1981-05-28

ROUTINE PROCEEDINGS


Hon. John Wise (Elgin):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. The urgency of this matter is in connection with the May 21, 1981 announcement by the Minister of Agriculture (Mr. Whelan) regarding the 1980-81 hog stabilization payment.
Since this measure violates the minister's discretionary powers under the 30-year-old Agricultural Stabilization Act, thus making his action illegal and, in addition, causes inequities to producers not only between but also within provinces, I move, seconded by my colleague, the hon. member for Prince Edward-Hastings (Mr. Ellis):
That this Minister of Agriculture immediately revise the application of this much needed program in such a manner as to avoid the penalization of producers who, because of the lack of adequate leadership and financial commitment on the part of the federal government, have purchased additional coverage and protection from their own provincial governments.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


VIA RAIL
Mr. Bill Clarke (Vancouver Quadra):: Madam Speaker, pursuant to the provisions of Standing Order 43, I ask for the unanimous consent of the House to move a motion on an urgent matter.
Referring to VIA Rail Canada Inc., the Commissioner of Official Languages stated in his report that the quality of
services in French on the trains remains quite inadequate throughout the country, even on lines crossing Quebec, because VIA Rail Canada continues to give priority to the principle of seniority in the choice of routes by its staff, with the inevitable result that too frequently the trains are manned by unilingual crews. Such a situation, which is ridiculous besides being frustrating and which might be hazardous, goes against the intent of the Official Languages Act, and particularly falls short of the promise concerning French services made by the Minister of Justice (Mr. Chretien) and others during the referendum campaign. Therefore I move, seconded by the hon. member for Edmonton-Strathcona (Mr. Kilgour):
That the House condemn VIA Rail Canada for the shortcomings of its official languages policy, and urge the Minister of Transport to take the necessary measures so as to ensure that this policy will be carried out by the Crown corporation, and that in the meantime the minister recommend that VIA Rail Canada act immediately with a view to eliminating this hazardous situation.


Madam Speaker:: The House has heard the motion of the hon. member. Pursuant to the provisions of Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


POST OFFICE
Mr. Peter Elzinga (Pembina):: Madam Speaker, I too rise under the provisions of Standing Order 43. One hundred and twenty years ago one of the very first western missionaries, Father Lacombe, established the mission of St. Albert in Alberta which, down through the years, has contributed much to the opening and development of the west. This year St. Albert, a city on the outskirts of Edmonton, will be celebrating its birthday in grand fashion. In the interest of preserving some of the national and historical nature of St. Albert, I move, seconded by the hon. member for Edmonton East (Mr. Yurko):
That the government issue a commemorative stamp honouring St. Albert and its founder. Father Lacombe, on this its 120th birthday, and that the site of the original mission be declared a national monument.


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

May 28, 1981


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE LATE CARDINAL WYSZYNSKI OF POLAND
Mr. Jesse P. Flis (Parkdale-High Park):: Madam Speaker,
1 rise to seek the attention of all hon. members of this House on a matter of urgent and pressing necessity under the terms of Standing Order 43.
I move, seconded by the hon. member for Calgary East (Mr. Kushner):
That this House express profound sadness and sympathy to the Polish people and the Roman Catholic church on the death of Cardinal Wyszynski, Primate of the Roman Catholic Church of Poland.
Cardinal Wyszynski was a very distinguished representative of the church and a dignified son of Poland. He was a great proponent of respect for human dignity, and his absence will be felt by all.


Some hon. Members:: Hear, hear!


Madam Speaker:: I am sure the House will want to express its sentiments by its applause.


Some hon. Members:: Hear, hear!


FORESTRY
Mr. Lyle S. Kristiansen (Kootenay West):: Madam Speaker, 1 rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the declared commitment of the Minister of the Environment (Mr. Roberts), who is responsible for forestry, made last December 1, almost six months ago in Fredericton, to the Maritime Forestry Complex in that city, and in view of the fact that the land sale exchange for the complex is now near completion and that officials have yet to hear from the federal government as to when the funds will be available, I move, seconded by the hon. member for Hamilton Mountain (Mr. Deans):
That the Minister of the Environment now live up to his commitment of December 1, 1980, and immediately inform this House when the government will put its money where his mouth is, commit these funds publicly, and begin to clear up the huge research and development and forestry education backlog, which all agree is stopping the forest industry in Canada from meeting its potential for huge growth.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


AIRPORTS
Mr. Scott Fennell (Ontario):: Madam Speaker, I rise under the provisions of Standing Order 43. My constituents have been disturbed, disgusted, and divided for almost a decade by the Pickering airport issue. Last month the Minister of Transport (Mr. Pepin) indicated that the Pickering lands confiscated from farmers in my riding will remain "in the refrigerator" until the 1990s. This means 20 years with the government acting as a slum landlord to an 18,000 acre wasteland.
Therefore I move, seconded by the hon. member for York North (Mr. Gamble):
That this House direct the Minister of Transport to stop sitting on the fence and tell us once and for all if plans to build the airport are being finalized, or if the bureaucrats will return the Pickering lands to the people.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. Bud Bradley (Haldimand-Norfolk):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent necessity. Every person in this House surely understands the importance in this country of agricultural small business, yet the government insists on sitting quietly by and watching thousands of hard-working Canadians in both farming and small businesses go bankrupt-


Mr. Baker (Nepean-Carleton):: Shame!


T.A. Bud Bradley: -the same government that unhesitatingly aided Chrysler, that spent billions of dollars in setting up a government oil company, and set up a cartel to help uranium producers get a good price. Is it not time, Madam Speaker, that they did something for our farmers and small businessmen in order to halt this unacceptable situation of interest rates and overhead? I therefore move, seconded by the hon. member for Oxford (Mr. Halliday):
That the government immediately take steps to offset the effects of high interest rates and overhead on the farmers and small businessmen of Canada.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


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


LABOUR RELATIONS
Mr. Gordon Taylor (Bow River):: Madam Speaker, I rise on a matter of urgent and pressing necessity under Standing Order 43. Whereas the Canadian Labour Board upheld the dismissal of two CPR employees at Revelstoke; and whereas pressing for their reinstatement, other employees at Revelstoke, led by a handful of militants, are on a wildcat strike has virtually stopped the movement of grain between Calgary and the west coast, and whereas it is absolutely ridiculous when a handful of persons can inconvenience and jeopardize the livelihood of thousands of farmers, to say nothing about the possible loss of markets, I therefore move, seconded by the hon. member for Assiniboia (Mr. Gustafson):
That this House urges the federal government to take immediately any and all steps necessary to stop this costly nonsense and to get the grain moving again.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


AIR TRANSPORT
Mr. Girve Fretz (Erie):: Madam Speaker, I rise on a matter of urgent and pressing necessity. Given that the Canadian Transport Commission has not yet made a decision on an Ottawa-New York City air link, even though a three-month search has failed to turn up any willing American carriers, and given the fact that two Canadian carriers have expressed serious interest in providing this service, I move, seconded by the hon. member for Surrey-White Rock-North Delta (Mr. Friesen):
That this House urge the Minister of Transport to get off his duff, that is if doing so does not conflict with any CTC guidelines, and make an early decision to award the direct air service to one or the other of the interested Canadian carriers.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


ROYAL CANADIAN MOUNTED POLICE
Mr. Bob Rae (Broadview-Greenwood):: Madam Speaker, whereas it has now been established that both the provincial Crown attorney and the responsible RCMP officer originally assigned to the investigation of transactions between Mr. Roland Thornhill and a number of chartered banks were pulled off the case before their investigation was completed, and whereas it is clear that the so-called investigation by the inspector general of banks simply consisted of telephone calls to the banks themselves, I move, seconded by the hon. member for Hamilton Mountain (Mr. Deans):
That this House calls on the government to launch a judicial inquiry into three particular questions involving Mr. Roland Thornhill; first, the agreements entered into between Mr. Roland Thornhill and a number of chartered banks for the forgiveness of certain loans; second, the reasons for the curtailment of local investigations by the head office of the RCMP and the attorney general of Nova Scotia; and third, the nature of the so called "investigation" carried out by the inspector general of banks.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. Bill Yurko (Edmonton East):: Madam Speaker, I rise under the provisions of Standing Order 43. During the February, 1978, first ministers' conference on the economy, the Prime Minister (Mr. Trudeau) stated, and I quote:
Premier Davis, your government in Ontario has introduced a refundable tax credit system to provide relief from property and sales tax for low and middle income taxpayers. Perhaps this is a model that should be pursued on a broader scale.
Therefore, Madam Speaker, I move, seconded by the hon. member for Prince Edward-Hastings (Mr. Ellis):
That the national government introduce a new budget at the earliest possibility and include in it home owner property tax deductibility up to a reasonable maximum, for income tax calculations, to provide some relief for home owners and at the same time reduce the injustice of people paying taxes on taxes.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

May 28, 1981
Oral Questions



ORAL QUESTION PERIOD


Right Hon. Joe Clark (Leader of the Opposition):: Madam Speaker, my question is directed to the Deputy Prime Minister and Minister of Finance who will know that yesterday his deputy minister testified that the Department of Finance is taking a very hard look at a new tax on Canadian workers, called generally a tax-based incomes policy. The minister will recall that in one of his own rare pronouncements recently on economic policy on May 6, he said:
A tax-based incomes policy has not yet been devised that is both administratively feasible and fair. In particular, I have yet to see a TIP design that ultimately controls anything more than wage demands-
That was the position of the minister on May 6. First, is the government in fact looking at this new tax on Canadian workers? Second, have the minister's objections to the designs then before him been overcome, and is there a new design? Third, does the new tax his department is studying control anything more than wage demands?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, it is true that I mentioned a number of alternatives in that speech, I believe, before the Conference Board, including a TIP as it is called. I said that I had not seen a program which would recommend itself to me, but that the search was still going on. That is the situation as it is today; there has not been any new insight conveyed to me as to a workable and fair program.
As the Right Hon. Leader of the Opposition may recall, I talked about the design of such a program and that a search for a suitable design would be continuing. That is the situation as it is now.


DESIGN OF SYSTEM
Charles Joseph Clark: Madam Speaker, perhaps the minister can give us a statement on the government's policy as to the kind of tax system which would be acceptable to it. If he does not find a design which does not have any effect other than controlling wage demands, if that is the only kind of design before him, will he reject this TIP approach?


Allan Joseph MacEachen: Madam Speaker, the question is hypothetical, because I cannot foresee what further study or research migh reveal. But I believe the situation is clear, it is a proposal which one ought to look at in the light of inflationary pressure. One has to be sure that it is fair and administratively feasible and has a design which would bring that about. We have not found one yet; we are still looking. I believe that is
what my deputy minister conveyed yesterday before the Senate committee.


DECLINE IN REAL WAGES
Charles Joseph Clark: Madam Speaker, let me pursue for a moment this question of fairness. The minister knows that, given the rate of inflation, the real income of Canadian workers has fallen. He knows that the average Canadian worker is now earning, in real terms, more than $500 a year less than he or she was earning in 1977. These people are the principal victims of inflation in Canada. Will the minister indicate how he could justify making these people, who are now the chief victims of inflation, also the chief targets of a new tax? Particularly when the government is prepared to be as helpful as it is to companies like Petro-Canada and to individuals like Maurice Strong, how can the minister justify dumping this special tax upon people?


Bob Rae: And to companies like Imperial.


Charles Joseph Clark: To companies like Imperial Oil, indeed. How can he justify helping out multinationals when he proposes to add to the cost burden of the average Canadian worker?


Allan Joseph MacEachen: Madam Speaker, if the day ever comes when I will recommend such a program to the House of Commons, I assure my right hon. friend that I will be in a position to justify it to most sensible people.


DEINDEXING OF TAXATION-GOVERNMENT POSITION
Hon. James A. McGrath (St. John's East):: Madam Speaker, my supplementary question is directed to the Minister of Finance. Yesterday when the deputy minister of finance was before the Senate Committee on National Finance he described the effects of high interest rates as a holocaust. I would go further and suggest that it is a holocaust in which wage earners and home owners have been the real victims. He also indicated that they would continue.
In June the minister gave an assurance in the House that the government "would not attempt to solve the economic problems of the country or the fiscal requirements of the government on the backs of the low income people of this country."
In view of the fact the minister's deputy indicated yesterday that deindexing was a real consideration at the present time and, as the Leader of the Opposition has indicated, real incomes in this country are declining, and given the fact that deindexing will tax the average wage earner and let the high income earners of the country go free, is the minister prepared to give an assurance now, in light of the uncertainties which have been created, that there will be no deindexing?


Allan Joseph MacEachen: Madam Speaker, we went around this
May 28, 1981

track last year. If the hon. member wants to play that game again he can go ahead, but I am telling him exactly the same thing 1 told him a year ago-when it comes to preparing for the budget all matters are up for consideration. He ought not to draw any particular conclusions from that with respect to indexation.
I should remind the hon. member and the Leader of the Opposition that when they talk about declines in real incomes in Canada, there has been a decline in productivity in Canada. It is about time hon. members opposite focus on the fact that you cannot have more by producing less. That is precisely what is happening in the country.


CHILD TAX CREDIT PROGRAM
James Aloysius McGrath: Madam Speaker, I would say to the minister that it is the government and himself who are playing games with the Canadian people, since yesterday his deputy minister raised the spectre of credit controls in this country, amongst other things, which could set off a wave of inflationary buying in anticipation of credit controls.
Given the fact that we are told that high interest rates will continue and that the government has no response to the impact of interest rates on the average wage earners of the country, and in light of the fact that the Minister of National Health and Welfare gave a kind of undertaking in this House the other day that there would be changes in the child tax credit program, I want to ask the minister if the government at this point in time is anticipating changes in the child tax credit program and/or the elimination of the child tax deduction.


Allan Joseph MacEachen: Madam Speaker, the hon. member is a bit out of date. He says that high interest rates will continue; obviously he has failed to notice that today at the treasury bill auction the bank rate declined by 38 basis points-a very significant drop. He ought to put that in his head.


Mr. Nielsen:: Eighteen point six eight per cent.


Allan Joseph MacEachen: Hon. members never mention a drop in the bank rate, they are interested only in increases.
With respect to the child tax credit, when a policy is decided upon it will be announced in the House in the regular way.


AIR SAFETY
Mr. Les Benjamin (Regina West):: Madam Speaker, in the absence of the Minister of Transport, which I find strange on the day following the publication of the Dubin Royal Commission Report on Aviation Safety, considering it is the first
Oral Questions
opportunity which members of this House have to ask questions, I will direct my question to the Prime Minister.
I appreciate the position of the Prime Minister in that he does not interfere with the responsibilities of each minister unless he asks them for a resignation, but can the Prime Minister tell the House that he will point out to the Minister of Transport that the appointment of the air administrator to the task force to implement the Dubin commission report is a direct conflict of interest and flies in the face of the report, in view of the fact that Mr. Justice Dubin has specifically mentioned that gentleman four times as one who created situations which interfered with aviation safety?


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: Madam Speaker, the important objective for the minister when he has an advisory council is to get a balanced view from experts in the aviation field.


Some hon. Members:: Hear, hear!


Robert Theodore Bockstael: The advisory committee is composed of two people attached to the ministry, but there are also four competent outsiders who will give him an unbiased report. The final decisions will be the minister's to take. If public servants are not satisfied with the decision taken by the minister after the advice is given by that committee, a good civil servant knows what he has to do.


Some hon. Members:: Hear, hear!


REQUEST FOR REMOVAL OF DEPARTMENTAL OFFICIALS FROM TASK FORCE
Leslie Gordon Benjamin: Madam Speaker, we have a case here where the Prime Minister is letting the department run a minister instead of a minister run a department. Of the six names, two are presently in the ministry, one was a past deputy minister of Transport Canada, one previously served as legal council for the MOT; plus the air administrator, plus the assistant deputy minister. A majority are from the ministry of transport on this task force.
Since the government report named four senior Transport Canada officials who deliberately interfered with accident reports and enforcement of safety and rules in order to avoid, to quote Mr. Justice Dubin, "political embarrassment to the department and to the minister"-


Some hon. Members:: Shame, shame!


Some hon. Members:: Oh, oh!


Leslie Gordon Benjamin: -would the Prime Minister ask the Minister of Transport to remove the officials of the Ministry of Transport from the task force so as to implement this report?


Some hon. Members:: Hear, hear!

May 28, 1981
Presence in Gallery


Robert Theodore Bockstael: I will reiterate my previous answer.


Some hon. Members:: Oh, oh!


Robert Theodore Bockstael: The four outsiders are regarded as having wide qualifications for this job. As a result of the Dubin report there is a recommendation for an independent tribunal for Canadian aviation safety. The minister is in agreement with this kind of a commission or safety board, and it will be dealt with in due course.


Some hon. Members:: Right on!


CONDUCT OF OFFICIALS
Mr. Ray Skelly (Comox-Powell River):: I have a final supplementary question for the Prime Minister. The Dubin commission clearly raises serious questions about the performance of their duties by the senior officials in the air transport administration, and by the administrator specifically, interference in an air crash investigation in Vancouver Harbour in September of 1978. In September of 1979 at Sechelt an air crash in my own riding followed, and was almost caused by a failure to produce certain items out of that previous crash. In the interests of fairness, fair play, and an unbiased evaluation of these incidents, and the implementation of the recommendations from an excellent report, would the Prime Minister consider relieving the administrator and those named officials until such time as an investigation can be conducted into the propriety of their actions in those investigations? Possibly another anti-dumping tribunal?


Robert Theodore Bockstael: Madam Speaker, the Minister of Transport is satisfied with the committee he has established. He will consider the first recommendation of the Dubin report to establish a Canadian aviation safety tribunal, and this will meet the recommendations of that report.


Some hon. Members:: Hear, hear!


PRESENCE IN GALLERY OF HON. D. T. MATENJE, MINISTER OF EDUCATION, AND HON. L. C. CHAZIYA, MINISTER OF FINANCE, OF MALAWI
Madam Speaker:: I would like to draw the attention of the House to the presence in our gallery of two representatives from the Government of Malawi, the Honourable D. T. Matenje, Minister of Education, and the Honourable L. C. Chaziya, Minister of Finance.


Some hon. Members:: Hear, hear!


WESTERN DEVELOPMENT FUND
Hon. John A. Fraser (Vancouver South):: Madam Speaker,
I have a question for the Minister of Employment and Immigration regarding the disappearing $4 billion Western Development Fund. Last fall the minister promised that he would consult with the provinces and bring out a spending blueprint by January, 1981. In March the minister said that, instead of a blueprint, propositions would be made public, to be used for discussions in western Canada. Has the minister given up on a blueprint and, if so, when will the spending propositions be made public, or has the minister lost control of this program completely?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, I should like to point out to the hon. member that the blueprint and the strategy by which the federal government can provide major support for economic development in the west, are already in place. We signed a major grain agreement with the Soviet Union-


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Lloyd Axworthy: We have given major assistance to the very important development of the LRT system in the hon. member's home city of Vancouver, which will enable major development of new technology in western Canada so that we can aid in the expansion and diversification of industry in that area. There has been major assistance in a number of economic development initiatives in the city of Winnipeg in the development of the Canertech Corporation. There is already a very clear and very relevant blueprint in place and working for the benefit of people in western Canada.


CONSULTATION WITH WESTERN CANADIAN INTERESTS
John Allen Fraser: Madam Speaker, I have another question for the same minister. I would ask him whether the blueprint that is already in place is the blueprint which he said would be in place in January, 1981. In view of the fact that the Right Hon. Prime Minister said a few weeks ago that no formal discussion had taken place with the western provinces, and in view of the fact that he is trying to spend $350 million in this fiscal year and $2 billion in the next three years, and that as yet there is no proposition, no blueprint, and no formal discussions have taken place, I should like to ask when formal discussions will take place. When will the propositions be made available? When can we count on the disappearing $4 billion fund being resurrected and presented to us so that we can see what it is?


Lloyd Axworthy: Madam Speaker, in the budget the Minister of Finance very clearly indicated that there would be a commit-
May 28, 1981

ment to put into place additional programs and projects to aid industrial development, and to look at areas of transportation and native development in western Canada. Those propositions are being worked on and are the subject of a wide variety of discussions between members of government and all kinds of interest groups in western Canada. They are ongoing discussions. When the propositions are prepared and ready, I can assure the hon. member that they will be available for his response as well as the response of the provincial governments.


RESTRICTIVE TRADE PRACTICES
Mr. Chris Speyer (Cambridge):: Madam Speaker, my question is to the Prime Minister. Will the Prime Minister undertake this afternoon to table in this House the report of the uranium inquiry prior to the House recessing for the summer, so that it might be the subject matter of discussion in this House prior to the summer?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the Minister of Justice has informed the House that the report has been referred to him as provided for by the law and that his officials were looking into the question of whether charges should be laid. If they are, the matter will become public; if not, I believe that there are-


Erik Nielsen: That is not what Ouellet said. Ouellet said it would be tabled.


Pierre Elliott Trudeau: Now we have an opinion from the Yukon, Madam Speaker. Maybe you could recognize him on a supplementary.


METHODS OF SUBMITTING BIDS
Chris Speyer: Madam Speaker, I have another question for the Prime Minister. During the currency of the cartel, did the Prime Minister ever have any information or belief, direct or indirect, as to the sham bid-rigging methods employed by the cartel members in raising the price of uranium?


Pierre Elliott Trudeau: Madam Speaker, the question contains an allegation of something being done with sham. I know nothing of that, Madam Speaker.


Charles Joseph Clark: That's good; we have got him on that.


Pierre Elliott Trudeau: Joe says they have got us.
Oral Questions EMPLOYMENT


TASK FORCE REPORT RECOMMENDATIONS
Mr. David Orlikow (Winnipeg North):: Madam Speaker, I should like to address a question to the Minister of Employment and Immigration. According to a confidential report of the minister's task force on labour market policies in the 80s, it is recommending to the cabinet that the goal of full employment be re-examined and that as many as 500,000 people from Ontario, Quebec and the Atlantic provinces will be forced to move to the west over the next five years in order to make a living. May I ask the minister why this report recommends a retreat from the full-employment goal and why further financial incentives should be given for people to move from where they now live to new areas, rather than providing the money to make job opportunities available for people in the areas in which they live?


Lloyd Axworthy: Madam Speaker, I should like to point out to the hon. member that whatever report he may have, there is not yet a final report; it is still being worked on. It would be remiss of me to try to respond to random or ad hoc comments drawn from a report which has not yet been tabled in the House.


SHARED-COST EDUCATION PROGRAMS
David Orlikow: Madam Speaker, the report also recommends that the federal government reduce its expenditures on post-secondary education. That recommendation is in line with the proposals of the Minister of Finance in his budget. The report recommends that the current federal contributions of $2 to $3 out of every $4 for postsecondary education be reduced to $1 out of $4, and that student fees be increased. Can the minister explain how, according to this report, "such a scheme would have the advantage of encouraging provincial governments to spend in federally desired areas" and that "students would be given more clout by having their fees raised"? How can that be done when the government wants to reduce its costs?


Lloyd Axworthy: Once again, I should like to point out to the hon. member that it is somewhat irresponsible to take isolated items from a report which is not yet published or final and has not been tabled, and try to make a case. I am sure the hon. member can wait, as other members will, for the completion of those reports and get the full and comprehensive picture. He will see that we are developing major strategies to aid and develop employment programs for this country and to ensure that we can meet the skills shortage which we all know is very critical to our economic health.

May 28, 1981
Oral Questions


ROYAL CANADIAN MOUNTED POLICE
Gordon Edward Taylor: Madam Speaker, my question is for the Solicitor General. On April 22 of this year in the village of Standard, about 60 miles east of Calgary, a lovely 15-year-old girl, named Kelly Cook, daughter of Mr. and Mrs. W. Cook, was kidnapped by a stranger. Kelly thought she was going to babysit for a neighbour. She has not been heard of since. The RCMP and hundreds of friends and neighbours have carried out an extensive ground search for clues, but without any success.
Will the Solicitor General bend every effort to alert the people and the police across Canada to be on the lookout for Kelly, culminating, we pray, in the safe return of Kelly to her home?


Hon. Bob Kaplan (Solicitor General):: Madam Speaker, I am glad to inform the House that I have already done so. When I was in Alberta last week I took the opportunity to discuss this case with the commanding officer. Although the investigation is being conducted under the provincial police program, I did express a considerable concern about it.


Gordon Edward Taylor: Madam Speaker, I appreciate the work and the attitude of the Solicitor General, and also the work that the RCMP is doing.


BORDER POST RECORDS
Gordon Edward Taylor: My supplementary question is intended for the Minister of National Revenue, Madam Speaker, but I wonder if his parliamentary secretary could answer in his absence. There is a possibility that Kelly has been taken to the U.S.A. or Mexico. Will the minister alert his personnel at the ports of entry to check their records and be on the look out, with any clues to be sent immediately to the RCMP at Strathmore?


Robert Phillip Kaplan: Madam Speaker I will pass that along to my colleague, and if that has not already been done, it will be done.


CANADIAN BROADCASTING CORPORATION
Miss Pat Carney (Vancouver Centre):: Madam Speaker, my question is addressed to the Minister of Communications. Yesterday the minister was kind enough to remind the House that in the past I have criticized the CBC for not spending more money on original production. He failed to add that the CRTC agreed with me in rejecting the application for CBC-2 for reasons which were outlined by three of my Conservative colleagues and myself when we appeared before the CRTC last January.
Since the minister was apparently prepared to find the $30 million for CBC-2, what steps is he taking to ensure that there are additional funds available for the increased Canadianiza-tion of the basic CBC-1 service?


Hon. Francis Fox (Secretary of State and Minister of Communications):: Madam Speaker, as I indicated a number of times before, the whole question of the CRTC licence is one which was quite properly dealt with by the CRTC itself. On the question of the level of funding for the CBC, this matter received the attention of cabinet during the course of the preparation of estimates. Cabinet decided to give the CBC approximately a 12 per cent increase this year. That is now up. Because of the normal arm's length relationship between the government and the CBC, it is now the job of the board of directors of the CBC to determine how best and most efficiently these funds can be spent.


GOVERNMENT PRIORITIES
Pat Carney: Madam Speaker, my supplementary question is also addressed to the Minister of Communications. As he knows, the CRTC has indicated that it is willing to consider an application for an interim service on CBC-2, consisting mainly of repeats. What are the minister's priorities? Are they for an interim CBC-2 service or to upgrade the basic CBC-1 service by providing more original programming?


Francis Fox: Madam Speaker, the position of the government is quite clear. We feel that the main objective, the main challenge which faces all people interested in the broadcasting industry in Canada is the development of a good Canadian program production industry, which will produce quality programs that Canadians will want to watch. That is the challenge. We hope to develop policy to help the private sector and, of course, the public sector to continue along these lines.


NATIONAL DEFENCE
Hon. Allan B. McKinnon (Victoria):: Madam Speaker, my question is for the Minister of National Defence. Southam News in Washington reports that two months ago the U.S. navy's aircraft and evaluation division prepared a secret report on the F-18 A. The U.S. Navy's report stated, quite frankly, the following:
It is difficult to make a case on cost or effectiveness grounds for continuance of the F-18 program. To date, none of the expectations that were the basis for initiation and continuance of the program have been achieved.
Did the U.S. Secretary of Defence discuss this report with the Minister of National Defence during his visit to Ottawa in April?
May 28, 1981


Hon. J. Gilles Lamontagne (Minister of National Defence):: Madam Speaker, I should reassure the hon. member for Victoria that in my discussions with Mr. Weinberger, the Secretary of State for Defence, we talked about practically all matters and documents relating to the F-18. Again reassurance was given to me that there was no problem with this program.
I was in Norfolk the day before yesterday with the navy and Admiral Train, who is in charge of the North Atlantic operations for the United States navy. He expects the F-18 to be the best plane the navy will ever have when it takes delivery of it, which will be as soon as possible.


Allan Bruce McKinnon: Madam Speaker, I am pleased that Admiral Train did not refer to it as the best lemon they ever had, as the minister did.
The U.S. navy report suggested alternatives to the F-18A aircraft which are cheaper and more certain of military success. Also, the U.S. navy has asked "at least two manufacturers" for cost proposals on attack plane options. Has the Department of National Defence looked into the options available to Canada if the F-18 A program is discontinued?


Mr. Lamontagne:: Madam Speaker, we have not looked to any alternatives nor have any alternatives been given to the defence department. We do not see a need because the F-18 program is going on schedule, very successfully, and delivery in October, 1982, of the first F-18 to Canada has been guaranteed by the U.S. navy, by McDonnell Douglas, and by Mr. Weinberger on behalf of the U.S. government.


INDIAN AFFAIRS
Mr. Jim Manly (Cowichan-Malahat-The Islands):: Madam Speaker, my question is for the Minister of Indian Affairs and Northern Development. The minister knows that Eldorado Nuclear Limited proposes to construct a uranium refinery at Blind River, Ontario. A growing number of local people oppose this refinery because of the negative implications on human health, genetics, the environment, and the economy.
For the past three months organizations representing 9,000 Indian people have been asking the minister to help them in their opposition to this destructive project. Why has the minister done nothing more than acknowledge receipt of their letters? Why has he not helped these people make their case to the Atomic Energy Control Board?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, I am aware of the concern of some of the Indian people in that particular area. It is largely a question of available resources which will enable them to present their case better. However, they are still able to present it.
Oral Questions


James Douglas Manly: Madam Speaker, I am surprised at the complete inadequacy of that answer.


