1981-01-28

ROUTINE PROCEEDINGS


Mr. Thomas Siddon (Richmond-South Delta):: Madam Speaker, I rise under the provisions of Standing Order 43 to propose a motion of urgent and pressing importance. Last weekend in Bonnyville, Alberta, the Minister of Energy, Mines and Resources (Mr. Lalonde) said, "Provinces don't own resources like you own your home . . . and provinces don't own the resources the way Libya and Saudi Arabia own theirs."
In view of this statement I move, seconded by the hon. member for Durham-Northumberland (Mr. Lawrence):
That the hon. Minister of Energy, Mines and Resources be required to make a statement on motions immediately, clarifying his new definition of resource ownership, which is clearly contrary to the constitutional pledge recognizing that natural resources belong to the provinces as set out in sections 92 and 109 of the British North America Act.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NATIONAL ENERGY PROGRAM
Mr. Gordon Taylor (Bow River):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. The excise tax on natural gas will increase the cost of heat and fertilizer to farmers, thereby increasing the cost of food to all consumers. This price increase will find its way into almost every segment of Canadian industry, increasing unemployment and inflation. Therefore 1 move, seconded by the hon. member for Red Deer (Mr. Towers):
That this House urges the government to eliminate the excise tax on natural gas from its national energy policy.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Edward Broadbent (Oshawa):: Madam Speaker, considering the increasing number of violent deaths in El Salvador caused by the current policies of the governing junta, and considering recent increases in United States military aid to El Salvador, I move, seconded by the hon. member for Winnipeg-Birds Hill (Mr. Blaikie):
That when the Secretary of State for External Affairs meets with General Haig in Washington this week he seeks a commitment from the American government to live up to its previously-established commitment to stop shipping lethal arms to El Salvador or involving itself in the internal affairs of any other nation.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EDUCATION
Mr. Tom McMillan (Hillsborough):: Madam Speaker, I rise under the provisions of Standing Order 43. The cabinet social development committee apparently has before it a proposal to cut some SI.5 billion from the $3 billion the federal government transfers to the provinces under the established programs financing arrangement to help pay the operating costs of post-secondary education institutions across Canada. 1 move, seconded by the hon. member for Peterborough (Mr. Domm):
That the government launch, in concert with the provinces, the universities and colleges, a full-fledged review of post-secondary education financing in Canada before it introduces drastic changes in the education component of the established programs financing arrangement.


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

January 28, 1981


Some hon. Members:: Agreed.


Some hon. Members:: Agreed.


Some hon. Members:: No.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Lome Greenaway (Cariboo-Chilcotin):: Madam Speaker, 1 rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the fact that many Canadian firms and many Canadian citizens have lost considerable amounts of money and assets as a result of political unrest in Iran, 1 move, seconded by the hon. member for Kingston and the Islands (Miss MacDonald):
That if and when the Canadian government decides to resume diplomatic and economic ties with Iran, the settlement of these accounts be one prerequisite to the resumption of our relations with this country.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


PUBLIC SERVICE
Mr. Rod Murphy (Churchill):: Madam Speaker, I rise under the provisions of Standing Order 43. Treasury Board has been rapped on the knuckles by the Public Service Staff Relations Board for attempting unilaterally to designate 1,800 of the 2,100 air traffic controllers as essential to the safety and security of the public, thereby in effect depriving them of the right to strike, despite the fact that under section 79 of the Public Service Staff Relations Act it is not Treasury Board but the Public Service Staff Relations Board which is empowered to make decisions regarding the designation of employees. Since this is only one of the many actions taken against public servants by the President of the Treasury Board (Mr. Johnston), 1 move, seconded by the hon. member for The Batt-lefords-Meadow Lake (Mr. Anguish):
That this House condemns this dangerous trend of the government to encroach upon the authority of its own agencies; that this House condemns the federal government for attempting to remove the right to strike from public servants; that this House condemns the President of the Treasury Board for his continuous harassment of public servants at chambers of commerce meetings and through the media; and that this House recommends that the President of the Treasury Board seek to promote good will with government employees by initiating open and frank discussions with union leaders and by negotiating in good faith.


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


MUNICIPAL AFFAIRS
Mr. Ron Stewart (Simcoe South):: Madam Speaker, I rise under the provisions of Standing Order 43. Having received protests from all over Simcoe county, I wish to prevail upon the government to reinstate the beneficial community services contribution program which permits municipalities to undertake necessary public works projects, alleviating the tax burden on local taxpayers. I move, seconded by the hon. member for Erie (Mr. Fretz):
That the government reconsider its decision to terminate the community services contribution program and take the necessary steps to implement a lengthy continuation.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NATIONAL ENERGY PROGRAM
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam
Speaker, 1 rise under the provisions of Standing Order 43. It is costing Canadian taxpayers $12 million daily to import foreign oil, an increase of $6 million daily since January, 1980, which is creating jobs and great wealth in OPEC countries. Therefore 1 move, seconded by the hon. member for Assiniboia (Mr. Gustafson):
Thai this House instruct the government to withdraw its energy policy, which is counterproductive to Canada's becoming energy self-sufficient, and that it revert to the energy policy outlined in the PC budget, which would make Canada self-sufficient, encourage investment in Canada, keep Canadian oil companies from moving to the United States and put a halt to the exodus of millions of dollars leaving the country.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
January 28, 1981


PENSIONS
Mr. Benno Friesen (Surrey-White Rock-North Delta):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity, particularly for retired railway workers. In view of the fact that any increase under the pension plan administered by the Canadian National Railways to its pensioners is administered on an ad hoc basis and in an irregular fashion, offering the least protection to pensioners who retired before 1973; in view of the fact that pensioners under the plan administered by the Canadian Pacific Railway received even less assistance than those under the CNR plan; and in view of the fact that few of the worth-while recommendations first enunciated four years ago in the Hall report have been implemented, I move, seconded by the hon. member for Red Deer (Mr. Towers):
That this House urge the Minister of Transport and the Minister of Labour to contact officials of the CNR and CPR, and also urge those unions which represent retired railway workers to lobby aggressively on their behalf, with the over-all purpose of ensuring more adequate protection for those pensioners who have little protection from the ravages imposed by an ever-increasing cost of living.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


ROYAL CANADIAN MOUNTED POLICE
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, 1 rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the fact that the senior assistant deputy minister in the Solicitor General's department last week threatened the eight provincial governments with RCMP contracts that unless the provinces agreed to a contract with the federal government the government would go ahead and charge the new rates anyway; and in view of the fact that these rates represent an increase of over 100 per cent in some cases and are an intolerable raid on provincial and municipal treasuries, 1 move, seconded by the hon. member for Nunatsiaq (Mr. Ittinuar):
That this House urge the Solicitor General to end his policy of confrontation tactics with the provinces on RCMP contract negotiations, make a far more equitable proposal to the provinces and municipalities on costs, and particularly on accountability of the RCMP to the provincial attorneys general, and stop taking actions which may very well threaten the break-up of the RCMP in Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
Oral Questions


FEDERAL-PROVINCIAL RELATIONS TRANSFERS AND EQUALIZATION PAYMENTS-MOTION UNDER S.O. 43
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, I rise on a matter which might find agreement on all sides of the House. The present agreement between the federal government and the provinces with regard to equalization expires on March 31, 1982. The agreement must be written and it is essential that Parliament be involved in this process. Therefore I move, seconded by the hon. member for Yukon (Mr. Nielsen):
That this House docs direct the President of the Privy Council to create a task force of seven members of Parliament to investigate on behalf of this House all transfers and equalization arrangements between the federal government, the provinces and the territories, so that an equitable arrangement for sharing revenue can be determined without confrontation prior to the expiry date of the existing agreement.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr.   Len. Gustafson@Assiniboia: Madam Speaker, my question is for the Minister of Energy, Mines and Resources. The economic situation in Canada is a very serious one at this time, as the minister knows. Will the minister take the necessary steps to give oil production first priority so that the economic picture in Canada may be strengthened? The minister's policies are driving out the industry-oil rigs, expertise and capital-to the United States. Is the minister aware that his policy is having an adverse effect on the whole economy of Canada, turning us into a nation which is begging for oil rather than a leading nation in the industry?


Hon. Marc Lalonde (Minister of Energy, Mines and Resources):: Madam Speaker, as of January 20 there were in Canada 532 active rigs compared to 496 on January 22, 1980, one year ago. In effect, drilling activity has been maintained at an appreciably higher level than during the same period in 1980. The petroleum industry is a very fundamental industry. The position of the government is stated in the Speech from the Throne and in "The National Energy Program", and is that the energy sector should be the motor or main engine of the Canadian economy in the 1980s. This is the position of the government, and that is why we have put forward an energy

January 28, 1981
Ora! Questions
program which will ensure that this industry remains a leader in progress in Canada.


Mr. Gustafson:: Madam Speaker, the minister continues to deny that oil rigs are leaving and that the industry in western Canada is being seriously affected by government policy. Yet it was stated in the news today that Saskoil is preparing to explore in Williston, North Dakota. Oil rigs are lining up at the border, yet the minister continues to deny the fact in the House. Will the minister take the necessary steps to redirect Canada's energy policy and see that the economic development of the nation does not become a foreign aid program of the United States?


Marc Lalonde: Madam Speaker, the hon. member contends that oil rigs are leaving the country. As of the last count by Oilweek magazine, 36 more rigs are in operation in Canada at this time than at this time last year. Thirty-six is the difference between 532 and 496. So the gloom and doom picture which the hon. member is trying to paint does not seem to be supported by the facts.


Leonard J. Gustafson: Madam Speaker, the minister is aware of the fact that Canada has one of the finest oil fleets in the world, that many rigs have been built in the last year and that seven rigs have left the Estevan area alone. The picture is the same all across western Canada. Does the minister want to turn towns in Saskatchewan, such as Estevan, Weyburn and Lloydminster, into ghost towns through the economic direction he is imposing on this country?


Marc Lalonde: Madam Speaker, the executive director of the oilwell drilling association stated last October, well before the budget and well before the National Energy Program, that it expected a 30 per cent reduction in wells being drilled in 1981.


Mr. Clark:: He saw you coming.


Marc Lalonde: That projection was completely independent of the influence of the budget, and based on an expected surplus in natural gas in the country at this time. The National Energy Program foresees a very substantial increase in revenue going to the industry and to the government of Saskatchewan over the next four years. If the hon. member cares to check the figures, he will find that the amount of money going to the government of Saskatchewan and to the industry under the energy program over the next four years is substantially higher than the last four years. There will be plenty of money for the industry to do the job it must do.
Finally, 1 should like to say that 1 had a very worth-while, fruitful and constructive meeting with my colleague, the Saskatchewan minister of energy two days ago.


An hon. Member:: He told you to leave the province.


NORTHERN PIPELINES
Mr. F. Oberle (Prince George-Peace River):: Madam Speaker, if it is true that figures do not lie, there must be some liars around who can figure.


Some hon. Members:: Oh, oh!


Frank Oberle: What the minister has just said certainly does not correspond with the true situation in western Canada. My question is also directed to the Minister of Energy, Mines and Resources, Madam Speaker, and it is in reference to some comments attributed to him yesterday by the press which he apparently made outside the House with respect to the Alaska highway natural gas pipeline. The minister is quoted as saying that the United States administration is completely committed to the $22 billion project. The minister draws his conclusion from a telephone call he received from the new energy secretary in Washington, who said there is strong support for the pipeline in the new administration. Naturally, we on this side of the House would have liked-


Madam Speaker:: Order, please. Does the hon. member have a question?


Frank Oberle: My question to the minister, therefore, is whether it is the intention of the new administration in Washington to issue something that comes closer to the ironclad guarantees that the minister was so anxious about earlier, or was it that the energy secretary called with respect to the new administration's intention to renegotiate and review the pipeline treaty that we have with the United States?


Marc Lalonde: Madam Speaker, the hon. member is misinformed. Secretary Edwards did not call; I called Secretary Edwards to congratulate him on his appointment and to assure him of the co-operation of the Government of Canada with the government of the United States in the energy field. I must say we had a very worth-while and fruitful discussion over the phone.


Charles Joseph Clark: Did he thank you for the rigs?


Marc Lalonde: We agreed that we should meet eventually, either in Ottawa or in Washington, to pursue further a number of files that are currently active between Canada and the United States in the energy field.
1 raised with the energy secretary the question of the Alaska gas pipeline as one to which this government attaches a very high priority. He confirmed that, as far as the Reagan administration is concerned, this pipeline is also of the highest priority and that he will make sure that all the commitments given by Congress under the previous administration and by the previous administration will be fully implemented.


Mr. Nielsen:: Have you got that in writing?
January 28, 1981


Frank Oberle: A supplementary question, Madam Speaker. We know that the previous commitments were of a more minimum standard rather than the ironclad guarantees that the minister had previously insisted upon.
1 apologize to the minister. I do not know; 1 am only taking my information from the press and I did not know who initiated the phone call.
Is it the intention of the minister now to insist on having from the administration certain guarantees in writing commensurate with the pipeline agreement or pipeline treaty that we have with the United States? Is he going to insist that these guarantees be issued in writing?


Marc Lalonde: Madam Speaker, the hon. member arrives very late in the game indeed. There have been very, very significant developments in the last six months between the parties concerned. The Northern Pipeline Agency, which is responsible for the construction of the pipeline, has been in regular contact and discussion with the parties concerned in the United States, the private sector as well as the energy department. Those discussions indicate that a great deal of progress has been accomplished in the full implementation of this project. There is no need for additional guarantees; the project is proceeding extremely well.


VETERANS AFFAIRS
Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, my question is directed to the Acting Minister of Veterans Affairs. I would appreciate it if the Minister of National Health and Welfare would listen as well, but I see she has left the chamber for a moment.
Mr. Bjarnie Paulson, an RCAF veteran of the Korean war, suffered tragically for 15 years from cancer all over his body which he attributes to his participation in the clean-up operation at Chalk River in 1958. Mr. Paulson has previously been denied a veteran's pension. Further, he was sworn to secrecy upon his retirement from the forces, and records, even to admitting his presence at Chalk River at that time, apparently have disappeared or have been expunged. As if multiple cancer were not enough, Mr. Paulson as well has had a long and bitter fight with the pension board.
Since his application for pension entitlement is now currently before the board, will the minister assure the House that this time his application will be treated promptly, thoroughly and compassionately?


Hon. J. Gilles Lamontagne (Minister of National Defence):: Madam Speaker, we always try to show compassion and fairness on questions of veterans' pensions. However, I would like to remind the hon. gentleman that the pension commission is an independent body. It is very seldom that we get involved,
Oral Questions
politically or otherwise. Nevertheless, I will take this subject to the president of the pension commission to make sure that everything is being done to treat this veteran with all the fairness and compassion he deserves.


HEALTH AND SAFETY
Mark Willson Rose: Madam Speaker, my supplementary question is for the Minister of National Health and Welfare. There were an estimated 600 military and non-military personnel involved in the 1952 and 1958 Chalk River accident clean-up operations. The Department of Veterans Affairs has released the names of 50 RCAF members involved. Of eight known civil defence workers who were participating in the clean-up, four have cancer, yet so far Atomic Energy of Canada Limited has refused to release any records of the personnel working at Chalk River at the time of the accident.
Since medical science is only now beginning to learn about the serious effects of long-term, low-level alpha radiation, will the minister of health insist that AECL turn over all pertinent records to the Department of National Health and Welfare? Will the minister instruct her department to begin a long-term medical study of all those people who were involved in Chalk River at that time, not only to protect them but to protect today's uranium miners and reactor station workers?


Hon. Monique Begin (Minister of National Health and Welfare):: Madam Speaker, 1 am not sure that the procedure proposed by the hon. member with regard to the Chalk River workers and the confidentiality of their medical records is quite appropriate. But 1 will discuss the matter with my officials and make sure that, if an epidemiological study is required on the workers, it will be done either by the institutions making the request or by contract.


Mark Willson Rose: Madam Speaker, 1 understand the minister's concerns about the confidentiality of the medical records. 1 think permission could be given by those affected if we knew their names. 1 am not asking for the records to be released to the public but only to the minister's own department.


NUCLEAR DEVELOPMENT
Mark Willson Rose: Madam Speaker, yesterday in the province of Ontario there was a major announcement concerning the expansion of nuclear energy in Canada. Since at the moment there is no safe way known to dispose of nuclear waste, and since it is estimated that Ontario

January 28, 1981
Oral Questions
has an overcapacity of some 4,000 megawatts expected to last until the year 2000, will the Minister of Energy, Mines and Resources-who is busily engaged now-reconsider his internal departmental review of the whole nuclear question and instead recommend a full public inquiry, so that if Canadians are going to be committed to a radioactive future, at least they will have the opportunity to understand why?


Miss MacDonald:: You should have stuck with a good government.


Marc Lalonde: Madam Speaker, 1 remind the hon. member that there are many studies and royal commissions under way in the various provinces. Saskatchewan had one, Ontario also conducted studies as well as British Columbia, and the Canadian government also published a number of documents on this matter. We are in fact doing an internal review of this question and I intend to make public as soon as possible the studies and the documents available to allow the public to react and to give us feedback on the various questions studied within my department. So I can assure the hon. member that the public in general and those concerned will have the opportunity to make their views known to the government and to the public if they so wish, and it is not my intention to keep secret, hidden or confidential the studies prepared in my department.

[ English ]


ADVISORY COUNCIL ON THE STATUS OF WOMEN
Mr. Walter McLean (Waterloo):: Madam Speaker, my question is for the minister responsible for the status of women. On Monday the minister told the House that he was prepared to ask the members of the executive committee of the Advisory Council on the Status of Women for a copy of an affidavit to which he had referred and upon which he placed very considerable reliance in the position he has taken in the conflict between him and Doris Anderson. Has he now obtained that affidavit and is he prepared to table it? If not, is it because the affidavit will not bear out the charges he has made?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, I have written to the members of the executive committee asking their permission to submit that affidavit. I have not yet received a reply.


