1981-12-18

ROUTINE PROCEEDINGS


Mr. Otto Jelinek (Halton):: Madam Speaker, I rise under the provisions of Standing Order 43. It is crystal clear that the November 12 budget is having a devastating effect on all sectors of our economy as witnessed by the outcry from virtually every responsible business and consumer organization in Canada, the latest two being the Canadian Institute for Economic Policy, headed by former Liberal finance minister, Walter Gordon, and the Economic Council of Canada. I therefore move, seconded by the hon. member for Yukon (Mr. Nielsen):
That this House condemn the government for its budgetary policy, as well as the Minister of Finance for imposing such financial chaos on all Canadians, and further that this House do not adjourn for Christmas until such time as the Minister of Finance introduces new, positive and realistic budgetary measures.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Thomas Siddon (Richmond-South Delta):: Madam Speaker, in view of the imposition of martial law by the communist Government of Poland, and now the brutal killing of innocent Polish citizens, all in a ruthless attempt to stifle the new, free spirit of Solidarity, thereby reducing the people of Poland to little more than slaves in their own country, I move, seconded by the hon. member for Annapolis Valley-Hants (Mr. Nowlan):
That this Flouse soundly condemn the military Government of Poland, and its Russian masters, for denying the Polish people their right to freedom of choice, and for the use of force and violence to crush the Solidarity movement, and warn
the Soviet Union of serious consequences if it continues to interfere in the domestic affairs of Poland.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


UNITED NATIONS
Mr. Marcel Prud'homme (Saint-Denis):: Madam Speaker, pursuant to Standing Order 43 I move, seconded by the hon. member for Parry Sound-Muskoka (Mr. Darling) and the hon. member for Hamilton Mountain (Mr. Deans):
That the House of Commons express its warmest congratulations to the new Secretary General of the United Nations, the Peruvian, Javier Perez de Cuellar, who has been elected unanimously by the General Assembly of the United Nations as the fifth Secretary General of that organization, and the first from our own western hemisphere; and that the House of Commons express its appreciation and thanks to the outgoing Secretary General Kurt Waldheim for his untiring efforts for peace during his two mandates as Secretary General from 1971 to 1981.


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


Some hon. Members:: Agreed.


Madam Speaker:: The House has heard the terms of the motion.


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, I just want to say that that blows my chances of an early retirement. I am sorry!


Some hon. Members:: Oh, oh!


Madam Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
Mr. Deans:: If I had known that, we would not have seconded the motion.

December 18, 1981
5.0.	43


VETERANS AFFAIRS
Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, on behalf of my colleague, the hon. member for Winnipeg North Centre (Mr. Knowles), I move the following motion under Standing Order 43. There are hundreds, perhaps thousands of veterans who have applied for service-related pensions. The time between applications and decisions runs upwards of one year. This is both unfair and unjust. I move, seconded by the hon. member for Hamilton Mountain (Mr. Deans):
That this government take steps now to provide whatever technical assistance is necessary to clear up this unacceptable backlog and to ensure that no longer than three months be established as the period for processing and deciding on pension applications.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


CRIMINAL CODE
[Stage Direction]
5.0.	43
Mr. Gus Mitges (Grey-Simcoe):: Madam Speaker, I rise under the provisions of Standing Order 43. Given the fact that there has been a steady increase in common assaults across Canada from 112,911 in 1979 to 117,103 in 1980, and given the fact that an increasing number of these assaults include attacks on taxi drivers, the most recent case being the murder of an Edmonton taxi driver while on duty, I move, seconded by the hon. member for Halton (Mr. Jelinek):
That the government give active consideration to the introduction of appropriate legislation that would make the use of safety shields standard equipment for all taxicabs across Canada in order to better protect those drivers who serve the public.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


HEALTH SERVICES
Mr. Jim Hawkes (Calgary West):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43.
I move, seconded by the hon. member for Oxford (Mr. Halliday):
That the Minister of National Health and Welfare (Miss Begin) ask the Minister of Finance (Mr. MacEachen) to withdraw any budgetary measures, including the dental plan, that will increase health costs for Canadians.


Madam Speaker:: Under the provisions of Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. Albert Cooper (Peace River):: Madam Speaker, whereas the Liberal government has served the small businesses of this country a Molotov cocktail of high interest rates, inflation, a National Energy Program, and an incompetent budget-


An hon. Member:: Nonsense.


Albert Glen Cooper: -and whereas the result of this will be an increased federal deficit because many businesses will no longer pay taxes as the result of having no profits, I therefore move, seconded by the hon. member for Edmonton East (Mr. Yurko):
That the Minister of Finance immediately introduce a new budget which will allow our Canadian entrepreneurs to have a taxable income once again.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Mr. Paproski:: Allan MacEachen said no.
December 18, 1981


THE ENVIRONMENT
Mr. Neil Young (Beaches):: Madam Speaker, I, too, rise under the provisions of Standing Order 43. In view of the precedent established by Environment Canada of providing financial and technical assistance to public interest groups to argue against the proposed Hyde Park clean-up agreement in U.S. courts, I move, seconded by the hon. member for Hamilton Mountain (Mr. Deans):
That this House instruct the Minister of the Environment to provide financial and technical assistance to public advocacy groups, to help them at hearings to begin in February next year to oppose SCA Services' application to expand the number and volume of chemicals they are permitted to discharge into the Niagara River.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

[Translation)


THE BUDGET
Mr. Alexandre Cyr (Gaspe):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43.
Hundreds of Canadians who had concluded sales contracts for property, boats or businesses, with a view to taking advantage of income-averaging annuities in order to defer capital gains over the next few years, which is both fair and lawful and would have provided fishermen and farmers with sufficient funds to provide for themselves and their families during retirement, can no longer do so since the new budget was brought down on November 12. These people who have spent a lifetime saving for their retirement have now become the victims of the budget and its retroactive measures. I therefore move, seconded by the hon. member for Bonaventure-Iles-de-la-Madeleine (Mr. Bujold):
That the House ask the Minister of Finance (Mr. MacEachen) to allow the legislation applying before November 12, 1981, to remain applicable, at least in the case of individuals who entered into contracts that were legal at the time, such as commercial fishermen and farmers who did so in order to purchase income-averaging annuities.


Madam Speaker:: Under the provisions of Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Right Hon. Joe Clark (Leader of the Opposition):: Madam Speaker, I rise under the provisions of Standing Order 43, supported by the hon. member for Oshawa (Mr. Broadbent), to present a motion similar to that presented yesterday. As the House will recall, yesterday the Secretary of State for External Affairs talked out the resolution proposed by the Canadian Polish Congress because he could not approve the world "tolerated" in the third paragraph of the resolution. Having made the appropriate changes, 1 call on all hon. members of the House to give their unanimous approval today to the following resolution from the Canadian Polish Congress:
We Canadians of Polish descent, are deeply concerned about the current events in Poland, and we call upon the Canadian government as cosignatory of the Helsinki Accords to undertake the following actions:
1.	To press for the immediate lifting of martial law in Poland and the release of all Solidarity officials.
2.	To press for the reinstatement of the rights of workers to form free trade unions.
3.	To publicly state that any intervention by a third party or parties into the internal affairs of Poland will be viewed with the greatest of concern.
4.	To send to Poland, for distribution by non-government organizations, significant economic aid in the form of food, medical supplies and agricultural machinery and feedstuffs in order that the people of Poland survive the coming winter.
We trust that the voice of the Canadian government as international mediator will be heard and that the conflicts in Poland will be resolved in a just and lasting manner.
Therefore I move, seconded by the hon. member for Oshawa (Mr. Broadbent):
That this House express its concern by supporting the resolution.


Some hon. Members:: Hear, hear!


Madam Speaker:: Is there unanimous consent? I am just worried because there has been a change in the motion which has been transferred to the Orders of the Day. Therefore, I cannot put it to the House. Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Hon. Mark MacGuigan (Secretary of State for External Affairs):: Madam Speaker-


Mr. Nielsen:: Talking it out again.


Mark R. MacGuigan: -the Right Hon. Leader of the Opposition (Mr. Clark) is once again presenting a resolution without any consultation with this side.


Some hon. Members:: Shame!

December 18, 1981
Oral Questions


Mark R. MacGuigan: This morning the hon. member for Park-dale-Hyde Park (Mr. Flis) did me the courtesy of consulting me on a resolution concerning the situation in Poland, which I am prepared to accept.


Some hon. Members:: Shame!


Mark R. MacGuigan: If the hon. gentlemen opposite were prepared to allow that, we would be pleased to see it passed.


Madam Speaker:: Order, please. I am afraid that I must interrupt at this time, it being 11.15 a.m. Oral questions.



ORAL QUESTION PERIOD


Hon. Michael Wilson (Etobicoke Centre):: Madam Speaker, my question is for the Minister of Finance. Now that the minister has had an opportunity to discuss with his departmental officials the involvement of Professor Neil Brooks in the pre-budget consultation, will the Minister of Finance explain today why his officials relied exclusively for outside advice on a man who is known to have anti-private enterprise views, and not on the broader group of tax experts that the department has used in the past?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, as I said in the House the other day, I was not aware that Neil Brooks had been an adviser to the department. I have no objection to the use of his services, but I would add there have been other advisers as well. The hon. member asserted that he was the sole adviser. There were a number of other persons from various institutions who were called upon from time to time to assist the department, and among these was Professor Neil Brooks.


NAMES OF ADVISERS TO DEPARTMENT
Michael Holcombe Wilson: Madam Speaker, would the minister be prepared to make that list available to the House so that we can judge the quality and content of the advice that came to the department during the pre-budget preparations?


Allan Joseph MacEachen: Yes, Madam Speaker, I would have no objection to giving the list of all the persons who were called upon to consult with the department prior to the budget. For example, there is a Mr. George R. Lucas, a private consultant. I wonder does the hon. member for Etobicoke Centre find his political flavour unacceptable, or is he going to apply some form of ideological test to Canadians who serve their government in this capacity? Maybe the hon. member would apply a test now to Mr. Lucas, or to Mr. Mike White of Moore Corporation, who provided some advice and assistance. What about Peter Wood of Clarkson, Gordon-would he apply the same test to him as well? I just find the hon. member's approach rather indefensible.


RULES AFFECTING SMALL BUSINESS
Michael Holcombe Wilson: Madam Speaker, the budget has a particularly harsh impact on small business. The minister has altered the rules on interest deductibility, on the Small Business Development Bond, on deferred profit sharing plans, on the dividend payouts of small business, on capital cost allowance, and on capital gains. The lit goes on and on. Would the minister today tell the House why he and his comrade, Neil Brooks, have chosen to attack small business so severely in this budget?


Allan Joseph MacEachen: Madam Speaker, as I have said previously in the House, the benefits to small business, although there have been changes, over all have been improved. For example, in the next taxation year an additional $50 million will flow to small business. As I have stated, it will be my pleasure to answer point by point the objections that have been raised against the small business package.
I must say that I find the hon. member's use of the word "comrade" rather interesting in light of his leader's motion earlier this morning whereby we are attempting to establish respect for each other in the world.


Some hon. Members:: Hear, hear!


EFFECT ON CONSTRUCTION INDUSTRY
Miss Pat Carney (Vancouver Centre):: Madam Speaker, my question is addressed to the Minister of Finance. It is the consensus of the small business community that the minister took lots and gave little to that sector of the community. The Minister of Finance is the Grinch who stole Christmas from the thousands of Canadians who are facing mass lay-offs because of the minister's budget measures. The Canadian construction industry says it is in a state of panic because of the changes in the measures affecting capital cost allowances. This is forcing intensive lay-offs, particularly in western Canada. Why is the minister attacking this industry which is made up of small businesses, mainly family firms, which employ thousands of people? How can he collect his revenues if the industry collapses?


Allan Joseph MacEachen: Madam Speaker, I do not accept the premise of the hon. member's question.
December 18, 1981


IMPACT OF SALES TAX
Pat Carney: Madam Speaker, my supplementary question is addressed to the same minister. Do I understand that the minister is telling this House that there are no lay-offs in the construction industry as a result of his budget, when the industry cannot even bid on 1982 contracts because it does not even know what the impact of the sales tax will be?


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: No. I am saying, Madam Speaker, that I do not accept the premise of the hon. member's question, and it has not improved with the repetition.


RAILWAYS
Mr. Les Benjamin (Regina West):: Madam Speaker, I should like to direct a question to the Minister of Transport in light of his response yesterday, and some leaks and news reports last night and today. He spoke about deforming the Crow rate idea yesterday, and said he wanted to modernize it. Is the minister's version of modernizing the Crow rate the implementation of an updated Snavely report that would give the railways a 35 per cent return on equity investment for grain transportation? Is that his version of a modernized Crow rate? Does his version of a modernized Crow rate mean an increase in Crow rates charged to prairie grain producers?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, as a number of us have previously said, the cabinet is now discussing the subject, and the question to be decided is should it be a comprehensive system approach, or should it be a special project approach. This is the point we are at now.
If 1 took some rather passionate objection to a question yesterday it was because of the fact that so many people who claim there should not be any change in the western grain transportation system do so by raising the straw man that such a change would mean the total elimination of the Crowsnest rate system. I was simply reacting to that yesterday in saying that such would not be the intent, nor would it be the intent to leave the railways entirely free to do whatever they want, charging any price they want for transportation of grain. 1 was saying yesterday this was not the case, that if the Crowsnest rate is modernized it would be by way of replacing it by another statutory regime. Yesterday I was reacting against the deformation of that intent.


POSSIBILITY OF RATE INCREASE
Leslie Gordon Benjamin: Madam Speaker, I do not want to be accused of being ungenerous to the government. 1 am always a very generous fellow and I will not abuse the
Oral Questions
rules by talking about misleading, prevarication, lying or anything like that, when just a simple explanation of stupidity will suffice.


Some hon. Members:: Oh, oh!


Leslie Gordon Benjamin: The minister did not answer the question. Does Crow rate modernization mean an increase in the Crow rate? Does it mean implementation of the secret Snavely follow-up report, and that the railways will get a 25 per cent return on the investment of donations by the taxpayers of Canada for the rehabilitation of branch lines, and that they will make money on the grants that were given to them by the Government of Canada?


Jean-Luc Pepin: Madam Speaker, should the government decide to modernize the Crowsnest rate, this will be announced in due course. 1 was only reacting yesterday to the anticipatory deformation of what the policy might be.