Erik Nielsen: Why?


Some hon. Members:: Oh, oh!


REQUEST FOR INTERVENTION BY MINISTER
James Douglas Manly: In February the minister promised that there would be a minimum amount, beginning with $1 million, to help Indian people across Canada make their case in terms of the environmental impact major resource projects have on them. So far none of that money has been made available to the people who will be affected by this project.
Will the minister provide funding for these people so they can have effective opposition to this project? Will the minister intervene with the Atomic Energy Control Board to prevent permission being given for this project?


John Carr Munro: Madam Speaker, the hon. member who serves on the standing committee is well aware of the increase in resources that we have been able to find to fund native organizations to help them present their cases, but there is a limit to the available money. We cannot satisfy the tremendous demand we have at the present time.


James Douglas Manly: Why don't you answer their letters?


John Carr Munro: The hon. member should be well aware of that. The hon. member's First question acknowledged that I had been answering their letters. Nevertheless I will review the situation.


FITNESS AND AMATEUR SPORT
Hon. Steven E. Paproski (Edmonton North):: Madam Speaker, my question is for the minister of fitness and amateur sport, or the Minister of Labour. I do not know what his title is now.


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: Would the minister advise this House why he has cut off a continuous contribution to the Western Canada Games? This is an ongoing contribution to help develop Olympic athletes.


Hon. Gerald Regan (Minister of Labour):: Madam Speaker, the department responsible for fitness and amateur sport on two previous occasions, in 1975 and 1979, gave some funding to the Western Canada Games even though they are not national but regional in scope. This was done to help them get started and make them successful. Probably the hon. member

May 28, 1981
Oral Questions
opposite may well have been minister at the time of the second contribution. I am not sure.


Steve Eugene Paproski: Yes, I was.


Gerald Augustine Regan: 1 am glad to hear that.
In any event, it is felt that the money which is available for fitness and amateur sport should be used on national programs, as is agreed between the provinces and the national government and for purposes that are traditionally followed, rather than for regional games. Mind you, if the hon. member opposite had not given away the lotteries to the provinces-


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Gerald Augustine Regan: -1 think we would have been able to do a great deal more if he had not done that.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Steve Eugene Paproski: Madam Speaker, that is worth a question of privilege, but I will not raise it this time.


Some hon. Members:: Oh, oh!


DISTRIBUTION OF FEDERAL FUNDS
Steve Eugene Paproski: Why does the minister not say that the government has never had as much money as it has now? Why does he not say the government is discriminating against western Canada because there are only two members of the Liberal party representing western Canada?


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Gerald Augustine Regan: Madam Speaker, I am surprised at the hon. member making any such suggestions at all. 1 think the hon. member has to agree that these games are regional in scope.


Charles Joseph Clark: It is the wrong region.


Gerald Augustine Regan: In relation to the question of discrimination, I am spending more of my time and effort on trying to help other people to bring the winter Olympics to Calgary than I am on anything else. That, I think, is a very important undertaking, and a national one in scope.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Walter David Baker: That may be the problem.


DEPARTMENT OF EMPLOYMENT AND IMMIGRATION
Mr. Benno Friesen (Surrey-White Rock-North Delta):: Madam Speaker, my question is for the Minister of Employment and Immigration. Recently the minister promoted, almost arbitrarily, the PM 1 immigration officers to the PM 2 level at four of our international airports. Is the minister aware of the whole range of new discrimination that he has brought into play by promoting people from the PM 1 level to the PM 2 level while overlooking the immigration officers at all the other ports of entry in Canada?


Lloyd Axworthy: Madam Speaker, if the hon. member recalls, we had an exchange on this particular topic in a discussion before Christmas when we looked at my estimates. I indicated to him at that time that we would be discussing these matters with the public service unions involved. Therefore the decisions taken concerning the elevation of certain officers at the busiest airports and reception centres across Canada was based upon that assessment of the actual volume with which they had to cope. Those were the discussions we had with the unions, and they are in agreement with the basic redrafting of the categories we now have implemented in the department. I think we have made sure that the criteria by which the innovation of the additional category was made were achieved in very close co-operation with the workers themselves.


DIFFERENCE IN TREATMENT OF SENIOR OFFICERS
Benno Friesen: The
minister ought to be aware that at the Port of Douglas, for example, another land-based port of entry which is a lot busier than Mirabel, the immigration officers have been excluded from any kind of promotion, even though they are senior officers. Meanwhile newcomers to the civil service are promoted immediately to PM 2. I wonder what the minister's defence is going to be if he has to appear before the Human Rights Commission or the Labour Relations Board?


Lloyd Axworthy: Madam Speaker, as I pointed out in my previous answer, this is a matter that is primarily of administrative discussion between unions representing the categories of the workers involved and the department itself. It is not a matter of human rights discrimination, but merely a matter of working out the relative sort of workloads dealing with different immigration and refugee categories that come into each of the points of reception. That was the judgment that was made based upon the objective criteria that were established.
May 28, 1981


CRIMINAL CODE
Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, I am glad to see the Minister of Justice back in the House as I should like to ask him a question. It is my understanding that there is to be legislation brought forward soon covering the matter of marijuana. I would ask the minister if he can tell us whether that legislation will distinguish in a statutory form between possession, importation, and trafficking, rather than leaving these matters to regulation, and will he also tell us when he plans to bring this matter before the House? Will it be before the summer?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, I replied to the committee yesterday that we are in the process of completing consultation with the attorneys general in Canada. When that process is completed we hope to introduce this legislation. I do not know whether we will have time to introduce it before the summer because, if the consultation is to be meaningful, we must try to include in the legislation the views of provincial attorneys general, but we want to introduce it as quickly as possible in order to clarify some of the matters that preoccupy the public.


MEDICAL REPORTS ON DANGERS OF MARIJUANA
Donald W. Munro: If it is
planned in the legislation to legalize marijuana-


An hon. Member:: No way.


Donald W. Munro: -I am wondering whether the minister and members behind him realize that this would be tantamount to changing the maple leaf in their emblem to a marijuana leaf.


Some hon. Members:: Oh, oh!


Donald W. Munro: My question to the minister is whether-


An hon. Member:: Go and have a smoke.


Some hon. Members:: Oh, oh!


An hon. Member:: Are you stoned?


Donald W. Munro: In developing the criteria for possession, importation and trafficking, and even the use of marijuana, will the recent medical reports which are now available and being distributed widely, be taken into account? They show that the use of marijuana is producing very serious effects on the children of those who are taking it, including hydrocephalus, damage to the bone marrow, and also very serious effects in the reproductive organs of males?


An hon. Member:: And you lose your hair.


Some hon. Members:: Oh, oh!
Oral Questions


Joseph Jacques Jean Chrétien: Madam Speaker, we have no intention of making the importation or utilization of marijuana legal. We want to change the form of the penalty and to modernize it. I do not think the hon. member is helping the situation at all by pretending that we will legalize marijuana. We have said so many times in this House, that this is not what we are about to do. We do think that once in a while we have to modernize laws which have been on the books for so long and do not cope with realities as they exist.


BANK ACT
Mr. Vic Althouse (Humboldt-Lake Centre):: Madam Speaker, my question is directed to the Minister of Finance. The Minister of Agriculture has been making important finance policy statements around the country regarding interest rates. Will the Minister of Finance please tell this House when we can expect revisions to the Bank Act which are designed to control interest rates, as promised by the Minister of Agriculture in a recent news report from Humboldt, Saskatchewan?


Allan Joseph MacEachen: Madam Speaker, I believe that matter was clarified last week in the House when the Minister of Agriculture acknowledged that he did not have in mind a revision to the Bank Act; nor do I.


FINANCE
Victor Fredrich (Vic) Althouse: Madam Speaker, I should also like to ask the Minister of Finance when he will be announcing the extension of the small business development bond past the termination date of December 31, and how soon can we expect the inclusion of unincorporated farms and small businesses in that program, again as promised by the Minister of Agriculture.


Allan Joseph MacEachen: Madam Speaker, no decisions have been reached on either of those points.


THE JUDICIARY
Hon. J. Robert Howie (York-Sunbury):: Madam Speaker, my question is for the Minister of Justice. Will he please advise the House whether a decision has yet been taken on

May 28, 1981
10014_____________________________
Oral Questions
filling the vacancies in the Supreme Court of New Brunswick, and if a decision has not been taken will he give very serious consideration to appointing a woman?
[ Translation]


Joseph Jacques Jean Chrétien: Madam Speaker, we have not yet taken a final decision concerning the appointment of judges to the New Brunswick Court of Appeal and Superior Court, but 1 will keep in mind the suggestion of the hon. member. Of course, we would be very happy if we could find a woman to fill one of those vacancies.


NATIONAL SECURITY
Hon. Allan Lawrence (Durham-Northumberland):: Madam Speaker, when the Solicitor General announced in this House that a review of the Taschereau papers by a retired civil servant was taking place, he indicated that he expected an answer and a report by May 1. He later said the government had received an interim report, but just yesterday the President of the Privy Council informed me that the government had received no report whatsoever. I wonder if the Solicitor General can clear up this contradiction?


Robert Phillip Kaplan: Madam Speaker, I have the interim report in my hand, so it certainly has come to us.


Allan Frederick Lawrence: Will you tell the President of the Privy Council?


Robert Phillip Kaplan: As I indicated publicly, the interim report suggests that the retired public servant doing the studies intends to get legal advice from law officers of the Crown on privacy questions and part IV of the Canadian Human Rights Act. When I mentioned the date of May 1 in the past it was to indicate that the initial term terminating May 1 had been given to the retired public servant because we were not certain how long the job would take. I did not indicate the job would actually be finished by that date. I can tell the House that it will be finished soon, and that the government will take a position on it soon.


SCOPE OF INQUIRY AND LOCATION OF CERTAIN DOCUMENTS
Allan Frederick Lawrence: Further to this 35-year-old delayed problem as far as access by the public is concerned, will the Solicitor General tell us if the review by Mr. Branscombe is also covering the personal notebooks of Mr. Gouzenko, the documents removed from the Russian Embassy, and also the details of the interdepartmental committee which reviewed the whole matter about 15 years ago as well, and also why are those documents being kept in
the archives of the RCMP rather than in the National Archives?


An hon. Member:: What did you do about it?


Allan Frederick Lawrence: Tried to get them released.


Robert Phillip Kaplan: Madam Speaker, Mr. Branscombe is initially looking at, and his terms of reference are limited to, the transcripts of the hearings. The hon. member is referring to some 601 exhibits that were also produced to the Kellock-Taschereau inquiry. It would certainly be a good idea to look at those documents as well, but it is a huge job. We are proceeding to do one thing at a time, first to review these transcripts in which members of the House have expressed the most interest. When that is completed and the government's decision is taken, it would be appropriate to consider looking at the files which are with the security service and in the custody of the RCMP, to review those, because they have not been reviewed in a systematic way, in order to determine what portions of those should be released and which should be retained.


TABLING OF REPORT RESPECTING BILINGUALISM POLICY
Madam Speaker:: I have the honour of tabling my report on the implementation of the special report of the Commissioner of Official Languages on the House of Commons, along with a document on the bilingualism policy which I have adopted for the House of Commons. One of those reports will be published in both languages, but the English translation of the special report of the Commissioner of Official Languages will be tabled later on this afternoon after the translation has been completed.
I should like to point out that if the House wants to refer it to one or other committee of the House of Commons, and perhaps to the Standing Committee on Management and Members' Services where I am authorized to appear, I will make it my duty and it will be a pleasure for me to appear, should that wish be expressed by the committee to which the report might eventually be referred.
Two reasons prevent me at this time from complying with the request of the Special Joint Committee on Official Languages if I want to respect the traditions of the House and follow them faithfully. First, only the annual reports of the Commissioner of Official Languages have been referred to a committee of the House. The special report which was commissioned by my predecessor has never been referred nor was it ever the subject of a full chapter in the annual reports, as was the case for the report of the Comptroller General on the
May 28, 1981

administration of the House of Commons. Therefore, the difference there is absolutely essential. Second, it was easier for me to appear before the Standing Committee on Public Accounts on which only members of this House sit. The presence of senators prevented me from appearing before the committee.
Therefore, should a reference to that effect be made to a committee of the House, I will be able, as it is my wish, to keep hon. members posted on the progress of bilingualism in the House of Commons and respect the principle of the transparency of administrations, which I consider very important.


WESTERN CANADA GAMES-STATEMENT BY MR. REGAN ON FUNDING
Steve Eugene Paproski: Madam Speaker, I rise on a point of order which has to do with the statement of the Minister of Labour (Mr. Regan) on the funding of the Western Canada Gapies. He misled the House when he said that $85 million could have been accumulated from Loto Canada. I would like to say that $30 million in the hand is better than a ghost in a bush.


Madam Speaker:: The hon. member knows that that is not a point of order; that is entering into debate.


BUSINESS OF THE HOUSE
Walter David Baker: Madam Speaker, could I ask the government House leader about his intentions with respect to government business for the balance of this week and into next week?
Perhaps while he is on his feet he might do what he could to designate as many allotted days as possible.


Mr. Pinard:: Madam Speaker, as usual, we will be very generous with allotted days, to the tune of two days a week. For next week I will designate Monday and Wednesday as the two allotted days.
[ Translation]
Tomorrow, we shall try to complete second reading of Bill C-61 on young offenders, or rather to vote on the amendment. We have agreed that if we reached that stage, the vote will be deferred until Tuesday. Afterwards, tomorrow, we shall try also to complete second reading of Bill C-58 to amend the Canada Elections Act.
Business of the House
As for next week, I have already indicated that Monday and Wednesday would be opposition days, and as for Tuesday and Thursday, we shall continue the report stage of Bill C-57 to amend the Excise Act, and I hope that we can also dispose of the third reading of that bill.


Walter David Baker: Madam Speaker, I want to bring a matter which is of concern to the House to the attention of the government. It has to do with the position in which we find ourselves under the Representation Act. When I was president of the privy council, I placed the appropriate reference on the order paper dealing with the representation in the House and, indeed, the question of the number of members of Parliament there ought to be in this House.
This arises because of an estimate given by the Chief Electoral Officer that, if nothing is done by Parliament and the matter is just allowed to lie, this House will expand in membership from 282 members now to a new high of 312 members after the next census. That would have an impact on cost. As the government House leader must know, the raw cost is about $170,000 per extra member, not counting support staff, buildings, housing, furniture and a host of other things. I wonder what the intention of the government is with respect to this.
If the government does nothing, then as my hon. friend knows the natural course of events will take place. The membership in the House will grow and grow, and the problem of the 1974 Parliament, which was denied then, will be passed on to a further Parliament. I want to ask my hon. friend whether it is his intention to present a discussion paper to the cabinet dealing with the size of the House of Commons. This is a matter of House business because it affects all of us. Could the government House leader answer that question?
Second, is the government House leader prepared, following that, to make the appropriate references of this matter to the Standing Committee on Privileges and Elections so that the House of Commons itself can get into this matter, which is important with respect both to the work of members and, indeed, to the way in which this place operates? I think it would be wrong-indeed morally wrong-if this matter were allowed to lie fallow, if nothing were done and if the normal events took their course.


Yvon Pinard: Madam Speaker, the issue raised by my learned colleague is very important, and it is a fact that according to available statistics, if the new electoral boundaries were applied under the present legislation at the next federal election, there could be up to thirty additional members in this House. However, it is far from sure that these new boundaries will be in effect at the next general election because, as my colleague is aware, under the present mechanisms, which are based on Section 51 of the Canadian Constitution and the various provisions of the Electoral

May 28, 1981
Business of the House
Boundaries Act, we could wait for as long as over three years before these final boundaries are in effect.
Let me simply remind him that the June 3 census will have to be completed within a year and that following the report of the Chief Statistician of Canada, it could take more than a year and a half before the various commissions set up for each province submit their report. In addition, they are entitled to a six-month extension. Ultimately, after the reports of the various commissions have been received my learned colleague is well aware that the new boundaries can be implemented only if Parliament is dissolved more than a year later.
All of this means that, for all practical purposes, we may have to wait between two and a half and three and a half years as of today before facing the possibility of 30 additional members or implementing the new boundaries. As for the next election, nothing is certain. No one cay say definitely that, under the present provisions of the Constitution, there will surely be 30 additional members after the next election. This remains uncertain. However, 1 am not suggesting that we refuse to deal with this matter. It concerns electoral reform in general. The Speech from the Throne mentioned that a parliamentary committee will have to be set up to consider electoral reform in general. This includes proportional representation, but the general theme will be electoral reform. I feel that since this would lead ultimately to an amendment to Section 51 of the Constitution, it would be sensible and wise to wait for a few weeks before making any change that might involve amendments to the Constitution.


Walter David Baker: Madam Speaker, the government House leader has lumped this in with electoral reform as he has seen fit. Unfortunately, he has not answered my question. The problem is upon us now and can be dealt with by the government House leader or neglected, whichever the government chooses. Is the government House leader preparing a discussion paper on the question of the size of the House of Commons? I am not talking about electoral reform or proportional representation but the size of the House of Commons. That matter is now upon us because of the peculiarity of events following the fall of my government and the beginning of the government which he leads in this House.
That is the question and I hope the answer is in the affirmative so that Parliament can deal with it. If he is not contemplating it now, would he undertake to the House to do so and advise immediately or within the next day, perhaps next week, as to his intentions? This question affects every one of us. The size of the House of Commons is important to all Canadians and how this institution works and ought not to be decided by neglect.


Yvon Pinard: Madam Speaker, I thought I had established a very clear link between the size of this House and electoral reform and amendments to the Constitution. However, if my
hon. colleague wants an answer now, it is not my intention now to prepare that discussion paper.
I will give him an answer to the second question he asked in his intervention, which was: Will I agree to make a reference to the Standing Committee on Privileges and Elections? The answer at this time is no, but I am not saying that in a few weeks the answer will be the same. All I am telling him is that we had better wait and see what happens with the Constitution. When we deal with electoral reform and changes affecting the size of this House, and that is linked to changes in the Constitution, then we will be in a better position to talk about any discussion paper and reference to committee.


Mr. Knowles:: Madam Speaker, the hon. member for Nepean-Carleton has raised an important issue to which we shall have to address ourselves in the not too distant future, but I think perhaps at the moment the best thing for us to do is to continue the discussions we have been having about this matter at House leaders' meetings. I am hopeful we can have discussions in addition to those we have already had and come to some understanding as to what might be done.
I join with the government House leader in suggesting that since this does involve an amendment to the Constitution it might make sense to wait a while to see whether it is to be done under section 91(1) of the British North America Act, as we did last time, or whether we do it some other way.
This being the time when we ask about future House business, Madam Speaker, may I remind the government House leader that his colleague, the Acting Minister of Veterans Affairs, just left his place in the House to go over to the West Block where we will be having a meeting this afternoon of the Standing Committee on Veterans Affairs. I may say to the government House leader that the Acting Minister of Veterans Affairs would have a much easier afternoon if we could be told now that within in a week or so a bill would be introduced amending last summer's Bill C-40, particularly with respect to widows who were left out of that legislation by virtue of an unfair phasing-in provision. I wonder if he can give us an answer to that question.
While I am on my feet, may I make a suggestion, not a worldshaking one but one which would save the printing of two pages every day in the House of Commons Order Paper. When you multiply that by the number of copies issued and the number of days we might yet sit, we might save a fair number of dollars. 1 refer to the fact that government order No. 41 is still on the Order Paper. It has no value because its provisions have been superseded by the House order passed unanimously on April 8 having to do with the debate on the Constitution. I realize that because this order was put under the provisions of Standing Order 21(2), it cannot be withdrawn by the Chair or the Table but only by unanimous consent of the House. We could in that way have that two page order withdrawn from the Order Paper and I suggest that the government House leader ask for consent that it be done.


Yvon Pinard: On the first question, Madam Speaker, I do not know what kind of afternoon the Acting Minister of Veterans
May 28, 1981

Affairs will have but I am certain that he is not in a position today to confirm that the bill referred to by the hon. member will be introduced within the week. All I can say to the hon. member is that there is good reason to be optimistic, but I cannot say that this bill will be introduced within a week or two.


Stanley Howard Knowles: Some time in June?


Yvon Pinard: Let us hope so. In so far as the second question is concerned, he suggests to me that I ask for unanimous consent to withdraw motion 41 from the Order Paper. I am very willing to do that at this time if such consent exists. I thought we had settled that matter in a House leaders' meeting at the time we made our agreement and it was by inadvertence that it was left on the Order Paper. We on this side have no objection to motion 41 being withdrawn from the Order Paper.


Stanley Howard Knowles: Since there does seem to be agreement among the House leaders that order No. 41 be withdrawn from the Order Paper, can we not have the question as to whether there is such consent?


Walter David Baker: Madam Speaker, that is the famous Pinard motion. I would be delighted to consent and I hope we never see its like again.


Yvon Pinard: Well, in view of the remark made by my hon. colleague, I think I said very clearly that we agreed at the time to withdraw it because it led to a very famous settlement. So taking that into consideration we certainly agree.


Madam Speaker:: Is it agreed to withdraw motion No. 41 ?


Some hon. Members:: Agreed.


Madam Speaker:: Agreed and so ordered.


PRIVILEGE
Mr. Stanley Hudecki (Hamilton West):: Madam Speaker, on May 26 in this House the hon. member for Western Arctic (Mr. Nickerson) made some remarks concerning alleged partisan behaviour on the part of the Minister of Indian Affairs and Northern Development (Mr. Munro). In making these remarks the hon. member made a number of alarming statements to which I find it necessary to refer at this time. He said:
I do not want to see Hamilton-style politics pollute the north.
Then he went on to say:
We do not want the extension of Hamilton-style politics in the north.
State Immunity Act
And then he said:
We in the Northwest Territories or the Yukon do not want association with the alleged, rather unsavoury elements of society that I am led to believe is the case in Hamilton.
I submit there are a number of areas of privilege involved here. The hon. member, in making these unwarranted remarks, has impaired my ability and that of Hamilton area MPs to do their job as members of Parliament. Due to his uncalled for and irresponsible statements, members representing the various Hamilton constituencies must now answer to their electorate to set the record straight and-


Madam Speaker:: Order, please. The hon. member will have to find other opportunities to set the record straight. The hon. member for Hamilton West (Mr. Hudecki) will remember that I disallowed the question of privilege raised by the hon. member for Western Arctic (Mr. Nickerson), and therefore that means that the hon. member cannot comment on that question. It has been disallowed as a question of privilege and therefore any divergence of views as to what was said in the course of that question of privilege cannot be discussed further on a question of privilege. So I have to tell him that he does not have a question of privilege.



ROUTINE PROCEEDINGS


Mr. Irene Pelletier (Sherbrooke):: Madam Speaker, I have the honour of tabling the third and fourth reports of the Standing Committee on Regional Development. If it please the House, I now move that the third report be concurred in.
[Editor's Note: For text of above reports, see today's Votes and Proceedings.]


STATE IMMUNITY ACT
Yvon Pinard: moved that Bill S-19, An Act to provide for State Immunity in Canadian Courts, be read the first time.
Motion agreed to and bill read the first time.

May 28, 1981
Order Paper Questions


REGIONAL DEVELOPMENT
Irénée Pelletier: Madam Speaker, if the House gives its consent, I move, seconded by the hon. member for Parry Sound-Muskoka (Mr. Darling), that the third report of the Standing Committee on Regional Development presented earlier this day be concurred in, without debate.


[Stage Direction]
Motion agreed to.

[ Translation]

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. D. M. Collenette (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 158, 1,710, 1,938, 2,020, 2,384 and 2,531.


Mr. Cossitt: What is a list of all Canada Council grants awarded during the fiscal year 1979-80 and, in each case, what (a) is the name and address of the (i) applicant (ii) recipient (b) was the amount of the grant (c) is the exact purpose in which the moneys will be used including any specific names or description given to each project?


Mr. Peter Stollery (Parliamentary Secretary to Secretary of State and Minister of Communications):: I am informed by the Canada Council as follows: "On the date this question was asked, a complete list of all Canada Council grants awarded during the fiscal year 1979-80 had not been compiled, printed, or laid before Parliament. This information has now been printed, however, in the 85-page Supplement to the Council's 23rd Annual Report, 1979-80, tabled in the House of Commons on February 5, 1981".


Mr. Wenman: 1.	Did the Minister responsible for Canada Mortgage and Housing Corporation announce on June 17, 1980, that 5,000 additional units would be made available to the non-profit and co-operative housing sector and, if so (a) how many will be allocated to British Columbia and where will they be located (b) what percentage of the total cost will be spent in British Columbia?
2.	What are the government's plans for future increases in housing made available to the non-profit and co-operative housing sector?


Hon. Paul J. Cosgrove (Minister of Public Works):: I am
advised by Canada Mortgage and Housing Corporation as follows:
1.	On June 17, 1980, federal housing Minister Paul Cosgrove announced that he had authorized CMHC to commit an
additional 5,000 dwelling units under the National Housing Act social housing programs. All of the units were to be made available under the non-profit and co-operative housing programs for new construction in areas where the vacancy rates were very low.
(a)	1,569 additional units were allocated to British Columbia as follows:
Vancouver	892
Victoria	57
Cranbrook	102
Kamloops	20
Kelowna	101
Prince George	152
Other tight markets	245
	1,569
(b)	This represents approximately 31 per cent of the additional allocation of units available across Canada.
It should be noted that in December, 1980, the Vancouver area received an additional 800 social housing units. These units were shifted from other areas not requiring their entire allocation.
2.	CMHC's forecast for the social housing programs, which include public housing, rent supplement, co-operative and non-profit housing, and housing aimed specifically at rural and native people, calls for the subsidization of 25,000 units per year. The approval of 5,000 additional units in 1980 was a special action taken in recognition of particularly tight market conditions in certain areas.


Mr. Lewis: 1.	Is there a Correctional Services Canada program in which inmates produce gymnastic equipment and, if so, what types of equipment are produced?
2.	What organizations and groups have purchased such equipment in (a) 1976 (b) 1977 (c) 1978 (d) 1979 (e) 1980?
3.	What was the dollar value of such equipment sold to (a) departments and agencies (b) public organizations and groups in (i) 1976 (ii) 1977 (iii) 1978 (iv) 1979 (v) 1980?
4.	What was the dollar value of gymnastic equipment purchased by Correctional Services Canada in (a) 1976 (b) 1977 (c) 1978 (d) 1979 (e) 1980?
5.	What is the policy of Correctional Services Canada in establishing prices for the gym equipment produced by the inmates?
6.	Are there current plans to further expand the program in any way?


Robert Phillip Kaplan: 1.	Yes, the Correctional Service of Canada's CORCAN Industries trains federal inmates in job skills comparable in nature and pace to those found in industry, thus increasing inmates' changes of successfully relocating themselves when they are released. The types of gymnastic equipment produced are balance beams, seating and balancing benches, agility boxes, vaulting boxes, Canadian foldaway climbers and agility stands.
2.	(a), (b), (c), (d) and (e) School boards and universities.
May 28, 1981

3.	(a), (b), (i), (ii), (iii), (iv) and (v) Figures on gymnastic equipment sales alone are not available as they are recorded under recreational equipment.
4.	(a), (b), (c), (d) and (e) This information is not available as it is recorded under recreational supplies which includes: gymnastic equipment, playground equipment and miscellaneous equipment such as ping pong and baseball.
5.	CORCAN prices are set in order to be equivalent to the private sector market prices for similar products sold at similar volumes.
6.	No.


Mr. Manly: 1.	Did representatives of the indigenous people participate in all phases of the staffing process in 1979 and in 1980, as outlined in memo number 79-7, from the Public Service Commission, dated June 21, 1979, stating the goal of the Commission was to increase participation of Indian, Metis, non-status Indian, and Inuit people in the Public Service of Canada, on the national level and in each of the different regions and, if so, on how many occasions?
2.	How many indigenous people applied, were interviewed, and were hired by the Public Service as a result of the policy announced on June 21, 1979, on the national level and in the different regions?
3.	What was the number of indigenous people employed in the Public Service in (a) 1975 (b) 1976 (c) 1977 (d) 1978 (e) 1979 (0 1980, on the national level and in the different regions?
4.	What is the total number of positions in the Public Service that qualify for the staffing procedures outlined in the June 21, 1979, memo, on the national level and in the different regions?
Mr. Peter Stollery (Parliamentary Secretary to Secretary of State and Minister of Communications: I am informed by the Public Service Commission as follows:
1.	Staffing bulletin 79-7, which outlines the Public Service Commission policy on the representation of indigenous associations in selection processes, states that representatives of indigenous people shall be invited to participate in staffing processes to fill vacancies, where the jobs to be filled possess "native content". The intent of this policy is considered to have been respected if the invitation to participate is extended, whether accepted or declined. Departments which have established client/department relationships invite representatives directly, without consulting the Public Service Commission and the Public Service Commission does not maintain specific data on the application of the policy. However, as with all direction by bulletin, the Public Service Commission monitors the policy's application, through the audit of staffing action samples, on a regular basis.
Some difficulty has been encountered in relations to departmental identification of native impact or content positions, required under Public Service Commission bulletin 79-7 and Treasury Board Secretariat Personnel Management Manual Chapter 115-21 (Personnel Management Policy Process). While some progress has been made implementation has not proceeded as quickly as the Public Service Commission and Treasury Board Secretariat would have anticipated, resulting in difficulties in assessing the effectiveness of the policy.
Order Paper Questions
2.	There exists no reliable data base to determine accurately the number of native people who have applied for jobs during the period in question. As recorded in the 1979 Public Service Commission Annual Report, 262 native people were appointed from Public Service Commission inventories. Public Service Commission regional offices are presently in the process of reporting statistics on personal data gathered on a voluntary basis for the period ending December 31, 1980, which will result in more accurate data being available in the future.
3.	For the years 1975 to 1978, there is no statistically valid record of figures on indigenous people employed in the Public Service. The records indicate that 2,674 indigenous people were employed in 1979; 1980 figures are not, as yet available. A regional breakdown is not available.
4.	The total number of positions in the Public Service that qualify for the staffing procedures outlined in the June 21, 1979, bulletin is not available as the task of identifying these positions is still in progress.