Walter Franklin McLean: Madam Speaker, the minister was certain that the executive committee minutes misrepresented the facts, even though he admitted he had not read those minutes. In light of the ongoing discussions, is he now willing to offer an apology to Miss Shelley-Ann Clark, the secretary, for slurring
her professional competence, or is he going to hide under the immunity offered by this House?


Lloyd Axworthy: Madam Speaker, I am not hiding behind any immunity. I simply go on the statement I made, which is that the five members who were party to that meeting have signed an affidavit suggesting that the minutes are not accurate. That is all 1 reported to this House; I made no further comment. 1 have not read the minutes. 1 still stand by that statement. If the members of the executive committee are prepared to release that affidavit and make it public, that is entirely their choice and decision to make. I abide by my statement, which is that I have requested them to do so.


CANADIAN ARMED FORCES
Hon. J. Robert Howie (York-Sunbury):: Madam Speaker, my question is for the Minister of National Defence. The minister has indicated that 11 military and two civilian personnel were involved in the use of Agent Orange in the 1966 defoliation operation at Canadian Forces Base Gagetown and that he is prepared to co-operate with the New Brunswick minister of health in dealing with the matter. For further clarity, I would like to ask the minister this. Has the minister initiated measures to identify all persons, military and civilian, who may have been exposed to a health hazard as a result of the use of Agent Orange or any other toxic substance at CFB Gagetown in 1966 or since then? Is he prepared to offer remedial assistance to anyone who establishes that he or she has been injured as a result of such testing?


J. Gilles Lamontagne: Madam Speaker, I can well understand the concern of the hon. member for York-Sunbury, considering that Gagetown is in his riding. He may not be concerned about the spraying action which took place, but rather about the way the question was raised by two NDP members, which needlessly and without reason alarmed the population in that area. I can assure the hon. member for York-Sunbury that at the moment there is no reason to believe there is any health hazard as a result of that spraying. I can further assure the hon. member of full collaboration of myself, the Minister of National Health and Welfare and the New Brunswick health minister. As far as identifying those who may have actually been exposed to this spraying is concerned, we are prepared to contact them to see what happened and have a full inquiry.


HAZARDOUS SUBSTANCES
J. Robert Howie: I thank the minister for his answer. I wish to direct a question to the Minister of

Transport on a related matter, the transportation of dangerous substances. 1 apologize for having been unable to give him notice. Has the minister received a request from Canadian National Railways or CP Rail seeking legislation to limit the liability of these multimillion dollar corporations for any damage suffered by Canadians as third parties resulting from the transportation of dangerous goods? What is the limit being sought, and what is the minister's response to this inquiry?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I am not aware of any formal request to that effect. 1 remember speaking with the president of CN about the fact that they now carry a very high level of insurance for material such as the hon. member has in mind. The railways are insured. As to whether they have asked for a limitation of liability, I will look into that and give the hon. member an answer at the earliest opportunity.


CANADA LABOUR CODE
Mr. Lyle S. Kristiansen (Kootenay West):: Madam Speaker,
I have a question for the Minister of Labour.
Early last week three of my NDP colleagues and myself met with officials of the United Steelworkers and some 50 uranium miners at Elliot Lake, Ontario. These workers are angry. They told us, and we agree, that the government's referencing last May of Ontario bill 70 into part IV of the Canada Labour Code has been a total bungle, a botch-up. Uranium miners in Elliot Lake and throughout Canada are now left surrounded and jeopardized by a jurisdictional no man's land which leaves them entirely without protection from the very real and hazardous dangers of that industry.
What action is now being taken to protect the safety and health of these miners, as promised by the Minister of Justice in reply to the hon. member for Brant on December 16 of last year?


Hon. Gerald Regan (Minister of Labour):: Madam Speaker, I thank the hon. member for his question. I assure him that the reports he has received are not accurate. The uranium mines are well protected by the regulations and the incorporation through reference of the Ontario regulations. I want to say to the hon. member that the jurisdictional question is one that would be more appropriately directed to the Minister of Justice, but it is my information that the process that has been undertaken is legal and the miners are as well protected by the regulations as they would be if they were under provincial regulations.
I might say that submissions were made by the steelworkers requesting that joint safety and health committees be established at the two largest uranium mines, Denison and Rio Algom at Elliot Lake. They were accordingly ordered to be established at these two locations in an order dated April 14. As of this date they are not yet in operation, due to the refusal
Oral Questions
of the steelworkers to nominate labour members to these committees.


Lyle Stuart Kristiansen: Madam Speaker, the minister and his government with their majority may be protected, but the people on the ground floor of the industry in Elliot Lake do not think that they are, and they are the ones who ought to know. Because of what these workers see as the government's bungling and their consequent lack of protection, 1 want to ask the minister this question, which does not have anything to do with jurisdiction.
Will the minister, along with the rest of the government's Punch and Judy show-the Minister of Justice, the Minister of Labour and the Minister of Energy, Mines and Resources who have the punch, along with the member for Nickel Belt who apparently does not have any-go to Elliot Lake and meet with the miners there, as the miners demanded? They asked us last week to forward that request to the government. Will they go there soon to learn from these people, whose health and lives are at stake, what they think are the realities in that industry?


Gerald Augustine Regan: 1 thank the hon. member for his supplementary. I appreciate his concern, but I feel sorry about his lack of accurate knowledge on the subject. I want to assure him that the minister of mines has been there on a regular basis and has had a number of meetings. 1 want to further assure the hon. member that 1 met with the officials of the union here in Ottawa on the subject. We had a thorough discussion of the matter. We explained in great detail the legalities of the situation. 1 want to say to the hon. member that he would do a great service if he would pass back to any friends he has the fact that these miners are as well protected by safety regulations as those in any mine in Canada.

* (1440)


AGRICULTURE
Mr. Marcel Dionne (Chicoutimi):: Madam Speaker, in the absence of the Minister of Agriculture I will direct my question to his parliamentary secretary. Potato growers in every province of Canada have qualified 1980 as a disastrous year because their income from sales was much lower than production costs. I would like to know whether the government will support them through agricultural stabilization as it did in recent years and, if so, when and how much assistance can Canadian growers expect to receive, since they are eagerly waiting for that answer to plan their seeding operations for 1981.
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January 28, 1981
Oral Questions


Mr. Marcel Ostiguy (Parliamentary Secretary to Minister of Agriculture):: Madam Speaker, farmers in eastern Canada, both in Quebec and in the maritime provinces, have filed applications with the Agricultural Stabilization Board and those applications are now being reviewed by the board and the Canadian Horticultural Council. Studies are not quite complete but 1 dare hope that in the very near future we will be able to announce in the House a stabilization program for potato growers in eastern Canada.


CANADIAN WHEAT BOARD
Hon. Don Mazankowski (Vegreville):: Madam Speaker, I should like to direct my question to the Minister of Transport who answers for the Wheat Board. I am sure the minister is aware of the ridiculously low wheat quota on CPR shipping blocs, particularly in the province of Alberta, some 2.9 bushels, while quotas on neighbouring CN blocs are some nine bushels to the acre, which violates the spirit and principle of equity. I wonder whether the Minister of Transport would consider prevailing upon his colleague in the other place to take immediate action to alleviate this very inequitable situation?


Jean-Luc Pepin: Madam Speaker, I will certainly bring that to the attention of the Minister of State for the Canadian Wheat Board.


Donald Frank Mazankowski: Madam Speaker, I would ask the Minister of Transport if he would consider asking the minister in charge of the Wheat Board to recommend an immediate quota adjustment; and if that is not available perhaps he might consider the movement of grain to CN lines if CP lines are going to continue to be congested.


Jean-Luc Pepin: Madam Speaker, I am absolutely sure that the Minister of State for the Wheat Board, if he has proof that there is an injustice in the distribution of quotas in this particular area, will move very, very rapidly to correct it.


WAR MEASURES ACT
Hon. Allan Lawrence (Durham-Northumberland):: Madam Speaker, my question is for the Right Hon. Prime Minister. The FLQ crisis occurred well over ten years ago. Other governments and other agencies of other governments are now releasing detailed information respecting the FLQ crisis. The French press and now the English press are almost daily making accusations and allegations about certain people relating to that affair. The then minister of justice, one John Turner, whom I am sure the Prime Minister will remember.
said ten years ago that when the full facts of the FLQ crisis are known in this House, the government's use of the War Measures Act will be fully justified. In view of all this, does the Prime Minister not now think it is about time, ten years after the event, for the mass of documentation under his control to be released to the public at large?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, l believe the hon. member has asked that question before and has had my answer. I stated at the time and I have stated since that the decisions of the government, on which this House voted, including the hon. member's party, were based on facts which were published and which were known. I still stand by that statement. If he believes he can get more information from my friend John Turner, I would be happy to give him Mr. Turner's phone number and to have Mr. Turner state all the facts within his knowledge.


Allan Frederick Lawrence: Madam Speaker, because I suspect that the Prime Minister knows there are now other people in this chamber who know of documentation and files in the control of the Privy Council Office, in the control of the Solicitor General and under the control of the RCMP, which by not being released provide a cover-up of monumental bungling of the right hon. member in this House-and I do not make that charge lightly-I wonder if it really is not time for the Prime Minister to review some of this mass of documentation and this mass of files to let the Canadian public know really what some of those decisions were based upon.


An hon. Member:: Come clean.


Pierre Elliott Trudeau: Madam Speaker, 1 want to remind the hon. member that this government has been seeking passage of the freedom of information legislation since the Speech from the Throne, and I understand there is an agreement among House leaders to expedite at least second reading tomorrow, thanks to the co-operation of all parties. Very soon we hope that legislation will become law, and if the hon. member thinks there are documents available which sustain his suspicions, he will be perfectly entitled to ask for them.
As to the monumental bungling accusation, I wish the hon. member could substantiate that. I repeat-and I think the facts are well known to Canadians-that in the period of years preceding 1970 there had been some 100 incidents of train derailments, robberies of arsenals, attacks on gun shops, kidnappings, murders and assassinations. I would point out to the hon. member that there was at that time a government in power which was not prepared to hand power over to a parallel government of unelected people, and that has meant there has been no violence in Canada since then. I think the hon. member should want to share in the credit for that because his party was responsible for our bringing in the War Measures Act.
January 28, 1981


THE BUDGET
Thomas Michael McMillan: Madam Speaker, my question is directed to the Minister of Finance. The minister's budget of October 28 stated that the government plans to realize net savings in transfer payments to the provinces in areas coming under their jurisdiction. Will the minister inform the House whether the net savings will be achieved by cuts in hospital insurance, medicare and post-secondary education funding, or will the savings be borne entirely by the education portion of the government's established programs financing?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, it is true that in the budget statement I indicated that we wanted to achieve significant savings in the large transfers from the federal treasury to the provinces. We have not yet commenced negotiations with the provinces and it is not possible at this stage to say in what area these savings might be achieved. That is the state of play at the present time.


Thomas Michael McMillan: Madam Speaker, my supplementary question is directed to the Minister of Finance. He has indicated there will be negotiations with the provinces on the established programs financing scheme. Given that answer, may I ask the Minister of Finance, if the federal government does decide to reduce substantially support for post-secondary education across the country, would the government consider itself bound, either legally or morally, to give notice to the provinces and, if so, how much notice would the government consider appropriate to give?


Allan Joseph MacEachen: Madam Speaker, quite apart from this particular question relating to one aspect of the transfers, I think the hon. member is aware that there is an expiry date for these agreements, and that if not renewed they terminate. It is because, as I understand it, the expiry date is in 1982 that we are now beginning to prepare within the government to undertake discussions soon with the provinces with a view to concluding a new agreement. I have not speculated upon the outcome of the situation in which we would find ourselves if agreements were terminated and no new agreement was put in place or no new understanding reached with the provinces. I have not examined that.


COMMUNICATIONS
Mr. Laverne Lewycky (Dauphin):: Madam Speaker, my question is for the Minister of Communications. The possibility now exists that Canadian AM radio stations may be soon forced to change their dial positions, a move which would benefit the United States and perhaps some Latin and South American countries, but would only hurt Canadians as it will
Oral Questions
decrease the quality of AM radio reception. Most of the new frequencies will be gobbled up by new northern U.S. stations, and at the same time would cost us millions of dollars. Could the minister inform this House whether the cabinet has decided on a position with regard to a change in the AM dial positions?


Hon. Francis Fox (Secretary of State and Minister of Communications):: Madam Speaker, we are addressing this question very closely at the moment. The traditional position of the Government of Canada has been that we were quite favourable to maintaining the spacing of ten kilohertz, and the U.S. position of asking us to move to nine kilohertz is one we would resist. I have received a number of representations from members of Parliament and from broadcasters across the country and we are aware of their concerns. Up to this time there has been no change in the basic position of the federal government that we support the ten kilohertz spacing.


RENEGOTIATION OF INTERNATIONAL BROADCASTING AGREEMENT
Laverne Lewycky: Madam Speaker, I should like to direct my supplementary question to the Secretary of State for External Affairs or, in his absence, to the acting minister. The present international broadcasting agreement will be renegotiated in November, 1981 in Rio de Janeiro. The consensus of the nations at that particular conference with regard to the frequency changes will carry the day. Would the minister inform the House if his department has any plans for assuming leadership among the nations in opposing this change in AM radio frequencies for the benefit of Canadian broadcasters and listeners?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: Madam Speaker, 1 will take that question as notice and get back to my hon. friend.


MUNICIPAL AFFAIRS
Mr. Doug Lewis (Simcoe North):: Madam Speaker, my question is for the minister responsible for the Canada Mortgage and Housing Corporation. On January 16 the minister announced that Quebec City will be receiving a new federal contribution granted under the community services contribution program for Quebec's professional hockey team arena. That grant was for $4.5 million. My question on behalf of the municipalities of Canada is this: Is the community services contribution program cancelled or is it not?


Hon. Paul J. Cosgrove (Minister of Public Works):: Madam Speaker, I am surprised that the hon. member would not recall the statement made when I announced that the 1980 program will not be continued and that some $400 million will be

January 28, 1981
Oral Questions
transferred out of the federal treasury to the provinces for the assistance of municipalities before March of 1982, when those payments will cease. The money to which the hon. member referred is part of that allocation to the province of Quebec, which has decided that that was how that money was to be used. The other allocations go to other provinces under the same formula in the present agreement. The hon. member should not be surprised that out of $400 million there will be allocations from time to time, some receiving more publicity than others.


Douglas Grinslade Lewis: Madam Speaker, my surprise is at the use of the word "new". I would ask the minister this question. When the province took over Loto Canada, the province of Quebec agreed to assume the cost of the Quebec coliseum using the new Loto Canada funds. Why is the minister paying out funds from this cancelled program which could be used by other municipalities when the province of Quebec has already agreed to fund the coliseum?


Paul James Cosgrove: Madam Speaker, the question raised by the hon. member indicates a part of the problem which the government had to confront when it reviewed that program, that is that the federal government permitted the provinces to designate where the funds under the community services contribution program would be spent. We said to the provinces, as did the government in the early design of that program, that they have the choice where the funds are to be spent. In retrospect we wonder whether that was a wise move, because the question raised by the hon. member indicates that, in a fast changing world where perhaps we cannot afford at any government level to spend money, for example, on soft services, perhaps it is not desirable to lock ourselves into that kind of arrangement.


INDUSTRY
Mr. Alain Tardif (Richmond-Wolfe):: Madam Speaker, 1 have a question for the Minister of Industry, Trade and Commerce. Asbestos ranks high in our national economy and it is even essential to the well-being of my riding. Can the minister tell the House whether his department intends to set up some kind of mechanism to dispel the cloud of uncertainty over asbestos? As a result of very negative publicity about asbestos we have been witnessing lay-offs which will soon affect over 1,000 workers.


Hon. Herb Gray (Minister of Industry, Trade and Commerce):: Madam Speaker, we know that our asbestos exports represent $600 million for our balance of payments, but at the same time, we need regulations to protect mines and plant workers. My department has therefore set up a federal-provincial task force to develop a reasoned and scientific policy that
will give due consideration to asbestos-related security and health problems, while recognizing the importance of this industry for the province of Quebec and Canada as a whole.


NORTHERN PIPELINES
Charles Joseph Clark: Madam Speaker, my question is for the Minister of Energy, Mines and Resources who, 1 think, will be familiar with reports that President Reagan's transition team recommended support for the northern pipeline on the condition that there would be no government guarantees. The minister would also be familiar with the view in financial circles that that project cannot proceed without financial guarantees.
In his conversation with the U.S. Secretary of Energy, did the Canadian Minister of Energy, Mines and Resources receive an assurance that the Reagan administration would be prepared to contemplate the kind of government guarantees that would allow the financing of the whole project?


Marc Lalonde: Madam Speaker, this matter was not specifically raised during my discussions with the American Secretary for Energy for the very simple reason that the information I have received from the Northern Pipeline Agency and our contacts within the American private sector responsible for the project seem to indicate that it might not be essential to have a financial guarantee from the government. Discussions are still going on with the private interests involved and it seems that a firm conclusion cannot be reached as yet as to the need for a guarantee from the American government.


Charles Joseph Clark: Madam Speaker, that answer indicates that, for whatever reason, the Government of Canada at the moment has no undertaking from the government of the United States that there will be the kinds of guarantees which the financial community believes are essential for the completion of the pipeline. Would the minister give the House an undertaking to seek and report such guarantees immediately, and would he give us an undertaking to put in writing either his record of the conversation with the U.S. Secretary of Energy or the commitments which the Government of Canada believes are necessary from the government of the United States for the completion of the whole pipeline project.