Leslie Gordon Benjamin: Madam Speaker, obviously modernize means increase. The minister has not answered. We can only assume that is the answer.


MARINE TRANSPORT
Leslie Gordon Benjamin: Madam Speaker, I would like to deal with another matter concerning Confederation bargains. The minister has ordered Canadian National to further affect transportation in Canada. Why has he ordered the reduction of south shore service, and the dropping of 42 ports of call from the north shore service and the cutting of ferry service between Sydney and Argentia as well as the north coast ferry service in Newfoundland? Is he trying to do for the Liberal Party in Atlantic Canada what Otto Lang did for them in western Canada?


Jean-Luc Pepin: Madam Speaker, that is a very strange supplementary question. It is an entirely different subject.


Mr. Broadbent:: The answer was strange.


Jean-Luc Pepin: If the answer was strange it is obviously because I am not in a position to give a clear-cut answer today.


Leslie Gordon Benjamin: You ordered it.


Jean-Luc Pepin: The leader of the NDP should understand that, and I am quite sure that he does.
On the subject of the coastal service in Newfoundland, I would be in a position to-but I don't have time-explain the why of our decision to eliminate service to a number of ports in the area. The hon. member who claims to belong to a party of

December 18, 1981
Oral Questions
change is probably the most reactionary member I know. Every time someone talks of change in Canada, he goes wild. What is happening in Newfoundland is simply the fact that since the entry of Newfoundland into Confederation a number of changes have taken place, and one of those changes has been the construction of highways in Newfoundland. Therefore, in the Avalon Peninsula and the Burin Peninsula-


Madam Speaker:: Order, please. I must ask the hon. minister if he could be shorter in his replies. Nearly every time he rises I am tempted to call him back to order.


SMALL BUSINESS
Mr. Lome Greenaway (Cariboo-Chilcotin):: Madam Speaker, my question is for the Minister of Finance. It concerns the Small Business Development Bond program. As the minister probably realizes, currently there are many applications for these bonds and they cannot be processed before December 31, after which time one has to be in dire straits to be an applicant. In my province of British Columbia, for instance, there are 80 applications being processed by one legal firm for one bank alone. There is no way they can get these through by the end of the month. If a person who wants a Small Business Development Bond can obtain a written commitment from his chartered bank before December 31, would the minister assure us that he would allow this application to go through while it catches up to the documentation?


Allan Joseph MacEachen: Madam Speaker, i regret that I did not hear the beginning of the hon. member's question. However, I believe that the circumstances to which he referred in his question were dealt with by me several days ago in the House with respect to the Small Business Development Bond and arrangements that had been made prior to the budget to permit them to be validated before the end of the year.


CRITERIA GOVERNING APPLICATIONS
Mr. Charles Mayer (Portage-Marquette):: Madam Speaker, my question is for the Minister of Finance and it concerns the changes to the Small Business Development Bond. The minister will know that changes have been made in the criteria to allow unincorporated businesses and firms which are in financial difficulty to apply for the bond. It is my understanding that the banks are not in a position to make those loans because there have been no instructions from the department. Will the minister speed up the guidelines set by his department so that the banks will be in a position to assist those people whom the budget was intended to assist?
[DOT] (M30)


Allan Joseph MacEachen: Madam Speaker, the same question has
been raised and, as I stated earlier, my department has had a meeting with the chartered banks. At the present time all the regulations have been clarified, and there is no justification for any delay arising from an alleged uncertainty as to what the changes mean. I take the view that there is no reason at the present time that derives from the government why these bonds cannot be processed.


AGRICULTURE
Mr. Bert Hargrave (Medicine Hat):: Madam Speaker, my question is directed to the Minister of Agriculture. The question is with respect to a recent public statement the minister made at New Liskeard, Ontario, at an Ontario Federation of Agriculture local meeting. It was a very extreme, abrasive, and totally uncalled for remark, and it was about "gutless" farm leaders, with the clear implication that he was referring to the livestock industry, and especially the cattle industry.
In view of the minister's cancellation of a meeting last December 9 with the livestock farm leaders to discuss national stabilization, I would like to ask the minister if he would now reconvene such a meeting and sit down and discuss harmonized national stabilization under the legislation of which he is aware, and include not only cattle producers but the cattle provinces as well.


Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, the hon. member talks about those farm leaders about whom 1 was talking, and I challenge him and anyone else who has led those people down that path to ruination and bankruptcy to accept their responsibility for doing it.


Some hon. Members:: Oh, oh!


Eugene Whelan: Hon. members opposite sound very guilty to me, guilty of the misdemeanour of advising producers on how to use an old-fashioned marketing system that is so outdated we are using it for hardly anything else in our society. Instead of just criticizing the government I say to those farm leaders that they should offer some constructive suggestions. They have not done that kind of thing. Some farm leaders have, and some have not. The farm leaders who have and the people who follow them are the ones who are not going bankrupt, as far as that goes.
The hon. member talks about meeting beef farmers, I have met more beef cattle farmers in the last six months than any other politician in this whole country. The date they set was an inconvenient date for me; I will meet with them any time they want. I met with cattlemen in Alberta on Monday of this week.


Some hon. Members:: Hear, hear!
December 18, 1981


THE BUDGET
Mr. Scott Fennell (Ontario):: Madam Speaker, my question is addressed to the Minister of Finance. Considering the universal opposition to his November 12 budget, and keeping in mind the spirit of Christmas, would he consider during the recess getting away from his rigid stand of removing interest deductibility, and instead permit interest deductibility for small corporations, that is, those earning less then $200,000 a year and up to $1 million? This is their only means of raising equity financing, and it is absolutely important to them if they are to develop this country.


Allan Joseph MacEachen: Madam Speaker, in the spirit of Christmas to which the hon. member referred, may 1 say that I regard his suggestion as very valuable, and I will take it under consideration.


EXTERNAL AFFAIRS
Mr. Jesse P. Flis (Parkdale-High Park):: Madam Speaker, in view of the fact that the House leader of Her Royal Majesty's Official Opposition refused to second a motion under Standing Order 43 which proposed that Canada should continue to provide assistance to the Polish people through the most efficient means, would the Secretary of State for External Affairs please tell the House, in addition to the $100,000 the government gave to the Canadian Polish Congress, and in addition to the $500 million grain credits which have already been given, is the government prepared to give the Polish people further assistance, and through what means?


Charles Joseph Clark: Talk it out, Mark.


Mark R. MacGuigan: Madam Speaker, 1 thank the hon. member for his question. 1 am pleased to be able to tell him and the House that the government is able, in response to an appeal by the International Red Cross for food, clothing and medicine, to announce today a grant of $500,000 to the International Red Cross for Polish relief.


Some hon. Members:: Hear, hear!


AUTOMOTIVE INDUSTRY
Ian Deans: Madam Speaker, my question is directed to the Minister of Finance. The minister is
Oral Questions
no doubt aware that just today there were lay-offs announced in the auto industry which will affect Oshawa, Toronto, and Ste. Therese. In the case of Oshawa and Toronto they are of a temporary nature, but the Quebec lay-offs are permanent. Will the Minister of Finance reconsider his refusal to reduce or eliminate temporarily the sales tax on new automobiles, and enter into some kind of program to stimulate the auto industry now, and encourage consumers to purchase the backlog of automobiles sitting in showrooms and on the lots of the various companies in order to try to get this industry back on its feet?


Allan Joseph MacEachen: Madam Speaker the hon. member has made a suggestion with respect to a tax change. I accept his suggestion, and if and when it will be possible to make further tax changes, I will take his suggestion into account.


John Edward Broadbent: What did you say, Allan?


Ian Deans: That is something like the aid given to people renewing mortgages last summer.


REQUEST THAT MINISTER MEET INDUSTRIAL REPRESENTATIVES
Ian Deans: Madam Speaker, in addition to the commitment the minister has just made, I wonder if he might consider sitting down with the industry and the provinces most affected and attempt to work out a program of assistance which would enable the industry to recover at least some of the share of the market which has been lost to cars imported from various parts of the world.


Allan Joseph MacEachen: Madam Speaker, in his preamble the hon. member raised a matter to which he has referred earlier, namely, high mortgage rates during the peak period. I undertook to have some discussions with the banking institutions. The hon. member will be pleased to know, as I am, that the Royal Bank has undertaken to renegotiate over 10,000 mortgages which had been put into effect during that period of high interest rates. That is a very positive step.


Mr. Lawrence:: Thanks to Ontario government pressure.


Allan Joseph MacEachen: In view of the benefits which flow from the hon. member's suggestions, I will take this further one under consideration and deal with it, I hope as effectively as with the former one, namely, successfully.


THE BUDGET
Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, my question is directed to the Minister of Finance. In light of the universal opposition to his budget and, in particular, to that portion dealing with taxation involving life insurance, will

December 18, 1981
Oral Questions
the minister confirm to the House that he will withdraw that measure concerning life insurance, and will he take a leaf out of the book of the former minister of finance, who tried to do the same thing but later withdrew because of public outcry?


Allan Joseph MacEachen: Madam Speaker, the hon. member talks about universal opposition to the budget. He seems to have forgotten that the budget was approved by the House of Commons by a resounding vote.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


An hon. Member:: Why are you changing it?


Charles Joseph Clark: Peter Lang is not applauding.


Allan Joseph MacEachen: If the budget of the former minister of finance had been treated in the same way, perhaps the hon. member would not be asking questions today.


INCOME TAX
Mr. Dave Nickerson (Western Arctic):: Madam Speaker, my question too is addressed to the Minister of Finance. Will the minister bring in permanent changes to the Income Tax Act to replace the remission order on the taxation of certain benefits, reference to which was made in his budget?


Allan Joseph MacEachen: Madam Speaker, as my hon. friend knows, we did extend that remission order for another period of time. In the meantime, before the remission order comes to an end it is my hope that we would be able to put in place a better system of support to meet the particular requirements dealt with in the remission order.

[DOT] (U40)


AGRICULTURE
Mr. Bud Bradley (Haldimand-Norfolk):: Madam Speaker, my question is for the Minister of Agriculture. The minister knows that farmers provide room and board for many of their seasonal and permanent workers in order to harvest crops during the year. He also knows that the budget emphasizes taxation of employee benefits. Since this would force an unacceptable cost increase to workers, which would have to be passed on to the farmers at such a difficult time, can the minister assure the House and agriculture in Canada that this room and board provided by the farmers will not force the workers to pay income tax on this benefit?


Eugene Whelan: Madam Speaker, I am not sure the hon. member is accurate in what he is stating. I would like to double check this and have further discussions. Some farm organizations have made that kind of representation to me. However, I do not have the kind of information I need to make proper representations. But I will do so, if it is as he says.


THE BUDGET
Thomas Edward Siddon: Madam Speaker, my question is for the Minister of Finance. Thousands of airline and railway employees in my riding and across Canada have an historic right to travel on a surplus space basis-the minister knows what that means-a right which has always been treated as a non-monetary benefit. The Minister of Finance has given a hint this morning that he feels a bit of the spirit of Christmas. Is he now prepared to announce the withdrawal of his ill-considered plan to tax these employee travel benefits, recognizing that the taxation of non-monetary employee benefits will only lead to higher wage demands, higher travel costs to the public, and a great deal of additional and unproductive paper-pushing by bureaucrats?


Allan Joseph MacEachen: Madam Speaker, the hon. member has referred to the question of free travel passes. He will recall that in the budget it was stated in more detail that Revenue Canada will be making changes in its administrative practice so as to require employees to include in income an appropriate value of their employment benefits, such as free transportation passes, lodging and boarding assistance. These were the only two items that were mentioned with respect to administrative change. No others have been mentioned. Therefore, I take it for granted that Revenue Canada will be establishing this administrative practice with respect to these particular benefits. That will be the responsibility of the Minister of National Revenue.
I draw to the attention of the hon. member the reasoning in the budget documents for the change in employment benefits. He ought to understand that the tax-free status of these benefits is inequitable for employees who cannot receive them. There has been an increasing practice to transfer benefits to employees in this form rather than through cash and normal remuneration, through that method escape taxation and, accordingly, place a higher burden of taxation on employees who are not treated in the same way.
The practice that is pointed out has been concentrated in the larger corporations, since employees of small business typically receive most of their remuneration in the form of wages and salaries which are fully taxable. That is the reasoning behind the proposal to establish some fairness among the employees of Canada. That is the philosophy behind the change.
December 18, 1981

[ Translation]


EMPLOYMENT
Mr. Pierre  Gimai@: Madam Speaker, my question is directed to the Parliamentary Secretary to the Minister of Employment and Immigration. In view of the tendency of the government of the province of Quebec to want to restrict the powers of Quebec municipalities, which was particularly apparent last year when municipalities were prevented from submitting Canada Works and Young Canada Works projects, could the parliamentary secretary inform us whether the province of Quebec has given any guarantees that municipalities will be able to submit Young Canada Works projects in 1982?


Mr. Remi Bujold (Parliamentary Secretary to Minister of Employment and Immigration):: Madam Speaker, unfortunately, we have as yet received no work from the government of Quebec whether or not it will allow Quebec municipal authorities to submit projects this year under the Young Canada Works Program. We have had discussions with government representatives, and we hope that this year they will take a more open stance and allow municipalities to submit projects. 1 would even like to suggest to representatives of the government of Quebec that, in view of their great love for democracy, they should conduct a referendum among Quebec municipalities to find out whether they want any projects.

Oral Questions
signed a number of years ago. I am sure he does not advocate that we abolish our obligations under that treaty.
On the question of access to the Common market, I will be interested in the hon. member's position if and when we ratify the agreement that was negotiated with the European Community. It will mean that Canadian industry will have to make up its mind whether it wants to have all the fish and full warehouses, or use some of the fish to trade for access to markets.


FEDERAL PROVINCIAL FISCAL ARRANGEMENTS
Mr. Tom McMillan (Hillsborough):: Madam Speaker, my question is directed to the Minister of Finance. Earlier this week the Conference Board of Canada projected that Ontario's rate of growth in 1982 would be worse than any other province in Canada. Given that the Minister's budget now ties equalization payments for the poorer provinces to Ontario's economic performance rather than to a national standard, and given that Ontario's economy is in decline, will he finally agree with the Council of Maritime Premiers, who issued a statement to that effect this week, that under the new formula fewer provinces will qualify for equalization payments and those which do will qualify for less money? Will the minister admit that the new formula is just another way for the federal government to grab revenue at the expense of basic and essential services in the poorer provinces of this country?