Mr. Knowles: 1.	What was the estimated amount of (a) employee and employer contributions that were made to employer pension plans (b) contributions that were made to Registered Retirement Savings Plans in Canada in each of the past five years for which data is available?
2.	For the same years, what was the estimated amount of (a) federal tax expenditures (b) provincial tax expenditures that occurred because of the tax laws which exempt contributions to employer pension plans and Registered Retirement Savings Plans and the earnings of the plans from personal and corporation income taxes?


Hon. Pierre Bussieres (Minister of State (Finance)):: 1.	Contributions to Registered Pension Plans ($ millions)
Year	1974	1975	1976	1977	1978Employees	1270.0	1549.6	1918.0	2141.0	2358.0Employers	2375.0	3008.8	3664.0	4074.2	4480.0
Source: Statistics Canada, 74-401, Pension Plans in Canada, 1978. The amounts for the years 1974, 1976, and 1978 are estimates.
Contributions to Registered Retirement Savings Plans ($ millions)
Year	1974	1975	1976	1977	1978Employees	1243.7	1524.3	2115.5	2368.9	2675.4
Source: Revenue Canada Taxation, Taxation Statistics for various years.
2.	Tax Expenditures for Contributions to Registered Pension Plans and Registered Retirement Savings Plans ($ millions)
Year	1974	1975	1976	1977	1978Federal	1100	1230	1400	1400	1725Provincial	330	360	400	580	740Source: Department of Finance	estimates.	
10020

May 28, 1981
Order Paper Questions
(1)	The amounts indicated differ in some cases from those published in the Tax Expenditure Account due to new data.
(2)	The tax expenditure amounts for 1977 and 1978 are based on the revised federal-provincial fiscal arrangements.
(3)	The provincial tax expenditures exclude those in respect of the Quebec income tax.


Mr. McKinnon: Does the office of the Commissioner of Official Languages distribute the kit and game "Explorations" and, if so, what is the (a) cost of mailing from the point of origin to Victoria, British Columbia (b) unit cost of production (c) purpose of the distribution to some Canadians?


David Michael Collenette: The Commissioner of Official Languages reports directly to Parliament and not through a minister. Questions can be put directly to him.


David Michael Collenette: Madam Speaker, if question No. 1,682 could be made an order for return, this return would be tabled immediately?


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered. Is it the pleasure of the House that question No. 1,682 be deemed to have been made an order for return?


Some hon. Members:: Agreed.


Mr. Herbert: With reference to the answer to question No. 3,693 of the First Session of the 30th Parliament, what government grants have been made to Canadian universities since the preparation of the answer?
Return tabled.


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


Madam Speaker:: Shall the other questions stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed, from Tuesday, May 26, consideration of Bill C-57, to amend the Excise Tax Act and the Excise Act and to provide for a revenue tax in respect of petroleum and gas, as reported (with amendments) from the Standing Committee on Finance, Trade and Economic Affairs, and motions Nos. 1 and 3 (Mr. Blenkarn).
Madam Speaker:: Before recognizing the hon. member for Pembina (Mr. Elzinga), I would like to read a suggestion from the Chair about the grouping of certain amendments to Bill C-57.
I indicated to hon. members last Tuesday the groupings to be followed in relation to the first 44 motions standing on the notice paper to be proposed at the report stage of Bill C-57. I have since had an opportunity to study the remaining motions, including the three new motions standing in the name of the ministers and I find that the motions affect certain of the previous groupings. For these reasons, and for the benefit of hon. members, 1 would like to indicate to the House which motions are affected. These motions are numbered 6, 7, 8, 13, 58, 11 and 12 as previously grouped.
The new grouping for these motions is as follows. Motions Nos. 6, 7, 8, 11, 12, 13, 56, 57, 58 and 59, all of which are in relation to the indexing provisions of the bill, could be grouped for debate and, if necessary, voted on in the following manner:
(a)	Question will be put on motion No. 6 and, if in the affirmative, this will dispose of motions Nos. 7 and 8. If in the negative, the question will be put on motion No. 7. An affirmative vote on motion No. 7 disposes of motion No. 8 and, a negative vote on the motion, that is No. 7, requires the question to be put on motion No. 8.
(b)	Question will be put on motion No. 11 and, an affirmative vote on this motion disposes of motions Nos. 12 and 13. A negative vote on motion No. 11 disposes of motion No. 12, with the question having to be put on motion No. 13.
(c)	Question will be put on motion No. 56 and, if in the affirmative, this will dispose of motions Nos. 57, 58 and 59. A negative vote on motion No. 56 disposes of motions Nos. 57 and 59, with the question having to be put on motion No. 58.
It is at this point I would like to bring to the attention of hon. members that my statement of last Tuesday is valid in relation to motions Nos. 1 and 3 now before the House, motion No. 2, motions Nos. 4 and 5, motions Nos. 9 and 34, motion No. 10, motions Nos. 14 to 26, motions Nos. 27 and 28, motions Nos. 29, 30, 31, 32, 33 and 35, motions Nos. 36, 37, 38, 39, 40, 41, 42, and 43 and motion No. 44.
The grouping of the motions not yet dealt with by the Chair is as follows: Motions Nos. 45 to 54 could be grouped for debate and voted on as follows:
May 28, 1981

(a)	Question will be put on motions Nos. 45, 46, 48, 49 and 54 separately.
(b)	Question will be put on motion No. 47 and, if in the affirmative, will necessitate the question being put on motion No. 53. However, a negative vote on the motion obviates the question having to be put on motion No. 53.
(c)	Question will be put on motion No. 50 and, if in the affirmative, disposes of motions Nos. 51 and 52. If in the negative, it obviates question having to be put on motion No. 51 but the question will have to be put on motion No. 52.
Motion No. 55 will be debated separately and voted on separately. Motions No. 60 to 135 inclusive have the same effect, that is, to strike part IV from the bill. It is my intention to group all of these motions for debate, with one vote disposing of the motions. Possibly, when these motions are reached, the Chair could propose for consideration by the House one question in the name of the hon. member for Etobicoke Centre (Mr. Wilson), seconded by the hon. member for Vancouver-Kingsway (Mr. Waddell), that part IV of the bill, being clauses 78 to 117 inclusive, be deleted. I make this suggestion in order that hon. members may consider it during the interval between now and the time when we reach for consideration motions Nos. 60 to 135.
Hon. members, I am sure, are aware that this is a rather complex bill, that the Chair has spent a considerable amount of time considering the record 135 report stage motions, and I can only hope that I have been fair in my analyses and grouping of such motions. I would like to reiterate what I stated to the House last Tuesday, that the Chair would welcome any suggestions hon. members may have in order to facilitate consideration of the bill. In the meantime, I have placed with the officers at the table a concise outline of the groupings and the voting procedures, should hon. members wish to avail themselves of these papers.


Peter Elzinga: Madam Speaker, in dealing with Bill C-57, the tax legislation presently before us, we find that the bill has in excess of 100 pages. As well, we notice in looking at the Order Paper that there are approximately 135 amendments proposed to the actual legislation. It is an extremely complicated piece of legislation.
Last Tuesday we heard from our chief spokesman on this legislation, the hon. member for Edmonton West (Mr. Lambert). In reality, there is really nothing more to be said because he did an excellent job in covering all the issues which pertain to the legislation itself. I pay tribute to the hon. member for Edmonton West. I have had the privilege of serving with him in the House for some seven years. In fact, he has served in the chamber for close to 25 years. When 1 first came to the chamber, I used to go to this hon. member for counselling when I had questions concerning parliamentary procedure. In addition, the contribution of this man in his almost 25 years of service is outstanding.


Some hon. Members:: Hear, hear!
Excise Tax


Peter Elzinga: It is excelled only by his dedication to his constituents. We deeply appreciate his expertise in matters pertaining to the bill presently before us. I would like publicly to extend my thanks to this fine gentleman for the association which we have.


Some hon. Members:: Hear, hear!


Peter Elzinga: In dealing with Bill C-57, which is a result of the finance minister's budget, we find that a number of energy matters pertain directly to the National Energy Program and a number of tax items which are included in this legislation. The tax items in the legislation affect the farming population with respect to the sales tax exemption for equipment. Included in the legislation is a tax exemption for equipment used by school boards and universities. There are restrictions on sales tax exemptions on equipment used by fishermen. There are also tax measures pertaining to advertising flyers, a subject about which I wish to speak.
As I am sure a good many hon. members are aware, the publisher of the Edmonton Journal appeared before the Standing Committee on Finance, Trade and Economic Affairs when this bill was before it to express his reservations on matters pertaining to this issue. There will be a number of newspapers adversely affected by this measure. I am sure the negative impact will be much greater on small weekly papers than it will be on large dailies. Mr. O'Callaghan, the publisher of the Edmonton Journal, expressed his views and concerns with respect to this issue when he appeared before the committee. I am hopeful that the ministers who are responsible for this legislation, and hon. members opposite, will pay heed to Mr. O'Callaghan's contribution. In my opinion he is one of Canada's finest publishers. He has spoken loudly and fought for justice and liberty for a free press and for equality for all. Regrettably, members opposite have far too often attempted to muzzle our free and democratic press.
I would like briefly to touch upon some of the energy issues which are in this legislation. Our party's critic, the hon. member for Etobicoke Centre (Mr. Wilson), touched upon some of the issues when he spoke on Tuesday. I would like to reiterate some of the concerns expressed by him at that time since there are measures in this legislation which have proved to be the most damaging elements of the National Energy Program. The tax measures contained in this legislation will have an extremely detrimental effect on the oil and gas industry, one of the few growth industries in Canada at the present time.
I would like to cite some figures to you, Mr. Speaker. Drilling activity in Canada this year as compared with last is down by over 50 per cent. The sales potential of petroleum properties is down 70 per cent this year as compared with last. The number of drilling rigs which have left our country number some 139. These figures prove with great clarity that the National Energy Program is having a detrimental effect on self-sufficiency as far as oil is concerned. We have a number of

May 28, 1981
Excise Tax
proposed amendments on the Order Paper which would effectively eliminate this unfair taxation.
It is interesting to note, too, what Alberta Gas Co-ops Ltd. had to say when representatives of their organization appeared before the committee. I would like to quote a portion of their presentation since it illustrates not only the detrimental effect this legislation will have on our national resource sector but the detrimental effect it will have on our entire economy. The brief states in part:
On behalf of our members, and for the benefit of all Canadians who are, or will, use natural gas or natural gas byproducts as a source of energy, we protest the imposition of the recently announced natural gas excise tax.
This excise tax will have particularly harsh effects on those with low or fixed incomes, unskilled wage earners, elderly pensioners, and farmers who have only limited opportunity to recover this additional cost.
So, as illustrated by Alberta Gas Co-ops Ltd., we see that these measures will have a detrimental effect on low wage earners, yet we find the government imposing greater taxation in this area while not offering any kind of assistance to those individuals in lower income brackets. In our budget we offered the energy tax credit to those individuals earning under $22,000. This tax is a punitive tax in regard to the natural resources of our country. As a matter of fact, in so far as the Alberta Court of Appeal is concerned, with respect to revenues on natural gas it has ruled that this tax contravenes the British North America Act. I do not wish to usurp the role of the courts but I do concur in its view and indicate my agreement with the position it has taken.
With the imposition of taxation measures such as the ones I am dealing with, I am surprised that the government has not seen fit to implement taxation measures on other resources, such as gold, uranium or hydro power which are found in the other provinces of Canada.
Just as Alberta Gas Co-ops Ltd. indicated the detrimental effects of the excise tax on natural gas, the Alberta chamber of commerce also illustrated the loss of jobs which will occur all across Canada because of the National Energy Program.
Yesterday in the debate on the National Energy Program the hon. member for Assiniboia (Mr. Gustafson) did an excellent job in describing the loss of jobs which is presently taking place in Canada because of the slowdown and stagnation of the development of our resources resulting from the National Energy Program. On many occasions we have received presentations from house builders associations and from individuals indirectly associated with the development of our resources which have illustrated how jobs are being lost in their small companies. I find that rather ironic when one looks at the record. During the last election campaign members opposite criticized us for advocating an 18-cent excise tax. They indicated gasoline prices would not reach those levels.
Let us take a look at the record, as illustrated in an editorial printed in the Edmonton Journal on March 5, 1981. The article outlines the series of price increases on a gallon of gasoline which total some 41.5 cents as compared to our 18 cents.


Some hon. Members:: Shame!


Peter Elzinga: Members opposite indicated that their gasoline prices would be lower than ours. I would like to show you, Mr. Speaker, where these price increases actually took place. On November 1, 1980 there was a refinery tax imposed of some 2.5 cents. On January 1, 1981 there was another refinery tax imposed of some 8 cents. On March 1, 1981 the first wellhead price increase added some 3 cents to the price of a gallon of gasoline. On March 3, because of the extra cost of imports, 2 cents was added on to the price. And thanks to Ottawa's National Energy Program an additional 18 cents was added to the price, which was equal to the 18-cent excise tax we advocated. There is more. The Canadian ownership levy added another 8 cents to the cost of gasoline. These figures are only up to March 5, 1981. Since then the price has risen in excess of the 41.5 cents per gallon increase.
When you look at the over-all record of this government as it pertains to taxation, you find that it is very discouraging to private individuals in Canada especially when you take account specifically of the indexation proposals with respect to alcohol and tobacco.
The reason Mr. Stanfield, as the leader of our party, advocated the indexation of personal income tax was so we could help the taxpayer and alleviate the enormous increases in his own taxation rates as a result of inflation. This government is reversing that role. It is making inflation work to the benefit of itself now, because every time the price of alcohol and liquor goes up, increased revenues are going to go to the Department of National Revenue. I find that very disturbing because what it does is effectively remove parliamentary control over taxation policy.
If we view the shifts as far as they pertain to alcoholic beverages, we find that the government's taxation policies have encouraged more consumption of hard alcoholic beverages or hard liquor as compared to beer and wine. The taxation level is heavier on our beer. As my colleagues the hon. member for Bow River (Mr. Taylor) and the hon. member for Surrey-White Rock-North Delta (Mr. Friesen) have indicated, beer is the working man's drink. This, effectively, is another taxation policy, and it is being perpetrated upon the working-class Canadian by our friends opposite.


An hon. Member:: No friends of ours!


An hon. Member:: The Tories are out for beer.


Peter Elzinga: It does not affect me any more because I am an abstainer. I feel the working-class individual in Canada deserves a break because he contributes so much to the welfare of our country.
When dealing with a measure which affects taxation, I think it is appropriate for one to examine the results of the policies of the Liberal party opposite. Let us look at the government's record for a moment and examine spending. We are all aware in this chamber that government spending has reached
May 28, 1981

astronomical levels. There is no control whatsoever on government spending.
If we look at the budgetary deficits which have been brought forward by hon. members opposite, they have increased on a yearly basis enormously. We have record-high unemployment levels in this nation. We have record-high taxation. We have record-high inflation. We have record-high interest rates, and our dollar is again at one of the lowest levels we have experienced in Canadian history.
This is surely not a record to be proud of, and I hope that hon. members opposite truly attempt to do something. On a daily basis in the House, they indicate to us that inflation is their number one priority. Well, the Canadian people do not take them seriously. President Reagan has indicated the same thing in the United States; but the United States' population realizes that he is serious in his intention to bring down the inflation rate. However, the Canadian population knows that the inflation policies of our friends opposite are a farce. The sad part of the inflationary trend is that it hurts and destroys those on fixed incomes.
I am hopeful that this government will take some measures to alleviate some of the difficulties that our pensioners, our single families, our small business sector and our farming population face. That is why we have made a number of specific proposals to the minister, such as the extension of the small business development bond to the small farming operation which conducts an unincorporated business. One would think they would be ready to act, because if we look at the record we find that there is scarcely a political problem which we are facing as a nation, which does not have the fingerprints of the Prime Minister (Mr. Trudeau) all over it. I hope they see the folly of their ways as far as government spending, taxation and high interest rates are concerned, and take measures and implement programs to alleviate some of the difficulties which the Canadian population is facing.


Mr. Ian Waddell (Vancouver-Kingsway):: Mr. Speaker, I am pleased to be able to take part in the debate on this very important bill, especially the provisions relating to petroleum. I call them the petroleum elements of the bill, and I would like to say a few words about them.
There are two petroleum elements. The first one is the 8 per cent PGRT, which is the petroleum and gas revenue tax, and it is a very important and controversial provision of this bill. It is so important that to a limited extent the negotiations with Alberta, Saskatchewan and British Columbia on the new oil pricing agreement, which this country badly needs, are being held up just because of this particular tax. Canadians are probably a bit mystified why that would happen and what is involved. I hope to say a little bit about that in my speech.
Just to set the matter in some sort of context, we are talking about a pile of money which is being sliced up between the federal government and the provinces. We are talking about $100 billion. That is what is involved, not only the 8 per cent wellhead tax but the whole split in revenue between the provinces and the federal government. That is why there is
Excise Tax
such a crucial dispute in this country. That is the first element I want to speak to on the bill, the 8 per cent wellhead tax. We call it the wellhead tax, the tax at the wellhead. The federal government hopes to raise some revenue by this provision in the bill. The provinces are up in arms about this and I will tell the House why in a moment.
The second petroleum element of this bill is the excise tax on natural gas, and I want to say something about that. It is very important that I do so because very little has been said in the House about that particular tax. It is very important that a member of Parliament from British Columbia, as I am, say something about that tax because it has a tremendous effect on the people of the province of British Columbia. We British Columbians know that if it has an effect on us, then it has an effect on Canadians generally. I want to come back and speak about that tax, to tell Your Honour how it has an effect and what should happen to these taxes.
Let me start with the 8 per cent wellhead tax. As I have said, it is simply a means for the federal government to get more revenue and more dollars. I do not think that we on this side of the House in the New Democratic Party dispute the fact that the Government of Canada needs money to carry on. It does not spend it very well. It throws it away by spending $2 billion a year for jet planes that do not work and money for ships that do not go, and so on; but by and large, it does need money for social and economic programs and for all sorts of things which affect the average Canadian and indeed all of us.
It is typical, however, that instead of looking to the Income Tax Act, which is the normal method that the federal government uses in raising money-and I mean the main method of raising money-the federal government introduces a wellhead tax. Everyone knows we all pay income taxes, except maybe Shell or similar companies. However, most of the ordinary people in this country have to pay income taxes every year. Most of the companies in this country pay income taxes. Instead of looking to the Income Tax Act, where there is a present effective rate of 11 per cent for the oil companies, for getting more revenue by taxing these companies, the federal government has introduced a new tax, the 8 per cent wellhead tax. In my view, it is designed to hurt the very people that the federal government said it intended to help.
Let me explain why I say that. If the government had tightened up the Income Tax Act, it could have taxed the profits of the companies. The profits of oil companies and banks have been incredible in the last few years, especially those of oil companies. We have pointed that out time and time again in the House of Commons. We have pointed out that some companies have not been paying tax. In 1979 Shell paid no tax. So what has the federal government done? Instead of taking broad tax measures under the Income Tax Act, it brings in this 8 per cent tax which taxes the upstream profits of the companies.
Now, I must explain the difference between upstream and downstream. I know all fishermen would understand that, but I will try to explain it in the context of oil. "Upstream" means the place where the oil and the gas is found. I have had to

May 28, 1981
Excise Tax
learn this, Mr. Speaker. Having been a criminal lawyer and then coming into the oil and gas field, 1 have had to learn these concepts. They are not difficult and I shall try to explain them simply. The upstream is where the oil and gas is found, where the drilling is done and the gas is brought out of the ground. As I understand it, and I may be corrected, a lot of small Canadian companies are involved in drilling, exploration, servicing rigs, bringing in the water and bringing in the gas- doing all sorts of things. Profits are made in those areas when oil and gas is sold downstream.
"Downstream" is the pipelining, the refining and the marketing. The downstream is controlled by the large multinational oil companies-Imperial, Shell, Gulf and Texaco.
This particular tax, however, really hits the people upstream and not the people downstream. The government produced a petroleum monitoring report which showed that small Canadian companies reinvested the money they made when they found oil and gas and sold it. Some of the multinational oil companies like to take a profit and send it to their American shareholders or put it into solar energy or coal or some other investments.
Because of the tax on the upstream operation, small business people from Alberta, Saskatchewan and British Columbia come to see us and say: "We are losing our business. Why are you taxing us? It is really hurting". Imperial Oil or any of the large companies have not come to us to say that they are hurting. As a matter of fact, their shares went up in value after some recent announcements by the government. The government has put the tax on in the wrong place, Mr. Speaker.
Yesterday the minister said: "There is more and more exploration; look at the figures". Then he gave out-of-date figures from last year. Mr. Speaker, we saw people in the flesh-live witnesses who visited us-complain that the tax is hurting them and that they may go bankrupt. These are the little guys, not the big guys, and we on this side of the House are prepared to listen to them, even if the government is not. We are prepared to ask the government to get rid of the 8 per cent wellhead tax and change the corporate income tax to get money that way.
There is another problem, Mr. Speaker. The west is alienated. The government has a lot of difficulty dealing with the west because its power base is in the east. I was struck by the tirade delivered by the Minister of Energy, Mines and Resources (Mr. Lalonde) in the House yesterday when he said that the west is not suffering. The party across the way puts itself forward as the party of national unity; but it cannot be a party of national unity if it does not listen to the west. It is easy to win elections-just take Quebec and Ontario, with low-priced oil in Ontario, and pretend that its interests are being looked after-although in the long run they are not- keep the solid base because of the many members from Quebec, and the result is permanent government in Canada.
There is a real problem in western Canada, Mr. Speaker. In its own way, it is having the same kind of revolution as that
which happened in Quebec in the sixties. I suspect many members opposite, including the Minister of Energy, Mines and Resources, came to this House as the result of Pearsonian Liberalism or as a result of feeling that there was a role for the federal government to play in co-operative federalism with the provinces.
This tax hurts co-operative federalism, Mr. Speaker, and I urge the government to consider it again. I do not make the argument that the provinces cannot afford it; I make the argument for the little guy. I am in favour of provincial revenues, but I believe there should be a better way of dealing with the provinces in respect of this 8 per cent tax.
It does not make sense to hurt the little guy upstream and forget about the big guys downstream, Mr. Speaker. That is where the tax should be applied. The same amount of money could be raised, the western provinces would be satisfied and the small businessmen in Alberta, B.C. and Saskatchewan would be satisfied, as would the principles of co-operative federalism.
I now want to deal with the subject of gas, Mr. Speaker. There is a problem with federalism when it comes to gas. This party is not opposed to the principle of a tax on gas but this is not a good time for it. My constituents want to know why there is a tax on natural gas which is produced by the western provinces-mainly British Columbia-when there is no tax on Quebec electricity or on Ontario gold and nickel or hydro. I find it difficult to answer them. I could say it is a source of revenue, but, Mr. Speaker, this is a bad time to levy that tax. At the time the Petroleum Administration Act was imposed unilaterally by the federal government, we as a party urged the minister to consider that tax again.
There is another reason why the tax should not be imposed, Mr. Speaker. There is a glut of gas in the United States at the moment. In 1979, the Clark government raised the gas export price and, as a result, the United States has not been buying British Columbia gas. Now, at the same time as the price of gas increases as a result of this tax, exports are decreasing.
The government has not allowed any change in the price of export gas. The result, as the economists would say, is that they have "used up the space". A tax has been imposed but we cannot get any more money for our exports, so who is to pay the tax? It is the people of British Columbia who will bear the burden.
It comes at an awkward time for British Columbia because the provincial government has been subsidizing the price of natural gas to the tune of $100 million per year. As a result, last year 40 per cent less gas was sold than the year before. Instead of the subsidy coming out of the sale of gas exports, it really comes out of British Columbia's general revenue. I am just trying to put the facts before the government because it does not have any members from British Columbia in its ranks and may not know this!
British Columbia had planned to raise the price of gas to consumers this year. At the moment, 1,000 cubic feet of gas costs $1.20. As a result of this bill we are debating today, a
May 28, 1981

41-cent tax will be imposed by July 1 and the province will likely impose another tax of about 60 cents. The price of gas for British Columbia consumers will be doubled.
It does not make much sense, Mr. Speaker, for the government to have a policy of switching off expensive imported oil for cheap Canadian natural gas, when the price of the Canadian natural gas is doubled. The actual impact in British Columbia will not be for people to switch from oil to gas, as the National Energy Program proposes; in fact, it will scare British Columbia away from switching to gas. They see a discriminatory tax. They see the price doubling. British Columbians will not convert to gas.
I am informed that this morning the Saskatchewan government filed a suit in its court of appeal against the federal government, challenging the federal government's ability to tax provincial Crown corporations. This lawsuit is of particular interest to the people of British Columbia. We market our gas through a Crown corporation called the BCPC, which is the British Columbia Petroleum Corporation. We used to have a socialist government in British Columbia, so we do not let the downstreamers take all the profit. We take the profit and distribute it among the people. BCPC buys gas from the producers and either sells it to the people or it is exported. BC Hydro is involved.
This lawsuit filed this morning by the Saskatchewan government will be watched very carefully by British Columbians. It will deal with the principle of whether a provincial Crown corporation can be taxed. It is not the lawsuit that I am pointing out but the fact that the government could have avoided the danger of lawsuits and disputes between itself and the provinces. We do not need that. These things should be settled in a different way, not through the courts. They should be settled through negotiation. That is what co-operative federalism is all about.
This tax is a divisive tax. By devious methods, the minister of energy is trying to raise money to deal with a particular problem. What he should do is negotiate up front with the provinces instead of levying these new taxes.
In summary, the taxes are against the principles of co-operative federalism. They are discriminatory against one region of the country. They hurt the little guy. They do very little to take additional revenues from the big companies. Instead, Canadians will end up with higher prices and higher costs at times when we really cannot afford to pay them. These costs will fall on the consumer, not on the big producers and markets.
While we on this side of the House are in favour of the principle of taxation and while we are in favour of the federal government being active and having a major role to play in this country, we must tell our friends across the way on the government side that this is not the way to do it and to delete these clauses from the bill.
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Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, I am pleased to have the opportunity to participate in the debate on Bill C-57 now before the House. I want to associate myself with many of the concerns that have been raised by members on this side and I want to express my views on certain aspects of the bill.
I, too, take extreme exception to this government's attempt to establish annual indexing based on consumer price index increases. I am well aware that the government has to raise money by taxes, but through many of the things the government is doing it gouges the wrong people.
1 share the suspicion raised by many of my colleagues that this proposed move based on consumer price index increases is simply an effort by this government to circumvent Parliament. In other words, the higher the cost of a product or a service, the more the government makes out of it. In turn, the more the consumer pays, the more the consumer goes in the hole.


Steve Eugene Paproski: Mr. MacEachen doesn't care.


Stan Darling: The Minister of Finance (Mr. MacEachen) does not seem to worry, as the hon. member for Edmonton North (Mr. Paproski) points out.
Such a method of indexing would perpetuate future increases, and members of this House would have no say in the matter. Parliament would not even have an opportunity to debate future increases because they would be already built in.
The indexing of taxes on such consumer goods as tobacco and alcohol, to mention only two, would surely anger and frustrate Canadians to a point where some might resort to alternate and illegal supply and purchase methods. I might say that they do not get too much money out of me through taxes on either of those products. I suppose if I were to be very mercenary, I would say tax both tobacco and liquor as much as possible because I do not happen to use them. In all fairness, however, I presume I have a great many friends and relatives who do use tobacco and alcohol, so I may pay in a roundabout way.


Peter Elzinga: These taxation policies are driving people to drink.