Marc Lalonde: Madam Speaker, I certainly do not intend to request at this time the kinds of guarantees that the Leader of the Opposition has mentioned from the U.S. administration. We have the word of the former president of the United States and we have a joint resolution of the U.S. Congress that they will take every step necessary to ensure the completion of that
January 28, 1981

pipeline. That assurance was given to me again yesterday by Secretary Edwards. I submit to the Leader of the Opposition that the U.S. authorities have stated quite clearly that they are fully committed to the construction of this pipeline. We have no reason at present to doubt that all the necessary steps will be taken to ensure that this pipeline is built according to the schedule that has been mentioned before.


PRIVILEGE
Madam Speaker:: I am ready to rule on the question of privilege which was raised yesterday by the hon. member for Nepean-Carleton (Mr. Baker), but as he is not in the House at present, and as I usually extend the courtesy of deferring a ruling when an hon. member who had brought forward a question of privilege is not present in the House, I considered taking that course today. However, in view of the fact that 1 have a notice of another question of privilege which seems to be close enough to the one which was brought forward yesterday, perhaps it would be easier if 1 dealt with the first question of privilege before hearing the new one. I would ask other hon. members who intervened in that question of privilege whether they feel they want me to rule today or whether I should delay.


Erik Nielsen: On that question, Madam Speaker, you will recall in the notice I sent to you, within the time limited by the rules, that 1 explained 1 wished to raise a very complex question of privilege involving, as I see it, the privileges of all members of the House.
In the second paragraph of my notice I set out that the privilege 1 wish to raise is complex and slightly overlaps the question which was spoken to yesterday. 1 mean just that-it bears a relationship. The submissions 1 intend to make today go far beyond that but indeed include a facet of the matter raised yesterday. It is my suggestion that, Madam Speaker, you might well be advised to withhold your ruling, if indeed one was necessary on yesterday's question which was not followed by a substantive motion, until 1 and other members who may wish to participate in what I consider to be a very serious and complex question have been heard. You should have all the facts, all the evidence and all the arguments before you, prior to making a judgment.


Madam Speaker:: Yesterday it was quite clear that I could not extend the time to today for arguing the question of privilege of the hon. member for Nepean-Carleton. The one raised yesterday by the hon. member for Nepean-Carleton has been argued to my satisfaction, and I am prepared to rule on it today.
If the hon. member, as he is suggesting, feels that I should defer-and 1 usually do that as a courtesy to the member who has raised the question of privilege-I am prepared to do it.
Privilege- Mr. Nielsen
The hon. member for Yukon (Mr. Nielsen) has sent me notice of a new question of privilege. The fact that he has stated it slightly overlaps the one raised yesterday does not mean he may discuss the question of privilege raised yesterday.
I will be very strict on that. The question of privilege which the hon. member will raise, the subject of which is suggested in his notice, should not overlap or should not discuss the one raised yesterday.
I can accept the hon. member's notice, but I must warn him before hearing him that it seems from his notice he might be asking the Chair to rule on an hypothetical situation. I just want to remind him that the Chair cannot rule on hypothetical situations. I appeal to him to be very specific about his question of privilege and, of course, not to refer to proceedings which took place in a committee.


MR. NIELSEN-CONSEQUENCES OF MINISTERIAL STATEMENTS AND UNDERTAKINGS
Erik Nielsen: Madam Speaker, notwithstanding your relatively short time in the chair, I am sure you have already observed that I am always specific in the matters which I raise, that I am never hypothetical, and that, unlike the government benches, 1 never deal in the abstract.
The questions which 1 want to put before the Chair and before members today are quite serious. They affect the privileges of all members of the House. When my submissions are through, in my submission and with respect, you will be compelled to look at yesterday's proceedings. I believe you will be compelled, in anticipation of what your ruling would have been today, to have another look at it, because it has a bearing and it is one of four elements which are involved in the questions I wish to raise.
I want to emphasize at the outset that we are not speaking of actions, or statements which may have been made before public meetings, in a political campaign, or statements to the media. We are dealing with statements made in the course of the parliamentary process, and we are dealing with statements which have been made in a parliamentary institution.
Before launching into the substance of what I have to say, let me say a word about the existing situation with respect to the recourse that members do not have in connection with questions of privilege which may arise in committee. As the government House leader is aware and as you are aware, Madam Speaker, such questions raised in any committee cannot be dealt with by the committee chairman unless that committee reports to the House, and then Madam Speaker is the only officer of the House or its institutions who has the jurisdiction to make a ruling on a question of privilege which arises in the House.
One might consider whether or not it is an abuse of privilege for the government majority on a committee, regardless of the political stripe of the government majority, to refuse the desire of the minority on a committee to have a question of privilege brought before you, Madam Speaker, because the chairman of the committee cannot rule. One might consider it a Catch 22

January 28, 1981
Privilege-Mr. Nielsen
situation where members, other than government members, have no way of bringing a question of privilege to a head if a government majority chooses to exercise its majority in a committee.
If that is the position, Madam Speaker, which I anticipate you might be taking in agreement with the government House leader and in accordance with my understanding of our existing rules, it may well command the immediate attention of the Chair and of all members of the House, since it is only those members on the government side of the House, who form the majority in any of our standing committees, who seem to enjoy the right to have a question of privilege reported to the Chair in this chamber and have it ruled upon. All other members are denied that right. In my submission that is very wrong and should be rectified.
The substance of the matter which was spoken about yesterday, as you will recall, Madam Speaker, was the right of members of this place to be able to rely on statements made by ministers of the Crown in the parliamentary process and on behalf of the government. That is not a hypothetical situation, in view of the events of last week and in view of the fact that the matter was on the floor of this House yesterday.
Just to touch very briefly upon what was dealt with yesterday, what your ruling was intended to deal with, and I am sure will be dealing with when it is given with respect to the proceedings yesterday, the question yesterday was narrowly confined. If there is any doubt about that, I suggest it should be resolved in favour of the privileges of members rather than the privileges of the government.
It was narrowly defined as to whether or not it is an abuse of the privileges of all hon. members for one minister to give an undertaking on behalf of the government and for a second minister to withdraw that undertaking. 1 do not intend to address myself to that point, in compliance with Your Honour's stricture. I intend to develop my submissions to you on three other very important points with respect to this question of privilege.
The first submission 1 wish to make to you, Madam Speaker, is with respect to the resolution of the question as to whether or not a breach of the privileges of the members of this House occurred by the fact that action was taken by some hon. members as a result of reliance upon an undertaking given by a minister of the Crown on behalf of the government in a parliamentary process, as in the case which arose and which was discussed yesterday, wherein amendments were withdrawn and discussion advanced to a later clause of the constitutional resolution, as a direct result of undertakings made by a minister of the Crown, and later revoked. Madam Speaker, in other forums that would fall within the definition of false pretences, under the provisions of the Criminal Code.
I would like to read from section 319(1) of the Criminal Code to see how that situation is regarded. It reads:
A false pretence is a representation of a matter of fact either present or past, made by words or otherwise, that is known by the person who makes it to be
false and that is made with a fraudulent intent to induce the person to whom it is made to act upon it.
That it was acted upon, there can be no doubt. With respect to the intent, I intend at a later stage in the development of my submission to refer you to citations from May's which strongly suggest that a breach of privilege has occurred on that count. There is no doubt in my mind, and I submit to you, Madam Speaker, that in a civil forum such representations would be regarded as a civil wrong, commonly called a tort.
The key point in procedural terms in my submission is whether or not the minister deliberately misled a parliamentary proceeding. It can be argued that when the Solicitor General (Mr. Kaplan) accepted the Conservative amendment he knew very well what arguments had been made against it during the summer, and by whom. It seems to me the record will disclose that was the case. In accepting the amendment he was either saying that the government had decided to set those arguments aside as being less crucial than the arguments in favour of the subject matter of the amendment which was being put forward, or he was only giving the appearance of accepting an amendment which he knew at the time would have to be repudiated at a later date. The position was changed after repetition of the original-


Madam Speaker:: Order, please. I sympathize with the difficulties the hon. member might have in arguing his case. He is constantly getting very close to discussing what has happened in a parliamentary committee. It is not because he calls it a parliamentary proceeding, that he chooses to give it a very general term, that the Chair must not see that he is obviously discussing what took place in the committee. I will hear the hon. member's question of privilege, but I must ask him not to refer to the proceedings of that committee because, as he knows, these questions should be discussed and dealt with in the committee. He knows the rules as well as anyone in this chamber. The way to deal with it in the House is to bring it into the House through a report. These rules are wise.
The Chair does not know what is going on in the committees and therefore it is difficult for the Chair to rule on matters which happen in a committee, unless the Chair receives a report. That is the reason for which that rule exists. It is sensible and wise. I would ask the hon. member not to put the Chair into too difficult a position, and I would ask him to try to argue very closely to his point. His question, as stated, would have to be very specific. He would have to argue it in terms of that specific statement and not refer to events or proceedings which took place in the committee.


Erik Nielsen: Madam Speaker, I appreciate that advice. Allow me to reflect for a moment, however, on the reasons for the existence of that rule. With great respect, I believe the reason for the rule which prohibits a discussion of committee proceedings in the House before those proceedings have been reported is a very narrowly technical reason, namely, that the House is not technically seized of the evidence, the record of the committee proceedings, until such time as that report does come into the House. In this modern age, where Hansard is
January 28, 1981___________________________________COMMONS
printed overnight, that archaic and narrowly technical reason, in my submission, falls to the ground. In any event, it should be examined.
1 might also point out. Madam Speaker, that I need not rely on the official reports of the committee to raise a question like this. This matter has received on-the-spot, blow-by-blow, verbatim television coverage throughout the length and breadth of this nation. So none of us can stick our heads in the sand, with respect, Madam Speaker-and my intention is not to reflect on the Chair-and claim that we do not know what happened. Any one of us who watches television knows. We can see it every night.
I will leave this matter, Madam Speaker, by saying simply that there was a position which was changed after repetition of the original arguments by the original proponents. It is not far-fetched, in my submission, to draw from that that there was a deliberate intent to make a commitment to the committee in question, which he knew was a commitment which could not be kept.
I wish to deal with my second point now. But perhaps the last point is the most important. The second point, but third in the elements of what I conceive to be a total question of privilege, is whether or not the question of a breach of privilege occurs by the fact that the committee is working to a strict deadline imposed by this House and has wasted limited time as a result of the undertaking given and withdrawn. I submit the answer to that question must be a resounding yes. If it is not clear already it will certainly become clear in the next day or two.
The fourth and last point, before I go to the citations, is whether the actions of the Prime Minister (Mr. Trudeau) and of the two ministers involved who, I regret to observe, are not in the House, I am sure as a result of other more pressing business, and of officials advising them, are subject to the citation at page 141 of the nineteenth edition of Erskine May's Parliamentary Practice, which reads, "Conspiracy to Deceive either House or Committees of either House" will also be treated as a breach of privilege.
Under the heading "Presenting Forged, Falsified or Fabricated Documents to either House or Committees of either House" the citation reads:
It is a breach of privilege to present or cause to be presented to either House or to committees of either House, forged, falsified or fabricated documents with intent to deceive such House or committees or to subscribe the names of other persons or fictitious names to documents intended to be presented to either House or committees of either House, or to be privy to, or cognizant of, such forgery or fraud.
The authorities listed below that heading include, among others, "Fabrication of documentary evidence (Martin's case, (1889))."
That precedent will support my submission, Madam Speaker, that the presentation to a committee, which is an extension to the House, of a false statement is, in essence, the presentation of a false document.
DEBATES	______________6653
Privilege-Mr. Nielsen
Under the second heading on page 141, "Conspiracy to Deceive either House or Committees of either House" it reads:
It has already been seen that the giving of false evidence, prevarication or suppression of the truth by witnesses while under examination before either House or before committees of either House is punished as a contempt; and that persons who present false, forged or fabricated documents to either House or to committees of either House are guilty of a breach of privilege. Conspiracy to deceive either House or any committees of either House will also be treated as a breach of privilege.
I submit that that quotation supports the fourth element of this global question of privilege. I would also like to cite page 142 of the nineteenth edition of Erskine May under the heading, "Misconduct of Members or Officers of either House as Such-Deliberately Misleading the House". It reads:
The House may treat the making of a deliberately misleading statement as a contempt.
The first paragraph under the heading "Corruption in the Execution of Their Office as Members" on page 142 has this
to say:
The acceptance by any member of either House of a bribe to influence him in his conduct as such member or of any fee, compensation or reward in connection with the promotion of, or opposition to any bill, resolution, matter or thing submitted or intended to be submitted to the House or any committee thereof is a breach of privilege.
I am glad to see that the Solicitor General has returned to the House. That passage might be viewed in the light of the very special relationship which existed in this instance between those cosy bedmates, the NDP and the Liberal members, not only in this House but elsewhere in their work together. I think sometimes it is the case of the little red rump wagging the pink dog. With regard to the last passage, I would also cite for the Chair's attention, the authorities listed thereunder.
Having briefly, but hopefully concisely and tersely, described what I submit is a very complex and serious question of privilege-on which other hon. members wish to address themselves-which goes far beyond yesterday's proceedings, at the end of hearing all these submissions and the arguments of hon. members who wish to participate, I will move:
That the matter of the statements made to the Special Joint Committee on the Constitution of Canada by the Solicitor General of Canada, as acting Minister of Justice, on Friday, January 24, 1981, and widely reported in the public media and the direct repudiation of these statements by the Minister of Justice on Monday, January 26, 1981, be referred to the Standing Committee on Privileges and Elections and that the committee consider in particular
(a)	whether it is an abuse of the privileges of all honourable members for one minister to give an understanding on behalf of the government, and for a second minister to withdraw that undertaking;
(b)	whether the question of a breach of privilege occurs by the fact that action was taken by some honourable members as a result of and relying on that undertaking, as in the case in question, wherein amendments were withdrawn and discussion advanced to a later clause of the constitutional resolution as a direct result of undertakings made by a minister of the Crown and later revoked;
(c)	whether the question of a breach of privilege occurs by the fact that a committee is working to a strict deadline imposed by the House and has wasted limited time as a result of the undertaking given and withdrawn; and
(d)	whether the actions of the Prime Minister, the two ministers cited above, and officials advising them, arc subject to the citation at page 141 of the nineteenth edition of Erskine May's Parliamentary Practice, which reads, "Conspiracy to deceive either House or committees of either House will be treated as a breach of privilege."

January 28, 1981
Privilege-Mr. Nielsen
If you find that there exists a prima facie case of privilege, Madam Speaker, the hon. member for Provencher (Mr. Epp) will second the motion. Before you take this very serious matter under consideration, I urge that you invite intervention by other members who may be interested in this very complex and serious question.


Hon. Bob Kaplan (Solicitor General):: Madam Speaker, I was absent from the House during the intervention by the hon. member for Yukon (Mr. Nielsen). I understand that he made statements referring to me. I am rising to reserve my right to raise a question of privilege based thereon when I have had a chance to review the "blues". If I consider it advisable, I will be prepared to take action tomorrow following question period.


Erik Nielsen: Madam Speaker, while I am not obliged to do so, the time constraints placed upon me in preparing this question of privilege prevented me from extending the courtesy of giving notice to the Solicitor General and other ministers of the Crown.


Hon. Janies A. McGrath (St. John's East):: Madam Speaker, I would like to take a few moments to address the very important question of privilege raised by the hon. member for Yukon (Mr. Nielsen). I hope you will allow me some latitude because the question of privilege presented by my hon. friend arises out of a question of privilege 1 raised in the Special Joint Committee on the Constitution last Monday.
Perhaps it would be helpful if I were to set out, without going into detail on the proceedings of the committee, the position in which I found myself when I originally raised this question of privilege in the committee last Monday.


Madam Speaker:: Order, please. I heard the hon. member's plea for latitude in placing his question of privilege, but I cannot allow that latitude. The hon. member must refrain from referring to what happened to him or to other members in that committee. I must assume that the hon. member had a chance to discuss that matter in committee with members of the committee and the chairman, and that in some way the matter was dealt with. 1 cannot allow the hon. member that latitude. He will have to speak closely to the question as it has been exposed by the hon. member for Yukon.


James Aloysius McGrath: Madam Speaker, the ruling of the committee chairman is germane to the question of privilege and the arguments which have been advanced by my colleague, and which I myself would like to advance, because the chairman ruled that he could not rule on a question of privilege raised in committee. The chairman's ruling was that only Madam Speaker could rule and that the committee could only vote as to whether or not the matter should be reported to the House so that Madam Speaker may rule. The chairman made that very clear. There was no ruling in the committee on the question of privilege.


Madam Speaker:: I am not sure that I should be arguing with the hon. member on this point, but I would remind him that the rule does exist. If a matter arises in committee, it is
dealt with in the committee by vote and after discussion which, I suppose, has taken place according to the rules. The hon. member cannot argue that he does not accept those rules. They are the rules established by this House. The hon. member has had his input and must accept those rules when coming into the House. So 1 do not believe that that argument can be invoked. If the hon. member wishes to discuss the question of privilege, he may, but he cannot tell me that those rules are not adequate. He may tell that to his colleagues in the House. I only apply the rules, and that is what I am doing now.