FISHERIES
Mr. Lloyd R. Crouse (South Shore):: Madam Speaker, my question is to the Deputy Prime Minister and Minister of Finance. Canada's fishing industry is today facing disastrous marketing problems. I ask the minister, since my question deals with tariffs, why does Canada grant preferential fishing rights to France while that country places a 15 per cent tariff against Canadian cod exports, as compared to no tariff whatsoever on Canada's competitors? Will the minister contact the proper authorities in France and the Economic Community, through the contractual link that was set up by the Prime Minister, pointing out that Canada cannot accept this situation and requesting that the tariff be eliminated on Canadian cod exports?


Allan Joseph MacEachen: No, Madam Speaker. I could not agree with the hon. member in the inaccurate statement which he brought into his question. First, I do not believe that the Ontario economy is in the state of imminent collapse as the hon. member seems to imply. The existing equalization formula has been roundly condemned by all the provinces. It has been disagreed with by an all-party parliamentary task force which concluded that the existing equalization formula should be abandoned. In this current session of Parliament we had to introduce a bill to eliminate the province of Ontario arbitrarily from receiving equalization payments. The necessity was obvious of producing a new formula, which stated that it was apparent that the Province of Ontario was able to provide a reasonable level of public services. Therefore, it would be a standard upon which the equalization is based. That is the approach.


Hon. Romeo LeBlanc (Minister of Fisheries and Oceans):: Madam Speaker, we have in fact been discussing with the European Community the very question of reducing tariffs against Canadian fish. Until the dollar strengthened, we were sending a considerable amount of fish to the European market. On the question of France, the hon. member surely knows that France is fishing in Canadian waters under a treaty that was
The fact of the matter is rather than equalization payments being reduced, as the hon. member alleges, they will increase under the new formula by about 15 per cent in total from year to year. It seems to me that that is a rather substantial increase in payments to the recipient provinces.

December 18, 1981
Oral Questions THE BUDGET


EFFECT ON RETIREMENT INCOME OF FARMERS
Mr. Lome Nystrom (Yorkton-Melville):: Madam Speaker, my question is directed to the Minister of Finance. On November 24 1 sent a statement to the Minister of Finance from a firm of Saskatchewan accountants who argue that under his budget would be the elimination of annuities for farmers, which really means the elimination of a great deal of their retirement income so that the average farmer in Saskatchewan would lose around $6,000 or more dollars per year, and in the year of sale he would see his taxes increase from $5,000 to over $70,000. In view of the fact that the minister has not replied to the information, nor to the questions we and the Federation of Agriculture and other people have asked on this issue, I wonder if the minister can confirm, in the spirit of Christmas, that later today or very shortly next week he will announce the reinstatement of the IAAC for farmers and small businessmen, or certainly an exemption that would cover the main concerns of the small farming community in this country?


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: No, Madam Speaker, I cannot confirm that I will be making any such announcement. I believe that the hon. member has, I am sure unintentionally, not fully understood the comparative advantage of the forward averaging system-


Charles James Mayer: No one understands it; that is the problem.


Allan Joseph MacEachen: -in comparison with the income-averaging annuity contract. Hon. members may be interested in knowing that recently representatives of the cattle industry came to Ottawa to express their concern about the elimination of IAAC, as they are called, and the substitution of the forward averaging. After an examination of the two alternatives, they concluded that probably the new system was better for the farmers. When they returned to the west they issued a statement to that effect and said that, "Yes, indeed, we think that system is probably better for the farmer".


An hon. Member:: It means that people will pay more taxes.


Allan Joseph MacEachen: Madam Speaker, may I say that the hon. member has raised a particular case and I am trying to get a letter off to him today that is on a very complicated example. I hope that will further our common understanding of this problem.


QUERY RESPECTING POSSIBILITY OF CHANGES
Lorne Edmund Nystrom: Madam Speaker, I have with me the comparison made between IAAC and forward averaging that was worked out by 12 accountants of a very respectable firm in our province. I should like to ask the minister directly whether or not he is stating to the House
today that the door is absolutely closed with regard to any changes that may pertain to small farmers, and small businessmen not large cattle ranchers, who depend on the sale of their farms for retirement incomes?


Allan Joseph MacEachen: Madam Speaker, the door is never closed at all. The hon. member will have an opportunity to state his case, if it is required, when the budget resolutions are before the House. I can assure the hon. member that I will be listening very carefully to any views that are put forward at that time and, indeed, as I have been listening to views up to the present time.


ANNOUNCEMENT OF CHANGES
Charles Joseph Clark: Madam Speaker, the Minister of Finance has heard several more representations from this party today for changes in the budget. Will the Minister of Finance indicate to the House whether he intends to introduce or to announce any changes in the budget before the House of Commons adjourns today?


An hon. Member:: You already know the answer to that one.


Allan Joseph MacEachen: Madam Speaker, it is my intention, as I have indicated informally, to indeed make some announcement today. I would make the statement on motions at the present time, but it is necessary that I make this announcement when markets close. If I get consent, Madam Speaker, I would be prepared to come into the House at four o'clock and make a statement and table some documents, so that the House of Commons would be fully apprised of the announcement before it recesses.


Erik Nielsen: You have it.


Allan Joseph MacEachen: Madam Speaker, I want to assure you that I have attempted to get these announcements put together before the House rose. That is why I have met the deadline today.


Erik Nielsen: Madam Speaker, I simply want to indicate to the minister right now that he has the consent of the official opposition to make that statement at four o'clock.


EFFECT ON BENEFITS PROVIDED FOR BRITISH COLUMBIA LOGGERS
Hon. John A. Fraser (Vancouver South):: Madam Speaker, my question is directed to the Minister of Finance. As the minister knows, in the forest industry in British Columbia there are certain benefits that can be considered deemed benefits, in terms of room and board for people working in outlying logging and timber operations. Will the minister advise the House whether he has yet responded to any representations from the forest industry or the unions in
December 18, 1981

British Columbia, and whether he will reconsider the budget provisions which would make those benefits taxable?


Allan Joseph MacEachen: Madam Speaker, my understanding is that under the present law these benefits are taxable at the present time.


IMPACT ON GUARANTEED INCOME SUPPLEMENT RECIPIENTS
Frederick James (Jim) Hawkes: Madam Speaker, I have a very serious question for the Minister of Finance. I rose in the House on November 27 and expressed my concern in the form of a question on the impact of his indirect and hidden taxes on senior citizens. Specifically, did his tax take from hidden taxes exceed the $35 which the House of Commons had voted to guaranteed income supplement recipients? The minister responded to the question, Madam Speaker, by stating "No". It is very clear in Hansard on November 27 that he responded "No". In my supplementary question I asked if he would table a scientific study to support his answer. He indicated a willingness, and suggested to the House that my information was incorrect. Earlier today during the question period, under the minister's signature I received the following letter, and I quote one sentence:
Work has commenced on the study and I will introduce it in the new year.
On November 27 the minister did not know. Today under his own signature he said that he will commence the study and introduce it in the new year. The minister misled the House on November 27. Will he stand in his place and apologize to the House for his statement?


Madam Speaker:: Order, please.


Allan Joseph MacEachen: Madam Speaker, I rise on a point of
order.


Some hon. Members:: No.


Madam Speaker:: Order, please. Sorry, but the hon. Minister of Finance may not raise a point of order at this time. He may later on.


EMPLOYEE TRAVEL BENEFITS
Hon. Jake Epp (Provencher):: Madam Speaker, I should like to direct my question to the Minister of National Revenue. In view of the fact that the Minister of Finance has now passed the hot potato of employee travel passes to that minister, will the minister tell the House whether he intends to pass regulations in his department that would make those employee travel benefits taxable?


Hon. William Rompkey (Minister of National Revenue):: Madam Speaker, the Minister of Finance stated very clearly this morning the position he has taken with regard to the taxation of benefits. My job is to interpret the law. I will be doing that in consultation with the Minister of Finance. I can assure the hon. member, the opposition, and the people in the
Business of the House
country that we will be doing that along the same lines as the general theme in the budget, and that is with fairness and equity.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


SPEAKER'S CHRISTMAS WISHES
Madam Speaker:: May I at this time wish all hon. members a very Merry Christmas and a Happy New Year. I rejoice with them that they will now have some time to spend with their families which, considering our functions and our life style, we all miss very much. May these moments with your families be filled with joy and love.
[ Translation]
A Merry Christmas and a Happy and Prosperous New Year to everyone, and the very best to you and yours during the holidays!


MESSAGE FROM THE SENATE
Madam Speaker:: I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill C-46, an act to regulate the importation of fresh, chilled and frozen meat and to amend the Export and Import Permits Act, without amendment.


PETITIONS
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table reports of the Clerk of Petitions stating that he has examined the petitions presented by hon. members on Thursday, December 17, 1981 and finds that they meet the requirements of the Standing Orders as to form.


BUSINESS OF THE HOUSE
Erik Nielsen: Madam Speaker, the Minister of Finance indicated that he would be making a statement later this day if he had unanimous consent to do so. We indicated immediately

December 18, 1981
House of Commons
that consent was forthcoming from this party. I wonder if the New Democratic Party could give an indication whether that consent is forthcoming from them.


Ian Deans: Madam Speaker, 1 did not realize that 1 was entitled to take questions. Of course, unanimous consent is given.


Madam Speaker:: Does the House give its unanimous consent?


Some hon. Members:: Agreed.
[ Translation]


Mr. Pinard:: In view of the fact that the Minister of Finance (Mr. MacEachen), with the unanimous consent of the House, will be making his statement at four o'clock, it obviously follows that there will be no private members' hour today.


Madam Speaker:: Is it agreed that the Minister of Finance should table the document later this day and that there be no private members' hour?


Some hon. Members:: Agreed.


Erik Nielsen: Madam Speaker, it is, of course, clearly understood that it will be considered a statement on motions and that there will be the appropriate responses from both opposition parties?


Ian Deans: Madam Speaker, I just want to be sure that when the statement is made it is understood that it is a statement on motions and that there will be an opportunity for questions.


Yvon Pinard: Madam Speaker, I am now able to inform the House that the Minister of Finance will not take up the entire hour he has been given, thus enabling members to ask a few questions if they should wish to do so. Therefore members of the opposition will have an opportunity to ask questions before the House adjourns at five o'clock.


STAFFING OF ENGLISH DEBATES REPORTERS
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, I rise on a question of privilege concerning a matter which could potentially affect the ability of all Members of Parliament in this House to carry out their responsibilities. It relates to a matter of administration, some might say. It is a question of a decision which was announced to the English language Hansard reporters in this House yesterday informing them, I am told without any prior consultation with that group, that a
vacancy in that particular area of administration will not be filled. I am drawing this matter to the attention of-


Madam Speaker:: Order, please. That is a matter of administration. I will be glad to discuss it with the hon. member, who wanted to see me just before question period but I had a series of meetings that led me up to the hour of the question period. It is a matter of administration. I can assure the hon. member that consultations have taken place and we are hopeful that the decisions taken will not affect the services of Hansard in this House. But I will be glad to discuss the matter with the hon. member.


POINT OF ORDER
Mr. Arnold Malone (Crowfoot):: Madam Speaker, I rise on a point of order. I wonder if the hon. member for Yorkton-Melville (Mr. Nystrom) might want to take the opportunity to make a correction to the record. I believe he inadvertently misled the House today when he put a question to the Minister of Finance (Mr. MacEachen) about tax as it relates to small farms. In making a distinction between small farms and cattle ranches, he implied that it was not needed when he knows full well that-


Madam Speaker:: Order, please. I am afraid that is not a point of order. It is a matter of debate or interpretation. If the hon. member wants to correct any statement in the House, he may do that himself. Hon. members may not ask other hon. members to correct their statements.



ROUTINE PROCEEDINGS


Mr. Maurice Harquail (Restigouche):: Madam Speaker, as chairman of the subcommittee on Armed Forces Reserves, and in the name of the chairman of the Standing Committee on External Affairs and National Defence, I have the honour and great privilege to present what I understand is the first report on the subject of the reserves as contained in the seventh report of the Standing Committee on External Affairs and National Defence, in both official languages.
[Editor's Note: For above report, see today's Votes and Proceedings.]
December 18, 1981


NATIONAL HOUSING ACT CANADA MORTGAGE AND HOUSING ACT
Hon. Paul J. Cosgrove (Minister of Public Works):: Madam Speaker, in accordance with Standing Order 41(2) I have the honour to table for discussion two copies in both official languages of a draft bill to amend the National Housing Act and the Canada Mortgage and Housing Corporation Act.


PETITIONS
Frederick James (Jim) Hawkes: Madam Speaker, it is my duty to present a petition signed by over 1,020 Canadians from coast to coast on behalf of the more than four million Canadians who benefit from the self-discipline and intellectual stimulation to be gained from chess.
The purpose of this petition is to indicate clearly to the federal government the urgent need for the federal government to follow the leadership of many provincial governments and other national governments and recognize chess as a universal form of cultural expression, combining physical and mental excellence.
[ Translation]
The purpose of this petition is to ask the Secretary of State (Mr. Regan) to change departmental policy so as to include measures to promote chess and, consequently, physical and mental excellence.

The petitioners hope, Madam Speaker, that in your examination of their petition you will find the petition in order, sense the urgency of their plea, and that you might use the discretionary powers vested in your office to allow discussion and referral to committee at the earliest possible moment.


Madam Speaker:: Would the hon. member like to repeat that in French now?


Some hon. Members:: Hear, hear!



CANADA LABOUR CODE


Mr. David Orlikow (Winnipeg North) moved: for leave to introduce Bill C-646, to amend the Canada Labour Code (security of employment).
He said: Madam Speaker, I have filed a copy of this bill with the Clerk and 1 wish to introduce it for the following reason.
During the past year lay-offs of Canadian workers have been occurring with increasing and alarming regularity. The
Business of the House
Canadian Manufacturers' Association has reported 140,000 lay-offs in that sector alone during the last few months.
This bill is designed to give increased protection to laid-off workers. If enacted, the bill would require longer advance notice of lay-offs, more generous severance pay and would provide for the establishment of a job protection board with representatives of labour, management and government, to inquire into the reasons for the lay-offs and plant closures.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.

['Agreed.']
Hon. Andre Ouellet (for the Minister of Energy, Mines and Resources) moved: for leave to introduce Bill C-87, an Act to Amend the National Energy Board Act (No. 2).