Stan Darling: The hon. member for Pembina (Mr. Elzinga) says that the government's policies are driving people to drink. I guess they want to try to forget their troubles. I have not had to resort to that yet.
I have no doubt that if this objectionable method of taxing is allowed to pass, wholesale smuggling might result. It has happened in the past and there is no reason to assume that it might not happen again. We might have the reverse of the infamous prohibition period in the United States when Americans in droves came into Canada for their liquor. This government will make the prices of these items so high that Canadians will be prohibited from purchasing them in Canada and would have to go elsewhere for them.
My own province of Ontario made a mistake when it recently introduced its budget by indexing taxes on consumer

May 28, 1981
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goods. I certainly do not agree with that. The provincial treasurer, who is a personal friend of mine and a representative of part of my federal riding, brought in an indexed tax on gasoline. At the present time I believe this tax is about 4 cents a gallon. Of course, when the price of gasoline increases, as it most certainly will, that tax will go up automatically.
Members on this side of the House remember back in December, 1979, when that same distinguished provincial treasurer was crying blue murder to the Conservative party because of the prohibitive proposed increase of 18 cents a gallon in the price of gasoline. Now we can see what we are paying with this great federal government in power which promised on a stack of Bibles that the increase would be limited to 14 cents a gallon. On Sunday on my trip back here I filled up my gas tank. I paid $1.67 a gallon for unleaded gas. I can assure hon. members that is about 60 cents or more per gallon than I paid when the Clark government was defeated.


Steve Eugene Paproski: Shame on you Liberals.


Stan Darling: Again, a slap on the wrist should be given to the provincial treasurer of Ontario. I guess he learned the dirty trick from the Minister of Finance.
I find it difficult to accept that, because this government is not able to control inflation, it will use inflation to index taxes. In other words, the higher inflation goes, the more money that will roll into the government's coffers. I do not think anyone would disagree with me about that. Even members on the government side of the House should be shaking their heads and agreeing with me.
This measure will allow the government to benefit from the inflation it has created. I hear the Minister of State for Finance (Mr. Bussieres) interjecting. The government is benefiting because of inflation, yet we hear the government telling us that it will do its very best to control inflation. To do that very thing, the government is keeping interest rates high. But at the same time this government is driving a good many businessmen to the brink of bankruptcy. Some will declare bankruptcy. I know a great many small businesses in my riding that are feeling the pinch. I am quite sure the Minister of State for Finance knows that as well. Possibly there are some small businesses going bankrupt in his own area because of high interest rates. This is an absolute disgrace. Reasonably successful businessmen who have been established for a long while are going to the bank to borrow money to meet operating costs or to purchase inventory during their busy seasons and are having to pay 21 per cent interest.
I also wish to express my concern and the concern of many others at what appears to be evident departures from the normal calculation of excise taxes. As the hon. member for Edmonton West (Mr. Lambert) pointed out, excise tax has been commonly known as the manufacturers' sales tax. This tax was imposed upon the price at which a manufacturer would sell his or her products. The bill before this House seems to be shifting the excise tax away from the manufacturer to the wholesaler and distributor. This will ultimately lead to a greater Financial burden on the consumer and will generate extra funds for the government.
I am quite sure that many other members of Parliament as well as 1 have received letters criticizing the government for this change in policy. I certainly hope the government will rethink this. This government does not need to print extra money; it simply digs a little deeper into the pockets of tax-paying Canadians. By this bill it looks as though the government wants to dig a little deeper into the pockets of certain segments of the nation which can ill afford to support this government greed.
I want to discuss the impact of the clause of this bill dealing with excise taxes on advertising and advertising supplements in small community newspapers. There are many small weekly papers in my riding, as in many ridings across the country, which offer the community a valuable service by providing news, information and entertainment. These newspapers, which do not have the financial resources of large corporations or the revenue resources of those in larger centres, are very dependent upon the advertising they obtain. The imposition of the excise tax as outlined in this bill would place the operations of these important papers in jeopardy. I hope the government will reconsider this matter, recognize the value and contribution of community newspapers and exempt those serving certain sized populations from this change in the taxing method.
I want also to express my opposition to that part of the bill which deals with the production of gasohol. As the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) mentioned when speaking on this issue, gasohol is legal and its use encouraged in over 30 of the world's nations. Why Canada, or at least the present Canadian government, should take a different stand is certainly beyond me.
Other governments have realized the potential of gasohol in certain circumstances and have supported its use. This government, however, seems to be determined to ignore it or, at the very least, will penalize Canadians who want to use gasohol as a fuel alternative. The bill before us reflects the government's attitude. It does not use the word "gasohol"; it refers to the product as "denatured spirits." This just means alcohol that is rendered unfit to drink.
The government seems less worried about the advantages of Canadians using gasohol for fuel as it is about the possibility that some Canadians will erect stills to produce alcohol for human consumption. Under this bill the government will grant a special temporary licence for the manufacture of denatured spirits which are to be used solely in experimentation and development of a fuel. Surely the government realizes that such experimentation and development has been going on for centuries now, probably for a few thousand years, and the process is fairly straightforward. There are experimental processes taking place in respect of alternative approaches to manufacture, both in the conversion and separation stages, but the simple distillation process is relatively unchanged.
Why in the world would the government want to limit licences for experimentation only when many Canadians have
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gone beyond that stage and are into production, illegally now,
I must point out? In my own riding we had an individual who had gone beyond the experimental stage and was in fact using gasohol to power his own vehicle. He was not only successful in producing the product, he was producing it cheaply. By making alcohol from crops grown on submarginal land on his farm, he was able to produce fuel for his vehicle which he stated cost him about 30 cents a gallon. I might question the 30-cent a gallon figure because I doubt if he charged for his own time, or perhaps put a charge on the land, and so on, for this, but nevertheless he did this and certainly created quite a furore and got a lot of publicity for himself across the country which certainly did him no harm.
Did the government applaud his ingenuity? It certainly did not. It sent the RCMP in there to lay charges against him. After all, it could be very embarrassing for the government to have an individual showing it that a final product works when the government is insisting experimentation is still required.
What must be equally embarrassing to the government is the fact that this man is a Liberal party member and in fact carried the standard of the Liberal party in the recent provincial election in the district of Parry Sound. He lives about 15 miles from my home town of Burks Falls. This same distinguished gentleman, Richard Thomas, is well known from appearing on television commercials for Canada Packers as "Ben", selling their bacon, so that is a plug for them. That did not hurt him during the election either. When I pointed out to Richard that he was a great Liberal expounding Liberal theories, yet they formed the government which was persecuting him, and also asked him to admit that the budget of the hon. member for St. John's West (Mr. Crosbie) would have protected him, he admitted it himself. Do not shake your head now, Mr. Minister of State for Finance. The Crosbie budget allowed the production of 2,500 gallons of alcohol, or whatever you want to call it; it most certainly did.


Steve Eugene Paproski: That's right and I'll vouch for that.


Stan Darling: I see the minister of state making a note of that. If he checks that he will find it to be correct.
This man Richard Thomas showed equal determination when he was faced with the charges laid against him. He hoped, he said, to argue in court that, although he had broken the letter of the law, he had not violated the intent of the law, which was to prohibit privately distilled alcohol for internal consumption. Incidentally, the charges against Mr. Thomas were eventually withdrawn, presumably because new legislation under this bill was pending.
Will this present bill help Mr. Thomas and others across this land like him who wish to manufacture gasohol for cheap transportation? I suggest it will not, because firstly there is a requirement that anyone applying for a licence must post a surety bond of between $4,000 and $10,000. I understand that amendments to reduce this amount are before the House. As an insurance agent for a great number of years, I should say that there will probably be additional business for general insurance agents across the country. The government is going
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to force people to buy, even when it is for their own use. The premiums on surety bonds and fidelity bonds are quite high now. In many cases it is quite difficult to have insurance placed. Granted, there is the possibility, if an experimenter does not know what he is doing, that he will blow himself or his neighbour up. This is why there will be a hesitancy with respect to issuing these bonds. Or the government could say: "If you are doing it for your own use, God bless you, go to it; but just do not get into the business in a big way".
The reason for the bond, Mr. Thomas was told by an official in the Department of Finance, was to guarantee the respectability of the applicant. The Department of Finance has devised the ultimate measure of respectability. If a Canadian has between $4,000 and $10,000 for bonding purposes, then that Canadian is "respectable". I suppose there will be a sign on the door of the licensing office stating "Only respectable Canadians need apply". I suggest to the government that if respectability is the sole criterion for the requirement of the bond, the provision should be dropped immediately. Why not have just a simple licensing fee to cover the cost of the licence and the office paperwork involved?
Then there is the fact that the licence is valid for only a year or less, and when the licence expires there is no renewal clause. How utterly stupid! Ingenious Canadians will buy equipment and so forth, and then they will know that once they get their projects operating successfully, the government will tell them they have to discontinue them after the end of the year. That is ridiculous. Why any Canadian in his right mind would go to all the trouble and effort-not to mention the cost-to build something when it is to be destroyed a year later, I do not understand. Equipment and accessories are not put together for a few dollars; it takes a few hundred dollars and in some cases thousands. Canadians are willing to invest that kind of money only on ongoing processes and only when they know their yields will be financially beneficial. I suggest that the government make the licence renewable or extend the time involved to a more practical term.
There is also a requirement for a complete description of the distilling process, including diagrams, at the time of licence application. The government is contradicting itself. If the licence is issued only for experimentation, how can the experimenter be expected to know in what final form his equipment and process will be? No one asked Alexander Graham Bell to provide a description of a conference call when he invented the telephone. This entire section of the bill needs to be reviewed and altered to reflect reality and common sense.
In its report the special committee of this House on alternative energy and oil substitution stated that it welcomed government actions to amend the excise tax to make it easier for interested people to begin distilling alcohol, but the government is not making it easier. This bill will have just the opposite effect. I agree with other members of this House that the production of gasohol should not be allowed to lay waste

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good farmland, but that is not the intent of those Canadians who are looking for cheap fuel alternatives.
1 am hoping the government will amend its thinking on this and allow ingenious Canadians-mostly farmers and rural people-to take advantage of this new idea of gasohol, to produce it for their own use and perhaps to sell a bit extra.


Mr. Vince Dantzer (Okanagan North):: Mr. Speaker, normally when I rise to speak in this House I do so with considerable pleasure and enthusiasm. However, with respect to Bill C-57 I must confess it is extremely difficult to be very enthusiastic. This is a tax bill, and no one likes a bill which purports to take money from Canadian businessmen or from individual Canadian taxpayers, even though I think we all realize that from time to time such bills are necessary.
However, this bill is particularly distasteful. As tax bills go-and they go a long way-I might say that this bill is an absolute horror. More than that, it is a disgrace because it does nothing more than reflect this governement's complete mismanagement of the economy, and it underlines this government's desperation for money.
I intend to speak generally about this bill in the short time I have available to me. However, in my remarks I will highlight two areas of the bill which I believe are particularly wrong and ill-advised at this time.
The first area to which I will refer is the government's attempt to index taxation to inflation, as it purports to do with its treatment of the tax on alcoholic beverages. The second area of my concern is the 8 per cent tax on petroleum and gas products. Ever since about 1973 when this government started deficit financing, it has continually spent more than it has received. Since 1973 deficit financing has become a way of life, as the Liberals have acted out their basic philosophy of government, which is that any problem in this country can be solved if they, the Liberals, can only throw enough money and enough bureaucrats at it. My oh my, the Liberals have certainly thrown enough money and hired enough bureaucrats over the past number of years, and they have done so to the point that today we have a yearly deficit of some $14 billion and a total deficit of $107 billion. I do not understand the magnitude of those figures. I cannot even imagine it.
With respect to the civil service, we must certainly be the overgoverned country of the western world. It is not surprising that, as a result of all this activity by the Liberal party, the country is bankrupt. The government is short of money and desperate for cash. There is a dire necessity for government restraint, but herein lies the difficulty. This government, and its bureaucrats who created the mess, are simply not capable of solving the problem. They simply cannot find the strength of will or the determination to cut back on government expenditures or to show any kind of restraint. It is like asking a firebug to put out the fire: he is emotionally incapable of doing so. When we ask this government to cut funding, it cannot do so.
What is the Liberal solution to this problem? The Liberal solution is to beg, borrow, wring, squeeze and, yes, even steal
money from the Canadian public. This government and its bureaucrats have discovered three ways to get money. I think the scheme is mostly that of the bureaucrats because I do not believe the occupants of the Liberal front bench are bright enough to conceive of the Machiavellian measures which are now being set in place. The occupants of the Liberal front bench are tired. They are the ones who started the mess. This is the worst front bench any Canadian government has displayed or Canadians have had to contend with as an excuse for government in a long time.
The only claim to fame of the occupants of the back bench is their knee-jerk response and their haste to say "Yes, Sir" to each and every crazy scheme proposed by the Prime Minister (Mr. Trudeau). One must wonder what they do in caucus other than discuss the length of the forthcoming recess, the terms of their pensions or even the size of their salaries. So the measures before us must come from the bureaucrats. In order to save their jobs and keep their ridiculously high salaries, it is they who come up with the grand design, and the Liberal government is carrying out the plan to squeeze more cash out of the Canadian public.
The grand design is threefold. The first method is inflation. This is an old standby used by many governments in many countries. There is always eventually the same result of runaway inflation and eventual collapse. It is a fairly useful gimmick. It fools the public for a short time and allows the government to finance its huge deficits. If you have an annual deficit of $14 billion and a total deficit of $107 billion, how do you pay this money back? The answer, of course, is to devalue the currency and soon we find it is easier to pay back good dollars with a cheap 75-cent dollar, a cheap 50-cent dollar, or an even cheaper 25-cent dollar, wherever and how far the public will let it go. This is the Liberal plan.
What are the mechanics of this plan? There are several. First of all, print money. The Liberal government over the years has constantly increased the money supply. Secondly, the government must make certain that money policy includes high interest rates, and they have done this. Who can deny that high interest rates are inflationary, particularly when they are not accompanied by fiscal policies and government restraint? It takes no genius to see, and only a Liberal would fail to see, that an increase in the bank rate increases the cost of production of all goods and services. The small and indeed even the large businessman paying 20 per cent to finance his inventory has to charge a good deal more than if he is only financing at 10 per cent.
If this government is serious about controlling inflation, where is the tight money policy that should be established? We do not have one; you can borrow all the money you want at high interest rates. If you are prepared to pay the 20 to 21 per cent mentioned by previous speakers, the money supply and the debt continues to grow.
Now, how else does this government encourage inflation? One method it is using is to cause the Canadian dollar to drop
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in value vis-a-vis other currencies, particularly the U.S. dollar. Consequently all the things we buy from outside Canada- fresh fruit, vegetables, capital goods, vacations-indeed everything, costs more and thus further fuels inflation. I suggest that the Liberal government achieved this fall in value of the dollar by keeping Canadian productivity at an unreasonable and uncompetitive level, by allowing investment in research and development to fall to disgraceful levels, and by failing to provide an industrial strategy for Canada in the 1970s and the 1980s, particularly for Ontario and Quebec. It is just another part of the horror story of the Liberal regime and it is extremely difficult to believe it was all accidental or the result of stupidity.
How else does the government cause inflation? Well, this government has some new and different kicks. Firstly, it spent over $1.3 billion to purchase a non-productive retail oil company which will not result in one extra barrel of oil in Canada or one extra job for Canadians. It then proceeds to charge this huge expense directly to the poor auto driver by gouging him at the gas pumps. And that, I suggest, is deliberately inflationary.
What else does this Liberal government do? It pays to foreign countries over $3.2 billion annually to buy high-priced oil because of a stupid political position, and that money is taken directly out of the pockets of Canadians to enhance the wealth of other countries. And that, Mr. Speaker, I suggest is inflationary.
Finally, as proof positive that this government wants to encourage inflation and that it is part of its package of fiscal tools to pay for the huge deficit, we have this bill before us which proposes to index tax increases to inflation. By this act, the government proposes to introduce automatic tax increases on alcoholic beverages so that in the future taxes are increased automatically whether or not the government needs the money. By this insidious device taxes will increase without reference to Parliament, without discussion or explanation whatsoever to the Canadian public as to the need for the increase.
In the peculiar way this government has imposed this tax on the industry, the result has been to discourage the consumption of beverages of low alcoholic content, beer and wine, and encourage the consumption of hard liquor. Surely a strange thing for a government to do and reason enough to change this legislation.
The terrible aspect of this tax is the fact that it is tied to inflation and that the government automatically receives more taxes without reference to Parliament. It will be taxing people on inflation; thus it has a vested interest in seeing that inflation continues. By indexing this tax, the government is formally giving notice that it endorses and encourages inflation as a part of its fiscal policy. No wonder Canadians across this country have lost confidence; no wonder that, in spite of the higher interest rates, Canadians are going on a buying binge and consequently rendering ineffective the high interest rate policy.
What is step number two in the grand design to obtain cash to pay its debts? Well, we all know by now it is the huge power
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and money grab on provincial resources. Not all provinces, however. The Liberals may be stupid economically but they are politically rather wise and identify their power with a majority in Quebec and strong support in Ontario, so these provinces generally will escape the resource grab. However, God or the Supreme Court will have to intervene to stop the resource grab in the rest of the country. The Liberals are taking the offshore resources of the Atlantic provinces. They are stealing the aboriginal rights of the Indian, Inuit and Metis and the lands of other people of northern Canada. Finally, and most aggressively of all, they are determined to rob the resource wealth of western Canada. The resource wealth of the west is the key to the Liberal program to obtain more cash and feed the insatiable bureaucrats' appetite for more and more spending.
A keystone in the government program to achieve this is the introduction in this bill of a petroleum and gas revenue tax. The act proposes to tax these products at the rate of 8 per cent of all revenues from production of oil and gas. It is not surprising that this tax has met strong opposition from the provinces since they charge, and rightfully so, that it makes nonsense of their constitutional right to own and exploit their natural resources.
In its method of application the tax is more in the nature of a royalty and in fact has been held as unconstitutional by the Alberta appeal court. Aside from that, the practical effect on the economy and well-being of the petroleum industry has been and is disastrous. Other speakers have described the results: 139 rigs have left the country; drilling activity has been reduced; sales of petroleum properties have declined.
The slowdown in the oil industry affects everyone. Out of every dollar the oil industry spends, 42 cents is spent in Ontario, 13 cents in Quebec, 29 cents in Alberta and 16 cents in other provinces. For every job created in Alberta in the oil industry, two are created in the rest of Canada. The loss of jobs and economic activity in Canada is almost beyond calculation.
And so goes the horror story. One can only stand back in amazement at a government which in a grand manner proclaims a national energy policy, one calling for oil self-sufficiency by 1990, and then proceeds to impose punitive taxation and ridiculous regulation sufficient to wreck the industry and ruin the economy in less than a year.
What are we told now? We are now told that the advisers of the Prime Minister are telling cabinet that the big shock in the eighties will be that there will be no jobs in central Canada for young people; there will be no jobs in Quebec or in Ontario. In fact, there will be no jobs for any of these people in the early eighties. What will they do? The advisers of the Prime Minister are telling us that some 500,000 young people-perhaps even a million-from Quebec and Ontario will have to move west to find jobs, work, security and employment.
The Trudeau government has failed these young people by failing to provide an industrial strategy or design for the

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industrial provinces of central Canada. The Trudeau government has failed to maintain an adequate or competitive industrial climate by not providing or encouraging sufficient research and development. The young people of Quebec and Ontario are now reaping the rewards of this Liberal government's stupid and ineffective economic policies. But the wonder of wonders is: Do these young people know that when they head west to the promised land, Trudeau and Lalonde will have been there before them?


David Michael Collenette: Order. You should refer to the Right Hon. Prime Minister and Minister of Energy, Mines and Resources.


Vincent Martin Dantzer: Are they aware that the jobs and security they expect to find do not exist because the Liberal government and its national energy policy has effectively ruined the industry and the economy in western Canada? These young people will find, if the government pursues its policies as exemplified in this bill, that there will be no jobs or security whatsoever in western Canada.
When I started this speech, I mentioned that the government, in order to meet its desperate requirements for cash, devised a three-pronged attack on the pocketbooks of Canadians. I have mentioned two of them: first, the resort to inflation and, second, the attack on provincial resources. The third arrow in the government's quiver has not yet been revealed, but it is in the making. Of course, that will be the attack on the pension funds collected from each working Canadian and each employer. At the moment only the provinces have attacked these funds and used them to meet provincial deficits and other requirements. In doing so, they are paying considerably less than the going rates of interest. I suggest we will shortly hear of the government's plan to increase greatly the Canada Pension Plan contribution; perhaps it will be doubled from 3.6 per cent to 7.8 per cent. Of course, this will have the effect of greatly increasing available cash. I suggest the federal government will ensure that it obtains at least 50 per cent of these available funds; but I believe that is a story for another time in the near future.


Some hon. Members:: Hear, hear!


Peter Elzinga: Mr. Speaker, I rise on a point of order. As tempted as I am to do it, I will not. But I put the hon. minister on notice that, in the event we do not have a quorum in the House shortly, I shall call for a quorum vote, if he wishes consideration of this legislation to proceed.


Some hon. Members:: Where are the Tories?


Peter Elzinga: There were only four Liberals present when I rose on my point of order.


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I thank the hon. member for Pembina (Mr. Elzinga) for getting me an audience. I want to make a few comments in this debate this afternoon. I will not speak long, but I want to sound a warning to my colleagues from other parts of Canada about the effects the National Energy Program is having in western
Canada and about the perceptions of western Canadians of our country, perceptions of deep concern to me.
Specifically I want to speak about the 8 per cent tax on gas and oil production in the bill before us today. This tax points out the policy of the government across the way. It is a policy more of confrontive federalism than co-operative federalism. It is a policy which is arousing the ire and concern of more and more reasonable people in the west. In fact, this morning the government of Saskatchewan took a challenge to the Court of Appeal of Saskatchewan on the 8 per cent tax on the production of gas and oil. I predict this challenge will end up in the Supreme Court of Canada, either appealed by the Saskatchewan government or by the federal government, depending upon whether or not Saskatchewan wins its case in its own court. The main reason they are challenging the legislation is that, for the first time in our history, the federal government is taxing provincial Crown corporations. I suggest that move is wrong.
In fact, I believe the entire 8 per cent tax is wrong. It is wrong for the following six reasons. It is wrong because it is a regressive tax. The 8 per cent tax hits the large companies like Imperial Oil as hard as it hits the small companies in Saskatchewan and Alberta. It does not differentiate between the rich and the poor oil companies in the country. For those reasons I believe it is wrong.
Also it is wrong because, as I said, it taxes Crown corporations. Who would have dreamt a few years ago that the Government of Canada would impose in a budget a tax on provincial Crown corporations? What kind of dangerous precedent or what kind of constitutional war could the country become involved in if the Government of Canada gets its way in imposing unilaterally, without notice or negotiation, a tax on the Crown corporations of the country which are owned by the people through their provincial governments? There is a danger that the provincial governments will retaliate and impose a tax on federal Crown corporations such as Petro-Canada, Air Canada and CNR. What kind of a war will there be between the federal government and the provinces if this type of nonsense goes on?
Third, it has been previously documented in the House by my party that a number of people are losing their jobs because of the national energy policy and the 8 per cent tax. I am thinking of southern Saskatchewan, western Saskatchewan and the area of my colleague, the hon. member for The Battlefords-Meadow Lake (Mr. Anguish), where people are losing their jobs because of the fact that the national energy policy is imposing a tax which is driving rigs out of the country.
Fourth, I believe that when the government imposes the 8 per cent tax, not only the companies pay. Eventually it will pass the tax on to the consumer, and the consumer will be paying at least 8 per cent more for petroleum products, for gas to heat their homes, for gasoline to drive their cars, for farm fuel and the like.
Fifth, it is also wrong because it represents what I believe is an illegitimate revenue grab by the federal government in a
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field of provincial concern. This aggravates or increases some of the grievances of the provinces about confederation.
Finally, I believe the 8 per cent tax is wrong because it discriminates against western provinces. It is a tax on gas and oil. Therefore, it is a tax on Alberta and Saskatchewan primarily, but also, to a lesser degree, on the province of British Columbia. If we are to have a special tax on the production of gas and oil in those two provinces, what about a special tax on the production of mineral resources such as nickel, copper, lead and zinc which come from other parts of Canada? What about some equity in the federal system?
I make an appeal today especially to Liberal party members sitting across from me to try to make them understand that the feeling of grievance and discontent in western Canada is strong and growing.
I do not stand here today to try to sound an alarm, but I do want to try to warn hon. members across the way that there are problems in the west and that policies such as these are responsible for making more and more western Canadians alienated from the very country in which they live. It is not just this confrontive federalism, this federalism of confrontation, this fight between governments-between Alberta and Ottawa, Saskatchewan and Ottawa or British Columbia and Ottawa; it is now a fight between the people of the country.
The ordinary people in my part of Canada are becoming more and more concerned about the role they are playing in confederation. I refer to The Globe and Mail of a week ago today, May 21. On the front page there is an article which I think all members should study. The headline reads "Alienation in West on rise, poll shows." It is an article concerning a public opinion poll commissioned by the Canada West Foundation, a very well known and highly respected group in western Canada which is partially funded by the four provincial governments. A poll was taken by this organization to find out how western Canadians felt about our country and to determine what kind of perceptions we have about Canada and its future. It followed a poll which was taken by this same group last October, right after the announcement of the constitutional resolution and the National Energy Program. The poll showed in almost all instances that alienation in the west is increasing.
The following statement was put to western Canadians:
Western Canadians get so few benefits from being part of Canada that they might as well go it on their own.
Some 36 per cent of westerners agreed with that statement; 36 per cent of our people said: "We get so few benefits we might as well consider going it on our own." Last October, 28 percent agreed with that statement and now 36 per cent do so.
That kind of statistic terrifies me. I think it should also terrify the government and should motivate it in the name of Canada and in the name of unity to have all of us stick together in one state, to find out why western Canadians feel that they are discriminated against. I think the government knows we want to stay in Canada; that is what the west wants.
Excise Tax
All over the west there are many people who are loyal to our country, who fought in two great wars under the flag of this country and who want to have this country stay together.
In the same poll people were asked bluntly whether or not they wanted to separate. Some 88 per cent of those polled said: "No, we want to stay in Canada." Last October 90 per cent of those polled replied in that way. On the other hand, there is a small minority of people who want to set up a separate state. Some 7 per cent of those polled said: "Let us have a separate country". Some 3 per cent said; "Let us join the United States." And 53 per cent of the people polled said that they have more in common in their hearts with the United States than they have with the people of central and eastern Canada.
So it is my purpose today to sound a warning to this House that, if we do not start to take some of the grievances in the west seriously, there may be a movement in western Canada which will be very hard to stop, which may start to snowball.
In many ways the atmosphere found in the west today is similar to that found in Quebec 20 years ago when we saw the increasing alienation of the Quebecois to the rest of the country. Some people pooh-poohed this and said: "They are just a bunch of fanatics; they will never succeed. If we do not take them seriously and if we continue on with the status quo, or perhaps tinker here and there and make just a few reforms, then separatism in Quebec will be absolutely dead."
In the province of Quebec last year there was a referendum in which 40 per cent of the people voted yes to a question which, in essence, would have constituted a signal leading Quebecers toward an independent state. There is a great difference between the motivation for independence in Quebec and the motivation in Quebec for a different arrangement in this country than there is in western Canada. But there are also many similarities. There are similarities in the way that people feel about the country, both in the west and in Quebec. People feel that we are not equal partners or equal participants with the other parts of the country. If we do not address these problems and if impositions are made on western Canada without consultation or representation from the west, then there might be an independence movement which, once it got going, would be like a snowball or a prairie fire-very difficult to stop.
Members opposite should take my plea seriously and eliminate the 8 per cent tax, or at least change it so that it is not a discriminatory tax against the people of western Canada. I feel that very strongly, Mr. Speaker. I feel very strongly that this 8 per cent tax is not something in isolation but is part of an over-all plan by the federal government to reduce its deficit by reorganizing many of the institutions and programs which we have in our country today. It is a move away from co-operative federalism. In that kind of federalism you sit down and come up with a compromise and consensus between the provinces and the centre. What we see is a move toward confrontative federalism where impositions are placed on the regions.
We have seen that the constitutional resolution takes powers away from the provinces and gives them to the courts. This was done against the wishes of the four provinces in the west

May 28, 1981
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and against eight provinces in Canada. We saw the National Energy Program being opposed not only by the political right in western Canada but also by the political left, the alliance of Premier Blakeney in Saskatchewan, the leader of a socialist government and the leader-


Mr. Smith:: He is phony.


David Michael Collenette: He is a closet Tory.


Lorne Edmund Nystrom: The hon. member may call Mr. Blakeney phony. I think part of the problem in western Canada is caused by calling western premiers phony. In every survey and in every conversation in the west you find people like Mr. Blakeney, Mr. Lougheed or Gordon Gibson, a member of the hon. member's own party in British Columbia, are united in their stand. They say a number of things must change, such as the National Energy Program and the way this government handles federal-provincial relations. If the government does not make these changes there will be a growth of the alienation in the west. I am very unhappy when I receive responses such as we have just heard from members opposite. I am very disappointed. If you look at the statistics reported in the polls which are taken in the west, you find 36 per cent of the people saying that if things do not change then perhaps they should consider independence.
Some hon Members: Oh, oh!


Mr. Anguish:: They sit back and laugh.


Lorne Edmund Nystrom: As my hon. friend says, the Liberals sit back and laugh. It is no damned wonder that they have only two members from western Canada; it is because of this kind of know-it-all arrogance which is being displayed today toward the west. It is a patronizing mentality. I say to members opposite that if they come out to our ridings and talk to people, they will understand what we are talking about when we say that westerners are very concerned.


An hon. Member:: Where were you in the referendum?