Charles Joseph Clark: Madam Speaker, you just said that you only apply the rules. As you well know, you also have a fundamental responsibility as the ultimate arbiter of justice as it extends to all members of this House of Commons.
You are the guardian of the rights and privileges of every member of this House of Commons as the occupant of the chair. That is your responsibility.
The dilemma that faces members of the opposition in particular is that we have a situation where it is quite clear to us that the privileges of members sitting in opposition have been abused. We are prevented by party vote from raising that abuse in committee, and we are prevented by the interpretation of the rules of this Parliament from raising an abuse which occurred in committee, in this House of Commons. In other words, we have no recourse against an abuse of the privileges of members of the opposition. You say that you are here to interpret the rules and apply them. That is the case, but you are also here as the guardian of the rights and the privileges of the members of the House of Commons.
1 rise simply to ask you, Madam Speaker, what are we to do? To whom are we to turn in a case where members of the government party, enjoying a majority, are able to have their privileges respected, and members of an opposition party who are not able to control a majority in committee are in a position where their rights can be abused-the same members, the same privileges, a double standard?
It is within your responsibilities as ultimate guardian of the rights and privileges of Parliament, Madam Speaker, to find or direct some way out of this dilemma, perhaps by making, or recommending, a reference to a committee, or perhaps by some other means.
I rise simply to make the point that it is unacceptable in logic and, 1 am sure, unacceptable to you, Madam Speaker, that there should be a situation where rights can be abused, where privileges can be abused and will not be upheld in the case of an abuse of privilege of members because of where they sit in this House of Commons.


Some hon. Members:: Hear, hear!


Madam Speaker:: In answer to the hon. member 1 agree that it is true I am the guardian of those rules, and if a situation
January 28, 1981

such as the right hon. member is suggesting has risen in committee, I cannot correct that situation by not following the rules, or changing them on my own. I am sure there are means of bringing this matter to light. If members feel that the rules do not allow them to act freely in a way that gives justice to them I am sure they can find means of bringing this matter to light and discussing it. We are doing just that today, 1 suspect.
I will listen to this discussion so that I may rule on it later, but I will listen to it while applying the rules that exist now. If rules should be changed at some other time I will apply those rules. That is the sense in which I am the guardian. Sometimes I have to make judgment calls and I do so following as closely as possible the rules and precedents. Therefore, I have to apply the rules; I have no other choice, and that is what I come to do.
I will listen to the hon. member, but I think if he has a case he will be able to argue it within the framework of our rules.


Hon. Marcel Lambert (Edmonton West):: Madam Speaker, at this point in your observations may I perhaps assist you in this regard, since I once occupied the position that you fill with honour at this time.
The Speaker has no choice of the sectors in which the Speaker will act as guardian of the privileges of hon. members on both sides of this House. When I was Speaker there was a minority administration. I have recognized, and Madam Speaker will recognize, that other Speakers have dealt with minority situations in which the decision of a chairman which could be arbitrary might affect the rights of members on the government side as well as members of the opposition.
I go beyond the case of the Right Hon. Leader of the Opposition (Mr. Clark). I think it applies to both sides of the House, because the rules have to apply evenly to all members of this House, in all situations. There are no technicalities which will prohibit or inhibit the protection of rights in this House.
If we are in Committee of the Whole and the Deputy Chairman is in the chair and a question arises, and there is a ruling; there is a right of appeal to Madam Speaker immediately on the report of the Deputy Chairman. That is provided for in the rules. Today we have a situation where there was a denial-and a wrong denial, if I may say so-by a chairman disclaiming to the authority to deal with a question of privilege. There is no chairman, no Speaker, who can duck a question of privilege.
Either the chairman was wrong in deciding that he had no authority to hear the question of privilege, and that would be my submission, or if there were a decision with an appeal within the committee, then an hon. member has the right to come to the Chair because the committee is merely an extension of this House.
The Speaker has the right, not only the right but the obligation, to protect the rights of all members. With the greatest respect, Madam Speaker, I for one cannot say that there is any situation where one may take refuge behind an anticipated lacuna in the rules or say that the matter took place in committee. After all, if the matter took place in the
Privilege-Mr. Nielsen
Committee of the Whole, not in the Speaker's presence but when someone else was the chairman, what is the difference? The overriding principle is that of protecting the rights of individual members in this House, and there is no other rule that will override that one.


Some hon. Members:: Hear, hear!


Madam Speaker:: I agree, and I disagree, with the hon. member. Obviously that is the responsibility of the Speaker, to protect the freedom of expression of all members, but the rules have been devised precisely to ensure that all of the members' rights are protected. The only way the Speaker can do this effectively and fairly is to base his or her decisions on the rules and on the precedents. That is what I intend to do.
I will hear the hon. member for St. John's East (Mr. McGrath).


James Aloysius McGrath: Madam Speaker, I shall try to compress my remarks within the parameters of your ruling with regard to not being able to deal with what happens in committee, but I have to make this point, and I think it is very important. It is you, Madam Speaker, as the custodian of our rights and privileges, who has the responsibility of ruling whether or not a member's privileges have been violated; not the majority. That is the point.
We do not dispose of these matters in the House by a majority vote; we dispose of these matters because we have conferred upon Your Honour the responsibility and confidence of making that judgment. If I cannot ask this House for redress, where do I go, Madam Speaker? To whom do I turn?
I and other members of that committee have been shamefully deceived. It is a very serious matter; it is not the simple flip-flop that the Prime Minister (Mr. Trudeau) or his colleagues like to call it. It is not a simple change in policy; it is not a simple change in attitude; it is a gross violation of a solemn undertaking that was given to hon. members in exchange for withdrawing an amendment.
I do not address myself to the time that was lost in that process, but 1 say to you, Madam Speaker, and I say this with respect, that it could very well have happened in this House because we could have been in Committee of the Whole. I wonder where Your Honour would sit then in terms of dealing with it because a standing committee or a special joint committee is merely an extension of this place in terms of Committee of the Whole.
I say to you, Madam Speaker, that a solemn commitment, a solemn undertaking was made in the parliamentary process in examining a resolution, a joint address, that was referred to the committee by this House. That solemn undertaking was to the effect that if we withdrew an amendment that we were proposing under a particular section then the government would receive and accept that amendment if we agreed to withdraw it and move it on another section.


Erik Nielsen: It was a false inducement.

January 28, 1981
Privilege-Mr. Nielsen


James Aloysius McGrath: It was a false inducement, as my colleague says. We agreed, and my colleague, the hon. member for Rosedale (Mr. Crombie), asked for the necessary unanimous consent to withdraw the amendment. Unanimous consent was granted, and we withdrew it. When we came to the relevant section and the government indicated on behalf of the Liberal party-and that is a matter of public record; they did not say "On behalf of the government"; they said "On behalf of the Liberal members of the committee"-when we arrived at the relevant section we were told, "The deal is off; there is no deal."
That is a serious matter, Madam Speaker. This place cannot function if we cannot accept the word of a minister speaking on behalf of the government. The most serious breach of parliamentary privilege that an hon. member can be guilty of in this House is to accuse another hon. member of deliberately lying. And rightly so, because that speaks to the fact that the system, the institution, has to get by on the honour and integrity of the members. Without that there would be chaos. 1 submit to you, Madam Speaker, that my privileges as a member of this House have been grossly and deliberately violated.
I have no quarrel or criticism to make of the hon. gentleman who presides, on behalf of this House, over that committee. Indeed, he has done so with distinction, and with honour, and with impartiality. 1 hope I will have a chance to refer to that at some other point. He indicated what the rules were according to the advice he received from his table officers. He indicated that he was not permitted to rule on my question of privilege, that he could only entertain a motion that the matter be referred to Your Honour, who is the only person who could so rule. The Liberal majority on the committee voted against having the matter referred to the House so that Your Honour could rule.


Erik Nielsen: That is the biggest wrong.


James Aloysius McGrath: Where do I turn? How do I get redress?
There has been gross deception, and there is no question about that. If you say that your hands are tied because of the rules of this place then, Madam Speaker, I submit to you with the greatest respect that, as the custodian of our rights, individually and collectively, and as the custodian of our minority rights, it is incumbent upon you to address this anomaly in the rules and to suggest that the matter be referred to the Standing Committee on Procedure and Organization where it can be dealt with immediately. Otherwise I am not capable, under the rules, of doing that, because I am subject to the whims and fancies of the majority in this House, and the majority in this House would never entertain such a motion from me even if it were procedurally acceptable. Only Your Honour, with the weight of the position that you carry in this place, can make such a recommendation where it would have any weight. 1 submit to you, Madam Speaker, that this is a very, very, serious matter.
We have to deal with the government in this place and in the committees of this place on a day-to-day basis. We have to accept the word of the government with respect to legislation. If the government gives its word, in exchange for certain commitments we make with regard to a certain provision of a bill, and if the government does not keep that word, then. Madam Speaker, where do we turn? With respect we can only turn to you. We can only turn to you as the one to whom we have entrusted the custodianship of our rights and privileges. 1 believe that you, in your wisdom and in your experience as a member of this House, indeed as a minister of the Crown, realize the gravity of the matter that has been brought to your attention formally by the hon. member for Yukon (Mr. Nielsen). 1 believe in your own mind that you appreciate the fact that 1 am entitled to redress. 1 humbly submit to you, Madam Speaker, that I can only obtain that redress from you.


Hon. Elmer M. MacKay (Central Nova):: Madam Speaker, as a member 1 realize the almost absurd position one is in, in having to talk in abstract terms about what is unmentionable according to the rules.
I would like to suggest, with great deference, that the proposition put forward by my hon. colleague that you use the weight of your office to approach the Minister of Justice (Mr. Chretien), the Prime Minister (Mr. Trudeau), or someone on behalf of the government opposite, to refer the matter back to the committee, be followed so that this impasse can be resolved here in the chamber.
Without drawing too long a bow I can recall that there was considerable discussion about whether a committee was in fact the master of its own house, so to speak, with respect to allowing television coverage of the committee. In that case there was real controversy whether this committee could determine that matter or whether the House had to do it. Eventually, as I recall, the House of Commons, through the Prime Minister, had to give direction to the committee to make it possible to have its proceedings televised according to the wishes of certain members of this House.
Therefore, with respect to this very important procedural matter, would it not be possible for you, Your Honour, to go to the Prime Minister, the Minister of Justice, or to whomever you please, to have this matter reconsidered in the committee? By doing this, at least Your Honour could have, without any possible confusion, the complete jurisdiction to deal with this proposition, to rule on it, and therefore exercise your prerogative as the custodian of our rights.


Mr. D. M. Collenette (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, I have a few words to say about this particular question. At the outset I should say that I think your patience and good will have been somewhat stretched this afternoon by the kind of debate we have heard from the other side. In essence what we are hearing is a debate on the same question that took place yesterday, a question on which you have reserved judgment.
I find it rather odd to hear the hon. member for St. John's East (Mr. McGrath) talk about the Speaker making a refer-
January 28, 1981

ence to the Standing Committee on Organization and Procedure, knowing as he should, as a parliamentarian of long standing, that the Speaker does not have that right and privilege. Indeed, it is the members of this Elouse collectively who determine our rules and not you, if 1 may say so, as servant of the House, as first among equals in this House.
1 find it difficult to entertain the arguments of my friend from Yukon who criticizes the rules of the House with respect to questions of privilege in committee only being dealt with by members of the House when the report is given to the House; yet, on the other hand, to make his case he has cited rather archaic references from Erskine May, which perhaps have no application to today's modern Parliament. There seems to be a dichotomy there in his thinking.
The rules are very clear. Beauchesne's citation 608 clearly states as follows:
Procedural difficulties which arise in committees ought to be settled in the committee and not in the House.
This is further augmented by citation 76 at page 24 of Beauchesne, which reads as follows:
Breaches of privilege in committee may be dealt with only by the House itself on report from the committee.


Erik Nielsen: And the majority controls that.


David Michael Collenette: And citation 76 goes on to talk about witnesses.
Those are the rules, Madam Speaker. I do not doubt the sincerity of the hon. member for Yukon (Mr. Nielsen) in that he feels legitimately that this rule should be analysed by members of the House, that it should be reviewed and perhaps even changed. I am not going to pronounce upon that. He may have a good point. But that is not what is at issue here this afternoon.
We have the rules clearly before us. With respect, you, I may say, must give rulings in the House based on the rules as they are written.
The hypothetical nature of the debate which the hon. member for Yukon tried to use in making his question of privilege-


Erik Nielsen: Never hypothetical.


David Michael Collenette: -because 1 maintain he is dealing with the same question as yesterday and as I said, 1 think he stretched your patience by dressing it up in hypothetical terms, but this point is also dealt with by Beauchesne in the fifth edition. In citation 117 (5) it reads:
Hypothetical queries on procedure cannot be addressed to the Speaker from the floor of the House.
Even in trying to make the case so as not to reflect on yesterday's deliberations, he is in a sense breaking one of our rules in trying to skirt another rule.


Erik Nielsen: There was nothing hypothetical about the undertaking.
Privilege-Mr. Nielsen


David Michael Collenette: Citation 117(7) of Beauchesne goes on to reinforce this, as follows:
The opinion of the Speaker cannot be sought in the House about any matter arising or likely to arise in a committee.
It is my contention that the debate we have heard this afternoon is completely out of order. Really we are dealing with the same case that was made yesterday, the judgment of which you have reserved perhaps until tomorrow.
However, there is a very serious matter arising out of the remarks made by the hon. member for Yukon. Perhaps this is what the Solicitor General (Mr. Kaplan) had in mind a few moments ago when he reserved his right to raise a question of privilege. The hon. member for Yukon having once been given the latitude to make his case-which 1 argue he should not have had-talks in terms of the intent of the minister. He questions the intent, the honesty, and the integrity of the minister. I, for one, would like to see the "blues". We were all present a few moments ago when those words were used. 1 wrote down the words "forged, falsified in terms of a statement, in terms of a document." This goes to the heart of our parliamentary democracy when one member is imputing a motive against another.
In effect the hon. member for Yukon is accusing the Solicitor General of making a false statement either in this House or in committee. The Prime Minister (Mr. Trudeau) explained the government's position on this quite clearly yesterday.
I should say to the hon. member for Yukon, who has been in this House some 23 years, he should not be so naive as to think that representations cannot be made by members or parties in this House and decisions of the government reversed. That is what this game is all about. You try to impress your views on each other. This is a debating forum. We try to convince each other of the certainty of our own opinion.
In that particular instance, the government reversed itself, changed its mind after hearing representations from members and parties on the other side. This is done every day, no matter whether it is with regard to the constitution, energy, or unemployment insurance. It is an essential element of the work in this chamber. 1 think the hon. member for Yukon is being somewhat naive in this matter.
Just to finish my point about imputing motives, the hon. member for Yukon referred to citations at page 142 of Erskine May, the nineteenth edition 1 believe it was. He talked about bribery. By extension is the hon. member accusing the Solicitor General of this nefarious kind of deed?
In my time here, and 1 have not been here as long as the hon. member for Yukon, I had never heard that word used in this chamber. It is an extremely serious word.


Erik Nielsen: 1 used it in 1963.


David Michael Collenette: The hon. member says he used it in 1963. Perhaps he is used to throwing around the word bribery if he has done it before. However, as somewhat of a novice in this

January 28, 1981
Privilege-Mr. Nielsen
chamber, I find it extremely serious when a member uses such terms as forge, falsify and bribery. 1 submit those words should not be allowed to stay on the record one instant. I hope the hon. member will withdraw them.
The Solicitor General was not in the chamber when those words were said, but I wrote them down. He said forge, falsify and bribery in connection with the statement the Solicitor General made not only in committee, but by extension in this House. I submit the most serious charge is not the one trying to be drummed up by the other side because it is dissatisfied with the rules, but the imputing of motives by the hon. member for Yukon against the Solicitor General.


Hon. Jake Epp (Provencher):: Madam Speaker, I want to put a few words on record on this matter of privilege. The motion was seconded by me. In his comments the Parliamentary Secretary to the President of the Privy Council (Mr. Collenette) made the point that it was not within your power, Madam Speaker, to refer this matter to the appropriate committee. The hon. member for St. John's East (Mr. McGrath) never made that recommendation. The recommendation to the Chair was that a referral be made, not that a direct referral be made by the Chair. There is a very marked difference between that and what the parliamentary secretary was saying.
There are two obvious questions that need answering in terms of redress. One was raised by the hon. member for Yukon (Mr. Nielsen) and the hon. member for St. John's East, namely, that undertakings were given and undertakings were removed. I will not address that any further. I believe that has been fully discussed.
There is another undertaking that 1 feel is directly part of this issue. In other matters we have a bill or a resolution and an opportunity for members to find redress, at least in the legislative sense, if not in the moral sense, through the avenue of report stage whereby amendments that have been defeated can again be brought forward at report stage. The House can at least address those amendments and take a decision apart from what might have happened in any committee of the House. That is normal procedure in terms of bills or resolutions.
That is not what is facing us here. We have no redress to bring an amendment forward to have that matter discussed now by all members of the House in the legislative sense, because we have not received from the President of the Privy Council (Mr. Pinard), the Prime Minister (Mr. Trudeau) or the Minister of Justice (Mr. Chretien) any word as to what form the debate will take once the matter is before this House.
Not only do I feel there is a responsibility on your part, Madam Speaker, to protect the rights of members who now have no recourse to redress in the committee because of the weight of majority, and that majority is being exercised in the committee, but on this issue there is no redress in a legislative sense that the matter can again be brought before the House. We do not have those guarantees. Both of those issues should be dealt with.