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
['for leave to introduce Bill C-87, an Act to Amend the National Energy Board Act (No. 2).']
Madam Speaker:: When shall this bill be read the second time? At the next sitting of the House?


Some hon. Members:: Agreed!


Madam Speaker:: Later today.



Mr. Baker (Nepean-Carleton):: Madam Speaker, while we are on the subject of introduction of bills, I wonder whether the government House leader could now advise the House if it is the intention of the government to introduce the Crown corporation bill which the President of the Treasury Board indicated is very important to him and which has been called for by the Standing Committee on Public Accounts and by the Auditor General. If he is not in a position to give me that answer now, would he undertake to give me that answer during the recess? I have information on some good authority that the government has now decided to jettison that bill, and 1 would want to be persuaded otherwise.


Yvon Pinard: Madam Speaker, obviously we shall not be introducing any other bills today. With regard to the bills which will be introduced after the holidays, we shall be in a better position to inform the House as of January 25.

December 18, 1981
Order Paper Questions

external affairs and national defence


MOTION RESPECTING AUTHORITY OF SUBCOMMITTEE TO TRAVEL
Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, I have a motion which 1 believe is agreeable to all sides of the House. I would move, seconded by the hon. member for York East (Mr. Collenette):
That the members of the subcommittee on the relationship between Canada and Latin America and the Caribbean of the Standing Committee on External Affairs and National Defence be authorized to travel during the period ending February I, 1982, to Cuba. Haiti, Jamaica, Trinidad and Tobago, Costa Rica and Nicaragua, and that the necessary staff accompany the subcommittee.


Madam Speaker:: Is it the pleasure of the House to adopt the said report by unanimous consent?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
David P. Smith: Madam Speaker, the following questions will be answered today: Nos. 2,035, 2,363, 2,766, 3,065, 3,222, 3,316, 3,368, 3,532, 3,533 and 3,535.
[ Text]


Mr. McKinnon: 1.	Was a Canadian Forces 707 aircraft committed to the Prime Minister's use during his recent European/African/South American trip and, if so, for how many days and hours?
2.	Were other service aircraft committed and, if so, for how many days and hours?
3.	What was the total itemized cost for transportation of the entire trip?


Mrs. Ursula Appolloni (Parliamentary Secretary to Minister of National Defence):: 1. Yes, 14 days.
2.	No.
3.	CF137 Boeing 47 hours flying time at $4,517/hr.-
crew temporary duty expenses	$8,410
Landing/ground handling fees at Dakaar, Lagos, Maidugure, Brasilia, Sao Paulo, Manaus and Mexico City	8,426
In-flight meals (resupply) at Dakar and Mexico City	3,636
Total expenses	$232,771


Mr. MacKay: 1.	(a) What was the number of RCMP officers involved in policing the provinces of Ontario and Quebec during the fiscal year 1980-81 (b) what was the breakdown, by function and geographic location, of the officers involved in (i) criminal law (ii) commercial crime (iii) customs and excise (iv) drug enforcement?
2.	For the same period, what was the total number of officers in the Ottawa headquarters and support staff involved in (a) criminal law enforcement (b) commercial crime (c) customs and excise (d) drug enforcement?


Hon. Bob Kaplan (Solicitor General):: (a)	2701	(regular "uniform" members)	Ontario	Quebec(b)	(i)	Federal criminal law*	418	349(ii)	Commercial crime	102	105(iii)	Customs and excise	67	62(iv)	Drug enforcement	241	117Total	828	633
* includes Criminal Code and other Statutes with the exception of commercial crime figures which are shown separately.
		Ottawa Headquarters	
		R.C.M.P.	Support
		Officers	Staff
(a)	Federal criminal law	169	92(b)	Commercial crime	25	5(0	Customs and excise	12	4(d)	Drug enforcement	15	5Total	221	106
Note: These figures include the following sub/sub/activities: detachment policing, special investigation, telecommunications, operational support, air services, criminal intelligence and immigration & passport.
Of the total RCMP officers (169), 55 positions are with foreign services at different points around the world and two are attached with Interpol, Paris.
The establishment figures for "HQ" Division include personnel who provide support services to all divisions. No distinction can be made as to the percentage of positions that are strictly dealing with the provinces of Ontario and Quebec.


Mr. Beatty: 1.	Did Norpak, Limited make an offer of employment to Mr. H. G. Bown, director general of information technology research and development, Department of Communications and, if so, on what date?
2.	On what date and to whom did Mr. Bown first disclose the offer of employment as required by the government's guidelines for holders of public office?
3.	(a) Did the Minister of Communications announce on June 23, 1981 that Mr. Bown would be leaving the department in order to take a senior executive job with Norpak, Limited (b) was he aware at the time of the implications of the guidelines in Mr. Bown's case and, if so, for what reason did he not mention that it was unclear whether Mr. Bown could accept such a job under the guidelines?
4.	On what date did the Minister of Communications first become aware of the implications of the guidelines for Mr. Bown's future employment?
December 18, 1981

5.	Was an application made for exemption from the guidelines and, if so (a) on what date (b) what form did the application take?
6.	Is Mr. Bown currently employed by the Department of Communications and, if not, on what date did he leave?


Mr. Jack Masters (Parliamentary Secretary to Minister of Communications):: In so far as the Department of Communications is concerned, the reply to the above question is as follows:
1.	Norpak Limited made a formal offer of employment to Mr. Bown on June 18, 1981.
2.	Mr. Bown officially disclosed his offer of employment to the assistant deputy minister (research) on June 19, 1981. This offer of employment disclosure was also made known to the deputy minister on June 19, 1981.
3.	(a) The minister announced on June 23, 1981 at the Noranda-Norpak news conference, that Mr. Bown would be leaving the department to join Norpak Limited.
(b) The minister was aware of the implications and the guidelines and the assistant deputy minister (research), Mr. Doug Parkhill, responded at the June 23 press conference that the department would adhere to the requirements of these guidelines.
4.	The minister was aware of the guidelines with respect to post employment for public servants. When the June 18 offer of employment to Mr. Bown became official, action steps were taken to seek exemption for Mr. Bown as provided for in the guidelines.
5.	(a) Yes, on July 15, 1981.
(b) The application was sent to Miss Anita Szlazak, the Public Service Commissioner who chairs the post-employment advisory committee for public servants which is responsible under the guidelines for reviewing requests for exemptions and making recommendations to the Treasury Board.
The application was made up of a letter from the deputy minister outlining Mr. Bown's case and the reasons on which the request for exemption was based. The letter was accompanied by supporting documents. The application for exemption and the advisory committee's recommendation was presented to the Treasury Board ministers on July 29, 1981 for consideration and was approved.
6.	At the time of receipt of this inquiry Mr. Bown was still an employee of the Department of Communications. Separation date: August 17, 1981.


TRANSFER OF IMMIGRATION OFFICERS TO DEPARTMENT OF EXTERNAL AFFAIRS
Mr. Cossitt: 1.	Were offices and employees of the Department of Employment and Immigration outside Canada transferred to the Department of External Affairs and, if so (a) on what date (b) for what reason (c) does the Minister of Employment and Immigration no longer have control over their functions?
2.	Are ministerial entry permits still issued by the Minister of Employment and Immigration and is it necessary for him to have the concurrence of the Secretary of State for External Affairs first?
Order Paper Questions
3.	Is this an attempt to dismantle or completely abolish the Department of Employment and Immigration and, if so, how can such a move be justified?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: 1. Some 350 foreign service employees of the Employment and Immigration Commission presently in Canada or posted abroad were transferred to the Department of External Affairs.
(a)	on April 1, 1981.
(b)	to establish a consolidated foreign service which will provide a more refined and effective tool to deliver all overseas programs.
(c)	No. The Minister of Employment and Immigration retains full responsibility for administering the provisions of the Immigration Act and its application in Canada and abroad. This includes immigration policy development, program design and legislative interpretation. The Department of External Affairs has assumed responsibility for the delivery only, of the immigration and other programs abroad under the policy and functional direction of the Minister of Employment and Immigration.
2.	The Minister of Employment and Immigration does not need the concurrence of the Secretary of State for External Affairs to issue minister's permits. Section 37 of the Immigration Act (1976) clearly gives this authority exclusively to the minister of immigration.
3.	No.


USE OF GOVERNMENT VEHICLES
Mr. Stevens: 1.	Is it government policy to allow cabinet ministers, deputy ministers and/or senior public servants to drive or otherwise use government vehicles for personal use?
2.	Does the government receive compensation for such personal use of these cars and, if so, on what basis?
3.	Who is responsible for the payment of operational and maintenance expenses while the vehicles are being used for the personal benefit of cabinet ministers, deputy ministers, and/or senior public servants?


Hon. Donald J. Johnston (President of the Treasury Board):: 1. Yes; cabinet ministers and deputy ministers of departments or equivalent may make personal use of the departmental vehicle assigned to their offices for official use.
2. Yes; all personal use of the departmental vehicle must be paid for on the basis of a kilometric/mileage rate. The total annual charge relates to the taxable benefit received and is determined as the greater of the amount calculated by multiplying the annual personal distance driven by the applicable rate, or the minimum stand-by charge as per section 6(2) of the Income Tax Act, generally calculated, on the date this question was asked, as 1 per cent of the capital cost of the vehicle. Effective with the 1982 taxation year, the minimum stand-by charge has been increased to 2'A per cent per month of the capital cost of the vehicle. Cabinet ministers make a monthly payment to the department equal to the calculated stand-by charge and a further adjustment at the end of the year, should personal use exceed that permissible by dividing

December 18, 1981
Order Paper Questions
the annual amount paid by the kilometric/mileage rate. Deputy ministers have the total taxable benefit accruing from personal use of the departmental vehicle added to their gross earnings for the year.
3. The payment of operational and maintenance expenses for these vehicles is the responsibility of the owner department, as the kilometric/mileage rate is established on the basis of reimbursement of both operating costs (gasoline, oil, lubrication, tires, maintenance and repairs) and ownership costs (depreciation, provincial tax, finance charges, insurance and licences).


IMMIGRATION LEVELS
Mr. Herbert: Were discussions held with provincial government representatives to determine what the immigration levels will be in the next three years and, if so, for each province, what minimum and maximum level was established?


Lloyd Axworthy: The provinces have agreed in principle that immigration levels should be set for the next three years. The major purpose of federal-provincial consultation in this area is to allow for an over-all exchange of views on all immigration policy, from which future levels may be determined.
Some provinces have indicated specific intake levels for 1982. Quebec expects to receive 16,000 to 18,000, Saskatchewan 2,850, and Prince Edward Island would like to receive 250 to 280 new arrivals. Most provinces, however, have referred to their needs in terms of a percentage of the total national level to be decided federally, stating preferences for maintaining or slightly increasing present intakes.


USE OF DND AIRCRAFT BY CABINET MINISTERS
Mr. Cossitt: 1.	With reference to the answer to question No. 1,996 with regard to the use of Department of National Defence aircraft by cabinet ministers which stated in part: "The list of executive aircraft used by cabinet ministers.. . will be available on a monthly basis effective October, 1981 (on request).", was such information requested by the hon. member for Leeds-Grenville from the office of the Minister of National Defence and, as of the date of this question, has the information been furnished and, if not, for what reason?
2.	Has a specific system been set up to make this information available each month to avoid any necessity of prolonged and repeated inquiries and, if not (a) for what reason (b) on what date will it be set up?


Hon. J. Gilles Lamontagne (Minister of National Defence):: 1. Yes; as of the date of the question the information for the months of October and November was being compiled, however, this information has since been forwarded.
2. Yes. The monthly list of executive aircraft used by cabinet ministers will be available on written request to the office of the Minister of National Defence within 15 calendar days of the following month.
(a) and (b) Not applicable.


ANSWER TO QUESTION No. 3,470
Mr. Cossitt: With reference to the answer to question No. 3,470 which referred in part to the human reaction of many officials in their attitude to answering Order Paper questions, is it government policy to (a) make such blanket statements (b) refuse to make public the names of the public servants involved (c) permit public servants, who complain about Members of Parliament who put questions on the Order Paper, to hide behind a cloak of anonymity?


David P. Smith: (a) See reply to question No. 3,470 answered December 10, 1981.
(b)	See reply to question No. 3,469 answered December 10, 1981.
(c)	This is a hypothetical question.


ANSWER TO QUESTION No. 3,649
Mr. Cossitt: With reference to the answer to question No. 3,469 which stated in part that "The hon. Member needs only to read successive Order Papers in order to form his own conclusions as to the answer to this question" and as to those members accused by the government of having "overloaded the system" concerning Order Paper questions, does the government realize that the hon. member for Leeds-Grenville did not request to be told his own personal conclusions but was requesting information from the government and, in view of this clarification, is the government now prepared to issue a corrected answer?


David P. Smith: In view of the fact that this question is entirely argumentative in nature and does not belong on the Order Paper the government pondered not answering. However, since the question implies that an incorrect answer has been given, it is clearly necessary to set matters straight. The answer to this question is: no corrected answer is necessary since the answer given was correct.


ANSWER TO QUESTION No. 3,479
Mr. Cossitt: With reference to the answer to question No. 3,479 which stated in part that the government bases whether or not it is amused on certain basic psychology texts, what is a complete list of all such texts used by the government?


David P. Smith: The answer suggested that the hon. member could, if he wished, consult such books. The government does not believe that it has any need to consult such books. If the hon. member wishes to do so and has difficulty with the index system in the Library of Parliament, he can enlist the assistance of any one of the professionaly trained staff in the Library.


QUESTIONS PASSED AS ORDERS FOR RETURNS
David P. Smith: Madam Speaker, if questions Nos. 1,997
December 18, 1981

and 2,519 could be made orders for returns, these returns will be tabled immediately.


USE OF DND AIRCRAFT BY CABINET MINISTERS
Mr. Cossitt: 1.	Since the date the government took office following the general election of February 18, 1980, was any Department of National Defence aircraft used by the Prime Minister and/or a cabinet minister and, if so, in each case (a) on what date (b) for what purpose (c) who used the aircraft and what were the names and job designations of all persons on board at any time (d) what was the point of origin, point of termination and any stops in between (e) what was the cost of the flight?
2.	What was the total cost of all such flights?
Return tabled.