Lorne Edmund Nystrom: The member from Quebec across the way is interjecting. A few months ago he said Liberalism was so popular in Quebec that Claude Ryan would sweep the province. As a result of the election in Quebec the only sweeping Mr. Ryan will be doing is the sweeping of his own office as he leaves the party leadership in the province of Quebec.


An hon. Member:: Where were you in the referendum?


Lorne Edmund Nystrom: It seems to me that I have touched some very sensitive nerves over there. They do not give a damn about what is happening in western Canada. They have established a western Canada development fund of some $4 billion, but there is no consultation with western Canada, with the four governments or the municipalities in the west. No committee of this House has been established to obtain some input as to how that money should be spent. There is no committee travelling across the country to find out what westerners want
to do with those funds. Again, it is a fund which will be administered here, from the centre, imposed on the west, regardless of what western Canadians feel. It is attitudes like that which inflame division in our country.
The former prime minister, Lester Pearson, stood for cooperative federalism. He stood for people working together, for people sharing ideas and planning together. I ask members opposite, what has happened to the Canadian tradition of consensus and compromise? What has happened to the tradition of listening to people? Surely to God that is democracy. Democracy is not a few bureaucrats who have no understanding of what happens in the west devising policies for our part of the country.
I see that you are signalling to me that my time is almost up, Mr. Speaker. I would like to hear some of the members from central Canada stand and put on the record those words they are heckling me with. Then perhaps the people of western Canada would have a better understanding of what the Liberal party really stands for. The two members there now from western Canada will not be there in 1983 or 1984.


Some hon. Members:: Hear, hear!



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Blaker):: Order, please. It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Esquimalt-Saanich (Mr. Munro)-National Security-Investigation of further spy rings identified by Taschereau royal commission; the hon. member for York North (Mr. Gamble)-The Constitution-Procedure for convening federal-provincial conferences; the hon. member for Saskatoon East (Mr. Ogle)-North-South Relations-(a) Preparations and recommendations for summit meeting; (b) Implementation of parliamentary committee recommendations; (c) Query respecting Canadian support for United States policies.
It being five o'clock, the House will now proceed to the consideration of private members' business as listed on today's Order Paper, namely, notices of motions (papers), private bills, public bills.
May 28, 1981


PRIVATE MEMBERS' MOTIONS FOR PAPERS
[Stage Direction]
Items Nos. 22, 5 and 4 allowed to stand by unanimous consent.

Mr. Jim Fulton (Skeena) moved:: That an humble address be presented to His Excellency praying that he will cause to be laid before this House before January 31, 1981, copies of all correspondence, telegrams or other documents exchanged between the Department of Fisheries and Oceans and British Columbia Hydro relating to joint funding and proposed dams in British Columbia including the names of the 20 salmon streams slated for damming.
He said: Mr. Speaker, I am pleased to speak today on my motion for the production of papers. Hon. members of the House will recall that on November 20, 1980 I asked the Minister of Fisheries and Oceans (Mr. LeBlanc) a question related to a document I had received from his department. That document was entitled the "Western Vision Blueprint", and talked about the possibility of the federal government and B.C. Hydro damming a number of rivers in British Columbia. Members will remember the indignant response the minister made, when trying to answer the question. The minister said that his officials had briefed me on the document when, in fact, they had called to plead with me not to release it.
The minister then went on to say that the issue would panic people in British Columbia. He said that outside the House, of course, because he was not able to respond adequately to me during the House of Commons question period.
I asked the minister questions about this so-called "blueprint" because of the concern I have over the possibility of this minister allowing rivers in British Columbia to be dammed without due concern for the fisheries resource. Despite the fact that the report says, and I quote:
That B.C. Hydro is looking for ways in which to meet peak power demands- many of these projects could have very attractive benefit cost ratios-there is an opportunity through joint development for both parties to meet their goals. We know B.C. Hydro is interested; we also know there are perhaps 20 or more salmon streams that would lend themselves to this approach.
That is taken from the document I received. It was prepared by Department of Fisheries and Oceans personnel, and I think it is important for hon. members of this House to have the names of those rivers and to know just exactly what this joint approach to hydro development in British Columbia involves.
The minister has refused to say which 20 rivers are going to be dammed and also by his silence has indicated he is not willing to tell the House what discussions have gone on between his department and B.C. Hydro.
It is therefore clear to me that when the government issues a report that says there are 20 rivers to be dammed, that identifies a five-year funding program and a financial flow, and all of this is set out in a very clear, technical way in the report, someone in the department of the Minister of Fisheries
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and Oceans has been looking at this very seriously. How does the government know that B.C. Hydro is interested? What kinds of correspondence and discussions have been held between the two? Or are we to assume that the minister and Bob Bonner have been quietly communicating telepathically?
In light of the minister's refusal to provide the House with any additional information whatsoever, I placed my motion on the Order Paper to have copies of correspondence, telegrams, or other documents tabled in the House by January 31, 1981. On December 17, 1980, the Parliamentary Secretary to the President of the Privy Council (Mr. Collenette) asked me to withdraw the motion. 1 asked to have the motion transferred for debate. We are going to have the debate today and at a future date.
After some research, I am glad to be able to speak in a more technical manner on this issue today. Perhaps I should not say "glad" because some of the information I have come across leads me to seriously question the Parliamentary Secretary to the President of the Privy Council's statement that no documents exist regarding the issue. Even more importantly is the information that indicates that this government is willing to sell out the fisheries resource in British Columbia, just as they have done on the Kemano issue, Amax, the Fraser River and others.
I am sure Your Honour will recall that on several dozen occasions I raised the question of Amax, a mining company which is being allowed to dump 12,000 tons of toxic effluent a day into Alice Arm. The statements I made in this House were refuted by the Minister of Finance (Mr. MacEachen), the Prime Minister (Mr. Trudeau), the Minister of Fisheries and Oceans, the Minister of Indian Affairs and Northern Development (Mr. Munro), the Minister of the Environment (Mr. Roberts), and need I go on? My statements have now been proven to be correct. Amax was, in fact, closed this morning because the tailings were resurfacing.
It comes right down to the crunch. If a document is prepared by fisheries and oceans, has a flow chart, gives a specific number of rivers, and names the actual figures which are under discussion for these joint developments, I think that when an hon. member gives notice of motion for the production of papers that he knows exist, or at least has some reason to suppose they exist, there is a responsibility on the government side to provide them as sheer information. We do not have a freedom of information act. It is important to hon. members, particularly those from British Columbia, regarding this issue that we at least be provided with background information, so that we can provide our communities and, in fact, our own members of the legislative assembly in British Columbia with that information and know what is going on and have some sort of a rational planning of hydroelectric development in a province which has had a tragic history of inappropriate dam development.
The truth of the matter, Mr. Speaker, is that at least one document does exist about this government's plan to dam rivers in British Columbia. In July, 1978 Crippen Consultants of Vancouver, B.C., submitted an unsolicited proposal to the

May 28, 1981
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Department of Supply and Services to do a study of possible hydro projects in B.C. In February, 1979, the Department of Supply and Services issued a contract to the same company. The project was to "estimate the potential for micro hydro development in remote communities in British Columbia". After much work I have been able to obtain only volume one of the two-volume report.
Let me make it clear at this point that micro hydro technology and small hydroelectric technology I am certainly very much in support of. Various European countries have come up with very innovative ways of producing hydroelectricity by small, torpedo-shaped hydraulic generation where they anchor it in the bottom of the river. The river continues to flow. The fish can go up and down and canoeists can use the river. Aesthetically it is not unpleasing. The natural flow of that fresh water into the marine environment allows the biological environment in the estuary to continue unimpeded and to maintain natural fish populations.
The report by Crippen Consultants identifies, in what they call the north coast region, 24 possible locations for micro hydro potential. In the other regions mentioned there are some 80 possible sites. A little bit of a quick calculation allows us to realize that not all streams and rivers in British Columbia have salmon. However, the Minister of Fisheries and Oceans, in his own document, has identified possible dams on 20 salmon rivers in British Columbia which, I think, is the real key and requirement for the production of these documents.
A quick review of the report does not indicate any concerns whatsoever over the fisheries resource. It does not discuss public hearings before any of these projects would get under way. In fact, the report has a nine-page section that lists "undeveloped hydroelectric sites" in British Columbia. This section of the report talks about creeks, and even mentions such rivers in my riding as the Nass and Skeena Rivers which have been unimpeded since time immemorial.
Is the Minister of Fisheries and Oceans aware of this study, I wonder? Is the Parliamentary Secretary to the President of the Privy Council aware of it? Are they aware of their responsibilities in relation to the production of these documents?
In their desire to put their blinders on when looking at my motion for the production of papers, the Department of Fisheries and Oceans closed their collective eyes to some of what the other government departments were doing. The members of this House know that I am interested in developing energy resources in this country. I am also completely aware of the possibilities of developing what are referred to in the Crippen report as low head power dams, something that I think many rural areas will look into in the near future. However, I and other members of this House, including, I hope, the Minister of Fisheries and Oceans, know how vitally important it is to protect the fisheries habitat. The report I have uncovered and the lack of concern the minister demonstrates tell me that we have to explain this issue to him time and time again.
There is more about reports, Mr. Speaker. The Stikine River in northern British Columbia is a beautiful river that flows from the northern reaches of my riding through some of the most incredible scenery in the province of British Columbia. The Grand Canyon of the Stikine is a sight to behold. As a matter of fact, I was up there last year with the previous Premier of British Columbia, Dave Barrett. We flew through to look not only at the fisheries in and below the canyon but at one of the last large goat populations in northern British Columbia.
The Department of Fisheries and Oceans chairs an interdepartmental task force that is studying the effects a proposed dam on the Stikine might have. In a letter dated November 18, 1980 to the Sierra Club in Vancouver, the Minister of the Environment wrote that the task force "has been established to provide advice to B.C. Hydro and Power Authority on study requirements and to review study progress and completed impact assessment reports".
I am aware that correspondence has been communicated from Fisheries and Oceans personnel in relation to the Stikine dam. It is an issue of international significance. I had the opportunity a few days ago to discuss the matter with Senator Ted Stevens from Alaska, who also has expressed alarm at the lack of public and international participation in relation to the fisheries resource on this particular hydroelectric proposal. The studies are being done under the auspices of British Columbia Hydro. The Department of Fisheries and Oceans is involved. It is a salmon river and in my view it is one of the 20 dams referred to in the Western Visions Blueprint as one of the rivers considered for joint development by B.C. Hydro and the Department of Fisheries and Oceans.
It is crucially important in a riding such as mine, in communities like Telegraph Creek where the Talt and native people make their home, that a member of Parliament be able to provide information on proposals for the damming of a river that has enormous and important salmon runs which provide the ongoing and traditional diet of the people and is part of their culture. For the Department of Fisheries and Oceans not to provide the documents relating to the Stikine requested through a notice of motion for the tabling of documents is, in my view, a very rash act that hits at the core of democracy.
Is the Stikine one of the proposed 20 rivers that the Western Vision Blueprint talks about? Why was some of that advice that the Minister of the Environment talks about not tabled in response to my motion? On April 9, 1981 in response to a letter I wrote to the minister about British Columbia Hydro plans for damming rivers in B.C., the minister replied:
I am not prepared to provide you with correspondence between Environment Canada and other federal departments regarding British Columbia Hydro plans for river developments in British Columbia-
The minister has told me in a letter which is just more than a month old, that correspondence does exist between his department and other departments but that he is not prepared to release it. In this House we have notices of motion and there are procedures fundamental to the parliamentary system, but
May 28, 1981

because we do not have a freedom of information act, members of the opposition are not privy to a great deal of ministerial documents prepared by civil servants. In my view, if those studies are to have an impact in some area of the country, they should be provided to the opposition. If they are particularly sensitive or refer to national security, members of the opposition could be told that such is the case, but at least they could become informed about what is going on between various levels of government and various departments.
What is so secret about these plans that the minister will not release them? Perhaps the Minister of the Environment should tell the House if any of his officials had anything to do with writing the Western Visions Blueprint.
In a letter written to me by the Minister of Fisheries and Oceans on February 3, 1981, he says:
Any proposals by B.C. Hydro have always been and will continue to be presented to my department for technical review in accordance with the habitat protection provisions of the Fisheries Act.
This is precisely my point, Mr. Speaker. The minister of fisheries is speaking about precisely the documents I was attempting to obtain which were referred to in a document prepared by his department. He wrote to me after the Parliamentary Secretary to the President of the Privy Council asked me to withdraw my motion, saying that there were no documents. We now have confirmation from the Minister of Fisheries and Oceans and from correspondence with the Minister of the Environment that the documents do exist, but apparently the government does not intend to comply with an order of this House. This method has traditionally provided not only members of the opposition but in some cases members of the government with valuable and vital information which enables them to represent their constituents effectively.
I should like to refer again to the Western Visions Blueprint document. In the second part, on page 2 under the heading "Department of Fisheries and Oceans-Western Visions Blueprint-Financial Flow", item 4, "Hydro planning and pilot projects", shows $1 million for year one; $3.5 million for year two; $10.5 million for year three; $11 million for year four and $11 million for year five. In the remarks column there appears, "Assumes joint funding with B.C. Hydro .. .". This chart shows the expenditure of tens of millions of dollars jointly between the Department of Fisheries and Oceans and B.C. Hydro. There are dams in my riding as I think there are in the ridings of many members from British Columbia, and I think we should have access to the information referred to in the document.
Item 7 of the document shows "Reservoir planning and pilot projects". In the first year it shows $1 million; in the second year $3 million; third year $3 million; fourth year $4 million and fifth year $4 million. The remark is, "Joint ventures with other agencies."
As if that were not enough, Mr. Speaker, under the heading "The Road to 1995" there appears the following in the text:
-the federal government could, by 1995, transform the B.C. coast, for example, or recast the script for the as yet unwritten history of those people dependent of fresh water fisheries.
Hydro Development
The people of British Columbia are not interested in the federal government alone transforming the B.C. coast, the lifestyles and traditional industries of the people who are dependent upon the fresh water fishery, without having direct involvement in and access to the information being developed. The text of the document goes on as follows:
The federal government frequently gets a negative image because ... it so frequently comes into conflict with agriculture, forestry, mining, hydro... Fisheries, and by extension the federal government, is too often seen by provincial administrations as a negative influence on other economic development. It is time for new approaches. Multiple resource management with a twist.
I am not sure who wrote the script for "The Road to 1995" but it may encourage members in their collective desire to get access to these documents.
It is interesting to note that the minister is not in the House today. I recognize that he has duties in other areas of Canada, but surely British Columbians have a right to access to planning documents that affect the rivers there.
In conclusion, Mr. Speaker, I want to say how important this debate is. Early next month there will be a meeting in Juneau, Alaska, where officials of the federal government, the provincial government, B.C. Hydro and Alaska state officials will meet to discuss the implications of the proposed damming of the Stikine River. I might point out that other rivers are also under consideration. Perhaps the documents that the Minister of the Environment and the Minister of Fisheries and Oceans have referred to in writing to me after the Parliamentary Secretary to the President of the Privy Council said there were none will now be released.
I believe the intent of my motion is abundantly clear: the government was to turn over documents related to the so-called Western Visions Blueprint. They say they do not exist. I believe the information I have provided to the House today shows that there are related documents, and that by its secrecy the government has shown that there probably are others.
Through you, Mr. Speaker, I respectfully urge the minister and the Parliamentary Secretary to the President of the Privy Council to go back to their offices today and ask the officials who were preparing the blueprint for their documents and to table the information in the House. To do so will respect the rules of this Parliament and will give the people of British Columbia the truth about what the government is planning to do about dams in British Columbia which may well impact on the salmon resource and other resources.


Mr. George Henderson (Parliamentary Secretary to Minister of Fisheries and Oceans):: Mr. Speaker, it seems obvious that the hon. member for Skeena (Mr. Fulton) has some kind of a bee in his bonnet over hydro dams in British Columbia and that his fertile imagination has dreamed up all kinds of sinister and clandestine deals between the Department of Fisheries and Oceans and B.C. Hydro.
The hon. member has received written and verbal replies to his questions on this subject, but apparently he still needs to be

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convinced that the federal government is not selling out B.C.'s salmon resources to B.C. Hydro.
Let us look at the facts without all the wild speculation and allegations. The first point to be made is that the Department of Fisheries and Oceans adheres to a long-standing policy to work positively at the watershed level with other water users when it can be demonstrated that fisheries goals can be accommodated. The department's main responsibility is, of course, to protect and, wherever possible, enhance the fish stocks. Where this can be achieved in concert with some industrial development, whether a hydro dam or whatever, then departmental officials will work toward this end.
Some time ago departmental officials put forward an idea, and I stress an idea, in a discussion paper in which they visualized the possibility in certain circumstances of fish enhancement facilities amalgamated with low-head hydro dams, with the suggestion that such developments might be financed on a shared-cost basis. It was an idea put forward purely for discussion purposes so that the practicalities and the pros and cons could be considered in the broader context of salmon enhancement. There is nothing sinister about that. This kind of procedure happens all the time in government.
However, 1 should make it quite clear, particularly for the benefit of the hon. member for Skeena, that at this time potential projects combining fish enhancement and power generation have not been identified anywhere in B.C. I cannot say that the concept is dead. It remains in the development stage within the department and might well receive further consideration at some future date.
I believe that, in situations where there is no harm to salmon enhancement and where the benefits of salmon enhancement can be increased by the installation of a low-head dam, a serious look should be taken at that possibility by everyone, including all department officials.
Let me also remind hon. members that the Department of Fisheries and Oceans has itself entered into the dam building business in areas where river or stream flow control is known to be a critical factor for fish. Such dams have proven highly successful in regulating water discharge for optimum fish production. To cite an example, this technique has been used in the Fulton River-maybe it was named after the hon. member-where a dam built by the department permits regulated water supplies to salmon spawning channels, and also in the Big Qualicum area to supply a spawning channel and hatchery complex.
These projects are both very successful fish producers which could not have been accomplished without dams providing controlled flow in the system. The point to be made here is that dams per se are not necessarily bad medicine as far as fish production is concerned. They can, and have been, used positively as a fish enhancement tool with good results.
At the same time I must also make it clear that the department remains committed to the natural production of fish, whenever and wherever possible, and to proper habitat protection measures.
High-head hydro dams can destroy salmon runs, in that they may present an impassable barrier to fish migrating upstream or downstream, as well as creating unnatural flow conditions which fundamentally change the aquatic environment in the area of the dam. It is the considered opinion of departmental experts that the various methods that have been tried to transport fish around such dams are not sufficiently successful to compensate for the numbers of fish that are frustrated in their migration patterns by the barrier. For this reason the department recognizes that fish, and large high-head hydro projects are essentially incompatible.
If I might enlarge a little on this subject, the Iskut-Stikine power project is a case in which B.C. Hydro is proposing a number of high dams capable of generating 2,765 megawatts of electricity, which could make it one of the largest power generators in the province. Considering that the Iskut-Stikine River system produces tens of thousands of salmon, the Department of Fisheries and Oceans is naturally concerned about the environmental impact of such a project. Although the dams could be constructed above what is thought to be the natural upstream limit of migrating salmon, B.C. Hydro, with departmental input, has spent in the order of $1.25 million to $1.5 million over the past few years in biological studies alone to determine the downstream impact of the construction of the dams. Here again let me make the point very clear and unequivocal that the Department of Fisheries and Oceans has no intention of approving a project which is likely to result in an unacceptable loss to the fisheries resource.
Turning to the wider question of the federal government's action and initiatives with regard to the west coast fisheries, I can confidently claim that the government's record is not one that we need be ashamed of. Rather, quite the contrary. I can point to a number of examples in support of this claim. The most obvious, perhaps, is the salmonid enhancement program, a federal-provincial project under which the federal government has undertaken to invest some $150 million over seven years with the objective of doubling the production of salmon and sea-run trout in British Columbia by the end of the next decade.
Back in 1975 when the Minister of Fisheries and Oceans first announced the salmonid enhancement program, he described it as "a bold and imaginative approach to the long-cherished dream of expanding our salmon resources". That was a very apt description because it has taken a considerable amount of boldness and more than a little imagination to plan and implement this major program, which involves the use of various enhancement techniques, including artificial spawning channels, hatcheries, fishways, lake fertilization and so forth.
It is now in its fifth year. The salmonid enhancement program is showing increasingly positive results in the number of salmon being produced through its various facilities throughout British Columbia. Last fall some 563 million eggs were obtained from the five species of salmon at SEP facilities.
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Of this total, 69 million were incubated in artificial containers while the remainder, all of which are chum or sockeye, were developed in regulated stream or spawning environments. The projected production of salmon and steelhead trout to the fisheries, plus escapement, from the 1980 brood is in excess of
3.200.000	pieces. In a year when winter floods may have devasted large areas of natural spawn, it is reassuring that such large quantities of stocks are protected in hatcheries and other facilities. Looking ahead to 1984, the concluding year of phase one of the salmonid enhancement program, it is predicted that department-staffed facilities will have the capacity to provide additional adult returns of about 383,000 chum, 307,000 chinook, 243,000 coho, 1,010,000 pink, 4,000 sockeye,
5.000	cutthroat trout and 7,000 steelhead trout, or 1,959,000 pieces in all.
One of the very satisfying aspects of the program operation is the amount of solid support it has been given by the public at large in British Columbia. The federal and provincial governments' rallying cry to protect and enhance the salmon stocks has been taken up with great enthusiasm by young and old throughout the province, and at the present time there is a force of more than 6,000 volunteers working on various salmonid enhancement projects.
An economic analysis has predicted a cost-benefit ratio of about 1.3/1.0 for phase 1 of the salmonid enhancement program, with net national income benefits of around $120 million, in terms of 1980 dollars. In addition to these monetary advantages, one must also include other benefits in terms of employment, particularly benefiting native people, regional development and resource and environmental preservation, for which it is almost impossible to assess a value in dollar terms.
Some people may ask: why are you expending so much money and effort on salmon enhancement projects in B.C. when industrial concerns continue to pollute salmon rivers, such as the Fraser, or in one way or another destroy the habitat on which fish depend to breed and grow? That is a good question, and I hope people will not stop asking it.
The answer, however, is not a simple one. It involves complex and sensitive issues concerning levels of jurisdiction and the priorities one should accord to competing users of the water resource. As far as the Minister of Fisheries and Oceans (Mr. LeBlanc) is concerned, his mandate is quite clear: his responsibility, which, I might add, was decided by the Fathers of Confederation when Canada's statutes were first put together more than a century ago, is to protect and manage the fishery resource. And to further explain how he and his department views these obligations, I feel I could do no better than quote from a speech which the minister presented at the official opening a week or so ago of a $3.6 million hatchery at Puntledge on Vancouver Island, one of the salmonid enhancement program facilities to which I was referring a little earlier.
The minister made these remarks:
What we are discussing here is a renewable resource-one might say an eternal resource-belonging to the people of B.C. and Canada, and I feel it is a time to get tough. There must be a tougher approach on the part of the federal government to protect fish habitat and restore the salmon stocks to their previous
Hydro Development
levels of abundance. How tough should we get? My answer is tough enough to ensure proper planning to avoid disaster, to repair damaged areas, and the acceptance by all concerned of the real cost of development-to mitigate negative impact and restore to the fish and other wildlife a decent environment.
The Minister went on to say:
I am aware that in some quarters the department's resolve to fulfil its habitat protection obligations is viewed with some skepticism. Certainly we have not done all that we could or perhaps should have done, but for the record I should point out that over the past three years the department has laid some 74 charges in B.C. under the habitat sections of the Fisheries Act. These charges covered such abuses as the deposit of toxic contaminants, sedimentation, landfilling, gravel removal, oil spills and destructive logging practices.
Apart from instituting legal action, we have also taken firm positions on various environmental issues where fish are involved. One is the Quinsam coal development proposal. My officials are advising the company of our concerns regarding the possible impact of the mining operation on the Quinsam River and will identify three serious potential problem areas. Unless I can be fully assured that the fishery resources of the Quinsam will be adequately protected, I am not prepared to grant approval under the Fisheries Act for this development.
Another controversial issue on Vancouver Island concerns the discharge of toxic mine effluent into Buttle Lake, headwaters of the Campbell River. In this instance we have laid three charges against Western Mines and are insisting that the company clean up its mine disposal methods to safeguard the salmon resources of the Campbell River.
At this point it might be useful if I reiterated the department's objectives on fish habitat matters. They can be stated quite simply. First, there must be no net loss of productive fish habitat in locations where the federal government manages the fisheries. Second, where feasible, we will restore and develop areas to provide a net gain in the total amount of fish habitat. Third, we intend to be firm in the use of the federal statutory powers to protect fish habitat when and where necessary, temperd by co-operative, fair and reasonable dealings with those who seek to use the water resources for other purposes.
Certainly the department prefers to use the consultative, co-operation route to achieve results rather than wielding the big stick with the inevitable confrontations and court proceedings. However this is not an area where we can afford to procrastinate. Once a fish habitat is destroyed or a salmon stock wiped out, they cannot be magically replaced overnight just because we have been successful in a court prosecution, however heavy the fine. Even with everything working in our favour, it could take years to offset the damage caused by a careless river diversion, the building of a dam, the thoughtless dumping of fill in a marsh or spawning bed or the discharge of pollutants into fish-bearing waters. Often the damage is irreversible and valuable spawning or breeding areas may be lost forever.
It is ironic that it is in the mighty Fraser River, which has the greatest potential as a salmon producer of any river system in British Columbia and possibly in the world, that we are experiencing the most serious fish habitat losses. I suppose it is easy to say that those agencies which should have been looking out for the fish, whether they fall in the federal or provincial domain, have been lax in not living up to their responsibilities. Be that as it may, fish habitat continues to be lost and the Department of Fisheries and Oceans is determined, one way or the other to reverse that trend. We cannot afford to wait.
It is not difficult to predict where the pressures on the Fisheries resource will originate in British Columbia in the near

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Hydro Development
future. As readily available B.C. timber resources dwindle and harvesting moves to difficult terrain farther up river valleys, land slides or erosion problems are likely to occur to the detriment of entire streams.
On another front, with a projected hydro power deficit predicted in B.C. as early as 1985, one can anticipate renewed overtures seeking shared or primary use of major rivers to generate power. With current economic conditions encouraging an expansion of B.C. agricultural production, irrigation needs for new farm lands will become an even greater competitor with fish in the use of water. The mining industry- hardrock, placer and, most recently, coal-is also expanding dramatically and making its own unique demands on water resources. Finally, the prospect of greatly increased shipment of oil by tankers and the spectre of possible major oil spills poses another damage threat.
I know that departmental officials are working on these and other initiatives to improve and strengthen the department's management role on the west coast and elsewhere and, granted a reasonable degree of co-operation, I am sure their efforts will meet with success.