Charles Joseph Clark: Madam Speaker, there is one other matter I might draw to your attention that will perhaps help you resolve the dilemma between your responsibilities as guardian of the privileges of the House and the difficult technical problem you have raised with regard to a question of privilege which arose originally in committee.
It is an unusual kind of committee, not simply in that it will not be reporting back as is normally done with a bill, but unusual more particularly in that its proceedings are televised live. There is no question that members of this House of Commons, including the hon. member for Brampton-George-town (Mr. McDermid) and others received, through the medium of television, a representation delivered directly by a minister of the Crown having to do with government policy. It was received directly through the medium of television by those members of Parliament and taken as a representation by a minister in a parliamentary context to members of Parliament.
Many of those members of Parliament acted on that undertaking. They acted in terms of representations they gave to their constituents, telling them that property rights would in fact be honoured and protected in the legislation now before the House of Commons. They perhaps acted in other ways as well.
1 know Your Honour wants to find a way out of the dilemma in which the rules have placed you, the dilemma between your responsibilities as guardian of the privileges of this House and the technical problem created, as the hon. member for Yukon (Mr. Nielsen) pointed out, at other times when it was not possible for the Speaker or other members of the House to be seized of information that arose specifically in committee.
In this case, because television was there, and because this House decided to extend that committee beyond the committee to affect the decisions and the information, not only of all Canadians, but all those Canadians who happened to be members of this House of Commons, there was direct communication by a minister of the Crown to individual members of Parliament emanating from, but not confined to, that committee, which affected decisions taken by members of Parliament.
1 believe Your Honour may well want to consider whether that fact would reduce the force of the technical obstacle, which I believe is the only real obstacle that is of concern to you in passing judgment upon what we consider to be a very serious breach of privilege.


David Michael Collenette: Madam Speaker, 1 rise on a point of order. I hesitate to rise because the usual rule is that individuals are only allowed to participate once in a debate on a question of privilege.


Madam Speaker:: The hon. member can rise on a point of order, as did the Leader of the Opposition (Mr. Clark) who spoke previously on this question of privilege. 1 can hear the hon. member on a point of order.
January 28, 1981


David Michael Collenette: I made those remarks in order to preface what I believe is a point or order. It is in reply to the remarks made by the hon. member for Provencher (Mr. Epp). So that the record is absolutely clear, the hon. member for St. John's East was clearly asking the Chair to initiate a reference to the Standing Committee on Procedure and Organization to look into the rules. 1 was saying that the Speaker did not have that power under the rules. 1 want that to be absolutely clear. That is what I said earlier. I dispute the interpretation given by the hon. member for Provencher.


James Aloysius McGrath: That is not what 1 said, Madam Speaker. What I said to you, with respect, was if you find that the rules do not cover this situation, then you should ask the House to refer it. You can recommend to the House, not that you refer it, but suggest to the House that this matter be referred to the Standing Committee on Procedure and Organization. That is not quite what the hon. member is trying to say. I leave the rest to the record.


Mr. Bob Rae (Broadview-Greenwood):: Madam Speaker, I have listened with interest to the discussions over the last two days in respect of this question of privilege and I am moved to say a couple of things about this matter.
The first thing is the question as to whether we are able to discuss matters in committee, whether we are allowed to comment on them, or whether you are able to rule on them. That is not something which I think can be very much in dispute. The rules, it would seem to me, are pretty clear on that.
The point being made by members of the Conservative party perhaps deserve further study by the whole House. The question as to whether we can continue this does admittedly put us into a difficult situation. If we are told by the chairman of the committee that he is not able to deal with the question of privilege, and we are then told by you that you are not able to deal with the question of privilege because you cannot deal with a matter before a committee, this puts us into a very difficult Catch 22 situation. If that is the case, this is something which 1 think has to be studied. That is the first point, and 1 think it is a legitimate and real concern.
1 do want to say something about the comments by the hon. member for Yukon (Mr. Nielsen). It seems to me rather extraordinary that, once one has had an explanation, whether or not it entirely satisfies the member, as this House has had an explanation from the Prime Minister (Mr. Trudeau) of the country and from members of the cabinet, as to what transpired over the last five days, and the explanation has been that there was a change of mind or a change of heart on the part of the government, a member of this House can quite casually, as if talking about the weather, clearly leave on the record the implication that the very fact that there has been a change of mind brings to his mind two possible interpretations which lead him to say there is a prima facie case. He says either there was some kind of conspiracy involved here in which the cabinet was deliberately misleading and placing a forged
Privilege-Mr. Nielsen
document before the committee-that is the first implication raised by the hon. member for Yukon, casually dropped as if this were the ordinary allegation one makes every day of the week about other members of the House of Commons. The second implication is that somebody has offered a bribe or somebody has taken a bribe.
1 think it must be said that if a member of this House is going to make that kind of an allegation, let him say who made the bribe, when was it made, and when was it accepted.


Some hon. Members:: Hear, hear!


Bob Rae: Madam Speaker, you have said earlier in another context that the words of the Leader of the Opposition (Mr. Clark) perhaps went beyond his thoughts, in many cases one would really think it is not an unusual occurrence for that to take place. But 1 would say it is very strange to me that the very fact of a change of mind, and how many instances are there in question period when that is exactly what we are trying to do, get the government to change its mind, and God would that they would change their mind in terms of policy on the economy-


Some hon. Members:: Oh, oh!


Bob Rae: If the Conservative party had understood the necessity of changing one's mind from time to time it would still be the government today, and everybody here knows it.
It is because of the very fact that the mere changing of a mind is seen to raise suddenly a prima facie case, either of conspiracy or of a bribe, that 1 must say, when that is the immediate thing brought to the mind of a member of this House I feel very sorry for that member.
It seems to me very strange indeed that one can casually make those kinds of allegations, saying that a bribe was offered, presumably by members of this party, that it was accepted, presumably by a member of cabinet, without saying who made the bribe, when it was made, and what was involved.
1 know the hon. member for Yukon prides himself on being a member of the Bar of many jurisdictions. As a member of the Bar he knows perfectly well that to make that allegation about some other individual, were it not for the protection of the House-he knows perfectly well that is a blanket smear on the integrity not only of members of the government but members of the whole House, which 1 must say is pretty unacceptable and pretty strange.
1 quite agree there is a problem which has been raised, and an embarrassment that has been caused. There has been a problem raised by the fact that the hon. member for St. John's East (Mr. McGrath) has been told that he cannot raise this in committee, and now when he comes before the House he is told he cannot raise it in the House. That is a genuine problem and a matter that has to be discussed. But, for the member for Yukon to say, just because there has been a change of mind on the part of the government, that raises a prima facie case of conspiracy or a prima facie case of fraud, is the most pathetic,

January 28, 1981
Privilege-Mr. Nielsen
unfair and unreasonable kind of reasoning on a matter of privilege I have heard since 1 came here.


Some hon. Members:: Hear, hear!


Mr. Donald W. Munro (Esquimalt-Saanich):: If I may, Madam Speaker, 1 would like to intervene briefly in this debate. I have to go back to the substance of the problem. First, the chairman of that committee stated that, under the rules, he has no authority to give satisfaction to a member who is complaining that his privileges have been breached. That is my first point. Here is the second point: the only recourse available to him, according to the chairman, would be to report to the House. Here is the third point: that report is voted down in committee by the Liberal majority. Under the circumstances. Madam Speaker, how can the member complain and seek redress when he claims that his privileges were breached?
It is difficult to accept the notion that a majority vote in a committee will decide whether or not privileges have been breached.

I should like to underline one other matter raised by the hon. member for St. John's East (Mr. McGrath), namely, that in this House it is forbidden to us to call fellow members, on our side or any other side, liars, or to say they are speaking an untruth. As the hon. member said, the reason for that is simple. We have to take their word for it. When we can no longer take that word, this House is in serious trouble. This House is in trouble now because of this stupid dilemma in which we find ourselves.
I say, Madam Speaker, that the matter is over to you as the guardian and custodian of the rules of this House and, if it is not over to you, then it is game over for the House and for Parliament.


Some hon. Members:: Hear, hear!


Madam Speaker:: 1 might make a few remarks before I allow another hon. member to speak.

The hon. member for Esquimalt-Saanich (Mr. Munro) spoke in impeccable French, and I congratulate him for that, but I must tell him that he did not bring new arguments which had not already been made in this debate by previous speakers. When participants in a debate reach the point where they repeat what has already been said 1 think the time has come for the Chair to indicate that just about enough information has been collected on the question under debate. That is why, before I recognize the hon. member for Surrey-White Rock-North Delta (Mr. Friesen), I urge him to be very precise and to come up with new arguments; otherwise I will have to ask him to limit himself and be extremely brief in his intervention because I have already allowed a rather lengthy debate on this
question. I must now have new arguments, otherwise I will not hear more interventions.


Donald W. Munro: Madam Speaker, indeed allow me to say very simply that nothing is lost by underscoring some specific arguments made in the debate.


Madam Speaker:: That is not a point of order, but I did hear what the hon. member said.


Benno Friesen: Madam Speaker, I will be very brief. I noted with interest that the hon. member for Broadview-Greenwood (Mr. Rae) used, and I quote him accurately, the term "mere changing of a mind". 1 would remind him and the government House leader that government members are entitled to change their minds as often as they want until they make a solemn commitment. After they make a commitment under the oath of the Privy Council, they are bound. That is the crucial point of this debate.


An hon. Member:: Right on.


Benno Friesen: They can change their mind as often as they want to, until they make a solemn commitment.
Second, I want to point out that this commitment was made not on the basis of a surprise amendment thrust upon them on the spur of the moment which would take them off guard so that they made an inadvertent error in judgment, but rather on an amendment which had been tabled by the hon. member for Provencher (Mr. Epp) a week prior to the time, and the government had that entire week from Tuesday to Friday to study the amendment, which they did. They came back with plenty of foreknowledge and, as a deliberate action, made a commitment to the Conservative members of that committee, and then withdrew it. It was a deliberate act on their part.


Madam Speaker:: Order, please. The hon. member, of course, is not referring to the proceedings of the committee. He will have to restrain his arguments to other aspects of this question.


Erik Nielsen: Ministerial responsibility.


Benno Friesen: Madam Speaker, the point is that members of the House must be able to count on the ministerial sense of responsibility and accountability. Once that commitment has been given, they must be able to depend on that commitment and not have the word broken by other kinds of negotiations which have been going on in order, as the Prime Minister (Mr. Trudeau) said yesterday, to maintain the consensus for which they were looking.
January 28, 1981


Madam Speaker:: i will take this question under advisement, but 1 will likely rule at the same time on both questions of privilege.



ROUTINE PROCEEDINGS


Hon. Pierre Bussieres (Minister of State (Finance)):: Madam Speaker, on behalf of the Minister of National Health and Welfare (Miss Begin), and pursuant to Standing Order 41(2), I should like to table in both official languages a copy of the agreement on social security between the Government of Canada and the government of Portugal.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
David Michael Collenette: Madam Speaker, the following questions will be answered today: Nos. 1,619, 1,753, 1,769, 1,772, 1,812 and 1,845.


Mr. Cossitt: 1.	Are steps being taken to change the railway tracks in the area of Smiths Falls, Ontario used by passenger trains to avoid the considerable delay spent in track switching operations and (a) if so, what are all the details (b) if not, for what reason?
2.	(a) Are steps being taken to improve the railway roadbed between Smiths Falls and Brockville in order to bring it up to modern standards (b) in what year was the roadbed originally constructed?
3.	(a) What is the scheduled travelling time for passenger trains between Smiths Falls and Brockville (b) what is the distance involved (c) what would be the estimated travel time for Toronto-bound trains between Smiths Falls and Brockville if the roadbed was brought up to the standard of the roadbed between Brockville and Toronto?


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: 1. No steps are being taken or are planned to change the railway tracks between Brockville and Smiths Falls, Ontario. The switching of trains from the CN to the CP track and the attendant delay cannot be avoided.
2. (a) No steps are being taken to improve the railway roadbed between Smiths Falls and Brockville as the existing track is adequate for present train opera-
Order Paper Questions
tions. As part of a long-term plan to improve rail passenger service in the Quebec-Windsor Corridor, there are plans to upgrade the service and facilities on the Smiths Falls-Napanee route. The Smiths Falls-Brockville route, however, would not be affected.
(b) 1854.
3. (a) Approximately 55 minutes on average.
(b)	Approximately 45 kilometres or 28 miles.
(c)	The average travelling time of a passenger train could be reduced by approximately ten minutes per train. The number of stops, curves, etc. precludes greater time savings.


Mr. Stevens: For the current fiscal year, what are the estimated expenditures of the Department of Industry, Trade and Commerce for (a) advertising (b) free or subsidized publications (c) other information conveyed to the public?


Mr. Ralph Ferguson (Parliamentary Secretary to Minister of State (Small Businesses)):: In so far as the Department of Industry, Trade and Commerce is concerned: Canadian Government Office of Tourism, (a) $10,467,300; (b) 940,700; (c)
1,450,000.
Public Information Directorate, (a) $1,300,000; (b) 950,000; (c) 200,000.
Metric Commission Canada (a) Nil; (b) Nil; (c) Nil.


Mr. Stevens: For the current fiscal year, what are the estimated expenditures of the Export Development Corporation for (a) advertising (b) free or subsidized publications (c) other information conveyed to the public?


Mr. Gerald Laniel (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: In so far as the Department of Industry, Trade and Commerce is concerned: Export Development Corporation advises that: For the financial year ending December 31, 1980, its estimated expenditures for, (a) newspaper advertising: $714,500; (b) free publications: $ 156,150; (c) other information: $190,625.


Mr. Stevens: For the current fiscal year, what are the estimated expenditures of the Canadian National Railways for (a) advertising (b) free or subsidized publications (c) other information conveyed to the public?


Robert Theodore Bockstael: The management of Canadian National Railways advises as follows: (a) $8.6 million; (b) $10,000; (c) Nil.

January 28, 1981
Motions for Papers


Mr. Herbert: In each of the past ten years, by province, what is the value of land procured by Defence Construction (1951) Limited?


Mrs. Ursula Appolloni (Parliamentary Secretary to Minister of National Defence):: During the past ten years Defence Construction (1951) Limited did not acquire any land.
RIVIERE BEAUDEtTE, QUEBEC-TOURIST INFORMATION CENTRE


Mr. Herbert: Did the government contribute to the construction or maintenance of a tourist or information centre off highway 40 near Riviere Beaudctte, Quebec and. if so. what was the amount and were any conditions attached to the payment?


Ralph Ferguson: In so far as the Department of Industry, Trade and Commerce is concerned: Under the terms of the government's Federal Labour Intensive Winter Works Project for the winter of 1971-72, the Canadian Government Office of Tourism contributed $80,000 toward the construction of a permanent tourist information centre at Riviere Beaudette, Autoroute 20, County of Soulanges, Quebec. The following is the proforma for the project:
Objective: To give quick stimulus to job creation in the winter across Canada.
Method:	By carrying out the clean-up, refurbishing,
re-design or augmenting with special new facilities, features or equipment, of one or more travel/tourism attractions or facilities per province.
Provincial Contribution: The aim was for the provincial contribution to match the federal contribution as closely as possible (a minimum for provincial contribution would be 25 per cent of the costs of the projects selected).
Costs: Costs were to be predominantly labour-intensive, although a minor share of equipment or capital cost could be included, provided this could be related to job creating activities. Approximately 75 per cent of the federal share of the contributions was to be made for the FY 1971-72 ending March 31, 1972 and 25 per cent in the two months of April and May and ending May 31, 1972.


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


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered. Shall the remaining questions stand?


Some hon. Members:: Agreed.


David Michael Collenette: Madam Speaker, notices of motions for the production of papers Nos. 20 and 39 are acceptable to the government.


Madam Speaker:: Is it the pleasure of the House that notices of motions Nos. 20 and 39 be deemed to have been adopted?


Some hon. Members:: Agreed.


[Stage Direction]
Motion No. 20-Mr. Keeper:
That an humble Address be presented to His Excellency praying that he will cause to be laid before this House copies of all correspondence, notes, minutes of meetings and other communications relating to Pacific Western Airlines proposal for maintenance hangar space at the Winnipeg International Airport.
Motion agreed to.
[Stage Direction]
Motion No. 39-Mr. Herbert:
That an Order of the House do issue for copies of all regulations and instructions in Defence Construction (1951) Ltd., concerning the publication of tender calls for construction work, including ail references to the amount and form of deposits that may accompany such tenders.
Motion agreed to.
David Michael Collenette: Madam Speaker, I ask that the remaining motions be allowed to stand.


Madam Speaker:: Shall the remaining notices of motions be allowed to stand?


Some hon. Members:: Agreed.


Madam Speaker:: Pursuant to Standing Order 54, 1 do now leave the chair for the House to go into Committee of the Whole.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Tuesday, January 27, consideration in Committee of the Whole of Bill C-54, an act to amend
January 28, 1981
[Stage Direction]
the statute law relating to income tax-Mr. MacEachen-Mr. Ethier in the chair.
On Clause 1 -
The Deputy Chairman:: When the committee rose last evening, clause 1 of the bill was under consideration and the hon. member for Assiniboia (Mr. Gustafson) had the floor.