USE OF FALCON JETS BY CABINET MINISTERS
Mr. McKinnon: Were Department of National Defence Falcon jets used to transport cabinet ministers or Members of Parliament during the first four months of 1981 and, if so, how many trips were made and, in each case (a) what was the (i) date (ii) point of departure (iii) destination (b) who was the principal passenger?
Return tabled.


David P. Smith: I would ask, Madam Speaker, that the remaining questions be allowed to stand.


Madam Speaker:: Shall the remaining questions stand?


Some hon. Members:: Agreed.


Mr. Stevens:: Madam Speaker, 1 raise once again the point of order I raised yesterday. Question No. 2,042, which touches on the costs borne by the taxpayers of Canada for the Prime Minister's world tour approximately a year ago, has still not been answered. Your Honour will recall that yesterday the government House leader promised it would be answered today, yet we now have a reply which does not include the answer to that question which has been on the Order Paper for months.


David P. Smith: Madam Speaker, if the hon. member would look up question No. 2,035, standing in the name of the hon. member for Victoria which is found in Monday's Order Paper, I think he would find that the question has been asked and answered.


Neil Young: Madam Speaker, I would like to ask the parliamentary secretary when he expects to answer my questions on the Order Paper concerning the Obstacles report. Yesterday the Minister of State tabled the government's initial response to the Obstacles report in the House, which addressed some 40 of the recommendations. In previous announcements by the government, the government spoke about implementing 56 recommendations from the Obstacles report. I wonder whether the parliamentary secretary could advise both the House and myself when we can expect answers to at least the additional
External Affairs and National Defence
16 initial responses which were not included in the minister's document tabled yesterday.


David P. Smith: Madam Speaker, I will be making representations to the hon. Secretary of State, who has just recently been designated as the minister responsible for co-ordinating those answers.


Mr. Waddell:: I wonder if the parliamentary secretary could advise the House whether the subcommittee on the Caribbean will be visiting the Turks and Caicos Islands in their travels.


David P. Smith: Madam Speaker, he could ask his colleague, who will be going, but I do not believe they were included in the order of reference which just went through the House.


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered. Does the House agree to have questions Nos. 1,997 and 2,519 made Orders for Returns?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


Yvon Pinard: That the Standing Committee on External Affairs and National Defence be empowered to examine security and disarmament issues with specific attention to Canada's participation in the second Special Session of the United Nations General Assembly devoted to Disarmament scheduled for June/July 1982, and report to the House not later than Friday, April 2nd, 1982; and That the Committee be empowered for this purpose to retain the services of advisers to assist in its work and that it also be empowered to retain such professional, clerical and stenographic help as may be required and that it also be empowered to advertise invitations to the public to submit opinions on the aforementioned matter.
He said: Madam Speaker, I understand that there has been consultation on this matter and that there is unanimous consent for adoption of this motion.


Madam Speaker:: Is there unanimous consent?


Erik Nielsen: That is correct, Madam Speaker. I do not have my Order Paper in front of me, but was the word "security" included in the motion?


Yvon Pinard: Yes.


Walter David Baker: Yes, it was.
14218

December 18, 1981
National Energy Board Act, No. 2


Madam Speaker:: Therefore, there is unanimous consent for adopting this motion.


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
Yvon Pinard: There has also been consultation on Bill C-87, and it has been agreed that we should proceed with all stages of the bill today, so that the motion should include referral of the bill to the Committee of the Whole. I wish to announce now that at the stage of consideration by a Committee of the Whole, I shall be presenting an amendment on behalf of the Minister of Energy, Mines and Resources (Mr. Lalonde), to have the number of additional commissioners restricted to six. In the circumstances, and subject to this amendment, I believe there is unanimous consent for the House to proceed as I have just indicated and that the bill can be taken through all stages and adopted during the next few minutes.


Madam Speaker:: Is there unanimous consent for proceeding with all stages of the bill?


Some hon. Members:: Agreed.


NATIONAL ENERGY BOARD ACT, NO. 2 AMENDMENT RESPECTING APPOINTMENT OF TEMPORARY MEMBERS
Yvon Pinard: that Bill C-87, an Act to amend the National Energy Board Act (No. 2), be read the second time and, by unanimous consent, referred to the Committee of the Whole.


Madam Speaker:: Is it the pleasure of the House to adopt this motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and, by unanimous consent, referred to the committee of the whole-Mr. Blaker in the chair.
The Assistant Deputy Chairman:: House in committee of the whole on Bill C-87, an act to amend the National Energy Board Act (No. 2). Shall clause 1 carry?
On Clause 1-Temporary Members


Erik Nielsen: On a point of order, Mr. Chairman, we whipped through second reading so fast that the minister did not make an explanatory statement. I see that the parliamentary secretary is in his place, and I assumed that he would be recognized first to make the statement which would normally
be made on second reading debate, and that he would be followed by the hon. member for Calgary Centre.


Mr. MacLaren:: Mr. Chairman, I could either do so now or on third reading, as the hon. member wishes.


Erik Nielsen: I think it would be appropriate if the explanation were given now.


Roy MacLaren: Mr. Chairman, hon. members may recall that last Friday, December 11, this House gave final reading to Bill C-60, to amend the National Energy Board Act relating to the detailed routing of pipelines, conditions relating to construction, entry on to the right of way, acquisition of the right of way and compensation for the use of the land. The bill is now awaiting royal assent. Hon. members may also recall that all parties agreed to the swift passage of the bill which had originated in the Senate as Bill S-12.
Bill C-60 will require that a company which files a plan, profile and book of reference with the Board must serve a notice on all landowners whose land is proposed to be acquired.


Mr. Andre:: You've got the wrong notes.


Roy MacLaren: The company must publish a similar notice in a newspaper in the area of the land involved. Landowners who have been served with a notice, and any other landowner who believes that his land will be affected by the pipeline, will have 30 days to file a notice of objection with the National Energy Board.
If any notice is received, the Board must conduct a hearing in the locale of the land affected, at which time the landowners who have filed notices have a right to be heard. The terms of reference of this hearing include not only the best possible route for the pipeline, but also the best method of acquiring the land and of constructing the pipeline. The Board has the power to address all of these concerns either by withholding its approval of the plans, profiles, and books of reference or by imposing terms and conditions on the approval.
There is substantial pipeline construction contemplated in the near future. The board estimates that nearly 4,000 land owners will be affected by the bill in the first quarter of 1982 alone. Even if only 3 per cent of them request public hearings, this could give rise to 120 cases in that quarter. Just how many land owners will apply is unknown at this time, but the board must have the flexibility to deal with the situation.
However, Bill C-60 did not provide for any additional board members to conduct these hearings. Staff will also be required by the board to administer Bill C-60, but arrangements have already been made with Treasury Board for the provision of such staff. However, under the National Energy Board Act, the board is restricted to nine permanent members with no provision for temporary members. These permanent members are needed to carry out the existing responsibilities of the board under the National Energy Board Act, the Petroleum Administration Act and the Northern Pipeline Act. With the
December 18, 1981

high level of activity in the energy field, all nine members are already committed to hearings throughout 1982 and beyond. It would be impossible for board members to carry out their obligations under Bill C-60 without provision for additional members.
As the President of the Privy Council has noted, concurrence has been received from all parties to introduce this bill in anticipation that it will receive swift passage so as to permit Bill C-60 to be proclaimed at an early date. The sole purpose of the bill before us now is to provide for the appointment of not more than six temporary members under terms and conditions to be prescribed by the governor in council and for such members to carry out such duties as may be assigned to them by the chairman.
Whether more permanent members are needed can be determined when experience has been gained in administering Bill C-60. Each of the temporary members will be governed by the same conflict of interest rules which are contained in the National Energy Board Act relating to its members.
Members may note that there has been a change in the wording of the residence requirements of board members. They are presently required "to reside in the city of Ottawa or within 25 miles thereof or within such other distance as the governor in council determines". It has been decided to change these definitions and relate them to the National Capital Region based on the definition set forth in the National Capital Act. This seems to reflect the appropriateness of using the term, National Capital Region, embracing an area in both Ontario and Quebec in referring to the federal Government of Canada.
As 1 pointed out, the act is basically simple. It provides for no more than six temporary board members, permitting the bringing into operation of Bill C-60 at an early date. It is the intention to proclaim the coming into effect of this act on the same day as Bill C-60.
1 have referred to the fact that this bill anticipates not more than six temporary members. At the committee stage of the bill, as the President of the Privy Council has already indicated, with the concurrence of the two opposition parties I will move an amendment that will limit the number of temporary members to not more than six.


Harvie Andre: Mr. Chairman, I want to take this opportunity to say a few words. We concur with the introduction of this bill. We did support and do support Bill C-60 which provides, I think, for a fair way of treating farmers, ranchers and other land owners who are subject to pipeline right-of-way expropriations. Obviously, we concur with the necessary changes to the staff of the National Energy Board so as to enable it properly to administer this new way of handling land owners.
I would also like to take this opportunity to indicate that an equal concern to Bill C-60 is a concern that we in this party feel about the ability of the National Energy Board properly and expeditiously to handle other very important issues which will be coming forward in the coming year. In particular, I consider that the hearings which the National Energy Board
National Energy Board Act, No. 2 will be undertaking on natural gas exports commencing March, 1982, are of vital importance in an energy sense to the future of this country.
These gas export hearings, I hope and believe, will result in the authorization of increased gas exports, which are vital to this country for many reasons. First, although the Minister of Energy, Mines and Resources never wants to admit it in this House, there are dozens and dozens of oil and gas companies in severe financial straits at this time. Many of these companies are primarily concerned with natural gas having explored for and found gas over the last few years. These companies have been unable to market their gas. They are now in hock to the banks and are faced with the extremely high interest rates prevailing, putting them into serious straits.
Yesterday I heard about a rather significant company, not a large one but certainly a significant company, that could be purchased for $1 as a result of its inability to market gas. This is a Canadian-owned company. That kind of de-Canadianiza-tion flowing from many of this government's policies on interest rates and the policies of the National Energy Board is something about which we should all be concerned. One thing the government could do without having to eat crow and admit how bad the National Energy Program is would be to examine and authorize natural gas exports.
We are faced with a very serious balance of payments problem and serious interest rate differentials vis-a-vis the United States, and increased gas exports would perhaps be the quickest, most readily available way in which we can improve our balance of payments deficit and reduce the interest rate differential between Canada and the United States.
Increased cash flows to industries from increased gas exports would be a tremendous stimulus to increased exploration and development. It will maintain thousands of jobs, not only in the oil and gas industry but all of the industries primarily located in central Canada that supply the oil and gas industry. They produce the pipes, the valves, the pumps, the machinery and so on which are so much a part of exploration and development efforts.
It is important that the National Energy Board get to these decisions quickly. The ability to sell natural gas to the United States market is being reduced daily. The door is slowly being closed. The reason is simple. The United States, unlike Canada, adopted a much saner energy policy two years ago. This triggered a massive increase in exploration and development in the United States. Large gas finds have been discovered in the U.S. Therefore, the market for Canadian natural gas is being reduced daily as a result. I might add that there are 300 to 400 Canadian companies in the United States drilling and finding natural gas also contributing to the restriction of market forces. If we are going to take this opportunity that gas exports offer, it is important that we do it quickly and very soon. It is important also that the National Energy Board be able to pursue these hearings with some vigour and make recommendations to the government as soon as possible.
I would be remiss if I did not mention the other side of the question. Will we have sufficient natural gas to look after

December 18, 1981
National Energy Board Act, No. 2 Canada's natural gas needs in the reasonably foreseeable future? That is a vitally important question that must be addressed by the National Energy Board as well. The National Energy Board is the best equipped body in the country to make that decision. The National Energy Board should be given the flexibility by the government to consider not just that gas which is now available through opening up a valve, but the gas that has been discovered and could be brought to market with reasonable dispatch. It should also be able to consider that gas which can reasonably be anticipated as coming on line as a result of the exploration and development activity that will be going on.
In conclusion, I would indicate that we are in favour of providing the National Energy Board with this increased manpower to provide flexibility in handling the ongoing mandate as well as the new mandate given the board as a result of Bill C-60. I would express the hope and the wish that the National Energy Board will understand, and I think it does, the gravity of the situation for the Canadian oil and gas industry in western Canada, particularly those smaller Canadian-owned companies which are rich mainly in gas rather than oil, and that the board will handle these hearings with dispatch and make recommendations to the government at an early date. Perhaps with that kind of quick movement on the part of the National Energy Board and, hopefully, the government, we can repair some of the damage done in the last two years, getting this vital and creative sector of the Canadian oil and gas industry back on track, making this country self-sufficient with a more vigorous economy. This will put back to work some of those thousands of Canadians who have been laid off as a result of the energy mistakes over the last two years.


Ian Gardiner Waddell: Mr. Chairman, I am pleased to speak on behalf of the NDP on this bill and to give our approval for its speedy passage. We agree that we need more temporary board members properly to administer the act. Like a hockey team, we would like a few leftwingers if we could choose, but I suppose we will not have that choice, and I will have something to say about that in a few minutes.
I do want to reply briefly to some of the remarks by the hon. member for Calgary Centre before I wish him a Merry Christmas as he leaves to go back to the gas boom. I could not let his remarks pass without some comment. They sounded like what one of my colleagues has called "the Canadian Hunter refrain", or what my colleague refers to as "the oil magots". The refrain is: Give us some money so we can find more gas and oil, becuse we are broke. Give us some tax advantages. When the money and the tax advantages are given, give us permission to export the gas and oil as quickly as we can because we have a surplus and we are broke. Then after it is exported they say: Give us more money because we have to find more. This is like perpetual Christmas, like having Santa Claus all the time. They say: Do these things or we will take our rigs south. We hear that refrain all the time.
At one time in this country in the early 1970s we were exporting one half of our daily production of oil because these people told us that we had lots and we should sell it. Now we are faced with this terrible difficulty of importing about one third of our oil. I am worried that the same thing may happen with natural gas.
We want to help these companies out, but there may be other ways of helping them. For example, would it not make more sense to move our gas east and west rather than north and south? If there is in fact a surplus of gas, perhaps we could even have a gas bank to store some of that gas for Ontario or for Quebec until we need it, particularly when the government is encouraging people to convert to natural gas. Perhaps it could be moved to the maritimes; we might even consider that. It seems to me those kinds of alternatives would make some sense, rather than advocating that we predetermine the board's hearings. After all, the National Energy Board has to determine whether we have an exportable gas surplus, and I do not think it is for members of this House to make those decisions for the National Energy Board.
We are in favour of this bill because we think the new members will be needed to administer effectively the provisions of Bill C-60, as mentioned by the hon. member for Etobicoke North. Bill C-60 was passed last week in the House. It related to new expropriation procedures and protection for those people who are affected, the land owners and small farmers, as a result of pipelines going through their lands. On previous occasions in the House, including last week, the hon. member for Kootenay East-Revelstoke made quite strong speeches about the necessity for that measure. Bill C-60 is the "Yahk" bill". It is named after a little town in British Columbia. They have a little slogan there: "I have been to Yahk and back". I hope you will go there some day, Mr. Chairman, to see that very friendly little place.
If my colleague to my left here stops yakking for a minute 1 will tell hon. members that the Yahk home owners raised such a fuss when their land was expropriated under a very old 19th century law that the member for Kootenay East-Revelstoke brought the issue to the attention of the Minister of Energy, Mines and Resources and the government did bring in the bill to update that expropriation procedure. What we are now doing is adding temporary members to the National Energy Board who will help administer the measure more effectively.
Before I sit down I want to draw the attention of the House to a private member's bill I had the honour of introducing in the House on October 10, 1980.