Mr. Thomas Siddon (Richmond-South Delta):: Mr. Speaker, given the optimistic outlook presented by the Parliamentary Secretary to the Minister of Fisheries and Oceans (Mr. Henderson) as to the commitment of the Minister of Fisheries and Oceans (Mr. LeBlanc) to husbanding the environment of British Columbia, at least in so far as our salmon resource is concerned, one would have to wonder why the minister is hesitant about disclosing the documents which have been called for by the hon. member for Skeena (Mr. Fulton) in motion No. 28, which is a call for the production of correspondence, telegrams and other documents exchanged between the Department of Fisheries and Oceans and British Columbia Hydro, because if all the things the Parliamentary Secretary to the Minister of Fisheries and Oceans has outlined are true, there ought to be nothing to hide.
I want to start by complimenting the hon. member for Skeena for bringing this very important matter before the House. It is in this type of forum that we can prevent in the future the kinds of disasters which have occurred far too often in British Columbia and in other parts of Canada in the past. However, in the comments of the hon. member for Skeena I found a hint that he feels there is something sinister in the fact that officials of the Department of Fisheries and Oceans would be meeting and corresponding with officials of British Columbia Hydro about the possibility of developing additional hydroelectric power on the streams of British Columbia.
I think the hon. member for Skeena typifies that overreaction to any environmental problem, which acts as a valuable conscience for our society but which sometimes makes it difficult for people to extract the facts and the truth from a lot of rhetoric and exaggeration. I am saying that this is an effective role for the hon. member for Skeena to play in serving as an environmental conscience, but as a former
professional person; a mechanical engineer, I believe man and nature can live in harmony. In fact, evidence shows that man can improve upon nature, and has in many ways, which makes our modern twentieth century civilization as comfortable as it is. Granted, there are problems and some disasters about which I want to say something, but I certainly agree with the hon. member for Skeena when he says that these documents should be available for public perusal. There ought to be nothing to hide, as I said a few moments ago.
I am glad the hon. member for Skeena said he was not opposed to the rational development of power on the waterways of British Columbia and in other parts of Canada because if we are to provide comfortable housing and meaningful employment for our young people who are to follow and if we are to feed the Third World nations and help them to develop their economies, we will have to develop our national resources in some manner in harmony with nature. However, we cannot avoid developing those resources and producing power as an important adjunct of that process.
The hon. member for Skeena seems to have constructed a very good case that there are certain documents in existence and that for some reason they are not being made available. When I was an alderman in a community in British Columbia, I had to deal with a very difficult problem. There was always a hue and cry as to whether documents should be made available or kept secret, and whether we should discuss things in camera or whether everything should be discussed before the public. I suggest that when planners are trying to lay out a framework for some concept of development, they ought to be free to do that, just as Members of Parliament sometimes, within the confines of caucus, like to talk and think out loud about concepts without having the pressure of public opinion on their backs. However, 1 submit that once documents relating to major developments of the scale we are talking about here are completed, printed, signed and exchanged between governments or departments, those documents should be made freely available. I do not know the reason for which the department and the Minister of Fisheries and Oceans could argue to the contrary.
I recall in municipal politics that if one disclosed what he was thinking about too early, then outspoken and sometimes reactionary environmental groups would ascribe all kinds of motives and exaggerate excessively, to the point that a very good project might be stopped in its tracks even before the studies had been done to the extent rquired to make the case and to make it on sound technical and quantitative bases. On the other hand, if documents are withheld, then there is always the suspicion that somebody has something to hide or that there is a great conspiracy. There is always the danger, as we have seen in the Amax case in particular, that when the facts are known, it will be too late to reverse initiatives which have been taken because of the implications for employment or in the case of the Amax project at Alice Arm because of the implications for investment. There is always the danger that perhaps we will not find out until after our light bulbs are lit by a new hydroelectric dam, and then we will be so comfort-
May 28, 1981

able and dependent upon that new form energy that it will be absolutely impossible to reverse that situation.
I think the secret is to allow officials to carry out these interdepartmental or intergovernmental discussions, but at the point when documents are available, printed and signed, they must then be made available for debate in a parliamentary or democratic forum. Decisions on these proposals should never be made within the confines of the cabinet room or enacted by order in council. In cases of major studies which have an impact on the environment, the environmental assessment and review process should be mandatory in all cases. There should be a full process of public debate and discussion where the technical experts and environmentalists come together and the relative merits or lack of merits in these projects are debated.
In British Columbia there are some examples of environmental disaster. Many years ago British Columbia Hydro began to dam many of the valleys up above Vancouver without cutting down the trees. One notable example is the Stave Lake area where we constructed a reservoir, but it was just dotted with dead timber. That timber had a recoverable value, but at that time no one could be bothered to clear-cut the land first. The Bennett Dam in the Mackenzie area of northeastern British Columbia came about in the same way only about 12 years ago.
Vast areas of northeastern British Columbia were flooded without the trees being cut down first. There is a continuing debate about the elevation of the High Ross Dam in Washington State, which would flood a valley in southwestern British Columbia, the Skagit Valley, and there is great danger of eliminating a very valuable recreational area there. Everyone is very suspicious of the arrangements and the deals which were made with Seattle City Light and Power many years ago, which again was not done in the context of a parliamentary forum where everyone could witness the debate and hear all the pros and cons of the proposals.
Of course, the most remarkable example of lack of care about a major and important salmon spawning resource is the deterioration of the Fraser River system itself. In the lower reaches of the Fraser where I live in the Richmond-Delta area the coliform counts are so high that our children cannot swim there any longer. The good people of Vancouver who do not want to see any more development in our area, want to continue to expand their discharge of sewage into the Strait of Georgia and Fraser River. At some point it may well be too late to regenerate the Fraser River for the purpose of maintaining the salmon runs which are so essential to our economy and the way of life of the people of British Columbia.
However, I would like for a moment or two to speak on the positive side because, as the parliamentary secretary has pointed out, the benefits of the salmon enhancement program have been clearly demonstrated and, assuming the government maintains its commitment, we will see before five years have passed over $150 million invested directly in salmon enhancement projects. The Capilano hatchery, for anyone who has
Hydro Development
visited Vancouver, is a remarkable example of what man can do to improve upon nature and produce hundreds of thousands of salmon each year of the coho, chum and chinook varieties which will then return in two or four years. Almost without fishing boats those salmon can be trapped back at the hatchery as they return to spawn and produce another cycle. That is essentially a man-made contrivance which has improved on nature many, many times over to our advantage.
The spawning channels at the hatcheries at Qualicum and Little Qualicum, have proven to be a tremendous improvement on nature where eggs laid by female salmon are nurtured and regenerate many, many times more efficiently than in the natural environment. The Puntledge River hatchery on Vancouver Island is an example of a hatchery being built immediately below a hydroelectric dam. In fact, it is an attempt to co-ordinate hydroelectric development with salmon enhancement in a positive way. It has its shortcomings, but many of the improvements technology is providing, such as vertical slot fishways and the ability to fertilize the lakes and reservoirs upstream of the dam as is done at Great Central lake on Vancouver Island, and the fish ladder and hatchery operations at Hell's Gate in the Fraser Canyon, provide the opportunity for salmon to multiply and coexist with man so that we might enjoy an increasing benefit in terms of the food resource that that represents to us all.
So I am saying that these sorts of projects should not be ruled out without detailed study which has to start somewhere, and I would be astounded if the hon. member for Skeena wanted B.C. Hydro to do such studies in isolation. I would suggest it is probably a tremendous advantage that they are meeting with DFO and provincial government officials, and consulting section 33 of the Fisheries Act. Without this kind of consultation, Mr. Speaker, the kind of disasters that have occurred in the past might well reoccur in the future. So although the hon. member for Skeena is serving as a valuable whistle blower, and I agree with him wholeheartedly that these documents should be released at this point, there is also, I think, a responsible position for the minister to take, provided, of course, the government will comply with this motion and release these documents because I do not see that it has anything to hide.
The Amax controversy and the cessation of the discharge from that mine site today should probably teach us all some lessons. It will teach the investors, the entrepreneurs and the industrialists something about the increased public consciousness and concern for environmental questions. But again, to add some balance I would suggest that the mere existence of a plume, which was discovered yesterday in Alice Arm, does not prove that there is a hazard to fish life or man. I do not know whether the hon. member for Skeena drags on those plumes with which we have to contend in committee rooms but many people do and plumes, whether they be from cigarettes or tall smoke stacks at places like Sudbury, are a fact of life. Man will continue to produce effluents and discharges so long as the natural biological processes continue. The mere existence of a plume should not be cause in itself for people to go parading

May 28, 1981
Hydro Development
around with placards and overreacting. The question is: does the plume in Alice Arm really carry on outside Alice Arm, which would be contrary to the special permit that was issued, and are the concentrations of particulates in excess of the limits set out under the legislation? In that case there is definitely a hazard, and I think the fact that Amax has agreed to cease the discharge means they are now concerned that there may indeed be a problem, that their hydraulic studies were not done thoroughly enough and their modelling of the situation did not simulate the real circumstances in Alice Arm.
So I believe that development is essential, and I think the hon. member for Skeena agrees with that. Much as people in his riding may not enjoy all the amenities those in Vancouver, Toronto or Ottawa enjoy, I would not want him to suggest that the people in the Skeena area, Prince Rupert, Terrace and elsewhere should not be able to aspire to the same types of comforts that our modern industrial society is providing. Perhaps in the long run, if we in this party agree to the favourite notion of the NDP, that we should have an industrial development strategy for Canada in order to have more finished product from our resources, we will have to contend with some of the large-scale projects such as the one at Hat Creek and chemical plants and factories, steel mills, and who knows what else. All I am saying, Mr. Speaker, is that I believe, and history will show, that if the engineering is done properly, if foresight is applied and there is an open process of studying these concepts and proposals, we can improve upon the natural circumstances. So let us keep a sense of balance on these questions.
I am not convinced that the hon. member for Skeena's notion of lowhead type turbines will sove the problem because there are economies of scale associated with transmission systems and networks that may mitigate against these lowhead type turbines unless they are going to serve merely a small neighbourhood area. In fact, I think we can build large scale projects in harmony with nature and in the process improve on the environment as far as our biological resources are concerned. I realize that other hon. members would like to have a chance to speak. I understand this debate will go on for another 20 or 30 minutes, so I will resume my seat at present and conclude by saying that 1 hope the government will accede to the request of the hon. member for Skeena.


Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, before I come to the substance of my remarks I want to congratulate the Parliamentary Secretary to the Minister of Fisheries and Oceans (Mr. Henderson), who, I believe, in his expose of the facts of this issue, has set out very logically that the issue is one which is being given serious consideration by the department as it has been in the past and will continue.
The hon. member for Skeena (Mr. Fulton) has raised a number of issues in his remarks. He says, and I do not believe he intends to say it in a disputatious way, that the minister, as I understood him, is not very concerned about this issue. The hon. member also made reference to the fact that the Minister of Fisheries and Oceans (Mr. LeBlanc) and the Minister of the Environment (Mr. Roberts) are not here today, and somehow
that adds up to their not being concerned with the issue. Well, if that is the implication he tried to leave in this House, I totally disagree; I think the opposite is the case.
1 would also like to indicate to the hon. member for Skeena that I hope to have the opportunity in the foreseeable future-


The Acting Speaker (Mr. Blaker):: I am sorry to interrupt the hon. member but the hour for private members' business has now expired and accordingly I do now leave the chair until eight o'clock this evening.
At 6.01 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of Bill C-57, to amend the Excise Tax Act and the Excise Act and to provide for a revenue tax in respect of petroleum and gas, as reported (with amendments) from the Standing Committee on Finance, Trade and Economic Affairs, and motions Nos. 1 and 3 (Mr. Blenkarn).
William J. Yurko: Mr. Speaker, as always I feel privileged to speak in this assembly; this evening particularly so because we are debating a most important bill, Bill C-57, to amend the Excise Tax Act and the Excise Act and to provide for a revenue tax in respect of petroleum and gas.
This bill is intended to increase substantively the revenues of the federal government by new taxation of those sectors of the Canadian economy which are growing, primarily the publishing, cosmetics, tobacco, alcohol and energy industries. This is being done at a time when the economy should receive a boost through tax reduction and decreased government spending policies such as those being followed in the United States, rather than tax increases.
Before speaking more specifically on various aspects of the bill, and in particular on part IV cited as the petroleum and gas revenue tax act, I want to address myself more generally to the present nature of the Canadian economy and the government's response to it.
Recently, the government has stated repeatedly that it is following a policy of economic gradualism. I ask: gradualism in what? Gradualism in the rate of rise in inflation which has
May 28, 1981

reached 12.6 per cent? Gradualism in the rate of rise of bankruptcies in the Canadian economy? In the first quarter of this year business bankruptcies are already up by 30 per cent over the comparable quarter last year. Is it gradualism in the rate of rise of government spending over the last few years which has now reached astronomical annual deficits of some $14 billion or $15 billion? Gradualism in the rate of change of the money supply? Gradualism in the rate of rise in interest rates? The wild gyrations in interest rates both up and down in the last year are hardly extremes of economic gradualism. Is it gradualism in taxation of selected growth industries such as are implicit in Bill C-57? The federal government is now seeking revenues from areas which have traditionally belonged to the provinces-taxation of resources at the source, a form of royalty. Mr. Speaker, I ask you, gradualism in what? Just what economic levers available to it has the government shifted gradually? Indeed, just what economic levers does the national government control today?
The government can increase the levels of taxation, as it is doing with this bill, Bill C-57. We have today in the Canadian economy the gradualism of confusion and economic acquiescence to forces beyond the control or fiscal management of this government brought about by a decade of economic neglect and misdirection. This national government has lost the ability to manage the national economy, lost it partially to the provinces. By de facto royalty taxation of resources, it is trying to regain some of that lost control. The government has lost it to the dictates of international economic forces beyond its control. It has lost it to the built up inertia and momentum of its own spending habits and policies during the last decade, policies directed toward wealth, redistribution with little or no attention to wealth formation and the competitive productivity of Canada's work force. In productivity we have dropped from second place to twelfth place in the last decade among the nations of the world. This bill, more than any other government measure, highlights the mess in which the Canadian economy finds itself today.
Canadian interest rates are totally at the mercy of the levels established in the United States of America. Why have the U.S. rates reached such levels and are apparently being maintained there, rates which have caused alarm to world leaders such as Helmut Schmidt? Why are U.S. rates so high, in excess of 20 per cent, when, indeed, the most recent monthly inflation rates were of the order of 5 per cent? There is a 15 per cent spread, Mr. Speaker. Has Canada made representations or asked to be apprised of the need for such high U.S. rates? Is the United States following economic gradualism? The U.S. dollar is fundamentally the basis or standard of all other free-world currencies. Why then are U.S. rates so high when its inflationary rate is reasonable? The United States is pursuing a course of reasserting its leadership role in the world. What better way to proceed than to strengthen its currency, promote an influx of investment capital, permit capital accumulation such that it can be directed for hard commercial and needed industrial reinvestment rather than frivolous consumer indulgence? This is not a policy of gradual-
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ism in the United States, it is economic shock treatment. In all its ferocity it is being imposed on Canada and Canadians; and this government recognizes, literally admits, that the economic mess it has created over a decade is so severe that about all it can do is pray that the U.S. will relent and reduce the severity of the shock treatment and lower interest rates. The government must have prayed pretty hard because today there came some small relief and interest rates dropped slightly.
Our very own spending habits; causing us to live well beyond our means-and effectively off the backs of future generations, have rendered us impotent. So we bring forth Bill C-57 and set back a vibrant oil and gas industry for at least a decade so that the government can generate a little more revenue to keep the deficit from rising a little higher. What can we do? We can face up squarely and realistically to the mess we are in and begin to plan, seriously plan, for the mid-term and the longer term while holding the economy together as best we can in the short term.
This nation needs an energy agreement, not only with one province but with all it needs it now. This nation needs an industrial strategy, and it needs one soon. Not an industrial strategy based on a dollar which must be constantly propped up by frantic fiscal transactions by the national government and the Bank of Canada, but a strategy based upon a dollar which has been allowed to assume its true international value. This nation needs a new rationale, a new direction, difficult as it may be, toward government spending and regulation at all levels of government. Government must manage the national economy more and be involved in it less.
In 1978, after a series of federal-provincial sectoral meetings, followed by a first ministers' conference on the Canadian economy, major decisions on the economy were agreed upon. What were those decisions and how do they differ from the government's fiscal and economic measures of today, which are more taxation and more spending, as is evident by the bill before us?
I want to refer to the Prime Minister's (Mr. Trudeau), analysis of the economy in 1978, just three years ago. This is what he told the first ministers:
Allow me to set out for a few moments what I believe are necessary conditions in this new partnership. Amongst many, I believe four are of primary importance:
First, it is governments' task (in consultation with Canadians) to establish the economic goals the country can achieve-
What are these goals today? More taxation? To continue:
Second, we must understand that private citizens and private markets have the major task in ensuring economic performance in Canada.
Not the government, the private sector. The Prime Minister went on to say:
Our job in government is to provide an economic framework-we cannot and should not manage all the details of economic activity.
What is this economic framework today? He said:
Third, we must recognize the country is diverse in its regions and that the economies of each region are continuously changing. It is because Canada is diverse and dynamic, that the relations between governments at all levels must be flexible and adaptable. That we must also demonstrate.

May 28, 1981
Excise Tax
Demonstrate how? By punishing the west through damaging resource taxation.
The fourth point the Prime Minister made at that first ministers' conference was:
-good economic performance is not an end in itself. But without it, the kind of country we all want, humane, tolerant and compassionate, is not possible. Therefore, we must provide the effective leadership which good economic performance demands. At the same time, as political leaders, we must aim to serve Canadians in a variety of ways, not just to help manage the balance sheet.
Where is that leadership today, Mr. Speaker? The Prime Minister went on to say:
From 1965 to 1975, government expenditures, at all levels, grew from 26 per cent to 36 per cent of our gross national product.
There are many who argue that our governments have grown too fast and too large. They say that in our attempts to provide government services for people, we sacrificed economic efficiency and competitiveness. I have some sympathy with this point of view.
That was his view in 1968. He said:
I recognize, as we all must, that if we are not efficient and competitive, if we do not create wealth in the country, we cannot sustain our efforts to help those who need it and build a more humane and equitable society.
But what have we done and what are we now doing?
The Prime Minister also said:
Our aim must be to constrain the growth of our governments. We must reduce our share of gross national product. But, even more important, we must reduce the intrusion of bureaucracy in the daily lives of Canadians.
That is what the Prime Minister said in 1978 at a first ministers' conference. What does this bill do? Is is an imposition, an intrusion in the taxation areas of other levels of government, particularly in the resource areas. The discussion culminated at that conference, and it is time we had another economic ministers' conference. There is need today for a first ministers' conference on the economy, and it should have been held several months ago. That conference concluded along these notes:
The first ministers of Canada's eleven governments have arrived at far-reaching agreement in a large number of economic matters.
Following three days of intensive meetings in Ottawa and two months of preparatory sectoral talks, they announced steps today that will:
-facilitate the setting of economic objectives-
What are those today?
-improve demand management policies,-
I will want to refer to these in a minute.
-foster responsible price and incomes behaviour,
-strengthen the business investment climate,-
This should be achieved not through more taxation, but through less taxation.
-and further shape trade, industry, energy, manpower and regional development initiatives.
First ministers see an expanding private sector as the major impetus for growth in the Canadian economy.
My, how this differs from the massive throttling of the Canadian economy through the National Energy Program and its fall-out legislation such as Bill C-57 and Bill C-48! What
were those demand management policies? There are three of them:
(i)	The general instruments of monetary and fiscal policy should be used to encourage the growth of demand which would bring the desired growth of output and employment at declining rates of inflation.
(ii)	The monetary policy being pursued by the Bank of Canada is consistent with this objective.
It was consistent at that time.
Is it consistent today?
First ministers agreed that the Governor of the Bank of Canada should review the objectives of monetary policy with the conference of finance ministers on an annual basis.
When was the last time the Governor of the Bank of Canada met with the finance ministers of the various governments in this country? Third:
(iii)	The trend of government expenditure growth should be held, on average, to less than the trend growth in the value of the GNP or provincial gross product.
Is that what we have done in the last year?
In this context, however, it was agreed that capital expenditures of a revenue producing nature were important to economic growth and development.
My, how these policies differ and how they are at variance with the policies of the government and the Governor of the Bank of Canada just three years later! What has happened during this period? I will tell Your Honour what has happened. We have not contained our spending as governments in this land. In particular, the federal government has continued to spend, and spend some more, and increase the national debt until we now know that that debt is over $14 billion per year and that much of it must be refinanced at much higher interest rates. So, we bring in a bill, Bill C-57, to tax primarily the growing industries in this land, particularly energy.
I find the 8 per cent tax, which is called the resource royalty tax, to be particularly interesting because, to my mind, that tax has several objectives; not only to raise revenue for a faltering government which is broke, and is in debt up to its ears, but to take revenue from the energy companies in western Canada and lower their cash flow to such a level of insignificance that they will start to put terrific pressure on the provincial governments to lower their royalties. That tax of 8 per cent is the federal government's way of imposing resource control, even though it does not have constitutional power to do so, or imposing a resource royalty on the provincial resource when there is no room for that taxation. So, the federal government simply said: "We will take from the companies their cash flow and tell them to go to the provinces and have them lower their royalties so the companies' cash flow can be increased".
That was essentially the reply of the Minister of Energy, Mines and Resources (Mr. Lalonde) to an hon. member on this side of the House who asked about the solution to the problem of wells which were being shut down in Saskatchewan. The minister said to go and ask the province to lower their royalties. So this is doing something indirectly through the Constitution which cannot be done directly.


Some hon. Members:: Hear, hear!
May 28, 1981


Mr. Ron Stewart (Simcoe South):: Mr. Speaker, I feel a sense of deja vu, in rising to speak on this bill today. Over 200 years ago the Americans staged a tea party in Boston to protest against representation without taxation. That is precisely what we are again now talking about right here.


Stanley Howard Knowles: It was the other way around!


Ronald Alexander Stewart: The government is asking Parliament to give carte blanche approval to a bill which would automatically increase excise taxes indexed to the consumer price index. How convenient it would be for the government not to have to face Parliament when future taxes are increased! How convenient it would be for the government not to have to deal again with unpopular measures in the future! But that is not the Canadian way because it was not the American way. It is the Liberal way. I have been present religiously in this House since Parliament was convened over a year ago and I have not seen one positive measure put forward by this government-not one piece of legislation which adds to the productivity of this country. That is what the free enterprise system is all about.
This bill is oppressive, regressive, rotten, and imposes risk-stifling taxation. It is putting an 8 per cent tax on our gas industry. Hon. members opposite stand up so proudly and say this is Canadianization. They call it a national oil policy, but I call it a disgrace and a nationalization oil policy. Not one piece of progressive legislation which deals with building Canada or measures to get this moribund economy moving again and put Canadians back to work, not out of work, has been offered.
This legislation is regressive, oppressive, unfair, discriminatory and will only add to the cost of living and inflationary woes of one of the greatest nations in the world. It is crippling the citizens of Canada.
We do not need negative legislation. We need positive measures which will provide social justice and groceries at a reasonable cost. We need jobs. That is what my constituents are interested in. We need less unemployment, not more. We need lower interest rates, and it can be done, so that more Canadians can carry on their small businesses and afford mortgages so they can own their own homes. It is the Canadian dream, if you will.
We need positive action and some sign from the Minister of Finance (Mr. MacEachen), who smirks and smiles and shrugs, that he is aware that inflation is enemy number one in this country. We need positive measures to encourage the manufacturing sector and to stimulate R and D.
Most of all we need an awareness on the part of the government that the economy is sluggish and that its policies are mainly to blame and should be changed. They can be changed.
I am fortunate to have a wonderful corporate citizen in my constituency in Molson's Brewery, one of the largest breweries in the world. The new rate of excise tax on beer goes far beyond the Crosbie budget in terms of the application of the
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levy. The Prime Minister (Mr. Trudeau) and the Deputy Prime Minister-the alleged-and I say alleged-Minister of Finance, have launched a new beer on the market. I wonder how many members opposite have heard about it. It is called "Overdraft". It is not a popular seller. It does not go down well with the average Canadian, like Molson's. Like the government, Overdraft is full of froth and suds and foam. I resent the government's end run in indexing this beer excise tax to the alcoholic beverages subgroup of the consumer price index.
I resent periodic increases in this tax without reference to this Parliament. We have not had the Boston tea party yet. Like some of my colleagues who spoke earlier, I am saying we have not had it

yet.
I resent the ham-handed efforts of the government to avoid facing Parliament on this issue in the future. I resent its arrogance-read any newspaper and you will see it-in attempting for all time to stave off the politically risky business of dealing with increases in the price of beer in future budgets.
The opposition was told that this tax is being imposed to protect government revenues derived from this tax from erosion and that it was based on the same formula which applied to the indexation of personal income tax. What a joke. Indexation of personal income tax is designed to protect the taxpayer from inflation and to discipline government to better manage our fiscal affairs. It was not intended that the government should ever profit from inflation by automatically receiving higher revenues from people because they obtained cost of living increases to ward off the ravages of the record high inflation which has been brought on by this government. That evidence is based on statistics, it is not just my opinion.
By indexing taxes on beer the government is doing or attempting to do exactly and precisely the opposite of what indexation of personal income tax, as originally suggested by the Hon. Robert Stanfield, is doing-it is taking advantage of a formula which is meant to buffer the consumer against inflation and fiscal management.
If we allow this measure to pass, the government will be allowed to tax people on inflation and to do it without ever again referring the matter to Parliament. Shades of the Constitution-shades of metric!
I am sure all hon. members are familiar with the brief which was sent to all Members of Parliament by the Brewers Association of Canada.
I would like to quote from a letter I received from a driver-supervisor for Brewer's Retail in my home city of Barrie. This is a concerned Canadian, not some executive officer. He points out that with this insidious and ad valorem tax on beer, by 1991 a case of 24 beer will cost $23.64 and a bottle of gin will cost $16.64. He writes:
I find this hard to understand since the alcohol content of distilled spirits is higher by volume by 35 per cent than it is in beer, I am also concerned that the proposal of automatic increases on alcoholic beverages would not require the approval of Parliament.

May 28, 1981
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Bob Rae: What does he think of Frank Miller's budget?


Ronald Alexander Stewart: The hon. member is known to suffer from constipation of thought and diarrhea of the mouth. The letter continues:
Bill C-57 seems to me to be a contradiction of this age old belief, by encouraging people to drink more distilled spirits, while discouraging the consumption of beer, which has traditionally been known as the beverage of moderation.
Perhaps the Finance Minister is discriminating in favour of his own personal like for single malt scotch imported from the Isle of Skye or the Hebrides of his ancestral acres in Scotland.
My correspondent from Barrie continues.


Mr. Evans:: A point of order, Mr. Speaker. I think you would have to agree that the last remark of the hon. member was derogatory and uncalled for. I would ask that you ask him to recall the statement.


The Acting Speaker (Mr. Blaker):: I am sorry, I think the reference to the place of ancestory of the Minister of Finance is geographically inaccurate but I cannot hold that the comments made are unparliamentary.


John Leslie Evans: A point of order, Mr. Speaker. The reference was to the alleged drinking habits of the minister and that is derogatory. I would ask that the hon. member be asked to withdraw that comment.


The Acting Speaker (Mr. Blaker):: I think I explained that it is not unparliamentary.


Ronald Alexander Stewart: I am glad I got through to the hon. member for Ottawa Centre (Mr. Evans) because every time I rise to speak he seems to bring up points of order. I think he must be paying a little bit of attention.


David P. Smith: As little as possible.


Ronald Alexander Stewart: My constituent writes:
My chief concern is that this discrimination will result in a loss of revenue for the brewing industry, which will result in the curtailment of future expansion and, therefore, the loss of many jobs, not only for employees of the brewing industry but also the suppliers of numerous products to the brewing industry.
Much the same as the oil industry, Mr. Speaker. The letter goes on:
As a concerned citizen, I would also like to know: Is the Liberal government prepared to lay an even heavier burden on the taxpayers of Canada in unemployment benefits, welfare benefits, etc. Would it not be better for the government to realize this revenue through income tax from people already in the work force. A great deal of the taxpayers' money has already been spent to create jobs. Bill C-57 would seem to me to defeat this purpose.
Amen. He concludes:
Thank you for taking the time to read my letter. 1 would like you to know that this is the first time 1 have felt sufficiently concerned to write my MP. 1 would appreciate a reply to my letter.
He got one, of course. I would like to don my other hat now, which is one of a wholesale tobacco distributor. Although not active for the past two years, I still maintain my firm which is under a management team. I speak today as a past president of the National Association of Tobacco and Confectionery Distributors of Canada. I note that the Minister of Finance
and the Prime Minister received and acknowledged a letter from John L. Cunningham, executive manager of NATCD. I have read the reply signed by the Minister of Finance-I will not talk about Scotch now-and 1 can only assume he is completely ignorant of the complexities of wholesaling and distributing, among other things. My own wholesale tobacco and confectionery sales are very small-only $15 million annually. The minister says he does not perceive an ad valorem tax to be an administrative burden. Can you imagine, Mr. Speaker? Has he ever had an inspector walk into his warehouse, as I did last Tuesday when the Ontario tobacco tax went ad valorem, and demand a cheque for $33,000 in excise taxes for a product that had not yet been sold?


Some hon. Members:: Oh, oh!


An hon. Member:: Where did they get that from?


Ronald Alexander Stewart: They borrowed it from this government. The minister has never held a job in the cruel world of business. It is a jungle out there.


Bob Rae: Blame it on Bill Davis.


Ronald Alexander Stewart: That product stacked in my warehouse represents risk on my part. The whole tax is an insidious vehicle which discriminates against the wholesaler, the small businessman and the oil producer. One hundred and twenty-five of them made representations here in Ottawa last week.
Only recently one of my chief competitors, a firm which grossed $25 million a year and which had been in operation since shortly after confederation, went into receivership, and with it 75 to 80 jobs went down the drain. These things are not being acknowledged on the other side of the House, but mention was made by my colleague, the hon. member for Edmonton East (Mr. Yurko) just a few moments ago. The government does not want to talk about those 30 per cent extra bankruptcies. They are real to me because they happen next door.
The minister talks about the number of jobs being created. What a joke that is. How many jobs were created because they were needed as a result of the small rate of growth in the economy and normal attrition? Jobs were created all right, but how many less than were really needed? That is the point, what about the number of bankruptcies we have, and our high interest rates? Does the minister know how many jobs have been lost in Canada because of his government's economic and energy policies in the field of taxation? No way. Does the minister know how many small firms he is forcing into bankruptcy and receivership? He does not care. As I said, one of my chief competitors, who was recently forced into receivership, operated six branches in Ontario, two cash and carry outfits and one vending machine company. They were wiped out. That is the legacy of the MacEachen school of economics.


An hon. Member:: What about competition?
May 28, 1981


Ronald Alexander Stewart: I am not afraid of competition but I do not need the government for my competition.
Ad valorem taxes on tobacco, cosmetics and beer are essentially indexed tax increases. They are essentially taxes without representation, and hon. members over there know it.
Not only are tobacco taxes already a burden on some seven million Canadians who enjoy cigarettes, cigars or pipes, but the finance minister's new approach will encourage further inflation and lead to an economic burden on Canadian smokers, especially those in the lower income groups or those on fixed incomes who comprise the majority of Canadian smokers. Whether hon. members over there like it or not, there are seven million smokers out there.
When provincial and federal budgets are brought down, it is always "a penny on the pint" or a nickel on a package of cigarettes. It is nickel and diming the poor guy who wants to have a little fun out of life. Too bad that our finance minister would not be indiscreet enough to tell a reporter "a penny on the pint" on his way into the chamber on budget night, and then we would be rid of him.