Leonard J. Gustafson: Mr. Chairman, last evening at ten o'clock 1 was saying that I was somewhat concerned about Bill C-54 and the direction it seems to take and about the Income Tax Act in general, as well as the procedure which the government is following and the policy it is setting down for the people of Canada in the tax measures before us. I drew a comparison between what is happening in the oil industry in western Canada today and the type of measure which we find before us here which is having a negative effect on the economy of Canada.
I should like to say at this point that I think it is very important for us to take a positive look at the direction in which the Canadian economy should go, and 1 would like to make some positive suggestions today, particularly from the agricultural perspective in view of my background, relating to the measures in the bill before us.
I am sorry that the Minister of Finance is not here today to hear these recommendations, but I hope they will be passed on. I was referring earlier to the Income Tax Act which had a devastating effect on the economic expansion of the country and on the oil industry in western Canada. In my own town of Assiniboia and within my riding the oil industry has been so curtailed that many of the supply companies, many people working on the oil rigs and in the service companies, have been laid off. Approximately 50 per cent to 75 per cent of those people have been laid off, and those numbers are not unusual in oil production areas. For example, PanCanadian in western Saskatchewan is suggesting it may have to close 77 per cent of its oil production. If you are familiar with oil production in southern Saskatchewan in particular, Mr. Chairman, you will know that 50 per cent of the oil wells in southern Saskatchewan produce less than ten barrels of oil. So it is most important that some type of positive direction be given to this industry.
The measures contained in the Income Tax Act and in the bill before us will have the same type of restrictive effect on the whole economy of Canada. This has been going on in Canada for a number of years, and if we do not change this direction we will have more serious economic problems in Canada. I want to relate in particular what is happening with respect to the capital gains tax on farms, a problem to which this bill has not addressed itself.
In the last election the Liberal Government of Canada promised some provisions for the benefit of farmers, particularly relating to valuation day of December 31, 1971. Those
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measures have not come about. The farmers of my area have been seriously asking about this because what simply happens today is that they take the 1971 valuation day and multiply it by 4.5 times the assessment of the land, and that is the value of the land which the income tax department uses. What will happen to farms and small businesses if the government continues in its present direction? It will force many farms, particularly family farms, into serious economic situations. I suggest to the minister that we must look into the future in regard to this type of legislation.
I see a very serious situation coming about in the province of Saskatchewan. It relates to the ownership of farms, the entire subject of capital gains, and exactly the direction in which the agricultural business is going. Under the land bank scheme the government of Saskatchewan bought over one million acres of land, that is, over 62,000 quarter sections of land. It is owned by the government; it is state-owned land. If the present direction of the government continues, there will be state ownership of land in Canada.
The present direction seems to be evident in what the Liberal government and the NDP have been doing in the constitutional talks as they look at the amendments to the constitution, clause by clause. When it came to the right of ownership of property, it is interesting to note that the Liberal party and the NDP seemingly agreed that that right should not be within the constitution.
The ownership of farms and land is very, very important to farmers. I would suggest that we should be addressing more positively the situation of capital gains tax on farms. If we do not address ourselves to that problem, the state, the government or whoever, will one day own the farms of Canada. It will be a sad day for production; it will be a sad day for Canadian farmers when they no longer own the land on which they produce grain, raise beef or whatever; it will be a sad day for Canada.
It is important for the minister and his department to start looking at the direction of agricultural production. Some of the restraining measures in the Income Tax Act have a counterproductive effect upon the ability of farmers to produce. I should like to speak very generally about something I have experienced, having had a history in agriculture, and the importance of it.
A farmer who may have anywhere from $500,000 to $900,000 invested in his farm is allowed the same depreciation and the same personal deductions as a wage earner. But, we must remember his investment in his farm, particularly with the present inflation, the high cost of machinery, the inflated cost of land to which we addressed ourselves a little earlier when we discussed capital gains, the inflated cost of repairs, and the high costs of production. Certainly a farmer who has been established for many years does not find himself faced with a major problem; but the young farmer who is trying to buy a farm, to pay high rates of interest and to make capital payments on his principal, finds that out of the small amount of money he is allowed to make after paying his high rate of income tax, he is not able to meet his obligations and to make

January 28, 1981
Income Tax Act
principal payments on his farm. The government should take a positive look at changing this direction in the interests of agriculture. At this time 1 should like to ask the minister, through his officials, whether they will take a look at this direction.
In the agricultural industry today there are many farmers who are not delivering grain because they find themselves in situations with which they cannot cope because of the income tax department. This is very restrictive to production in this country. I am not saying that farmers should not pay a fair level of income tax. They realize that they can average their income over five years, which is a benefit, but I believe that we are operating under 1949 methods. The department has never implemented an up-to-date method of operation in regard to agriculture which takes into account the inflation factor of the 1980s. If we do not meet this present challenge which is causing serious problems, particularly in the agricultural industry and also in the area of small business, the economy of Canada will face an even greater challenge.
I have been receiving letters daily from my constituents concerning this matter. Just the other day I received a letter from a businessman in Assiniboia, Saskatchewan. He pointed out that the Income Tax Act has not kept pace with the importance of development in this country and is restraining production to the point where our production capacity is not being utilized.
Last evening I pointed out-and it bears repeating-that the policies of the government have laid the oil industry of Saskatchewan flat on its back. Seemingly the minister laughed about that today, but it is no laughing matter in the towns in my constituency and in all of western Canada. Yet the Minister of Employment and Immigration announced some $4 million aid programs for the province of Saskatchewan which will come out of the pockets of taxpayers. This simply does not make sense. On the one hand they restrict the industry to the point where unemployment is increasing, service rigs are leaving the country, and oil wells are being shut down because it does not pay to bring them into production as production is so low. On the other hand they ask the taxpayers of Canada to pay x millions of dollars to subsidize people who find themselves unemployed. You cannot blame the Canadian people for that, you must blame the Government of Canada for it.
A very good example within the tax structure of Canada today concerns rebates to farmers on gasoline. This is an example of circulating paper and creating jobs. 1 know the department says that the tax or rebate-10 cents or seven cents a gallon-cannot be taken off at source at the bulk station. I do not know why they cannot find a way to do that. There is a very simple method, but they would rather circulate paper. You see offices full of people sending out circulars to the farmer telling him how to apply. The farmer finds himself unproductive because, instead of being able to feed another pen of steers, he is filling out the papers for the rebate, which get him all confused. Then he needs an accountant and a
lawyer to help him fill out the forms. So, what do you have? You have big government circulating paper, and no production. There is not one more hoof of beef, one more roast, or one more bushel of wheat. There is no production whatsoever. This is the type of program suggested by too many government big idea men.
1 want to suggest to you, Mr. Chairman, that the people of Canada, farmers and small businessmen in particular, are fed up with this kind of administration. I say to the department and to the minister that it is most important we take a look at this area in Canada today. Do you know that Canada should be having the biggest boom in its history today? Mr. Jarvis, who is responsible to the Wheat Board, made a statement the other day to the effect that this could well be the golden age of western Canada in agriculture. We know what could happen in western Canada with respect to oil and production. Make no mistake about it, so does all of Canada. We should not be beggars in the boardrooms of the world. We should be leaders of production, both in oil and agriculture. And we will be. We mean to put into place some legislation with regard to the Income Tax Act which will allow Canada to produce in the way that only Canada can.
I suggest to you that we must take another look at some of these areas. 1 would like to deal again briefly with valuation day and its importance to farmers. 1 have had a number of calls to my office, and a number of farmers have stopped me on the street to ask me about this. They ask: when will the government keep its promise to the people of Canada? I think what is important, is that it keeps a promise.
More important than that is the very serious situation which exists for farmers because of the Income Tax Act. I again ask the government and the minister's department to take a look at this valuation day and the capital gains situation. It is altogether out of tune with the time in which we live. It is archaic, in terms of being up to date with what must happen with respect to agriculture and capital gains.
I wish to speak of another matter about which 1 have some knowledge. I filled out a payroll for some 25 years. The Income Tax Act-


Denis Éthier: Order, please. I regret to interrupt the hon. member but his time has expired. He will be allowed to intervene again on the second round. Right now I must recognize the hon. member for Pembina.


Mr. Elzinga:: Mr. Chairman, I, too, appreciate this opportunity to participate in Committee of the Whole on Bill C-54. Prior to making my comments I would like to take this opportunity to congratulate the hon. member for Assiniboia. I would like to align myself with his statements with respect to capital gains. He indicated the approach that both the New Democratic Party and the Liberal party are taking in regard to state ownership of our farm land, or of any land in Canada. It is interesting to note that the Liberals and the NDP voted against our property rights amendment in the constitutional debate. It is also interesting to note that in 1976 at the Habitat Conference the same Liberal administration supported a reso-
January 28, 1981

lution which was put forward in support of public ownership of all lands.
In reviewing Bill C-54 and examining some of the economic problems we are facing in Canada we find that, in effect, this budget is counterproductive to many sectors of our society. It will be counterproductive as far as it affects the small business sector, our farming population and our senior citizens. We introduced a budget about which 1 will speak in more detail later. We introduced a very socially progressive budget, when we had the opportunity as the Government of Canada. At the time the New Democratic Party, the supposed party of social compassion, voted against those progressive policies which we had advocated. At the time that illustrated to me the way that they speak out of both sides of their mouths. They indicate they do have a concern for the underprivileged in Canada, yet they do not show it when they have the right to exercise a vote in the Elouse of Commons.
Bill C-54 covers the amendments and the various propositions brought forward by the finance minister in his minibudget of April, 1980, and in his budget of October, 1980. If it is to be faulted it can be faulted in a good many areas with respect to the deletion of various proposals. There were many important proposals which we included in our budget and which the Liberal party has not seen fit to adopt. A good many of the recommendations which we supported in our budget have been brought forward in this minister's budget, and I commend the government for that.
With respect to what the member for Assiniboia mentioned, there is no relief from capital gains for the farming sector of our country. On several occasions in the previous election campaign the Minister of Agriculture promised that valuation day would be changed from 1971 to 1974. This commitment was not fulfilled by the party opposite. Under the Crosbie budget we offered an opportunity to the farming sector whereby they could roll over their capital gains into a registered retirement savings plan. This went a long way in alleviating the farmer's burden, whose only retirement plan is realized when he sells the property he owns.
We are glad to see that the present government has again accepted our proposal with respect to the Small Business Development Bond. We advocated this measure in order to alleviate high interest rates which so many sectors of our society were facing. We are disappointed that this measure will expire on March 31, 1981. It is my understanding we will be introducing amendments to extend the expiry date of the Small Business Development Bond program beyond that time period. We are hopeful that the Liberal party will accept this suggestion.
Let me congratulate the government for including the provisions with regard to volunteer firemen. We advocated the proposal whereby the allowance would be increased from $300 to $500. However, I am disappointed that the government did not include a provision for an energy tax credit. What the government has done in imposing higher energy costs on
Income Tax Act
Canadians is totally different from what we advocated. The Conservative party advocated an 18 cents excise tax on gasoline to be imposed on those individuals who drive a vehicle. The government impose a refinery tax, which means that even individuals on low incomes will now be burdened with the additional costs. Nor has the government brought in an energy tax credit for those individuals who earn less than $22,000 per year.
Because of the energy policies of this government, exploration activity will be 40 per cent less this year, which amounts to approximately $2 billion in investments. As the result of the government budget, interest rates will be higher. Let us review some of the positive measures which were introduced in the Crosbie budget. We intended to reduce government spending. In spite of that, the Social Policy Board of Canada indicated that the budget was the most progressive budget it had seen in the past ten years. We intended to eliminate mismanagement while at the same time helping those who were most in need of help. As I indicated earlier, the Crosbie budget offered capital relief to farmers, and the working spouse deduction which the government has accepted.
I hope that the government will give some consideration to offering aid to those individuals who face high mortgage costs. The Conservative government committed itself to offering such aid. In light of high interest rates, I hope the government will come forward with positive measures to alleviate the situation. The Conservative policies reflected a belief in the individual Canadian, that he or she could develop without the government becoming too involved in their private lives. We felt that we could contribute to the development of the individual rather than inhibit that development.
it is worth while to review the five commitments made by the Prime Minister during the 1980 election campaign. His first commitment was that the Liberals would manage the nation's finances more vigorously in order to make more effective use of taxpayers' money. He made the specific pledge that his party would hold the line on government expenditure growth under the rate of the GNP. Upon examining this budget we find that for the coming fiscal year there will be an increase of some 12.8 per cent in total federal expenditures and it forecasts an increase in the GNP of 11.1 per cent, which includes inflation. In reality government spending has not been held in line. That is the first promise broken by the Prime Minister.
The second promise of the Prime Minister's five-point plan was that he would achieve energy security at a fair price for all Canadians. He indicated that he would negotiate an increase of less that 14 cents on the price of a gallon of gasoline. In reality we see that the price of gasoline per gallon has increased by anywhere from 20 cents to 30 cents. Now we find that the negotiations between the federal government and the producing provinces are at a stalemate and a settlement cannot be reached. Consequently, our energy security is becoming a fading dream.
The Prime Minister's third promise was that his party would develop an industrial strategy which would provide jobs, spur

January 28, 1981
Income Tax Act
growth and increase Canadian ownership and control. The Prime Minister indicated:
This party will not simply stand by and let the recession come . . . We will fight it and overcome it. . . . A Liberal government would use every economic tool at its disposal to save Canadian jobs and to maintain Canadian growth.
In the year since that speech, the Prime Minister and his government have made no effort to use any economic tool at all to stave off recession. In fact the government did not bring down a budget until seven months after it had resumed office.
The Prime Minister's fourth commitment in the five-point plan was that he would head a national government which used its strength to realize the aspirations and economic potential of each of our provinces. He said that it would be a national government which builds up rather than tears down and that it would make the 1980s a decade of opportunity rather than a decade of doubt. In the one year since that promise, one resource sector in one part of our country is to be taxed to the detriment of that portion of the country. And we have a constitutional proposal before this Parliament which makes second-class citizens of all those individuals outside the provinces of Ontario and Quebec. The Prime Minister gave the specific commitment that he would give each individual area and province the opportunity to develop and grow.
The fifth promise made by the Prime Minister was that his party would enhance the security of every individual by helping those who most needed assistance, and they endorsed the right of every Canadian to have a job. One year later we find that these pledges have not been kept and that the government has not even begun to put them into effect.
I wish to refer to our excise tax proposal of 18 cents per gallon of gas, as compared to what the government is doing. As hon. members will recall, we proposed that price increases would affect only those individuals actually using gasoline. This administration has imposed a refinery tax as well as a tax which applies not only to gasoline but also to home heating fuel. This means that individuals on low incomes will have to pay that tax without the benefit of an energy tax credit.
My party has done some research into the specific levels of gasoline costs. My colleague, the hon. member for Vegreville, put a question to the minister of energy on January 12 in which he indicated that gasoline costs had gone up by some 30 cents in a period of one year, after receiving a commitment from the Prime Minister during the 1980 election campaign that prices would not rise by any more than 14 cents a gallon. I have a number of quotes from retail and wholesale outlets in my constituency which indicate that the price has gone up by between 20 cents and 38.9 cents.
Canada is blessed with a great deal of natural resources and human potential. One cannot help but be saddened by the fact that the government is stifling that human potential and the development of our natural resources. It is my hope that the government will reflect on what it is doing and come forward with policies which will help the individual develop and which will allow us to develop the natural resources of the western provinces to the benefit of all Canadians.


A. Daniel McKenzie: Mr. Chairman, 1 wish to speak briefly on Bill C-54 with regard to the energy section, the effects of the budget, and the disastrous effect of the Liberal energy policy on the industry and the country as a whole. What is most disturbing is the attitude of the government, which has made it perfectly clear that it will keep us on this disastrous course. We are going to have to keep hammering away until we can get ministers to budge on the position they have taken.
1 want to congratulate the hon. member for Pembina on his remarks. He certainly made one point very clear-never trust a Liberal.
I should like to comment on some correspondence we have received from the oil industry and the drilling industry in Canada about the very serious and damaging effects the Liberal energy policy has on them. I want to quote from a letter dated January 26 this year from the Independent Petroleum Association of Canada to the Prime Minister. The letter points out:
After three months of careful study we the members of the Independent Petroleum Association of Canada have concluded that the National Energy Program (NEP) will have disastrous consequences not only for our industry but for Canada's national goal of energy self-sufficiency and, indeed, the over-all economy.
We represent the Canadian owned and controlled independent segment of the oil and gas industry in our country.
I want to emphasize that I am talking about Canadian companies, Mr. Chairman, not multinationals or oil barons. We are talking about small Canadian companies that are being harassed and chased out of the country by Liberal policies.
The letter goes on:
We have no quarrel with the stated objectives of the NEP. We simply do not believe the program will achieve them; moreover, it will prove to be counterproductive to those objectives.
Every document, letter, magazine or newspaper 1 picked up has this same phrase, "counterproductive to those objectives". So we are going backwards under their ridiculous policy.
The letter continues:
In view of the far-reaching national and international implications of the NEP. we respectfully request that your government establish a special joint committee of the Senate and House of Commons to undertake a full examination of the impact and ramifications of the National Energy Program.
Again referring to the National Energy Program, the letter goes on to point out:
These implications include the health of the national economy, jobs in every part of Canada, the secure supply of oil over the immediate and longer term, our international trade and baiance of payments, and the unity of the country. Indeed, as stated in the NEP itself, the program "will impinge... in almost every sphere of Canadian activity,-"
The activity seems to be taking place at the borders where trucks are lined up loaded with drilling equipment moving out of the country.
It was reported the other day that at Coutts, Alberta, there was a line-up of trucks of one mile long last week. The energy minister disputed this today, but we are getting pictures of
January 28, 1981