An hon. Member:: This sounds like a commercial.


Ian Gardiner Waddell: My friend across the way says this is a commercial, and it is. He should read that bill because it is an attempt to upgrade and modernize the National Energy Board. The bill we have before us today only touches on one aspect, adding some temporary members. What I was attempting to do in my bill was make some other provisions and I just want briefly to touch on those.
December 18, 1981

If we could broaden this particular bill today we could put something in it to really make sure that these members got decent salaries and decent status. We have to upgrade these boards, the National Energy Board and other administrative boards, almost to the status of the Federal Court. We should do that because these boards are handling the day to day important matters in Canada, for example the exportation of oil and gas, television licences, the cost of telephone service, prices of this and that, air fares and so on. These boards need to be upgraded. They do not need to be populated by low level appointments. In the past there have been a lot of what one commentator called political hacks appointed to the board. It was not me who said that but a distinguished commentator from the Law Reform Commission.
The other thing we need to do with the National Energy Board is upgrade the role of board counsel. We also need to make public and open up the internal procedures of that board and let the sunlight in as they do with administrative boards in the United States. We need to consult people about appointments, including provincial governments. We should change the background requirements of some of the people who are appointed to these boards. For example, we do not have any environmentalists on the National Energy Board, yet we have been hearing from very active people on environmental law and environmental matters for the last 15 years. Why don't we do that? There are no northerners or native people on these boards. There should at least be a representative of those groups on the boards.
There are many things which can be done to upgrade the boards. I would ask the hon. member to read my bill over the Christmas holidays. He will find it in the October 10, 1980, Hansard and I will put it in his Christmas stocking.
In conclusion, I say that we in the NDP support the provisions of this bill. However, we draw the attention of the government to how appointments are made. Let us not have the usual political hacks. Let us not have the former candidates and bag men. We should try to get board members, even as temporary members, who will take to the board some experience in various fields and who have backgrounds which are not now represented on the boards. We need people who understand the plight of small farmers whose land might have to be expropriated for these public works projects. With that comment, Mr. Speaker, I think I can give our party's consent to the speedy passage of this particular bill.


Roy MacLaren: Mr. Chairman, 1 move, seconded by the hon. member for Moncton:
That Clause I of Bill C-87 be amended by adding immediately after line 16 on page 1 the following: "(6.1) Not more than six temporary members of the Board shall hold office at any one time".


Denis Éthier: The House has heard the proposed amendment of the parliamentary secretary. Does the House agree to this amendment?


Some hon. Members:: Agreed.
Electricity and Gas Inspection Act


[Stage Direction]
Motion agreed to.
Clause 1, as amended, agreed to.
Clauses 2 to 4 inclusive agreed to.
Title agreed to.
Bill reported.
The Acting Speaker (Mr. Blaker):: When shall the bill be read the third time; by unanimous consent, now?


Some hon. Members:: Agreed.


André Ouellet: that the bill be read the third time and do pass.
Motion agreed to and bill read the third time and passed.


ELECTRICITY AND GAS INSPECTION ACT
[Stage Direction]
Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs) moved that Bill C-ll, an Act relating to the inspection of electric and gas meters and supplies, be read the second time and referred to the Standing Committee on Health, Welfare and Social Affairs.
He said: Mr. Speaker, I shall be very brief, except to move adoption of this bill which is to replace the Gas Inspection Act and the Electricity Inspection Act. There are several good reasons, Mr. Speaker, why the two existing acts should be consolidated in a single act. First of all, existing legislation governing the accuracy of measuring electricity and gas has not been changed since 1920, so that a review and improvements are necessary to reflect present-day circumstances and technological progress.
Second, the future act will allow accreditation of private meter manufacturers, so as to increase the industry's responsibility for measurement accuracy. However, I can assure the House that the Department of Consumer and Corporate Affairs will continue to test electric or gas meters whose accuracy is contested by a purchaser or vendor. Such tests have proved to be an excellent means of ensuring that everyone gets a fair deal, and if they are combined with regular inspections of accredited manufacturers by inspectors, Canadians should be receiving even better service in this area. I would like to point out that the act provides for adjusting provisions to measuring instruments to be used for new energy forms or means of distribution, such as the supply of steam from a central source.
I can assure the House that the intent of the act has received very broad support. In fact, a number of public utilities have written to ask us to accelerate passage of the bill. Thus, the proposed legislation will maintain a system under which our
[Stage Direction]
December 18, 1981
Electricity and Gas Inspection Act national consumption of electricity and gas will continue to be measured correctly, and my department has a responsibility for seeing to it that the legislation is applied fairly to all marketing agents. Especially with respect to energy and measurement of electricity and gas consumption, this bill is entirely in line with my department's terms of reference. I therefore recommend that this bill be supported by hon. members on both sides of the House.
Mr. Geoff Scott (Hamilton-Wentworth):: Mr. Speaker, it is with great pleasure that I rise to take part in the second reading of Bill C-ll, an act relating to the inspection of electric and gas metres and supplies.
Perhaps I could paraphrase the words of the Gettysburg Address and suggest that the world will little note nor long remember what is said here, but it can never forget what we are doing here.
I feel like the hon. member for Winnipeg North Centre (Mr, Knowles). I used to sit up in the gallery for the better part of 20 years and wonder what monentous legislation could keep Members of Parliament here on the last day, just before the Christmas recess. Well, this is an example of the monentous kind of legislation. As I say, 1 feel like the hon. member for Winnipeg North Centre in filling in these final moments.
As an aside, I am sure that the thoughts of all members of the House are with the hon. member for Winnipeg North Centre at this time and we all hope to see that distingushed gentleman back here on January 25, even, Sir, if you do not agree with the principles of Bill C-ll.
Bill C-ll was first introduced in April, 1980 by the hon. Minister of Consumer and Corporate Affairs (Mr. Ouellet). In fact, it is almost identical to Bill C-20 which was introduced by my esteemed friend, the hon. member for Durham-North-umberland (Mr. Lawrence), when he was minister of consumer and corporate affairs. In 1978, this bill was introduced by the former Liberal minister of consumer and corporate affairs, the hon. member for Notre-Dame-de-Grace-Lachine East (Mr. Allmand).
It is the opinion of the Progressive Conservative Party that this bill has been required for some time. It is with regret that it has not come before the House for second reading until now. It is our hope that it will proceed quickly through all stages of debate today in the House.
The purpose of Bill C-l 1 is many- faceted. This legislation will replace two existing acts, the Electricity Inspection Act and the Gas Inspection Act. Both of these acts have not been substantially amended or altered since the 1920s. As well as consolidating and updating the current acts, Bill C-l 1 will also serve to eliminate a number of inconsistencies in the acts which have resulted in various problems of interpretation and enforcement of these two outmoded pieces of legislation.
Due to the fact that these current acts have not been substantially amended since the 1920s, this new bill will reflect the changing technologies in the gas and electricity metering industry. The legislation is also forward-looking, in my view, in
that it will provide for the application of the provisions of the legislation to new sources or supplies of energy or new forms of energy distribution. This is a very attractive part of the legislation. We in this House are always being accused of only reacting to change, but here we are anticipating it and applauding it.
The act will also legitimize the use of certain recognized units such as British thermal units, of BTUs, as they are commonly known. The criminal offence provisions of the act are also strengthened. The act makes it a criminal offence for any contractor or supplier to "short supply" a customer by incorporating the wording and intent of Sections 33 and 34 of the Weights and Measures Act. The act also makes it an offence to commit theft by substituting a misleading or fraudulent meter.
The main purpose of this bill, however, aside from these very important housekeeping measures, is to permit the Department of Consumer and Corporate Affairs to transfer a portion of its meter inspection function over to the private sector. Not only will this enable the already overburdened and understaffed branch of legal meterology to utilize its staff in other areas, but it also aids in reducing the government's expenditure at a time when many of us on this side of House are determined that the spending priorities of the government must be redesigned and directed particularly to important areas, such as housing and farming.
The act will authorize qualified utilities and meter manufacturers to verify and seal electricity and gas meters, subject to frequent audits and inspections by the staff of the Department of Consumer and Corporate Affairs. It will, therefore, extend to the Canadian consumer the same protection he currently receives but at considerable savings to the federal government.
I feel it is incumbent upon me, as consumer affairs spokesman for my party, to allay any fears on the part of consumers who may feel that turning over verification of meters to those industries and contractors who sell the product is, in effect, the fox guarding the chickens. Only those utilities which are qualified and competent and accredited meter shops will be permitted to inspect gas and electricity meters. The qualified service people will have to register annually as well as be subject to spot audits by federal government inspectors to ensure that these meter shops and inspectors are maintaining strict quality control procedures.
These utilities and meter shops are required to meet strict standards on the quality of testing equipment and quality control measures. These standards are set by the federal authorities in accordance with prescribed standards of calibration. It at any time a meter verifier fails to meet these standards, the accreditation necessary for him to be in business can be revoked and the meters under his jurisdiction sealed and re-verified.
Should a dispute between an electricity or gas utility and a consumer arise, federal government inspectors will be able to arbitrate the dispute and verify the meter's accuracy. I hope
December 18, 1981

these safeguards calm the fears of many consumers. The standards are quite rigid, and the penalties for not adhering to them are quite strict.
I am also pleased to see a feature of our government incorporated into this bill, that is, a sunset provision. The minister responsible for the act will submit a report to Parliament after five years on the administration of the act. Should any difficulties arise out of the administration of the act, then the consumer can be assured those sections of the act which are being questioned will come under the scrutiny of this House of Commons.
It is with great pleasure that I say "yea" to Bill C-l 1, and 1 hope we can proceed quickly to royal assent.
May I call it one o'clock, Mr. Speaker?


The Acting Speaker (Mr. Blaker):: The Chair will recognize the hon. member for Hamilton Mountain (Mr. Deans).


Ian Deans: Mr. Speaker, 1 want to say just a word or two about Bill C-l 1. It was very interesting to hear my good friend and colleague, the hon. member for Hamilton-Wentworth (Mr. Scott), outline the provisions of the bill. Having read the bill, 1 recognize that those indeed are the provisions!
I want to talk about some concerns I have about the legislation. I will begin by saying that we will support the passage of the bill, but we do so with some two or three reservations.
It is all well and good to write out the procedures which must be followed in order to effect a proper testing, particularly of natural gas equipment. Perhaps testing of electrical equipment is not quite as important, although it can cause problems. I want to talk seriously for a moment about the hazard involved with natural gas and the difficulties which can be encountered in dealing with it. I have spent a significant portion of my life working as a firefighter, and 1 can recall on numerous occasions going to fires or to gas leaks in an attempt to evacuate the areas and assist in bringing things under control. It scared me no end when I realized that it would be quite easy for a very major catastrophe to occur as a result of inadvertence or inadequate inspection.
I am therefore compelled to say that no matter how we write the legislation, unless we can instil in the people who are going to assume this responsibility that the responsibility is a real responsibility for the lives of people, then no legislation will suffice in any way.
I draw a comparison with the legislation passed in the province of Ontario some years ago regarding motor vehicle safety inspection. It was done for a good reason. It was done because it was believed that there were on the roads of Ontario vehicles which were unsafe, and we therefore passed legislation which empowered licensed mechanics to inspect vehicles and to issue stickers saying that vehicles were in good working order as far as safety was concerned. I can tell hon. members that it has been brought to my attention on numerous occasions that after cars had been inspected and purchased, brakes
Electricity and Gas Inspection Act
failed and wheels fell off. Vehicles were not adequately inspected. The safety of the drivers and people in the vicinity of those vehicles was placed in some jeopardy.
With that in the back of my mind I was concerned about this legislation. It will become a primary responsibility of the minister-who is undoubtedly listening to me with one ear and listening with the other to his colleagues-to ensure that the Ministry of Consumer and Corporate Affairs does in fact oversee inspections and inspectors in such a way as to protect the safety of Canadians. It is not good enough to assume that just because there are penalties in the bill people given the responsibility of carrying out day to day inspections will automatically do that in such a way as to guarantee the safety of those people who must come into contact with these apparatuses.
I urge that the minister have a staff of a size sufficient to make sure that not only meters and other paraphernalia to be used are properly tested but also that there be a continuation of spot checks both on those who are doing inspections and on the work which has presumably been inspected and for which certificates have been issued, and that spot checks be made on a regular basis across the country to guarantee the quality of the work. As I say, in the case of natural gas in particular the hazard involved is signficant. I suggest to the minister further that with regard to employees who are currently involved in testing-if I speak quickly, I will get to the end-they be given priority and the opportunity to undertake that work.
With those few comments I will now allow the bill to be read the second time.


The Acting Speaker (Mr. Blaker):: The Chair is a little uncertain. Is there a disposition among members to put the bill through all stages?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Blaker):: Would the minister like to have his bill through all stages before lunch or after?


André Ouellet: Before lunch, Mr. Speaker.


The Acting Speaker (Mr. Blaker):: Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and, by unanimous consent, considered in committee, reported, read the third time and passed.
The Acting Speaker (Mr. Blaker):: It being one o'clock, 1 do now leave the chair until two o'clock this afternoon.
At 1.03 p.m. the House took recess.

December 18, 1981
Pest Control Products Act AFTER RECESS The House resumed at 2 p.m.