Gordon Edward Taylor: They are learning fast from Moscow.


Ronald Alexander Stewart: 1 ask hon. members, how far can this government go?


Bob Rae: All the way to Queen's Park.


Ronald Alexander Stewart: How much more can the tobacco industry and the average Canadian bear? I wonder if the hon. member opposite, who is flashing his cigarette package, realizes that a carton of 200 cigarettes costs me as a distributor $8.82.


Bob Rae: Shame on Frank Miller.


Ronald Alexander Stewart: That is including a 2.5 per cent nine-day discount. That is the bare-faced invoice cost. Do hon. members know that is taxed $6.54?


An hon. Member:: How much is federal tax?


Ronald Alexander Stewart: I will tell you how much it is. The $2.92 tax goes to the Ontario government and $3.62 goes in tax to the blue-suited feds over there.
The tobacco industry is an important industry in Canada, and hon. members should not forget that. Last year the total retail sales value, including taxes of all tobacco products, was $3,135 billion. Nine hundred and thirty four million dollars was paid in federal excise duty and sales taxes. That is almost the entire budget for our foreign aid program, which you people over there want to inflate to .75 per cent of the GNP. Then that program will be up in the billions again. Can we afford it?
Where else could this spendthrift, greedy guts government get that kind of money to do the things it is doing by waste? Provincial jurisdiction realized $765 million from the tobacco industry. Corporation income taxes in the manufacturing sector were $56 million. Tobacco creates jobs in the fields and
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in the plants. In 1980, wages in the industry totalled $166 million, and another $23.7 million was spent by the industry in transportation costs. But go ahead, tax it, tax it out of existence, just like you are doing with everything else. You have not had a fresh idea in 13 years.
The tobacco industry believes that the federal and provincial governments, which never miss an opportunity to identify inflation as one of Canada's major problems, should set an example of restraint instead of adopting new inflationary fiscal methods. This industry is being taxed out of existence. There were some 66 independent distributors in Toronto a few years ago. There are now approximately 12.
Getting off the tobacco subject and into another area, I would now like to read a telex that I received from Bruce Roland, publisher of the Barrie Examiner which is the daily newspaper in my city. The telex reads:
Re proposed legislation altering newspaper taxation. Extremely concerned this ill-advised legislation if passed will cripple entire Canadian newspaper industry. Legislation would be tax upon newspaper's raw materials as well as revenue and profit. Proposal shows almost total lack of understanding about newspapers and their operating methods.
That is to be understood. The telex concludes:
Strongly suggest taxation proposal using equitable and urge maintenance of past practice. Yours truly, Bruce Roland.
I wrote to the Minister of Finance (Mr. MacEachen) upon receipt of Mr. Roland's telex. I received a three-page reply which left me neither any wiser nor better informed than when he stands up in this House. I concluded that the minister has no intention of changing this part of his legislation or anything else because he feels that the taxing on all advertising inserts will place all producers of these products on an equal basis. Equalization and linguistic equality, that is all we care about. No doubt we will soon see a new echelon of bureaucracy in the public service armed with rulers measuring the inches or centimetres of lineage devoted to advertising. Big brother will watch over everything, including the ads we will read in our daily and weekly newspapers. We will call it Pravda the third.
There is another little sleeper, that is the packaging tax. The sleeper tax has aroused the ire of Canada's marginal manufacturers who say that a Department of Finance decision requiring them to pay federal sales tax on repackaged goods will mean higher prices to the consumer and a loss of jobs.
A fellow friend of mine who is in the paper business in Barrie, Mr. Ron Lynch, mentions potato bags. If you are a grower and pack in bags, you pay no tax. But if you pack goods as a manufacturer, you do pay tax. A marginal manufacturer assembles, cuts to size, bottles, packages, repackages or otherwise prepares goods for sale. Some Canadian manufacturers are considering manufacturing outside Canada to minimize the lousy tax. This will mean a loss of Canadian jobs.
I would like to talk about furniture but I realize my time is quite short, but I could go on and on about many things. In a letter dated March 13, signed by John Cunningham of the NATCD, he listed all these unfair, undemocratic taxations. I could talk about Ron Findlay, Vice-President of Rothmans, who told me today that there are 600 products in every

May 28, 1981
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warehouse and most retail stores that will require paper changes. We have created a paper monster, and a bureaucratic nightmare which is fuelling the fires of inflation.
Walter Hitch, President of Kolmar in my town, states that the cosmetic industry will not be taxed in the same manner as other manufacturers of consumer goods. I have heard also from John Rogers, President of Molson's Brewery. My list goes on and on.
Mr. Lumsden, head of the independent wholesalers wrote about the 600 retailers he serves and what it will mean to them. He says he is a fairly organized businessman and he finds it incomprehensible. Next we come to the pharmaceutical industry. I can go through the whole gamut of what this measure will do to the independent businessman of Canada. This is on top of the imposition of the nightmare of metric and the taxation on oil.
Taxation indexing is not what is required, but, as Reuben C. Bellan stated in the Trudeau star "but increased productivity is what we need." May I repeat to the hon. minister of Finance what Cromwell once said to the British autocrat: "If you cannot handle the finance portfolio, in the name of God, go!"


Gordon Edward Taylor: I rise on a point of order, Mr. Speaker, because during the first half of the address by the hon. member for Simcoe South (Mr. Stewart) the hon. parliamentary secretary, the member for Ottawa Centre (Mr. Evans), stood outside the curtains holding his drink, I guess of coffee, and did his interrupting. If he is going to interrupt, the least he could do is follow the rules and be present in the chamber.


The Acting Speaker (Mr. Blaker):: I regret to inform the hon. member for Bow River (Mr. Taylor) that it is not necessarily part of the tradition of heckling that hon. members be inside the curtains.


Gordon Edward Taylor: On the point of order, Mr. Speaker, could the hon. member get up in the gallery and heckle? If he cannot do so, why can he do so from behind the curtains? Come out in the open, don't be afraid.


John Leslie Evans: I am not afraid of you, Gordon, not at all.


Mr. John Gamble (York North):: Mr. Speaker, in rising to participate in this debate on Bill C-57 it is significant to note that from the earliest of times, in terms of the parliamentary system, the public, represented by their elected representatives, has been very jealous of the control by government of the taxation of the citizen. It is accordingly with some regret that we note that the system implanted permanently within the tax framework, as established by Bill C-57, has the effect of removing that direct participation by members of Parliament in determining what the tax laws of the day shall be.
Before my colleagues to the left scream that this is the very thing that has happened recently in the province of Ontario in the recent provincial budget, let me say I agree, and the comments I have in respect of this government will apply
equally to any government which endeavours to impose tax without presenting to the elected representatives of the Parliament or legislature to which they belong an opportunity to discuss and vote for or against a particular piece of legislation.
I do not think it matters whether the government is provincial, federal, Conservative or Liberal, or in an unusual circumstance, NDP, and I say "unusual circumstance" because fortunately the country has had so few of them.


An hon. Member:: Go west.


John Albert Gamble: The hon. member suggests I go west. I have been west. The great people of western Canada had an opportunity to get rid of a canker that had infested them in British Columbia, and hopefully that kind of circumstance will not recur.
In any event I think it is appropriate that members of this House have regard for the change that is occurring. That change is not one we should accept without very substantial and recognized complaint. We have seen changes in this place in respect of our ability to stand and speak for or against a particular issue; changes in such innocuous pieces of legislation as the Canada-Germany Tax Convention which contains a provision by which there is no legislative enactment, in respect of changes, without the imposition of closure, which is built into the very piece of legislation presented to the House and subsequently passed. This is the same kind of creeping undemocratic authoritarianism about which all members should be concerned.
The provisions of Bill C-57 go far beyond that and that alone. They permit the growth of an element in our economy, sought allegedly to be retarded by the government. The Prime Minister (Mr. Trudeau) just the other day, in a very learned dissertation on what the psychology of inflation entailed, indicated that some people believe that because prices are going to increase, it is appropriate that those people increase the price of their product or their services. In the process, they increase those prices in excess of what is really required. Of course, those people of whom he spoke include the members of his own cabinet who have brought before the House this piece of legislation.
It is the personification of the inflation psychology which drives prices up, and this is allegedly opposed by the government. Yet, because of the way in which it fixed its ever-increasing tax bite in respect of excise taxes, it is clear that by fixing them, in relation to certain products covered by the Act, to an element of the consumer price index, the government has given a clear signal to the entire population of Canada that it expects the consumer price index, as it relates to those elements, to increase. The government has made an announcement to Canadians generally that tomorrow the prices of those goods will be higher than today. How has the government made that announcement? It did so by suggesting that its revenues be tied to the prices as they increase.
An ad valorem tax would similarly go down in the event that the price of the commodity, as an element of the consumer price index, was reduced. Of course, the government knows
May 28, 1981

that the price is not coming down because the government is the greatest cause of inflation in the nation. What it has done now, having caused inflation, is to tie its tax grab to the inflationary spiral it has created. Beyond that, it has then gone to the public and announced that prices tomorrow will be higher than prices today.
We know the effect of that kind of inflation psychology. It drives the prices of products out of the reach of the ordinary Canadian. It has the effect, naturally, of influencing the ultimate cost of money. Interest rates have skyrocketed. Despite the fact that today they may have taken a brief dip- and I hope it is not the kind of dip that occurred last year which was followed by insurmountable increases, and presumably we will not be bereaved of those high rates for some time-the fact of the matter is that as a result of increasing inflationary pressure, interest rates will and must rise. It is illogical to ever assume that the investor, whoever that investor may be, the bank or the individual, is prepared to lend his or her money, in the case of the bank its money, at a rate of return which is less than the rate at which the money is being eroded by inflation. With an inflation rate of 13 per cent, it is unrealistic to expect interest rates at 10 per cent.
As a matter of fact, if you really analyse what is occurring, in the event that a lender is in the 50 per cent bracket, a rate of interest at 18 per cent will result in a net return of 9 per cent, and inflation is eating away at the equity of a loan at the rate of 13 per cent, so the loan in fact will result in an annual loss of 4 per cent in terms of the real value of the capital amount of the loan.
Interest rates have to be tied to something more basic than what the government has suggested, that is a direct connection with the U.S. rates, having regard to the fact that every Thursday we have been artificially manipulating interest rates in Canada through the purchase of treasury bills.
Those prices have, in large measure, been influenced by a determination not to permit the Canadian dollar to decline at a rate which would startle the public into realizing what a horrendous mess the government has made of the economy of our country. The real value of the dollar should not be sustained as a consequence of interest rates but, rather, through the value of the product itself and, like any other commodity, if it is in demand, as it should be, instead of being something which is sold off to acquire another product in a foreign currency which may produce a higher interest rate-if it is, accordingly, in demand for some other purpose than for the generation of interest alone-then that commodity, that dollar, will be sought after and have an intrinsic value. How can that intrinsic value be established in the massive amounts which are required for the purposes of today's economy? It is very clear that the most effective and direct way by which this can be done is through the development in western Canada of our gigantic resources which will contribute to our energy requirements.
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Why am I dealing with that issue now? Very clearly, because this delightful piece of legislation has the very opposite effect. It has a provision with respect to a special royalty imposed against the generation of energy revenues, a special tax not based upon profit but, rather, upon recovery of an amount. It is a gross tax, a royalty tax, new and special and designed, I say, to retard development which is essential not just for that part of the country but for the whole nation.
Accordingly, I submit that the only way we can avoid the economic calamities which are caused in our country as a direct result of high interest rates is to attract Canadian investment into an area which is absolutely vital. Those dollars, once tied up in plant and machinery, not only in that part of the country which will ultimately use it but also in that part of the country expanding its economy in order to produce the goods which are needed, will not be available to flee the country in search of a higher interest rate in the United States or elsewhere but will be used for the purpose of generating, as genuine equity, the kind of energy production that is required and vital to Canadian needs.
I was interested in the fact that this ad valorem concept which is built into Bill C-57 has not gone unnoticed among the general public. I had occasion to meet with a constituent who is astounded and offended by the fact that this government would introduce a piece of legislation designed to preclude Parliament from examining on a regular basis the tax structure of the country. I had thought that that kind of consideration was one which might arouse the ire of people in this House and might generally concern some theoretician who likes to examine parliamentary history, but it appears that that is not the case. People are genuinely concerned about the protection of their rights, and they look to this House to protect those rights. They look to the members of this House to undertake that task and lead the way so that other governments, be they provincial or otherwise, come to recognize that the public is not asleep. The public is not prepared to have its rights trampled upon. I refer to those rights which historically have been the foundation of our very being here and the very foundation of the system which we currently enjoy. Accordingly, it is appropriate that we direct as much attention to this issue as we can, hoping-and I am concerned having regard to the way in which the government has responded in the past- to make them realize that something fundamental and wrong is being perpetrated upon not only the system but also the people who live by it and suffer from it.
If I may just return for a moment to the issue of the detrimental effect of the resource royalty tax of 8 per cent upon the general economy of the nation, I might add that I find it extremely strange to learn that the Minister of Energy, Mines and Resources (Mr. Lalonde) is about to prepare the public for another increase in the price of petroleum products at the pump. He is telling us now that we shall shortly be paying an additional two and a quarter cents a gallon to be added to the two and a quarter cents a gallon we have already paid for a total of four and a half cents a gallon. The reason is that Alberta is reducing its oil production by another 60,000

May 28, 1981
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barrels a day and by September, presumably, will reduce it by another 60,000 barrels a day, with the result that at that time, if the federal government follows the policy it has already announced and implemented, a total of 6.75 cents a gallon will be imposed by way of special taxes for the purpose of paying for imported foreign oil to make up for the deficit in production capacity which Canada, chiefly through Alberta, has been able to make available to the general public.
It is curious that this government can extract potentially 6.75 cents a gallon from the public by way of a special tax and pay that money directly to foreign producers of petroleum products, but it could not take that same 6.75 cents and pay it to another Canadian. There has never been a suggestion by the government that the method it has adopted for the purpose of paying for this increased price of petroleum should not be applied in settling its disputes with the government of Alberta. Yet the mechanism is there, and I am convinced, as surely as I stand here, that when that dispute is resolved, the government will have fixed permanently as a tax, never to be removed, the 4.5 cents or the 6.75 cents, whatever it may be, because once imposed, tax is used for whatever purpose the government may set about to use it.
I attended a meeting of the Public Accounts Committee this morning. We had before us the deputy minister of national revenue, and we were discussing those Canadian taxpayers who have never filed tax returns. It was suggested that some of them might well have been in the over-65 age group. I explained at the time that the reason for that particular group's declining to pay tax is probably that they remember that in 1918 when the act was introduced, the government of the day promised that it was simply going to be temporary in nature and, accordingly, they are holding the government to its word.
It is absolutely vital that we come to recognize that this piece of legislation is damaging in its present form, and it is damaging for the reasons I have discussed with respect to the effect it has upon the democratic system, our right to be consulted and our right to speak on and vote for or against a tax increase. It is inappropriate that this House should be asked to grant permanently to the government the right to extract taxes on an ever-escalating basis.
It is wrong because it has no regard to the fact that the greatest way to build the country is by removing, not imposing, additional taxes on the great energy resources available which, if developed, will remedy the economic ills with which we are concerned.


Mr. Bert Hargrave (Medicine Hat):: Mr. Speaker, Bill C-57 and Bill C-48 are the main component parts of the October 28, 1980 budget or, as the government now prefers to call it, their National Energy Program. Provisions of both bills and their implications that are now so apparent are a major irritant and a source of extreme frustration leading to serious alienation throughout all of western Canada but especially in Alberta. This extremely serious situation must surely have been obvious
to every member of Parliament about two weeks ago when the 126 oil and gas well servicing industry representatives spent two days in Ottawa. Their very effective lobby cannot be dismissed if only because they were all Canadian managers and owner-operators of the entire petroleum service industry in Alberta. They were effective because they were all speaking from personal experience about severe cutbacks, lay-offs, current massive budget reductions, idle drilling rigs and supporting services. They were all having to face the reality of a vastly reduced level of operation or perhaps complete shutdown which would lead to selling out or moving to the United States. Those were the grim realities that faced a good many of them, and surely the grim message they brought cannot be ignored, especially by the Minister of Energy, Mines and Resources (Mr. Lalonde) and the Minister of Finance (Mr. MacEachen).
Of the two energy bills this one, Bill C-57, is the more important for the oil and gas well servicing sector, and for me personally because of my special interest and concerns in natural gas in southern Alberta. The discovery and use of natural gas took place about 100 years ago near my home city of Medicine Hat. As a natural resource, natural gas has made a major contribution to that city, and the industrial development of gas-related industries contributed significantly to our painfully slow recovery from the lost generation of the drought and depression wracked 1930s. That was followed by another ten years of recovery and readjustment. Natural gas has rightfully been part of our heritage for almost 100 years. Both of these taxes, the production tax, also known as the natural gas and gas liquids tax, and the 8 per cent wellhead tax known as the PGRT, are viewed with extreme shock and bitter disappointment by all of us in southern Alberta. All Albertans are completely convinced that they are a deliberate and massive federal revenue grab directed right at Alberta.
It was my privilege to participate as a member of the Standing Committee on Finance, Trade and Economic Affairs whenever discussions and witnesses relating to natural gas issues were before that committee. I wish to express my thanks and appreciation to the Minister of Finance and the hon. member for Sarnia (Mr. Cullen) for their analysis of the separate representations of the various witnesses before the committee and those received by letter. The first submission to the committee was from my home city of Medicine Hat which was presented by mayor Ted Grimm and alderman Dr. Ken Sauer, who stressed their quite unique situation wherein the city has developed and owned its own natural gas and electric utilities for almost 100 years during which time these utilities have been exempt from corporate, income, production and sales taxes.
The application of these taxes has been described in their brief quite aptly as confiscatory, abnormal and constitutionally without precedent. They pointed out:
-we do not export the resource-
That is, natural gas:
-nor the profits from its exploitation. We upgrade the resource in Canada, thereby creating jobs for Canadians.
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Later on in this logical and common sense comment they had this to say:
A court of law may interpret the legal technicalities and find that the tax is unconstitutional, but only Parliament can interpret the fairness or equity of taxation.
The new taxes will boost Medicine Hat's residential gas rates by 197.6 per cent, surely an increase much higher than at any other point in Canada. The minister's appraisal was that:
The gas tax is a uniform absolute amount for all gas users and thus customers in all parts of Canada will face the same increases in absolute costs.
I must say that comment is small comfort indeed to retired people in Medicine Hat when they pay next winter's gas heating bills.
Now another witness before that committee was the Federation of Alberta Gas Co-ops Ltd., and they made two visits to Ottawa to tell their story of the impact of this tax on rural Alberta. They ably represent 85 user member-owned rural utilities who supply 40,000 natural gas services for 140,000 people in rural Alberta. They operate a 40,000 mile distribution system which supplies about 80 per cent of Alberta's rural areas. They made the statement that:
Time will show that it was, and continues to be, sound planning to convert to the more plentiful natural gas, from the depleting and more costly portable fuels such as oii and propane.
And the gas co-op has extended a very generous offer to other provinces in Canada to share their experiences and expertise in rural gasification developments. They also make two telling points respecting the impact of these two taxes. The first is that substantially higher gas costs due to the taxes will be a severe deterrent to the Department of Energy, Mines and Resources natural gas conversion program now under way. That program is logical and sound. However, this tax approach is surely not the way to go about it.
The second impact is the immediate and enormous cost increases of commercial fertilizers, most of which use natural gas feedstocks in addition to those other farm fuel costs. In total, it must be obvious that our basic food production costs will increase significantly.
Another witness, the Bow River Gas Co-op, a federation member with headquarters at Vauxhall, Alberta, has illustrated these cost increases with recent figures in a report dated January 7, 1981. On 136,000 mechanically irrigated acres, the cost increases due to the new taxes are as follows: For natural gas used as a fuel in irrigation pumping, a total of $174,000; for two varieties of fertilizers, 11-5-5 and 34-0-0, a total of $659,000, for a total cost increase of $835,000, all due to the natural gas taxes alone. And that figure prompted this appropriate comment from that co-op.
This is one big sum of tax money to take out of one small farming community.
The Bow River Gas Co-op concluded its cost statement by indicating:
If we farmers are not given any protection against this special tax on all fuels, I know there will be a drastic drop in production on irrigated farms.
That statement was made by one of its executives, a man by the name of Henry J. Dick.
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The Federation of Alberta Gas Co-ops Ltd. made a very reasonable suggestion that an extension of time be allowed for the tax payment from the current 30 days, after the end of the month of sale, to 90 days. This was a very reasonable suggestion; I think it was widely supported in committee. However, the minister in his appraisal suggested that other taxpayers could also make similar claims and that to extend the time of payment of the tax to all taxpayers would be costly in terms of lost revenue. Surely the minister has missed their point completely. It is a very valid point and should be reconsidered.
Another witness was the Alberta Energy Services Association. This is the energetic group to which I referred in my opening comments who were here about two weeks ago. That 126-member lobby represented the oil and gas well servicing industry from such widely separated places as: Red Deer, Drayton Valley, Whitecourt, Lloydminster, Calgary, Brooks, Medicine Hat, Weyburn, Estevan and Swift Current.
As Canadian citizens and as responsible electors-and this is their phrasing-they questioned the government energy policy which results in thousands of lost jobs, increasing reliance on very costly foreign oil and financial instability in numerous small communities such as the ones I have just indicated. They also pointed out that hundreds of wells producing less than 12 barrels per day have been made uneconomical by the National Energy Program. Such wells are particularly service-intensive and contribute to energy self-sufficiency throughout Canada, no matter where they are.
The Canadian Petroleum Association in its committee presentation confirmed that Alberta indeed has surplus and proven natural gas supplies of between 16 and 20 trillion cubic feet in capped gas wells. But they are concerned with the continued and increasing slowdown in both drilling and exploration as a result of the National Energy Program, while at the same time the government is pushing its gas conversion program to utilize those capped gas well supplies. I think they have reason to be concerned. They reminded us all that five to ten years' lead time is necessary for adequate exploration and development planning.
The companion association, the Independent Petroleum Association of Canada, was critical of the National Energy Program grant system which heavily favours investment on federal lands, whereas their members are largely confined to the western Canadian sedimentary basin in the provinces. They said bluntly that both taxes should be withdrawn.
The Alberta Chamber of Commerce reaffirmed its belief that Canada can achieve energy self-sufficiency through prompt development of Canada's domestic energy resources, particularly oil. The chamber of commerce bluntly said that the production and wellhead taxes constitute a major infringement by the federal government on the rights of the provinces to own and control their natural resources. They concluded by saying:
A preferable course would be for the federal government to proceed under the Income Tax Act, and if justifiable, consider establishing a surtax on income deemed to be windfall profit.

May 28, 1981
Excise Tax
In concluding my remarks pertaining to the submissions before the standing committee, I must say that I very much appreciated the somewhat more favourable appraisal of the Minister of Finance respecting two odd groups. One was the Motorcycle and Moped Industry Council and the other was the Canadian Water Well Association. Needless to say, the comments were a nice change of pace from most of his other discouraging words on just about all other submissions.
In conclusion, I say very seriously that throughout these remarks I have only repeated several references by others concerning the propriety and legality of the production tax and the PGRT, but surely this is the bottom line of the entire National Energy Program, at least as perceived by the west, especially by Alberta. Let there be no misunderstanding. I am referring to that threat to Alberta's natural resources by the federal Liberal government in these two particular taxes, as well as in Bill C-48. There is a valid reason for what is happening in the west right now. It makes little difference whether we call it alienation, frustration, anger or even separation. These emotions are very real and exist in Alberta, essentially because of the perceived threat to our natural resources which we have only owned and controlled since 1930-that is only 51 years ago!
At this moment the unanimous decision of the Alberta Court of Appeal is still the law of the land, at least until it is overturned by a higher level, the Supreme Court of Canada. Until that happens, surely the Alberta position applies, at least in so far as that decision is defined.
Finally, I am sure the Minister of Finance, his parliamentary secretary and the Prime Minister (Mr. Trudeau) are aware of this feeling in the west and its relationship to this particular bill. I say to them that the 135 amendments now before us in report stage are an indication of that feeling. It is not too late to do something about it.


Some hon. Members:: Hear, hear!


James Douglas Manly: Mr. Speaker, I am pleased to speak this evening in support of my party's position on Bill C-57 and to highlight some of my own personal concerns and some of the concerns of my constituents regarding this bill.
We all recognize that governments need to raise revenue. We know there is no such thing as a free lunch. Ideally, the money we pay as taxes should not be counted as lost but, rather, as a contribution to the common good. But sometimes when we look at government spending habits and its concern with outdated fighter planes and some of its other extravagances, we wonder whether or not this is true. We recognize the importance of our taxes, but we also say that a tax policy should consider many questions in addition to asking how much money can be raised for the government in a specific situation. For example, a tax policy should ask questions concerning the effect of a tax upon the economy in general and upon individual sectors of the economy. It should ask questions about the effect of a given tax upon individuals. Apart from its direct effect upon the economy, it should ask about the effect
of a tax upon the environment, upon the social and cultural fabric of the community and of the nation.
This might be a good place to begin. For example, the act exempts from tax paintings, drawings and pastels, which is good as far as it goes, but it says nothing about original prints. In our society artists do not have a very easy time of it. All but a very few stars have difficulty making a living. However, one area of art which has been growing and provides an important part of many artists' incomes is the sale of limited editions of original prints. Not only does this sale help the artist, but it also helps to democratize art. Art should not be the preserve of a wealthy elite-the Medicis, the Rockefellers and the Thompsons of our world. By exempting paintings and drawings but not original prints, we are discriminating against our ordinary people in favour of the wealthy.
I am particularly concerned about the effect of this discrimination upon many Indian artists. All Canadians can take pride in the recent upsurge of Indian art. I think particularly of Indian artists who use motifs from the west coast of British Columbia and of artists who are painting from their woodland Cree and Ojibway traditions. This art, and the new understanding and respect which it has brought to Indian people, has been largely dependent upon print-making techniques. It is because prints have been available, that artists such as Daphne Odjig, Jackson Beardy, Norville Moriseau and Robert Davidson have become household names in many parts of Canada. Our tax policy should encourage this art and not discourage it. Therefore, I urge the government to accept the amendment proposed by my colleague, the hon. member for Kamloops-Shuswap (Mr. Riis) and include "original prints" in the list of exemptions.
The government is equally shortsighted in its proposals to tax newspapers which have advertising content beyond a certain percentage. This proposal hits especially hard at small community weeklies. Over the past years, and especially the past year, we have seen the spectacle of large chains taking an ever-greater share of the daily newspaper market in Canada. Corporate takeovers, mergers and shutdown all point to a situation which is very rightly under combines investigation at the present time. As the large dailies move further and further away from local concerns and have less and less contact with local communities, and as they move toward a prepackaged product, the role of community newspapers in our country continues to grow.
For example, in my constituency there is no single daily which serves the entire area, but we are well served by seven community newspapers. These papers are very concerned about the proposed new regulations and the effect that they will have upon their ability to continue publishing. They recognize the government's valid concerns to tax catalogues and sales sheets which have no editorial content at all, but they object to the way in which this concern is being implemented in this bill. For one thing, they point to the manner in which advertising content is defined in the regulations. Instead of
May 28, 1981

counting the amount of paid advertising and then subtracting that from the total space in the newspaper, the regulations begin by narrowly defining editorial content. This way of defining the situation provides a disincentive for charity advertising. It means that little logo fillers for such things as the Participaction program would be counted as advertising. It raises questions about the possibility of newspapers refusing to carry advertisements for certain organizations and using the excuse that carrying the advertisement would bring the newspaper over a certain percentage of advertising content. It raises very serious questions about the whole freedom of the press, which is fundamental to our society. I again urge the government to seriously consider and accept the amendments proposed by my colleague, which would limit the tax to catalogues.
We can look at small businesses and the way in which they are affected by some of the proposals before us, for example, beauty parlours and the tax on cosmetic supplies. Beauty parlours and their operators are truly small businesses and often family enterprises, which have difficulties making ends meet what with maintaining an inventory and adequate equipment. By placing this tax upon supplies which are used in business, it is making it more difficult for these small businesses to continue.
Like other members of my party, I object to the principle of indexed taxation which is being introduced in this bill through the indexation of taxes on alcohol and tobacco. The government already has too much of a stake in inflation. By placing indexation on these taxes we are setting a precedent whereby the government would not have to show any concern at all about bringing in a budget and facing the music in the House of Commons over its taxing policies. Instead, there would simply be automatic tax increases as the cost of living went up, and we have seen no indication from the present government that the cost of living will be going down.
As has been pointed out before, in this bill we have seen the ridiculous bureaucratic definition which exempts some equipment for the handicapped. It exempts braces which are used on the feet and ankles. Surely in this Year of the Disabled the government could recognize that any appliances which are meant to assist disabled people to function better in society should be given tax exempt status. We should not leave these people at the mercy of a stupid bureaucratic decision.
Dynamite is a substance which has been traditionally exempt from taxation. For the first time in our history it is now being taxed. This hits at the construction industry, especially in western Canada. I point out that here we see the government concerned with short-term financial gain-a very small one-but one which has an impact on the environment. For example, we are concerned that industry and buildings should not be built on valuable agricultural land and estuaries, but these are the easiest places to build. In British Columbia, if we are to build away from these areas, blasting is involved and dynamite is required. We are placing a disincentive upon moving away from building on environmentally sensitive areas.
Excise Tax
The New Democratic Party has been urging the government to recognize that small businesses which are involved in collecting sales taxes are subject to a great deal of additional red tape as a result. We urge the government to recognize the contribution these small businesses are making and that it should make provision in this tax bill so that these businesses could withhold 3 per cent of the taxes which they collect, up to a maximum of $1,000. This will not affect large companies such as Eatons and The Bay. However, it will help small businesses. These are the people in our society right now who very desperately need to have some help. At a time when other government policies are discriminating against these people in terms of high interest rates, we should not be passing by an opportunity to make it slightly easier for them to do a job on our behalf which we require them to do.
Again, we can look at the provisions of the bill which exempts equipment specifically designed for use in classrooms. At a time when education is under pressure, another sector of our society which is under considerable pressure today, we should be extending this exemption to include all materials which are used in the classroon, whether or not they had been specifically designed for this.
I would like to draw my remarks to a conclusion by simply pointing out that in its over-all tax policy the government, in the past few years, has been focusing entirely too much upon individuals, small businesses and this sector of society, for tax revenue. It has been ignoring vital areas where profits have been increasing, and taxes have not recognized this. We have heard the news about bank profits being up 58 per cent in the first quarter of this year. We are not doing anything about tapping that source of revenue. Instead, we are continuing to load more and more tax burdens upon individuals and small businesses.
So I urge the government to consider the amendments that the New Democratic Party is putting forward. I urge the government to consider the needs of small businesses, and to consider the social and environmental impacts of some of these taxes, as well as the short-term economic gain which it might make by imposing them.