these trucks lined up and leaving. 1 am sure the minister would say that the picture in the Red Deer Advocate is false and that they are telling lies and that this is not happening. I doubt very much if the Advocate is publishing false pictures and giving false information about drilling equipment and trucks leaving Canada. A report in last Thursday's Advocate states as follows:
Rigs Leave-A convoy of trucks carrying a disassembled oil drilling rig clears through United States customs at Coutts on the Albcrta-Montana border Thursday. This rig, owned by Hi-Towcr Drilling Ltd. of Edmonton, needed 30 trucks to transport it, although some require up to 60 trucks. About 50 rigs have moved south through Coutts since last October when the federal energy policy was announced.
Today the hon. member for Assiniboia gave more figures about the devastating effect this is having on the province of Saskatchewan. The Saskoil Company is applying to do drilling in Montana. How are we to become self-sufficient when this sort of thing happens? I think the reason the Liberals are continuing with this disastrous policy is because they are trying to squirm out of the ridiculous statement they made in the last election campaign that they were going to get cheap gas for Canadians. 1 think they had better get off that "cheap gas" idea and tell the truth to the Canadian people. They should tell the people how much of their money is being spent daily to bring imported oil from the OPEC countries. I brought this up in a motion today, Mr. Chairman. It costs $12 million per day for oil from the OPEC countries. They will become wealthy and have all their people working. But not this country, Mr. Chairman.
I should now like to read part of a letter from the chairman of the Hudson's Bay Oil and Gas Company Limited-not some company over in Africa or Asia. The letter states:
Since the passing of the October budget, and the introduction of the National Energy Program, parliamentary and media debate on Canadian energy policy has been intense. As chairman of one of Canada's principal petroleum companies, I am acutely aware of the importance, not only to the industry but also to the economic and social well-being of Canadians, of an energy policy of optimum benefit to the nation.
He enclosed a brochure. 1 shall not read all of it but just some of the more important parts. On page 5 it states:
The over-all impact of the measures proposed in the National Energy Program will be a very sharp decline in the industry's cash flows and earnings.
With double-digit inflation, Mr. Chairman, you need a large cash flow. You cannot work on a little bit of cash flow.
It continues:
All of the industry forecasts, as well as those made by other knowledgeable observers, indicate that the industry's cash flow will be reduced by approximately 30 per cent and its net earnings by about 50 per cent. This inevitably will result in a substantial reduction in exploration and development activity in western Canada. It also will seriously impair the industry's ability to undertake the risks and finance the massive investment required for development of the oil sands and the frontiers.
So much for energy self-sufficiency under this National Energy Program and these clauses of Bill C-54.
On page 6 the brochure states:
In short, we are firmly convinced that an arbitrarily defined requirement for Canadian control to qualify for the proposed Canadian ownership incentives is not only unnecessary but would unfairly penalize many Canadians who already
Income Tax Act
own shares in the industry. It also could discourage foreign-conlrollcd companies from making shares available for purchase by Canadian investors and thus prove counterproductive to the achievement of greater Canadian ownership of the petroleum industry.
Everything that this government has come out with since it got back into office is counterproductive. It has made absolutely no headway at all in any area.
I have a letter here from a small Canadian company which is struggling to survive, called Riley's Datashare International Ltd., based in Calgary. The letter which was sent to all members on our side of the House states:
Enclosed is an interim financial report which outlines our position on the National Energy Program.
Riley's Datashare International is a data service company providing products to the petroleum industry around the world from offices in Calgary and Houston. We arc a public company with over 1,300 shareholders, more than 90% of whom are Canadian residents. While a small company of just 200 employees, 140 of which arc in Canada, we believe we arc representative of the many petroleum service companies who will be hurt by the NEP.
It is all the little companies, the medium-sized companies and indeed even the multinationals that are being hurt-are getting walloped by these policies. Of course in the end we suffer too.
The letter concludes with the following:
In our view, the program is in need of drastic revision. It threatens economic activity, is furthering the sense of regionalism in western Canada, and jeopardizes our chances of energy security. We urgently suggest reassessment.
1 hope that in the near future the finance minister or the energy minister will come up with some way of reassessing or withdrawing this program. They cannot continue with this ridiculous procedure in light of all the evidence that is coming from these firms. We cannot assume they are all lying to us or giving us false information. If they are, then someone had better get up and discount it.
Riley's also enclosed a brochure. In part, under the heading of "National Energy Program" we read:
The major event of the second quarter without doubt was the federal government's National Energy Program and the continued inability of the two senior levels of government in Canada to reach an agreement on petroleum pricing and revenue sharing. Much coherent and sincere opposition to the NEP is being made by the petroleum industry in terms of the impact on the industry and the nation as a whole. In our view the inappropriateness of the program traces to several inconsistent objectives:
They go into great detail about how the program is affecting them. They comment on "Self-sufficiency-Activity" as follows:
The federal government remains committed to energy security and yet the net effect of the NEP is to reduce the industry's ability and willingness to achieve this. Industry cash flow under the program will be reduced.
They go on to explain how this program is affecting their firm and its expansion.
Neither the Minister of Finance nor the Minister of Energy, Mines and Resources is here, but the Minister of State for Finance is. 1 would like to refer to Oilweek magazine for January 12, 1981. There is a lengthy article quoting statements and comments made by various provincial cabinet min-

January 28, 1981
Income Tax Act
isters, as well as statements by people in the industry. The only favourable comments 1 can find in this magazine are some statements made by the Minister of Energy, Mines and Resources and the Minister of Indian Affairs and Northern Development, but the other 15 or 20 statements are extremely critical of the National Energy Program. I think the minister would learn a lot about his government's programs and the effect they are having on the nation if he would read this magazine. If he has not, I would suggest that it would make great reading for him tonight.
The statement by Mr. Robert H. McClelland, minister of energy, mines and petroleum resources for the province of British Columbia, is headed "Significant Slump Expected". 1 will not read his statement in full, but in part it reads:
-unless the federal government seriously reconsiders its positions, the outlook is very discouraging.
Then there is considerable detail, similar to what was in the two letters I received this week.
The next article to which 1 will refer is by Mr. Selby W. Porter, president, Canadian Association of Oilwell Drilling Contractors. This is not a multinational firm nor does it have anything to do with OPEC. He states:
The combination of the recent federal budget, the national energy program, the lack of a pricing agreement for crude oil between the federal government and the producing provinces, and the declining gas sales and exports to the United States, combine to ensure a downturn of exploratory and development activity in 1981.
How on earth can we become self-sufficient when every oil company and drilling company is winding down?
Mr. Porter goes on to say:
The outlook for 1981 in the present circumstances is dismal for the contracting industry; with a forecast of only 5,800 wells to be drilled in 1981, and as a consequence we arc faced with the prospect of a large surplus of equipment, service facilities and personnel.
This doom and gloom story goes on. Here is a statement by Mr. Jack M. MacLeod, chairman of the board of governors, Canadian Petroleum Association. The heading of his article is "Self sufficiency goal slips away". Here is another statement: "Canada's potential continues to be frustrated by the failures of our national policies."
I cannot find any statement anywhere which gives this government any credit at all for any of its energy or budget policies. I do not know whether this minister wants to make a statement today as to whether the government is looking at changes, is concerned, or whether this is all false information which these people are handing out.
If the minister would like to take a few minutes to make a statement as a start, we would certainly appreciate hearing from him. The explanation to date from the energy minister was meaningless. Perhaps this minister might have a better explanation as to what corrective measures the government is going to take.


Frank Oberle: Mr. Chairman, I have a few opening comments and then I would like to ask the minister some questions. I
assume he is in the House this afternoon to answer some questions.


A. Daniel McKenzie: Excuse me, Mr. Chairman, 1 wish to rise on a point of order. I do not like to interrupt my colleague, but if the minister is not going to answer any questions, could he inform the House that he is refusing to do so? That way we will know whether we are wasting our time here, and we will just have to make 20-minute speeches. I allowed time for the minister to answer, and he seemed to be rising. Then you recognized the hon. member for Prince George-Peace River. Let us hear from the minister if he wants to answer any questions.


Denis Éthier: My apologies to the hon. member for Winnipeg-Assiniboine. I did not realize the minister was rising. We will ask the hon. member for Prince George-Peace River if we may continue-as I ought to have done earlier-and hear the minister in reply to questions.
[ Translation]


Pierre Bussières: Mr. Chairman, I believe that if we start replying to all the questions asked after each speech, we shall never be able to conclude the clause by clause consideration of this bill. However, as concerns the specific question asked by the hon. member at the end of his speech having regard to the energy policy of this government, I would like to repeat that the position of the government as expressed by the Minister of Energy, Mines and Resources is quite clear and very well-known. Not only have the views of the government concerning our energy program been expressed today during the oral question period, but they have also been discussed many times in the last few weeks during the oral question period and outlined during the debate on certain bills. I do not believe that our position in this regard is ambiguous. What we want is to develop the energy sector in Canada and to Canadianize the industry while meeting the objective of self-sufficiency.


Denis Éthier: The hon. President of the Privy Council on a point of order.


Mr. Pinard:: Mr. Chairman, in answer to the hon. member from North Carolina-


Some hon. Members:: Oh, oh!


Yvon Pinard: I am sorry. I am referring to the hon. member who just rose on a point of order and I apologize to him. I just want to bring to his attention that there is an understanding that we deliver general speeches on clause 1 of the bill. I understand that questions will be posed when we are at clause by clause study of the bill. 1 hope that we can come to the clause by clause study of the bill as soon as possible so the minister will be in a position to answer all of the questions that will be put to him.
May I add that when the hon. member was asking questions, the minister could not clearly understand what was
January 28, 1981

being asked because he was politely answering one of his Tory colleagues to whom he was speaking.


Mr. Hamilton (Qu'Appelle-Moose Mountain):: Mr. Chairman, 1 rise on the same point of order. 1 would like to amend slightly what the House leader has just said. The minister was in the House yesterday. He was asked the same question, whether he was going to answer questions at the end of each speech. He said, "no", that he was going to make a list of them, and when the general debate on item one was over he would answer those points that he could. That was the undertaking he gave last night. 1 do not think that it is harmful to the House to know he made that pledge to us.


Denis Éthier: Perhaps the Chair might intervene for a moment. My understanding was as indicated by the hon. member for Qu'Appelle-Moose Mountain, that hon. members would not be seeking answers to questions while debate is on clause one, but rather that those questions would be pursued under the relevant clauses. There is no Standing Order of the House at this moment that necessitates that. It is simply, as I understand it, the way members have indicated they wish to proceed.


Frank Oberle: Mr. Chairman, I am not that enthused with the arrangement. However, if it was an understanding arrived at through discussion by all members of the House, certainly I will respect that. I have a few questions for the minister and I hope he will take note of them this afternoon although, 1 do not know why he would have his officials here if he is not answering questions. My questions are not so much to do with what is in the bill but rather about matters which were left out of the bill. I would have hoped that those questions could have been answered, but I am prepared, if everyone else is, to wait until the minister sums up the discussions with respect to clause 1 of the bill.
At the outset, 1 want to make a few comments following on those of my colleagues who spoke earlier. The government should not be too surprised if, when dealing with a tax bill, we talk about such matters as energy, and the economic policy in general, and matters which strike even deeper to the very foundation of the institution as it will be affected in the future by the arrangements we are presently discussing with regard to constitutional reform.
I have here a document. It is a copy of a book in our library which the hon. member for Victoria dug up. It lays out the procedure one would follow to establish an extreme radical alternative to the type of western democracy on which our system is built. The book is called "Birth of the Communist Manifesto". The early advocates of communism talked about some of the things one would have to do in order to achieve a redistribution of wealth and the transfer of productive mechanisms away from the bourgeoisie to the workers. According to this book, the following would be required, and I quote:
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!. Abolition of property in land and application of all rents of land to public purposes.
2.	A heavy progressive or graduated income tax.
3.	Abolition of all right of inheritance.
4.	Confiscation of the property of all emigrants and rebels.
5.	Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly.
6.	Centralization of the means of communication and transport in the hands of the State.
7.	Extension of factories and instruments of production owned by the State; the bringing into cultivation of wastelands, and the improvement of the soil generally in accordance with a common plan.
8.	Equal liability of all to labour. Establishment of industrial armies, especially for agriculture.
It goes on and on. What struck me when reading this is that when you go over it you see that many of these things have already been achieved in our society. This document is the foundation for a very progressive and graduated income tax act. The imposition of those kinds of taxes on property would demean them in a way to affect their value when inherited by one's children.
We already have the centralization of banks. Of late, in our constitutional debate, we have been talking about the nationalization of property. It is being said that the right to own property will no longer be looked at as a right in the future, but rather as a privilege. The right to own property, which in my opinion is the most fundamental basis of western civilization, would no longer be respected in our constitution. I wish to quote another sentence from this very interesting document:
In this sense, the theory of the Communists may be summed up in the single sentence: Abolition of private property.
I do not suggest this government is about to go out and confiscate property. However, we do have that in our energy program. There is a clear confiscation of private assets in the sense that, if they are located on federal lands, the Crown corporation will be directed to move in and assume 25 per cent ownership in the lands and the improvements that have been made under the lease without compensation. If that is not confiscation, I would like someone more knowledgeable to explain what it is.
These people, together with their friends to my left, have done more than that. They are abolishing God. I was tempted to stand up before question period today and move a motion under Standing Order 43 suggesting that we rename this place Babylon, and rename our Prime Minister "the king of Babylon". Obviously he has anointed himself as God. He is wiser than the Almighty. We no longer need any reference to God in our constitution. I do not want to be unkind to the right hon. gentleman, but I sincerely hope that he will not be destined to suffer the same fate as the king of Babylon. As you know, when the king of Babylon denounced Jehovah, a mysterious fiery hand came out and wrote on the wall, "weighed, counted and divided". Of course he was assassinated the same night he made the pronouncement. I do not wish that our Prime Minister be assassinated, but I wish he would reassess in more realistic terms the effects of his type of a new society which he is perpetrating upon us.

January 28, 1981
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After that rather gloomy opening, I want to address some remarks to the minister who previously showed some interest in a proposal I made with regard to northern benefits. This is more directly related to the bill. I wish the minister would make some notes and respond to my questions, either now or at an agreed time.
There is a reference in the bill regarding northern benefits. There is a remission order which allows certain northern benefits which employers in northern and remote areas of the country pay to their employees on which no income tax is payable. These benefits are now identified. They basically have to do with travel, housing subsidies, and other direct costs for which the employer wishes to compensate the employee. There is no remission at the moment for actual northern benefits paid out in cash.
I spoke yesterday in the Elouse with respect to my proposals. I laid out to hon. members, and specifically to the minister, the rather serious inequity which exists in northern Canada where living costs are much higher than in other parts of the country. I pointed out the effects of this kind of insensitive income tax policy on lower-income people in the north, particularly those on fixed incomes, old age pensions, unemployment insurance and other forms of social assistance. The payments are the same everywhere in this country. An unemployment cheque is the same amount for a person north of 60 as in the rest of the province. The amount of the old age pension is the same. However, living costs are three times higher in some areas than in the cities.
With the evidence produced through my report, we had every right to expect some reflection of the proposals, which are being actively studied by the department, in this bill. There is no doubt that the report is based on logic. The government compensates employees in the north with cash payments to mitigate the cost differences, the financial hardships associated with northern living. The federal government pays between $1,000 and $12,000 a year to employees of the public service who are posted in isolated areas. I would ask the minister whether it would not be reasonable to expect, if it is costly and difficult for federal employees or employees of large corporations, both of which have chosen to compensate their employees, to cope with these special circumstances, that it is equally costly and difficult for every other Canadian living in the north?
I have enumerated some of the problems that add to the cost of northern living, including the high cost of gasoline. I have pointed out some areas where a gallon of gasoline costs $5 or $6, and that perishable foods have to be flown in by aircraft and therefore are three or four times the cost in cities.
1 have pointed out that other countries with similar geographic difficulties are dealing with this problem by establishing different tax zones and allowing taxpayers in those zones greater personal exemptions in order to equalize opportunities and to achieve a greater degree of equality and fairness in the sense of income tax. After all, equity and fairness are supposed
to be the basis of the act. With a graduating and progressive tax scheme one is supposed to be charged taxes in accordance with his ability to pay, and there is no doubt that one's ability to pay in this country varies very dramatically in accordance with where one lives.
1 was able to table my report before the Committee on Indian Affairs and Northern Development. 1 know the minister of the department has a serious commitment to give earnest study to that document. I am also told that the committee on northern affairs, on finance, and national revenue, and the officials of the three departments are seriously looking at the whole question of northern benefits and will be making recommendations to the cabinet, the Treasury Board, and the Minister of National Revenue in relation to the handling of the tax act as it applies to northern residents.
1 notice that the Minister of National Revenue has just entered the chamber. I know as well of his interest. He has written to me and has said they are earnest and serious in their assessment of this rather serious situation. What I would ask him to do is nothing else but to use the same criteria the federal government uses to compensate its northern employees in terms of housing subsidies, cash payments or northern living allowances, applying that same criteria on a more universal basis, namely, to use the Income Tax Act to allow all northern residents, whether they work for the government, some other business or even northern businessmen, to make the same kind of deductions. After all, that must only be fair.
I would ask him to study seriously, for instance, what Australia is doing in that regard, and what Denmark is doing in its treatment of taxpayers in Greenland. These people undoubtedly have come to the same conlusion that I reached. I want to tell the minister how serious this matter is for the 5 per cent of Canadians who live in the two tax zones I have identified in my study. This percentage of people would have paid $470 million too much in personal income tax if nothing else were done except the application of these criteria. That has to be very dramatic. In many cases the tax dollar is taking food out of the mouths of children. Their parents cannot afford the kind of nutritious food other Canadians could not possibly do without.
1 would ask the minister to look seriously at that. I can assure him there is a wide community and constituency of support for this proposal. Certainly the federation of independent business people has embraced the proposal as a policy and many of the unions operating in the north, the steelworkers, for instance, have made that their national policy. Every municipality in the north has written me letters of support, and I am sure the minister has received letters as well. Strangely enough, as I speak on open line programs throughout the country I get nothing but a positive response, even from people in the larger cities who just simply do not understand how difficult and costly it is to cope with the harsh realities of northern winters, the isolation, and having to send children two or three thousand miles away to learning institutions, or to hospitals for special medical treatment, and so on.
January 28, 1981

All I am saying is that in order to achieve any degree of equity and fairness in the north, the Income Tax Act would be the tool to use. The establishment of different tax zones would be a method that is acceptable. It has been proven in many other countries and deserves the consideration of this government. I am very disappointed that some of these proposals were not reflected in this particular bill, but 1 am hopeful the minister, in response to my comments, will be able to enlighten us as to how the multidepartmental study is going and what the government's views are in respect of these proposals.