THE ROYAL ASSENT

['Order, please. I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill C-87, an act to amend the National Energy Board Act, without amendment.']
The Acting Speaker (Mr. Blaker):: 1 have the honour to inform the House that a communication has been received as follows:
Government House Ottawa
18 December, 1981
Madam,
1 have the honour to inform you that the Honourable Brian Dickson, Puisne Judge of the Supreme Court of Canada, in his capacity as Deputy Governor General, will proceed to the Senate Chamber today, the 18th day of December, 1981, at 2.45 p.m., for the purpose of giving royal assent to certain bills.
1 have the honour to be,
Madam,
Your obedient servant,
Jacques Noiseux for
Edmond Joly de Lotbiniere
Administrative Secretary
to the Governor General



[Stage Direction]
The House resumed, from December 11, 1981, consideration of the motion of Mr. Whelan that Bill C-45, to amend the Pest Control Products Act, be read the second time and referred to the Standing Committee on Agriculture.
Dave Nickerson: Mr. Speaker, I am pleased to be able to speak on a subject worthy of debate on a Friday afternoon in the House of Commons. It is a most important matter how we in Canada control our pests. However, before I commence my remarks I shall raise in the House the observation that the hon. member for Perth (Mr. Jarvis) is not present. The hon. member for Perth gave me a solemn undertaking yesterday that if I were to sit in this House and listen to his speech on Bill C-53, he would sit here in return and listen to my speech on pest control! Having given that solemn undertaking, I find it rather unusual that the hon. member has not complied with his undertaking. However, I do see the hon. member for Timmins-Chapleau (Mr. Chenier), and he might serve as a surrogate. I shall address my remarks specifically to him who, I am told, knows a lot about the subject matter.
Pests are an important matter for this House. As 1 look around, I see pests opposite me, Mr. Speaker, pests to the left of me, and also in Saskatchewan and in Manitoba. We have to do something about these pests. There are no pests in Alberta
yet, or very few. Perhaps we should try to be serious for a few minutes.
1 have certain objections to the bill, Mr. Speaker. My objection is to the punishment provision. Section 10(1) (a) of the Act reads as follows:
10. (1) Every person who, or whose employee or agent, violates any provision of this act or the regulations is guilty of
(a) an indictable offence and is liable to imprisonment for two years,-
There is something unusual about that wording, Mr. Speaker. The same wording is used not only in the Pest Control Products Act but also in the Pesticide Residue Compensation Act and the Plant Quarantine Act. Unlike other legislation where punishment is set at a maximum and a judge could impose imprisonment of any period up to that maximum, this act specifies a fixed period of imprisonment for two years.
The Electricity Inspection Act provides that someone found guilty of an indictable offence is liable to imprisonment for a term not exceeding two years. There is that proviso, "a term not exceeding two years", or five years or whatever is the standard wording. I am unable to determine why in this and similar legislation dealt with by the Minister of Agriculture (Mr. Whelan), a fixed period of imprisonment is specified. I hope that matter will be rectified at some future date.
I could also take objection to section 10(2) of the act, Mr. Speaker. Under the Criminal Code people are presumed innocent until found guilty, and a great deal of effort is expended on giving people the maximum opportunity to be presumed innocent. Under this and similar legislation, guilt is assumed until the accused party can prove innocence. Last night we were dealing with the important question of rape. I do not understand why, when dealing with such a subject, or with murder, the presumption of innocence is made, whereas when dealing with a contravention of the Pest Control Products Act guilt is assumed until innocence can be demonstrated.
This applies not only to a principal but to his agent. The agent need not necessarily be present and perhaps cannot even be found. I think this is rather unfair. I would prefer if there were an assumption of innocence until the Crown proved guilt.
There is a problem with the very restrictive drafting of this bill, Mr. Speaker. The drafters of this and similar legislation, assisted by the Department of Justice, take the view the drafting should be wide enough to take in every conceivable thing that might happen.
The definition of a pest control product could include an ordinary hammer. Someone might be able to kill a beetle with a hammer and so it would be included. By regulation, however, the hammer could be exempted from the definition of a pest control product. It seems that the wording is all in favour of the government and that a manufacturer or someone engaged in selling such products could be at a disadvantage.
The definition of a pest control product includes mousetraps.
I have a few words to say about mousetraps. The question of mousetraps and the legislation relating thereto could be a good
December 18, 1981

example of the differences in party philosophy. In this party we believe that if you invent a better mousetrap the world will beat a path to your door. You should be able to accumulate wealth and prosperity beyond your wildest dreams. We believe that someone who invents a better mousetrap should receive the full fruits of his labour. According to the philosophy of the party opposite, however, the builder of a better mousetrap would find hordes of bureaucrats at his door with legislation such as this Pest Control Products Act, asking him to fill in pieces of paper and to abide by reams of rules and regulations. The inventor would wish he had never heard of a mousetrap let alone make a better one.
A leg-hold trap could be included in the definition of pest control products, according to this bill, Mr. Speaker. I come from an area where many people make their living through the use of such traps. I know that in some parts of Canada people oppose this device. In the Territories we take the view that the provincial or territorial authorities should make the rules and regulations which govern trapping. Other people, however, believe that the Criminal Code should be amended to bar the use of that type of trap and others that are deemed to be inhumane. If it were the wish of Parliament that this be done,
I would not argue that it lies within the jurisdiction of this body, but would insist that it be brought before the House of Commons and the Senate for debate.
This bill provides a way to get around the situation. The use of such traps could be outlawed by regulation. I do not think that is the proper way to address the question. It is my personal opinion that the leg-hold trap should not be banned. Many of my constituents have written to me on this subject at great length. They make a living from its use and have not found any alternative that is as effective. I would not like to see them lose their livelihood by a back door method such as that which might be allowed under the Pest Control Products Act.
What we are doing with the amendment before us is to make the provisions of the Pest Control Products Act binding on Her Majesty the Queen in right of both Canada and the provinces. I would like to hear from the spokesman on the government side what amount of consultation has taken place with the provinces on this matter. 1 agree wholeheartedly that various federal government departments should come under this act and be bound by it. There is a question of jurisdiction with the provinces. If I am satisfied that these consultations have taken place and that provincial governments agree that it should be binding on provincial government departments, then I would certainly have no objection to that. However, I would like to hear from the government side whether or not these consultations have taken place and concerning the position of the provinces with respect to this legislation.
I have another doubt concerning the act, in that we are really entering an area of joint responsibility, one of those grey areas where part of the legislative responsibility for pest control devices comes under the provincial government and
Pest Control Products Act
part comes under the federal government. It would seem legitimate to me that the federal government should deal with aspects of pest control devices and products, such as manufacture, interprovincial sales, and import and export of these products. However, the use of these products in a particular province or territory should be governed by provincial or territorial legislation, in my opinion. Most provinces and the territories have pretty good pesticide acts. Therefore, we must be careful, in reading through the act, that we are not trespassing on provincial grounds.
I have one other point to make with respect to this act. I wish that the Minister of Consumer and Corporate Affairs (Mr. Ouellet) were here. I noticed that he was here just a few minutes ago. However, in reading through the Pest Control Products Act and its accompanying piece of legislation, the Pesticide Residue Compensation Act, one will see that the latter contains a provision which has a bearing on the problem with which we are seized in this House relating to urea formaldehyde foam. If someone suffers a loss under the Pesticide Residue Compensation Act with respect to the use of pesticides approved by the government under the Pest Control Products Act, that person will be entitled to compensation. That idea is established in law and has apparently been operating for some time under the auspices of the Minister of Agriculture (Mr. Whelan). I see very little difference between the use of the agricultural products we have here and the use of urea formaldehyde foam insulation as approved by CMHC, which reports to the Minister of Public Works (Mr. Cosgrove). It would seem to me that the same types of things have happened. The product has been approved by the government, and I we were to follow the philosophy contained within the Pesticide Residue Compensation Act, the user who suffers a loss should be entitled to compensation.
I think that I have done pretty well for Friday afternoon on a bill such as this, Mr. Speaker. I do not think I have kept the House waiting too long. We on this side do not wish to unduly prevent passage or slow it down. I thank Your Honour for your kind indulgence.


Mr. Bill Yurko (Edmonton East):: Mr. Speaker, I will not be long in discussing the merits or demerits of this piece of legislation. However, I felt it appropriate to get up and ask some questions. I hope the government is prepared to answer those questions.
This is an amendment to the Pest Control Products Act, an act which is apparently administered by the federal Minister of Agriculture (Mr. Whelan). First of all, I want to ask why this amendment is necessary. If it is necessary, why was the act not amended years ago? Why is the amendment so late in coming if, indeed, it is necessary?
The second question one must ask is what this amendment does. I would simply like to read the explanatory notes to indicate what it does. It states that:
This amendment would make the Pest Control Products Act and any regulations made there under applicable to Her Majesty and any agent of Her Majesty, thereby providing legal authority to control the use of pesticides by

December 18, 1981
Pest Control Products Act
departments or agencies of the federal government or any provincial government.
One would have thought that legislation like this, passed some years ago, would automatically apply to federal agencies and departments. Therefore, the obvious intent of this legislation is very specific; that is, to make it applicable to areas of provincial jurisdiction. One must then ask whether or not ministers of the government, such as the Minister of Agriculture, the Minister of the Environment (Mr. Roberts), or some other minister, had undertaken extensive negotiations with the provinces to come to some agreement with respect to the extension of this legislation to areas of provincial jurisdiction.
During the first half of the decade of the seventies, I was rather extensively involved in an attempt to reach an accord between the federal and provincial jurisdictions with regard to the applicability of various sections of the Constitution to environmental matters. It was obvious, early in the seventies, that there was some degree of confusion as to just where the concern and responsibility for subsequent legislation lay in Canada with respect to environmental control. Of course, on several occasions we had reached federal-provincial accords for the protection and enhancement of environmental quality in Canada as a result of some major conferences, particularly the Stockholm Conference on the Human Environment in 1972, and a series of conferences in connection with the Canadian Council of Resource and Environment Ministers. One fundamental understanding we had between the provinces and the federal government was that the federal government would be primarily responsible for the establishment of ambient standards across the nation which would subsequently be followed by the provinces. However, it was understood that the provinces would be primarily responsible for establishing source standards and, indeed, the regulation and enforcement of those source standards. Therefore, the amount of effluent from a plant or the distribution of some particular type of pesticide was supposedly a matter for provincial regulation and control, rather than federal control.
I would therefore ask whether or not this action and this change to the legislation is being undertaken unilaterally by the federal government or whether, in fact, it is being done after considerable consultation and agreement with the provinces. I think that in light of the new constitutional accord with the provinces, there will be areas of doubt in the future concerning jurisdiction. We will wonder whether the jurisdiction lies with the provinces or the federal government or whether it comes under property and civil rights or some other area. There will surely be a continuing and increasing need for discussion, co-operation and agreement in areas like this.
Therefore, without holding up the bill any longer, I would again simply ask the federal government, in the hope that it can answer, whether or not it has had substantive discussion and agreement with the provinces; if so, which provinces have been consulted with regard to the addition of Clause 1 of this bill which will make it binding upon them?


Mr. Simon de Jong (Regina East):: Mr. Speaker, unlike the two previous speakers, I think this is an important amendment. Perhaps the importance is not what is in the amendment itself but what is missing. This act has not been reviewed or changed for some time. I believe a minor amendment took place in the mid-1960s. Many important developments have occurred since that time, particularly in the area of chemical control of weeds and pests.
This is an important issue because it places before us the issue of technological innovations and how our society adapts and deals with them. Over the last two decades we have seen a growing number of ways in which insects, pests and weeds are controlled by chemicals, but we have never taken a look at the side effects which these new chemicals have on the environment and on the health both of the consumer and the producer. It is a case whereby one section of society has gone forward and innovated new technologies without really taking an over-all look at the effects of other sectors upon society.
Indeed, this is an important issue. Every year hundreds and thousands of gallons of toxic substances are distributed throughout our environment, possibly causing great havoc to our environment and to human health. The system that has existed so far has been an honour system. When a new chemical is produced by a manufacturer, that manufacturer may have spent several years working on the product and might have invested $20 million in research. That manufacturer will be very anxious to see his particular product get registered, allowing him to market it to farmers and to other consumers. However, before marketing can take place, the government insists on the company coming up with studies which demonstrate the product is not hazardous to the environment and to the health of both the consumer and the producer.
The government has relied on the data of private labs to verify that the substance in question is not carcinogenic or harmful to the environment before allowing its registration. But very often in the last several years these private labs have deliberately falsified their tests. The major scandal, of course, centred around the Industrial Biotest Laboratories of Illinois in the mid-1970s. This lab removed dead mice and replaced them with live mice. They deliberately altered the results of their tests. A chemical called captan was developed by Chevron. Chevron requested that IBT alter its findings and study documents.
We have had cases in which corporations that were developing chemicals have asked testing companies to deliberately falsify the test results. As a result of these tests, governments determine whether or not to allow registration of chemicals.
The IBT scandal is one of tremendous magnitude. Most of the major pesticides and herbicides on the market in Canada today were tested by that lab. It was on the basis of those tests that the Canadian and the American governments allowed these products on the market. IBT is not the only case, of course. There are other cases. For example, criminal convic-
December 18, 1981

tion of several officials of the Richardson-Merrill company occurred as a result of a drug called MER/20.
The chemical dornwall was produced by the Wallace Tier-nan company. Again it was found that there was fraudulent manipulation of data.
The McNeil Laboratories pleaded no contest on charges of concealing information about the chemical flexin.
Hazelton Laboratories was charged with falsifying data on the artificial sweetener aspartame and the drug aldactone.
The drug panalba was withdrawn from the market in 1968 after information in the manufacturers' files was accidentally discovered by an American food and drug administration inspector.
The Velsical Chemical company was indicted by a U.S. grand jury in 1977 for suppressing information that chlordane heptachlor was carcinogenic.
There is a long string of private labs whose tests were discovered to be false. Nowhere does the amendment that we are dealing with today touch on these important questions. We are dependent upon an honour system, an honour system which has obviously broken down.
The Saskatchewan government has been quite concerned about the laxity of the federal government in dealing with this important question concerning the health and welfare of Canadians and our environment. The present system of regulation has been condemned as having major deficiencies by the Saskatchewan Environmental Advisory Council. Farmers, grain elevator operators and many others suffer from health problems related to chemical exposure, yet chemicals whose safety is in doubt continue to be widely used. Residues of these chemicals contaminate food, pollute lakes, rivers, wells and other sources of water. I will come back to the question of the pollution of water, which is so important to the province of Saskatchewan and to the prairie region, in a moment.
A stinging condemnation of the regulatory system for pesticides is contained in the 1977-1978 and 1978-1979 annual reports of the Saskatchewan government's environmental advisory council. We can read in the 1978 report the following:
There are major deficiencies in the present research and regulatory process.
The report went on to state that the federal government does not do enough independent research on the chemicals it approves.