Some hon. Members:: Hear, hear!


Mr. Gordon Towers (Red Deer):: Mr. Speaker, it is actually unfortunate that we in the House of Commons at the present time must deal with this government in a situation now facing Canadians. The Minister of Energy, Mines and Resources (Mr. Lalonde) who is supposedly responsible-he is often referred to as "Marc the Knife"-has succeeded in causing an oil rush to the United States. This is unfortunate because all of us are going to suffer. We in the west are suffering now; but let me impress upon the backbenchers on the other side that perhaps they can get through to the minister and to the cabinet what is actually happening here in Canada today before it is too late.
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May 28, 1981
Excise Tax
Time is running out on us, and every week and every month the disastrous situation which is befalling Canadians increases. On May 7 of this year, not too many days ago, the latest figures which came out showed that 139 drilling rigs had left Canada, 72 service rigs had left, 63 more drilling rigs are committed to go, and 42 service rigs are going. Every time we lose a rig, we lose 60 people and 60 jobs. This reflects right through to eastern Canada. I will deal with that later. However, this is why we in the west are hurting at the present time, because we see this happening to people around us. We see it happening to those people who depend upon the oil industry. It is a new industry. Perhaps our eastern colleagues do not understand that. It has not always been with us. It is a new industry. There are a great many companies, and there are hundreds of them, which do not have the financial backing to withstand an extended period of drought. When I use the word "drought", I use it to literally imply that there are no jobs and the industry is going down the tube because of the policies of this government. Bill C-57 is the best example that I can give anyone as to what the government is doing to us.
There were 49 wells drilled in my area in Red Deer in April, 1980. There were 27 wells drilled in April of this year. The number of licences granted from April of last year to April of this year are down. Fifty-nine licenses were granted last year, and this year they are down to 30. There has been a 50 per cent drop. This spells doom for the industry out there. There is absolutely no way that we in Canada are ever going to be self-sufficient if we are going to continue in the direction we are going.
1 do not really know what we must do to make the Minister of Energy, Mines and Resources realize what he is doing to our country and to us as Canadians. Surely the backbenchers on that side can see through it if he cannot. Yesterday he spoke in the House of Commons on our opposition motion which condemned the government and the minister for what they were doing. Honestly, I have never heard such a conglomeration of unadulterated garbage delivered in this House of Commons as I did from the Minister of Energy, Mines and Resources yesterday. It would imply that he does not know what he is doing. He does not know what he is talking about. We are all going to suffer the consequences if something is not done very shortly.
Evidently, the members of the cabinet are not listening; but I see the Parliamentary Secretary to the Minister of Finance (Mr. Evans) sitting in the House tonight. I would hope that he would use his good influence to get through to the cabinet and to try to explain to it exactly what is happening. Yesterday the minister tried to imply that had our 18 cents a gallon gone through, Canadians today would be paying more for gas than they are paying under the present administration. I would like to tell those who are present in the House tonight that as of May 6 of this year, in the 13-month period, gas prices at the pump have gone up 52 cents. Our policy of 18 cents a gallon tax plus the increases in price, would probably have netted about 37 cents. So Canadians are now paying more because of
the policies of this government and its national energy program. It is disastrous.
I understand that one of the areas which has not been discussed up to the present time is the tax which has been put on Canadians because of the purchase of Petrofina. The purchase of Petrofina does not mean that one more oil well is drilled. There might even be fewer drilled because of the resulting bureaucratic administration.
However, I will tell Your Honour what is happening. Every Canadian in Canada is paying three and one-half cents a gallon for every gallon of oil he buys because the government saw fit to buy Petrofina. This creates a problem for those people who are in private industry. There are agents in my area who are furious with the government. They might have voted Liberal sometime if the government had administered sanely; but there is absolutely no way those people will ever vote Liberal again because they have to collect that three and one-half cents a gallon tax, they have to keep it on their books, they have to pay it into the federal treasury, and then it is turned over and used to compete against them by their competitor in Petrofina through PetroCan.
Does this makes sense to you, Mr. Speaker? It certainly does not to me. I would like to see someone in this House of Commons stand up and try to protect that kind of a policy. Actually, what will happen is that it will undermine the whole industry. How can the government keep on doing that?
It is my understanding that at the present time the federal government has contributed about $1 billion, in one way or another, to Petro-Canada. What return are we as Canadians getting? Are we getting dividends? Are we getting debentures? Are we getting interest? No, we are not getting any of that. It works out to almost $3 billion by the time the whole program is through, if it is not carried on any further. If any industry is given a break of $3 billion, even at 15 per cent interest, which is now low because of this government's policy, at 15 per cent interest it will work out to approximately $450 million to $500 million a year.
If that is given to any company or individual, what will it do to competition? The only way that people in the industry will be able to stay in business will be if the corporation is so incompetent that it will erase the benefits that should be accruing. We have seen this happen before. The government cannot even run the Post Office, so how is it going to run the oil industry, especially with the leadership we have in the Minister of Energy, Mines and Resources?


David P. Smith: What about PWA?


Thomas Gordon Towers: I can tell the hon. member about that. He does not know what it is like to be land-locked as we are in the province of Alberta. When the premier of British Columbia, a socialist, tries to purchase PWA in order to keep the head offices and industry in his province, it is no wonder that the province of Alberta wants to get it, in order to establish a line of communication between Alberta and the north. I realize
May 28, 1981

that some people in Ontario would like to cut us off from that but through the wisdom of our government, that did not happen. Otherwise, we would be land-locked completely as we do not have access to a port. Surely the hon. member would not deny us the right to the air.


David P. Smith: I thought you were against government enterprise.


John Leslie Evans: Only against federal government enterprise.


Thomas Gordon Towers: Mr. Speaker, if there had been a chance of PWA being purchased by private industry, we would have been happy to see it. There is no room for two PWAs in western Canada, only one, so we had to get it and we are proud that we did.


Mr. Deputy Speaker:: Order, please. With all due respect to the hon. member I must call to his attention that a tax measure is before the House. He seems to have strayed just a little bit from the subject of the bill. I invite him to return to it.


Thomas Gordon Towers: Thank you, Mr. Speaker. Knowing your generosity, I know you would never deny me the opportunity or right to counter some of the erroneous statements made across the floor. That is really all I was doing, Mr. Speaker.


Mr. Deputy Speaker:: Order, please. The hon. member has made his point. I think I have made mine.


Thomas Gordon Towers: Mr. Speaker, I was trying to impress on the backbenchers that drilling rigs are leaving Canada in unprecedented numbers. Jobs, equipment and technology are going to the United States because of the repressive energy policies of the Minister of Energy, Mines and Resources.
It is not only the workers on the oil rigs who are the losers. It is also hundreds of others in support industries. My colleague, the hon. member for Medicine Hat (Mr. Hargrave), today mentioned the people who came here to try to influence the government to change its policy. There is one thing that I should like to impress upon you at this point, Mr. Speaker, and that is that our whole democratic system will break down if governments do not listen to witnesses who, in their own time and at their own expense, come to the capital of the country to plead their case and nothing is done.
They come here and get their concerns off their chests and are sent home like good little people but no attention is paid to them. If the government will not pay attention to the pleadings of these people who come to present their case before the standing committees, what is the use of the charade? It would be better to tell them that nothing will change anyway. I would hope the government would listen to those people.
Not long ago a Senator from the other place said to me, "You don't change much around here." I do not know about that, Mr. Speaker. I would like to think that we can change things. But the only way that will happen will be if the majority on the other side of the House begins to listen and to act on what is being said.
Excise Tax
As I said earlier, the west is hurting now, but it will only be a short time until the residents of Ontario will begin to hurt as well.
In the last month, two delegations of oil company and oil service company executives have come to Ottawa at their own expense to attempt to explain to eastern Canadians the devastating and punishing impact that federal oil-pricing policies are having on the west. We may be losing people and technology, and what we have lost we will never regain. The people and machines that have crossed over to the United States where the economic climate is more receptive, may never come back to this country. Why should they when we have had two problems in the last eight years?
It all started in 1973 and you would remember that, Mr. Speaker, as you were in the House at that time. The then Minister of Energy, Mines and Resources, the Hon. Donald Macdonald, saw the light, got busy and corrected the problem. It did not last nearly as long as the present problem. Now we have a minister who will not listen. So we cannot blame people for getting out. They have to look after themselves. They have to buy their own groceries and provide a roof for their families.
Until the time of the Trudeau-Lalonde axis, we experienced a happy economic climate in the oil field. Everything was going well. Everyone was busy, there was a lot of activity and orders were placed in eastern Canada. Everything was going smoothly until the present administration decided it would nationalize the industry under the guise of Canadianizing it.
The risk takers-the oil companies-initiated activity in the patches. In spite of what some may think, that technology and understanding is not gained overnight. It takes a while to accumulate it.
The drilling and exploration provided jobs on and off site. The activity provided jobs in the mills and fabricating plants in eastern Canada, in the valve industry, in the pipeline fabrication industry, in the steel plants, and so on.
Economic activity in western Canada in the oil fields enabled western Canadians to purchase the products manufactured in the appliance and automotive plants all over eastern Canada. The multiplier effect of economic activity in oil in western Canada is staggering.
To drill a well and maintain it involves 31 companies-31 small businesses which benefit and pump earnings and payrolls into western communities and eastern businesses. The Department of National Revenue will also suffer because the same amount of income tax will not be collected as in previous years.
As I stated, it takes 31 separate companies to bring in and service one rig. These 31 companies have, combined, an investment of $12 million in equipment. They will employ about 100 employees who will work 536 man days from spud to completion. They will purchase and use goods and manufactured products made in Canada from Vancouver to St. John's, at rates of up to 70 per cent of total expenditures. Already I have heard of production cutbacks in some central Canadian factories as a result of reduced oil field purchases. The conse-

May 28, 1981
Adjournment Debate
quences, the ultimate punishment, the end product of the federal government's oil policies is that some Ontario and Quebec workers have been paid off and told to go home because there is not a job for them in the oil industry. There is nothing for them. It is cutting back right across the board. Those people who think it is just the west that is suffering had better begin looking in their own backyard.
May I call it ten o'clock, Mr. Speaker.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Donald W. Munro: On April 3 of this year, as reported at page 8946 of Hansard, I obtained from the Solicitor General (Mr. Kaplan) an undertaking to report to me on whether any orders had been issued at any time to bring to a halt inquiries being made into some of the spy rings whose existence was brought to light back in 1945 and 1946 by Igor Gouzenko and made public through the publication of the Taschereau-Kellock report. I am still waiting for that report.
It was not given to me on May 25 when the Parliamentary Secretary to the Minister of Supply and Services (Mr. Kelly) replied to my intervention that evening, as reported at page 9904 of Hansard. Perhaps I will be given the long awaited report in the course of the reply that will be made to my intervention this evening. I hope so, because I raised a cognate question even earlier, on March 30 to be exact, as reported at page 8733 of Hansard.
The Gouzenko report, as the Taschereau-Kellock report is often called, is perhaps not well known by many of the young people today. I would earnestly recommend that it be made compulsory reading for anyone entering university or the public service. It would also be helpful reading for the executives of our large private enterprises and for those who become our trade union leaders. The message it conveys is chilling, but it must not be forgotten. We have allowed ourselves to be lulled to sleep or into a state of complacency on a matter of infiltration and subversion.
There are those, I suspect, in high places today who would prefer that the Gouzenko report be covered with the dust of oblivion. So pertinent is it to today's frightening circumstances that 1 intend to drag it out, dust if off a bit and place on the record in 1981 some of the findings recorded in 1946, some 35
years ago. Let me quote verbatim from page 685 of the report. The first finding reads as follows:
There exists in Canada a fifth column organized and directed by Russian agents in Canada and in Russia.
The second finding reads:
With the fifth column there are several spy rings.
The third finding reads:
We have been able to identify many of the members of one of these rings, namely, that of which Colonel Zabotin was the head in Canada.
These findings lead me directly to the questions to which the Canadian people and I deserve a straightforward answer. First, were any efforts made at the time or later to run down the rings, other than the Zabotin ring, the investigation of which was pursued and people were brought to trial as a result? Second, if such efforts were made, what were the results?
Third, what credence can be placed in reports in the press and elsewhere that those efforts of the RCMP security services to run those other rings to earth were called off by someone in a position of influence. Those rumours persist and it is time they were either put to rest or the truth of them revealed.
In his comments as reported in Hansard on May 25, at page 9904, the Parliamentary Secretary to the Minister of Supply and Service spoke of four sets of the Taschereau-Kellock documents. He mentioned the location of only three. Therefore, and here is another question I am bound to ask, what of the fourth copy of the transcripts of the Taschereau-Kellock report? Is it complete? How do we know that it is complete? Although the parliamentary secretary was quite categorical in assuring me in that same reply as follows:
-that the exhibits and miscellaneous papers of the Taschereau-Kellock commission involving some 601 original statements, personal notebooks of persons interviewed by the commission, etc., are also stored in the RCMP archives.
Why, I am now bound to ask, are these exhibits and miscellaneous papers not also available to the public under the 30-year rule? Is someone being protected? Is there some reason why they are being maintained beyond the reach of public scholarship or the press, whichever might be the more interesting?
There are more questions here than can be asked in the seven minutes allowed me this evening, and many more than can be answered in the three allowed for the reply. I therefore hope that when the results of the current inquiry into the release of the Gouzenko papers or the Taschereau-Kellock papers are made available to the House, hopefully this month, the minister will make a statement on motions so that some of these questions can be put to him and answers obtained. Thank you, Mr. Speaker.


Mrs. Celine Hervieux-Payette (Parliamentary Secretary to Solicitor General):: Mr. Speaker, I am pleased to answer, on behalf of the Solicitor General of Canada, the question put by the hon. member for Esquimalt-Saanich (Mr. Munro) who,
May 28, 1981

really, according to what he says, is feeding the rumour mill. I feel he is doing his best to keep those rumours alive. In recent months, they have certainly been a popular topic in the newspapers.

The hon. member rightly points out that Mr. Gouzenko did in fact state that there were several other spy rings operating in Canada in addition to the one of which he was directly aware. It will be recalled that Mr. Gouzenko disclosed the existence of a spy ring operating on behalf of Soviet military intelligence, the GRU. Mr. Gouzenko claimed that there were other spy rings operating in Canada, some perhaps also under GRU direction, and still others which were under the control of the Soviet state security intelligence organization, the KGB.
This information was also disclosed in the 1946 report of the Taschereau-Kellock commission of inquiry. I might say to the hon. member that an exhibit in any report is part of the report and should be disclosed at the same time. I am just wondering why the hon. member is asking why the exhibits have not been disclosed when the report has not been.
This is not a new question, Mr. Speaker. Indeed, on May 31, 1978, as recorded in Hansard at pages 5920 and 5921, the Solicitor General of the day, the present Minister of Supply and Services (Mr. Blais), gave a full and complete answer. I reply to a written question by the hon. member for Leeds-Grenville (Mr. Cossitt), the minister acknowledged Mr. Gouzenko's claim that there were several espionage rings operating in Canada at the time in question and that it was not true that the RCMP only pursued the investigation of one network. In reply to a request for further details, the solicitor general at the time noted that it was not the policy of the government to comment publicly on individual police and security investigations. The hon. member for Esquimalt-Saanich knows that, and for obvious reasons government policy is not changing.
In the second part of his question the hon. member for Esquimalt-Saanich makes the allegation that the RCMP investigation into these additional Soviet espionage networks was interrupted or stopped by other members of the public service. This allegation again is almost identical to the assertion referred to in the earlier question by the hon. member for Leeds-Grenville. In his question that hon. member supposed that the government had failed to act in relation to the investigation of these other groups. In fact, the solicitor general at the time advised the House that the government was satisfied that all leads flowing from Mr. Gouzenko's information had been exhaustively pursued and that no further action was required.
I wish to assure my hon. friend that all the information was given at the time and it has not changed since then.


THE CONSTITUTION-PROCEDURE FOR CONVENING FEDERAL-PROVINCIAL CONFERENCES
John Albert Gamble: Mr. Speaker, on April 6, 1981, I posed two questions to the Prime Minister (Mr. Trudeau). The first one related to the application of clause 35(1)
Adjournment Debate
of the constitutional resolution which will return to this House, and it involved the requirement under that clause for the Prime Minister to call a constitutional conference consisting, in terms of those in attendance, of himself and the provincial premiers. I asked a question as to the usefulness of that particular clause, having regard to the indication of the Prime Minister that day or the day before that he did not intend to attend a meeting called by eight of the ten provincial premiers.
My concern at the time was that it is futile, very clearly, to insert a provision of this nature in the principal and fundamental law of Canada which requires for its application the good will not only of the Prime Minister of the country, but also the good will of ten provincial premiers and, presumably, in the event that the Yukon and Northwest Territories become provinces, ultimately the good will of the premiers of those areas as well. I did not believe it was appropriate that the Prime Minister attend to the request for a meeting, in the fashion he did, without recognizing the harm that he would do to the natural good will which was necessary in order that, first, the provincial premiers attend these intended conferences and, second, something indeed be accomplished thereat.
Fortunately, subsequent to April 6 the Prime Minister did indicate that he would attend such a meeting, and he went on at some length at a later date as well to point out that he hoped the good will that needed to be fostered in Canada would continue after the Supreme Court had ruled. Presumably he meant the Supreme Court would rule in his favour because it was not long after his comments that the Minister of Justice (Mr. Chretien), as recently as the latter part of last week, indicated that in the event that the Supreme Court should determine that the autocratic position taken by the federal government is ultra vires, he will see to it that the Supreme Court is used as an instrument to extract from the provinces some of the authorities they are currently exercising.
These matters are significant, and they go to the very roots of the need in our country for government leaders in the provinces and at the federal level to deal with each other on a basis of, if not friendship, at least some form of open congeniality which will produce the well-being desired by the people of Canada. From all indications, what has transpired so far is a clear demonstration for all who have witnessed the proceedings, that this government is hardly the government to be involved in the process of establishing such a fundamental change in the nature of our country.
My supplementary question dealt with the acknowledged legal concept that in the event the charter of rights is established as contemplated by this resolution, the Supreme Court of Canada will in fact, as is the case in other jurisdictions, legislate through its interpretive judgments dealing with what the words in this charter mean. That is a simple principle of law and one which surely must be recognized by the Prime Minister who, I understand, was called to the bar, although I doubt he has ever practised. At least I do not think he has ever practised.
Instead of dealing with the issue which was raised in the question, the Prime Minister dealt with the myth that for 54

May 28, 1981
Adjournment Debate
years we have been trying to obtain a consensus. Nothing is further from the truth. The alleged charter of rights and freedoms with which we are presently concerned and which gives rise to most of the dispute throughout our nation was first presented to the people of Canada, to this Parliament and to the provincial premiers in October of 1980. October of 1980 is the fall of last year, and 54 years never enters into a determination of the time within which we have been concerned about this issue.
Then the Prime Minister went on in answer to my substantive question to say the following:
As to the question itself regarding the role of the courts and Parliament, it seems to me that the hon. member is under a misapprehension. What I have said is that both branches of government should be autonomous and should operate autonomously. It is our job to legislate. It is the court's job to judge whether the legislation is intra vires or ultra vires.
That is not the question I was asking, Mr. Speaker. I know it is the court's job to determine whether legislation is intra vires or ultra vires, but that was not the question. The question was very simple: does the court not in fact legislate, having determined that it is intra vires, and thereby preclude this Parliament and all subsequent parliaments from ever determining whether they may change the words in the charter. That was the question.
Now, Mr. Speaker, a prime minister who responds in the fashion this one has does no service to the public or this Elouse. Very clearly this Parliament is the supreme parliament of all parliaments because it has fixed the basic law of the country, if this package goes through, and no subsequent parliament under any circumstances will be able to change the law as this Parliament has enacted it. Now that is the death blow to the democratic process, Mr. Speaker.


Mr. Ron Irwin (Parliamentary Secretary to the Minister of Justice and Minister of State for Social Development):: Mr. Speaker, I have three comments in relation to what the hon. member has said. First, we have not been discussing a charter of rights just since 1980. A charter of rights has been discussed for at least the last 12 years. There have been three distinct studies, and I advise my learned friend to read them. The first was the Canadian Bar Association, the second was the Pepin-Robarts report and the third was the parliamentary committee, all dealing with the charter of rights.
We have been talking about this for 54 years, Mr. Speaker, and once again at the tail end of this debate we are going back to process and procedure and I say that at some point my good friend, the hon. member for North York (Mr. Gamble) will have to say yes or no, I stand for a charter; yes or no, I stand for aboriginal rights; yes or no, I stand for mobility rights; yes or no, I stand for rights for the handicapped; yes or no, I stand for non-discrimination of women and the aged. I think the time has come when the people of this country are saying to the opposition that you can no longer hide behind the premiers, you have to come out and say whether a law in Newfoundland that disallows unions is to be tolerated any
longer; whether a law in Quebec which discriminates, prejudices and padlocks Jehovah witnesses is to be tolerated any longer.
Now either you stand for these things or you do not. We all represent the people; the premiers, the members of this honourable assembly, members of councils of municipalities. And at some point you have to make the decision on what is right and wrong and what is hiding behind procedure.
What did the premiers come up with? The Hon. Sterling Lyon is still against the charter. I heard nothing about minority language rights coming from the Hon. Rene Levesque. I heard nothing from the Hon. Brian Peckford. I heard nothing except another checkerboard suggestion, the fifth one that has come from either the premiers or the opposition, that would allow the right to a jury in one province and not in another, rights of the aboriginals in one province and none in the other provinces because, and you know I am telling the truth, the checkerboard formula provides that if it affects the provinces, as these things do, they can opt out. There can only be one right of mobility, that is the right of a Canadian to move across this country and work where he wishes. I say that to meet with the premiers at this late date to discuss what they are proposing would be a disservice to this country and the people we represent.


NORTH-SOUTH RELATIONS
[Stage Direction]
(A)	PREPARATIONS AND RECOMMENDATIONS FOR SUMMIT MEETING
(B)	IMPLEMENTATION OF PARLIAMENTARY COMMITTEE RECOMMENDATIONS
(C)	QUERY RESPECTING CANADIAN SUPPORT FOR UNITED STATES POLICIES
Mr. Bob Ogle (Saskatoon East):: Mr. Speaker, my question is in relation to a question I asked the Right Hon. Prime Minister (Mr. Trudeau) on May 20 in regard to the policy recommendations Canada will put to the summit meeting this summer. I asked very specifically if Canada was going to have a policy uniquely different from that of the United States, a made-in-Canada policy as it relates to the entire question of North-South. At that time the Right Hon. Prime Minister replied to me:
We know from the statements made by the U.S. administration that they are more keen on bilateral aid and perhaps aid from the private sector than on multilateral and public aid. This is not the point of view of Canada or of other summit countries.
To my mind what the Prime Minister has told me is that Canada is not going to follow the policy of the United States which at this time is going to be linked more closely to bilateral aid. This basically means that the United States will give aid to another country but will be very much directing it.
The reason I asked to have my question reviewed tonight was that prior to it, at a meeting of the Standing Committee on External Affairs and National Defence on April 21, 1981, the Secretary of State for External Affairs (Mr. MacGuigan) said exactly the opposite. The Prime Minister seemed to say
May 28, 1981

that Canada would move away from bilateral aid to multilateral aid, meaning that Canada will join with other countries and have an aid program with a much broader spectrum than this direct deal. The Secretary of State for External Affairs said the following:
-so we are certainly moving, at the present time, more in the direction of expanding bilateral aid than of expanding multilateral aid.
There seems to be no clear policy about how Canada's program of aid will function. I appreciate very much the difficulty of truly aiding somebody else. Perhaps one of the most difficult verbs in the English language is the verb to aid. How do we help someone else? How do we help someone else so that the other person is helped and does not become, in a sense, subservient?
Last summer we in the North-South committee visited the United Nations during its special session. At that time we had an opportunity to speak with Donald McHenry, the U.S. ambassador to the United Nations. In his discussions with us, he summarized, perhaps, better than anyone else I have ever heard, the notion of aid. He simply said that aid is for aid. Aid is not to fight communism. Aid is not to build up the industrial sector. Aid is not to buy off somebody. Aid is to aid.
We will be hosting the summit meeting in Ottawa and later we will be one of the two nations taking part in the other summit meetings in Mexico and Australia. England and Canada will be the only two countries sharing the entire summit meetings. At this time in Canadian history, I think it is extremely important for the House of Commons and the people of Canada to know exactly what the policy of this government is in relation to the question of what is aid and why we are aiding.
I have heard the recent reports of the business group which deals with Latin America. This group is very happy with Canada's aid program because it means more business for them; it is a kind of subsidized business grant. As I question what is our policy on aid, I would like to read into the record what Mr. Masse, the president of CIDA, who is responsible for the Canadian aid program, said in an interview which appeared in The Financial Post on May 16. He said:
Investment in big projects is all very well, but it's not really efficient unless you also change the way people use capital ... So now we intend to invest more in people, particularly in the areas of occupational training, management skills, health and education. It's a way of increasing the productivity of people themselves.
I gather what Mr. Masse says now is that he is looking upon aid as something which is being sent and that he is trusting other people at a very low level, not big projects which will benefit Canadian industry, but people there who need the aid. They will make the decision as to how it will be used. I would like to ask the government what Canada's basic principles and philosophies about aid are and who is making the policy.


Mr. Ralph Ferguson (Parliamentary Secretary to Minister of State (Small Businesses and Tourism)):: Mr. Speaker, I
Adjournment Debate
would like to assure the hon. member for Saskatoon East (Mr. Ogle) that his concerns are being considered by the Government of Canada.
Preparations for the July summit are progressing well. The personal representatives of the heads of state and government will be meeting shortly in Vancouver. It is still difficult to say with certainty what topics will be given priority at the summit. Some heads of state have been elected only recently, among them Mr. Mitterrand, and they will have to have the opportunity to express their opinions as partners about the various themes to be considered at the summit. For the moment, we presume that the summit will deal with the five traditional economic subjects: macroeconomics, monetary and financial matters, trade, energy and, naturally, North-South relations.
On the last subject, the report on "Aid Policies and Procedures and Other Contributions to Developing Countries", requested by the heads of state in Venice, will no doubt give rise to in-depth discussion.
The government has been very pleased with the contributions which the parliamentary task force has made to North-South issues both in terms of its recommendations about appropriate Canadian policies and of the all-party stimulus it has provided for public discussion of these important issues within Canada. The government's initial attitude to the basic thrust of the task force report is very positive. Its individual recommendations have been the subject of close study over recent months and are currently under consideration by ministers, and detailed responses are expected shortly.
Obviously, Canada's North-South policy does not parallel that of the United States which may choose to give priority to bilateral assistance and to the private sector in order to meet the needs of the developing world. We do trust however that they will not neglect the multilateral dimension of aid and we hope that the summit will examine certain key areas of relations with developing countries where concrete progress would be possible. We are thinking particularly of the needs of the Third World with respect to energy and the development of agricultural production and food. There is substantial agreement among the summit countries on the objectives to be promoted, but there are differences of opinion on the means of achieving those objectives. It is our hope that the summit discussions will help to reconcile the different points of view, and it is from this standpoint that we will approach the North-South issues with the United States and other summit countries at the Ottawa Summit.


Mr. Deputy Speaker:: A motion to adjourn the House is now deemed to have been adopted. Accordingly this House stands adjourned until tomorrow at 11 a.m.
At 10.29 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, May 29, 1981