J. Robert Howie: Mr. Chairman, I should like to speak for just a moment about the special 50 per cent investment tax credit proposed in this bill.
In my view the designation of areas to receive the special 50 per cent investment tax credit should involve regions of the country which suffer the effects of regional disparity, instead of census divisions within regions and, indeed, within provinces. Last Wednesday I spoke at length on this matter and made my argument in that regard. Today I should like to detail a few points in support of my argument.
According to the data base on which the program is based, 13 of the 42 areas selected do not qualify for designation with regard to the per capita income and family unemployment rate criteria used in the selection process. An additional factor, that of isolation, has to be included in order to effect the qualification.
Eleven areas that do not qualify under the per capita income and family unemployment rate criteria are not included. I would like to illustrate this point by referring to the census divisions identified in the province of Quebec.
L'Islet, census division 13, has a per capita income of $2,760 and a family unemployment rate of 3.3 per cent. This area is not included, while Riviere du Loup, census division 8, with a per capita income of $3,577 and a lower family unemployment rate of 3 per cent, is included.
L'Islet is part of Bellechasse, which for a long time was represented by a distinguished Social Credit member of Parliament, and is now represented by an able member of the government caucus, who may wish to pursue this matter. If he does so, the research material I have gathered will be available to him.
Labelle, census division 16, has a per capita income of $3,227 and a family unemployment rate of 3 per cent. Again, Labelle is worse off than Riviere du Loup, but it too is excluded, and 1 have to ask why.
Charlevoix, which is represented in the House by my friend, the Minister of State for Small Businesses, has a per capita income of $4,000 and a family unemployment rate of 3.2 per cent, but is not included as an area designated to receive the benefit. Apparently the Minister of State for Small Businesses does not enjoy the same good fortune as the Minister of Regional Economic Expansion and the Minister of Finance whose constituencies are included. That is quite understandable, but perhaps the Minister of State for Small Businesses will have some difficulty explaining to his constituents how the
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Minister of National Revenue was so fortunate as to have part of his constituency included, with a per capita average income of $5,531 and a family unemployment rate of only 1.5 per cent, in census district number 10, which is Labrador.
I want to be the first one to suggest that the answer is to be found in the weight that is given to an isolation factor, but looking at the per capita income of $5,531 which is higher than most included areas of Quebec, and a family unemployment rate of 1.5 per cent-a lower unemployment rate than all the other areas in Quebec which are included-I have to suggest to the Minister of State for Small Businesses and the Minister of National Revenue that that is some isolation factor!
If my colleagues from Quebec who are left out of the designation marvel at the way that the identification has been done, they will probably find great sympathy from my colleague from Haliburton in Ontario, census district 46, which has an average income of $3,879 and a family unemployment rate of 3.1 per cent. It is the only census division in Ontario to meet the criteria of the program. Yet it is not included in the program.
Part of Thunder Bay district, in census district 58 which is included, has an average income of $6,827 and a family unemployment rate of 2 per cent. Again, it must be some heavy weight that is given to the isolation factor!
If the isolation factor is great in Ontario, some other mysterious and powerful force is at work in Nova Scotia. The Minister of Finance must be delighted that Inverness, census district 15 in his riding, with an average per capita income of $3,674 and a family unemployment rate of 3.1 per cent, is included, while the member for South West Nova is hung out to dry in respect of Digby, census district number 3 in her riding, which has a per capita income of $2,826 and a family unemployment rate of 3.3 per cent. Inverness is in, and Digby is out. In fact they both should be in, but for some strange reason the area represented by the distinguished member for South West Nova has been excluded.
She is in pretty good company because Cumberland, census district number 11 in Nova Scotia, with an average income of $3,524 and an unemployment rate of 3.3 per cent, has also been excluded. The member for South West Nova is in good company with the very able member for Cumberland-Colches-ter.
For a real shocker we go to Queen's County, New Brunswick, census district number 4, which has the lowest per capita income in all of New Brunswick at $2,484, and is excluded. Its 3.3 per cent family unemployment rate is higher than one, and the same as two areas included from that province.
By removing Rimouski, the urban area, from the county, by removing Sept-Ties from Saguenay in Quebec, by removing Thompson from census district 22 in Manitoba, and Grande Prairie from census district 15 in Alberta, the rest of the census division in each case was able to qualify.
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January 28, 1981
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I want to suggest to the minister, who is quite prepared to ignore the city of Moncton in New Brunswick and the city of St. John's in Newfoundland, that he at least consider using this same technique to recognize the balance of the counties in which these areas are located. This is, of course, predicated on the stubborn determination of the government not to do the right thing and to recognize all of the Atlantic provinces as a region that suffers from disparity and should be identified for the benefits of this otherwise excellent program.


Mr. Roche:: Mr. Chairman, like my colleagues, 1 have a terrible temptation to use clause 1 of this bill for a global assault on a government which richly deserves it, but in the interest of time I will zero right in on a point which 1 wish to draw to the attention of the Minister of State for Finance and also of the Minister of National Revenue who is here, because what 1 am going to talk about, Mr. Chairman, is the question of voluntary agencies in Canada and the income tax amendment which is very sorely needed on their behalf which will, at one and the same time, be a social advance in this country and save the government $93 million. A proposal to improve the social conditions in our country and make a substantial saving to the public taxpayer, to the government, is a proposal which, if you do not want to build a monument to the one who makes it, at least should be taken seriously by a government concerned about the public purse today.
It is not a new proposal, Mr. Chairman. 1 am bringing it up again in this debate because the government has not moved on the proposal which has been put forward in the form of various motions over the years by about half a dozen members, and most recently by myself on June 9, 1980. 1 draw to the minister's attention pages 1898 to 1905 of Hansard of that day. In that debate is to be found the detail of a proposal which is not terribly complicated but which contains many figures to sustain the point f made a moment ago, which is that my proposal would actually result in saving the government $93 million in the initial year.
In essence, the proposal is that the standard $100 deduction for charitable donations be done away with and that taxpayers be given an option of either claiming their gifts to charitable and voluntary organizations as deductions from taxable income, or be allowed to claim 50 per cent of the value of the gift or donation as a tax credit.
Doing away with the $100 standard deduction immediately saves the government, on the figures of 1977 which are the most recent ones available, $245 million. It also becomes much more fair to people who are actually giving donations to voluntary organizations, and it becomes more fair to the organizations because there is a greater incentive for people to make donations to voluntary organizations when they can be given the choice of a deduction, if their tax credit is such that it is more advantageous for them to do that, which it would be for high income earners, or the choice of claiming a tax credit for 50 per cent of the gift, which would apply to a great majority of income taxpayers in the middle to lower ends of the scale.
This is not a fly-by-night proposal. The origin of it goes back to the National Voluntary Organization, an umbrella group of 108 national voluntary and charitable organizations representing some 45,000 registered charities in Canada. These are organizations for the disadvantaged, the poor, the sick and the needy. They are organizations for children and the aged, health organizations, organizations for research into heart and lung disease, cancer, diabetes, muscular dystrophy, health services for the mentally and physically handicapped. They are religious organizations sustaining and preserving our spiritual values, international development organizations, educational organizations, environmental organizations, native, ethnic and cultural organizations. There is a wide group within our society which this organization represents. Indeed it would be hard to think of a Canadian who is not touched one way or another by the social benefits provided to our society by voluntary organizations.
What is happening to voluntary organizations today? They are being hit by the inflation factor in such a way that patterns are now established of a decline in giving because of the squeeze in which so many people find themselves and the transferring of that financial squeeze to those groups that have hitherto been the beneficiaries of a charity based upon a reasonable financial position which is now being eroded as a result of inflation.
I am not advancing an argument against controlling inflation. I am only recognizing the inevitability of continuing inflation and what it is doing to voluntary and charitable organizations which perform such a tremendous service to our country. Briefly, they are in a tax squeeze.
If a change were made to the Income Tax Act along the lines that I have mentioned, the situation would be improved. 1 must say that the hon. member for Winnipeg North Centre gave support to my proposal. Of course he entered certain caveats. There were certain measures in my motion about which the hon. member had some reservations. I accept those reservations because I am not wedded to the precise detail of how the Income Tax Act should be amended in such a way as to give incentive to people to increase their donations to voluntary and charitable organizations. I am only speaking to the principle of it, that the time has come to make a change to the Income Tax Act which will be of benefit to voluntary organizations and will be an enrichment to the social fabric of the country. I can say that there is widespread support in the House for such a move.
The Parliamentary Secretary to the Deputy Prime Minister and Minister of Finance responded to my motion, but he did not even bother to listen to the arguments or to figure out the actual computations of the figures which I advanced on behalf of national voluntary organizations. He made a canned speech which was written beforehand. The figures included in my motion to my knowledge have not yet been disputed by the Department of Finance.
January 28, 1981

I will not argue about a few dollars one way or another. 1 am only advancing the position that the introduction of such an amendment would be not only socially beneficial, but it would be a saving to taxpayers. 1 advanced the argument that the cost to government for such a proposal would be $391 million, whereas at the present time it costs $484 million in tax revenues because of the way in which the present law is written. The parliamentary secretary said that we cannot afford it. I say that we can. I say there is a widespread public support in Canada for such a move and that the lime has come for us to advance it.
I have received mail from various voluntary organizations and national associations all over the country. I will refer to only a few to show the wide range of support for this proposal-the Canadian Mental Health Association, the National Council of YMCAs of Canada, the Canadian Heart Foundation, the National Indian Brotherhood, Grant MacEwan Community College in Edmonton, and the Canadian Jesuit Missions. That is only a handful of the organizations in Canada which support the proposal and would be among the beneficiaries.
Finally 1 come to an argument which I think has an overriding appeal. When we consider what needs to be done to help voluntary organizations which are of tremendous benefit to the country, when we consider the widespread support for an income tax amendment which would increase the incentive for Canadians to give to those organizations, and when we consider that it would be a fair tax return to the Canadian government and to Canadian taxpayers, all of that should carry the case. But, there is one final argument.
On behalf of the political parties of this country we put in place a few years ago an income tax amendment which allowed people to give to political parties and to receive a tax write-off of 75 per cent at the bottom line. I think there is an argument to be advanced for political parties because they also make a very important contribution to the total fabric of our society. As a result of that income tax amendment, the political parties are now able to raise money despite inflation. They are able to raise plenty of money for their needs.
1 am particularly directing my remarks to the Minister of National Revenue. If we can make such an amendment on behalf of political parties, I submit the time has come for us to apply the same principle of a tax credit of 50 per cent at the bottom line-I am only asking for 50 per cent of what is given to registered charities and national voluntary organizations. If we can do it for political organizations, I submit the time has come in the spirit of social justice for us to do it for voluntary organizations which are providing such a tremendous benefit to everyone in the country.


Mr. McKnight:: Mr. Chairman, I enter this debate with some apprehension. Because the officials of the minister are available in the House and we are meeting in Committee of the Whole, I understood that questions would be answered. But now I am not sure whether I understood that properly. Can I ask questions and expect answers now, or can I ask questions and expect answers later?
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Pierre Bussières: Later.


William Hunter (Bill) McKnight: Well, just to start off, we have heard some discussion about the problems in the tax laws of Canada. I am not sure whether it is because they are written by lawyers, economists, or computer experts in a computer language with which not too many of us are familiar.
From watching television and from reading my daily and weekly newspapers, I know that the government spends hundreds-and I would presume hundreds of thousands-of dollars of taxpayers' money telling Canadian taxpayers how simple and easy it is to understand the tax system.
1 should like to refer to one clause in Bill C-54. If the minister's officials feel able, when I come close to the end of my time, I would gladly give them an opportunity to explain it. Clause 66.2(6) reads as follows:
Where a non-resident person is a member of a partnership that is deemed under Paragraph I 15(4)(b) to have disposed of a property described in Subsection 59(1.1), his share of any amount that would be an amount referred to in Clause (5)(b)(v)(A) or Subparagraph (5)(b)(vi) or (xi) in respect of the partnership for a taxation year of the partnership if section 96 were read without reference to Paragraph (l)(d) thereof shall, for the purposes of this act, be deemed to be an amount referred to in Clause (5)(b)(v)(A) or Subparagraph (5)(b)(iv) or (xi), as the case may be, in respect of the non-resident person for the taxation year of the non-resident person that is deemed under Paragraph I I5(4)(a) to have ended.
I know that sounds like a speech made by the Minister of Transport, or maybe the minister responsible for the Canadian Wheat Board in the other place. To be fair, I think it is maybe a bit extreme. But I think it is an example of the problems that we, as members of Parliament, have in trying to understand the tax laws. It is an example of additional costs accruing to individuals in Canada in trying to meet the requirements of good Canadian citizenship, that is, of fulfilling their tax obligations.
In Bill C-54, and in the budget, a considerable amount of time was spent with respect to the National Energy Program and also with respect to something called COR, Canadian Ownership Rate. I question the ability of this document to say what oil company in Canada, what company, could be called Canadian. There have been discussions with respect to that question during question period. 1 have been trying to read up on the subject to the best of my ability. There are two companies which come to mind when considering this matter, Dome Petroleum, which is considered by everyone to be Canadian, and Home Oil. The ownership rate which applies to Dome Petroleum, according to the rules as Jack Gallagher and I interpret them, is a tremendously difficult matter. The company's 15,287 registered shareholders, under the COR rules, only bring the Canadian ownership rate up to 52 per cent. Dome requested that it be able to purchase an interest in a company, of which it owns 49 per cent, in order to bring up its Canadian content. That company is TransCanada Pipe Lines. Is Dome Petroleum a Canadian company or is it not? Bill C-54 is mute on that.

January 28, 1981
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The other company I mentioned, Home Oil, is owned 100 per cent by Hiram-Walker Consumers Home Ltd. If the same rules are applied to Home Oil it is 75 per cent to 80 per cent Canadian-owned. These circumstances illustrate some of the problems which industry in Canada sees.
I would like to ask the Department of Finance if it is aware of the computer modules which the Department of Energy, Mines and Resources has established, according to Edmund Clark, for the cash flow of every oil company in Canada? If the department is aware, does the Minister of Energy, Mines and Resources accept the figures that the cash flow of the oil companies will be 28 per cent higher this year than last year, as stated by the Minister of Finance in answer to a question from the hon. member for Calgary Centre? This is cash flow which is needed by the oil companies for reinvestment. Or does the minister accept the figures of Mr. Bell, the Vice-President of Petro-Canada, which show that the cash flow of the oil companies will be 25 per cent less this year than they were last year?
If these computer modules are in place I do not see why there should be a discrepancy of over 50 per cent in these figures. Why is there this discrepancy between the figures of the Minister of Finance and the statement made yesterday in the Toronto Star by Mr. Bell?
I would also like to know if the department is aware that the figures for drilling for oil in Canada in the second quarter of 1981 will be 54 per cent to 58 per cent less than last year. If so, do the officials agree with those figures? Do they also agree that more than 50 per cent of the drilling rigs presently working will have their contracts expire before the second quarter of 1981? We hear the gobbledygook from the Minister of Energy, Mines and Resources with respect to there being more rigs drilling this year that at the same time last year. If the minister were to take the time to visit western Canada and go into the oil-producing areas, he would hear some statistics which would bother him considerably.
Most of the drilling rigs are now under contract. The reason they are under contract is because until this present program was put in place under the National Energy Program the use of rigs was at a premium in Canada. So oil companies had to contract on a long-term basis in order to have rigs available. The rigs which are presently drilling are also drilling for another reason. We have heard figures about the increase in
drilling in Saskatchewan. The reason there was an increase in November and December is because of the credit system which was set up by the government of Saskatchewan. The system was such that if you drilled so many wells you would get an increase in your royalty. That system was removed as of January 1. So companies looked at their credit pool and decided that they must drill more wells in order to use up their credits. That is what they did. That is one of the reasons why there was more activity in the fourth quarter of 1979.
The problem we have in my constituency is with respect to capital gains. Several of my colleagues have spoken about this matter. In my opinion the capital gains tax is a tax after a tax. In view of statements made here I am sure everyone is aware of the promise made during the election campaign by the government. Ministers promised to change V-Day for capital gains from 1971 to 1974 values. I wonder if the minister could explain why this has not been done. Perhaps I have misread something because of my inability to read computereeze. I do not think I have. I think it is something which this government promised and which it has not given. It is like so many other things. What bothers me with respect to capital gains is that we in this party seem to be the only ones in this House who think it is a double tax.
The hon. member for Broadview-Greenwood accused the government of abandoning a field of wealth taxation when it removed the taxation on capital gains and estate taxes in 1972. We in this party do not stand for a death tax. Apparently the NDP does. I find it strange that the hon. member for Vancouver East suggested in this House that there should be a 100 per cent capital gains tax. The farmers in Saskatchewan, even the ones in NDP constituencies, do not believe there should be a 100 per cent capital gains tax on their sweat, blood and toil, on that which has taken them sometimes three or four generations to build up. This government made a commitment to remove some of the onerous aspects of the capital gains tax in its election promises in the February campaign. We look forward to seeing those promises kept when Bill C-54 is translated into English or French.
Mr. Chairman, I would like to call it six o'clock.
Progress reported.


The Acting Speaker (Mr. Blaker):: It being six o'clock I do now leave the chair until two o'clock tomorrow.
At six o'clock the House adjourned, without question put, pursuant to Standing Order.

Thursday, January 29, 1981