Walter David Baker: They fired the scientists.


Simon Leendert de Jong: This report also states that both the agriculture and the health and welfare departments are forced to rely on laboratory tests by the chemical manufacturers.
The danger signals are out, Mr. Speaker. The high incidences of still births and birth defects in various counties in Ontario surely are a warning to us. I have raised this issue many times. We have reports by Environment Canada on the pollution of surface water on the prairies. In an article in The Western Producer for September 25, 1980 we read:
Pest Control Products Act
The comments came hard on the heels of the release of a study made by Environment Canada last year which showed almost every animal, fish and bird tested throughout the prairies show traces of manufactured chemicals.
We have a report of a study from Tobin Lake, Saskatchewan. The researchers took some of the most primitive life forms, single cell animal forms, at the bottom of lakes and found in them a high degree of abnormality. In other words, the chemicals so widely used on the prairies eventually run through the water system, are deposited in lakes and sink down to the bottom, causing abnormalities in the simple life forms at the bottom of lakes.
This is an early warning system. We cannot go on forever and ever dumping more and more highly toxic materials in our environment without the chickens coming home to roost at some stage. There are limits to the amount of clean air, clean earth and clean water. We are fast approaching those limits. Unfortunately, there is nothing in the minister's amendment to this bill that deals with this very serious problem.
I am not the only one who raises this concern. I have in my possession a letter from the deputy minister of health and welfare which is dated July 16, 1980. That is when this amendment was being discussed. Essentially the deputy minister was suggesting to the Department of Agriculture that the Department of National Health and Welfare be named or listed specifically in the Pest Control Products Act, because the Department of National Health and Welfare does not trust the Department of Agriculture to make unbiased decisions as to what chemicals should be allowed on the market.


An hon. Member:: They can't even look after their own labs.


Simon Leendert de Jong: They cannot look after their own labs, indeed. That is another accurate observation.
It has been our position in this party that what is needed is either a Royal commission or a special inquiry, and personally I would prefer a parliamentary inquiry, into the whole chemical question, to study everything from manufacturing to registration, pollution, usage and the disposal of toxic wastes. We must begin to form an overview of what these new substances are doing to our environment. We must begin to examine in depth what alternatives there are, because surely we must begin to come up with alternatives. As I mentioned before, the danger signals are there. We are running out of time.
What are the solutions we can put in place? I am not one who advocates the immediate banning of all sorts of chemicals. I consider it to be part of my duty as a Member of Parliament to give warnings and to raise the fact that there are early warning signals warning us of the limitations. We are running out of time and must begin to devote our energies and resources to the development of other means by which pests and weeds can be controlled, perhaps by biological means. Unfortunately, the amendment before us misses all of these points.
I would like to see the Department of the Environment and the Department of National Health and Welfare mentioned in

December 18, 1981
Pest Control Products Act
the act. They should be involved in the decision-making process by which chemicals are registered.
Of course, the Minister of Agriculture (Mr. Whelan) claims his department has a good working relationship with the Department of National Health and Welfare, that the departments do consult with each other and that his department does take the advice of the health department. But that relationship has not always worked.
When it came to the chemical called captan, one of the chemicals tested by the IBT labs and later the test was found to be faulty, the Department of National Health and Welfare recommended that the chemicals should not be used. The Department of Agriculture chose not to follow that advice. In fact, it has now set up its own little group to study this chemical. When it comes to the crunch the Department of National Health and Welfare takes a back seat, indeed, in the decision-making process.
We in this party will continue to press for a responsible attitude by governments to new chemicals that come on to the market. We feel it is not just up to the Department of Agriculture to determine which products should be placed on the market and which products should not. The health of Canadians, both consumers and producers, is at stake here, as is the health of our environment. In that decision-making process we maintain that those other guardians of the public interest, the Department of National Health and Welfare and the Department of the Environment, should also be involved.
The matter of the Constitution was raised just a few moments ago by a previous speaker. Personally it is one of my regrets that in the constitutional process responsibility for the environment and, therefore, responsibility for future generations who must inherit our earth, was not discussed. All too often the responsibility falls between different departments and different levels of government, so in fact what we have is a collective system of irresponsibility.
While our clean air, clean water and clean earth are being consumed by one generation, no one is around to protect the rights of future generations who must live with the mess we are leaving behind for them. I personally hoped that at some stage during the constitutional debates this particular question could have been raised. Some agreement could have been reached among the various levels of government to take on the collective responsibility for the health of our environment, in order to ensure that future generations will have something to inherit. Unfortunately this did not occur, but it is not too late. I urge the government, the Minister of Agriculture, the Minister of National Health and Welfare (Miss Begin), and the Minister of the Environment (Mr. Roberts) to allow a parliamentary special task force to convene and to discuss in depth all the ramifications of chemical use in our society and in our way of life.


MESSAGE FROM THE SENATE
Mr. Deputy Speaker:: Order, please. I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill C-87, an act to amend the National Energy Board Act, without amendment.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Whelan that Bill C-45, to amend the Pest Control Products Act, be read the second time and referred to the Standing Committee on Agriculture.
Mr. Gordon Taylor (Bow River):: Mr. Speaker, this is a very short bill but, in my view, a very important bill. It deals with poisons that can kill human beings, wildlife, and even the earth by stopping it from producing. I do not think we should be in a rush to pass it without adequate debate.
Poisons are always dangerous. The act has been administered with some indifference and, in some cases, with arrogance. It is high time we as Canadians started to take more care with regard to the administration of acts such as this.
This simple amendment is important, and I commend the government for bringing it in. This bill requires more than one amendment. There are many things, some of which have already been mentioned, that are crying for attention, and I have in mind pesticides, herbicides and other toxic materials. As members of this House we have a very definite responsibility in dealing with these matters. We should give them the importance they really deserve.
In relation to the testing of these poisons, I am not at all satisfied that Canadians should be accepting tests carried out in other countries, simply putting the stamp of approval on the substances and using them in this country, because those pesticides, herbicides and toxic materials can mean suffering and sometimes the death of human beings, suffering and sometimes the death of animals, fish and wildlife, and the death of our producing land.
When one of the early explorers saw the prairies which have since become Manitoba, Saskatchewan and Alberta he wrote to the head of his company and said: "This land is a wilderness, it is only good for buffalo; there is no value to it whatsoever". I want to suggest that he missed one great fact, that this land contains two, six or eight inches of black soil. Often today we do not place sufficient value on that black dirt. It is what produces our food. That is what gives us bountiful harvests, along with the sun and the rain and the bountiful will of God. Without that black dirt we would not have the
*

December 18, 1981

standard of living we enjoy in Canada today. In many cases we are killing or destroying the fertility of that black dirt. How many millions of tons of black dirt-


Mr. Speaker:: Order, please.



THE ROYAL ASSENT

[Stage Direction]
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Mr. Speaker, the Honourable Deputy to the Governor General desires the immediate attendance of this honourable House in the chamber of the honourable the Senate.
Accordingly, Mr. Deputy Sneaker with the House went up to the Senate Chamber.
And being returned:
Mr. Deputy Speaker:: 1 have the honour to inform the House that when the House went up to the Senate Chamber, the Deputy Governor General was pleased to give, in Her Majesty's name, the royal assent to the following bills:
Bill C-60, an act to amend the National Energy Board Act-Chapter No. 80. Bill C-48, an act to regulate oil and gas interests in Canada lands and to amend the Oil and Gas Production and Conservation Act-Chapter No. 81.
Bill C-46, an act to regulate the importation into Canada of fresh, chilled and frozen meat and to amend the Export and Import Permits Act-Chapter No. 82.
Bill C-84, an act to amend the Small Businesses Loans Act (No. 2)-Chapter No. 83.
Bill C-87, an act to amend the National Energy Board Act (No. 2)-Chapter No. 84.
Bill S-23, an act to incorporate the Jules and Paul-Emile Leger Foundation- Chapter No. 85.
Bill C-86, an act for granting to Her Majesty certain sums of money for the public service for the financial year ending the 31st March, 1982-Chapter No. 86.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Whelan that Bill C-45, to amend the Pest Control Products Act, be read the second time and referred to the Standing Committee on Agriculture.
Pest Control Products Act
Gordon Edward Taylor: Mr. Speaker, tons of black earth have been lost to agriculture because of mining, because of pesticides having been put into it and because of bad construction methods, and black dirt will continue to be lost if we continue disregarding its value in the way we have been. We should be looking very carefully now at the situation respecting the injection of poisons into the earth. We should be developing better testing methods for pesticides and toxic materials. We should not be satisfied to accept testing done in another country. 1 agree with the speaker from the New Democratic Party who a few moments ago said that the Department of Agriculture has not been doing a good job administering the Pest Control Products Act.
We are dealing with the health of human beings, the health of animals and the health of soil. Our country depends on the health of these vital resources, and the Department of National Health and Welfare and the Department of the Environment should play a vitally important role in this whole matter.
Very little attention has been given to the effects on people of chemicals, pesticides, herbicides and other toxic materials which are designed to do certain things. One pesticide is 2-4-D, which is used to destroy all the growth along highways to make them safe for travel. We do not want brush to become a snow trap and cause accidents and deaths on the highway. The objective is good, but blowers are used to spread poison on rights of way, and in many cases little attention is paid to whether the poison is spread beyond the actual rights of way. In many cases the poison goes beyond and destroys trees, grass and gardens. I remember when one of these blower operators was destroying weeds along a highway; the wind was blowing across the highway and causing the poison to land beyond the right of way. 1 asked him why he allowed that poison to be spread on a man's garden. This man depended on that garden for his livelihood. 1 said, "You have destroyed everything in his garden". The blower operator said, "I could not have done that; the blower will only blow 12 feet, and that garden was 30 feet away". 1 said, "Ye gods man, don't you realize the wind can carry it?"
The public had to pay, and one man lost his job. There has to be some responsibility exercised when we deal with these poisons.
Another case was brought to my attention when I was an MLA of poison being spread by means of an aircraft. Again no cognizance was taken of the kind or of what that poison would do. It went through an open window into a room where there was a sick lady, and this made her sick to the verge of death. She was able to pull through, but she suffered for months because of that carelessness in the distribution of poison. We have to realize that poisons are not little toys. This is not a matter to be laughed at, because these poisons are destroying human life, plant life, wild life and soil. This is a very important matter. There is a responsibility on the part of the departments which administer acts like this to make sure proper notification is given before poison is used.
Just last summer a machine was used to spread poison in a schoolyard, and the school board was not even notified. This

December 18, 1981
Pest Control Products Act
poison was spread deliberately to clean up weeds which were felt to be a public nuisance. Youngsters played in the schoolyard, and some of them became very ill. No notification was given to the principal of the school in that small town. No sense of concern or responsibility was demonstrated. They simply went in and did it. I agree completely with the previous speaker, who said there has been a lack of realization that we are dealing with poisons. There have to be some severe penalties for those who completely disregard the health and lives of people, and that is why I am glad to see this amendment. The government has to accept this responsibility too.
This act is binding on Her Majesty in right of Canada or of a province and any agent thereof. I hope we have the legal authority to enact this for the provinces. 1 presume we have. This point was raised by the hon. member for Edmonton East (Mr. Yurko). I assume that part of the work was done.
There must be a responsibility on governments, whether federal, provincial or municipal, when poisons are being distributed to ensure that they do the job for which they are intended and that they do not affect the lives of people. The methods used are important. Cognizance must be taken of the wind, the amount of moisture in the air and so on. Scientists and others trained in this area should set the criteria as to when, how and where these poisons are distributed.
About seven years ago an Alberta company, I would not say it did not care but it thoughtlessly allowed toxic materials to enter a stream. That stream passed through a farmer's land. He had a beautiful herd of cattle which drank from that stream. They took sick and he lost the entire herd. He did not know what was the matter. They had been healthy. You can admire a healthy animal. However, they became deathly sick and were dying before his eyes. He quickly got a vet who found that the water had been poisoned and that was why his animals were dying. It took two years to affix the responsibility on that oil company. The farmer was eventually paid for his herd. That really did not replace the herd because it was a beautiful herd. Again, it was carelessness, no responsibility for what poisons do. Our people must be trained to realize they are dealing with poisons. We go to great lengths to label our bottled poisons so that they are kept out of the reach of children, and properly so. We should be even more careful when spraying these poisons on our soil, grass, trees and in the air. Who knows what harm they can cause?
Many people will not eat fruit until it has been washed. When I was a youngster, I went to the bushes in the coulees in the canyon of the Red Deer river where I picked and ate the chokecherries and the saskatoons. I did not eat many gooseberries because I did not like them. I never thought anything of it. It was good fruit, beautiful fruit, excellent fruit, delicious fruit, but boy, I would not eat it today with the poisons being sprayed in our countryside. It is necessary to wash them before eating them. When we get fruit from Ontario, Nova Scotia or British Columbia, we wash it before eating because we do not
know what pesticides or herbicides have been sprayed. There is a responsibility on the part of government.
I commend the government for now accepting responsibility for its actions and those of its agents. When I was in highways I did not allow the poisons to be thoughtlessly sprayed so that they would ruin the farmers' crops, destroying their livelihood. I had to take the responsibility for that. If I had permitted that to happen two or three times, someone would have said that I was not doing my job and that I had better get out. In fact, we had to let someone go who we thought was a responsible person, because the Crown must be responsible for the actions of its agents. The minister must take that responsibility. That is our way of government.
I would like to see an amendment to this bill to put some responsibility on the Minister of the Environment (Mr. Roberts). After all, he is trained to look into these matters. The environment is being affected. There are many ways of ruining the environment, ways probably that I have never even dreamed of.
I recall an occasion when we were building a bridge over a stream. Someone said to me that if we were not careful and did not put it at a certain height, it would stop the fish getting from the warm water to the cold water, and they had to get there. I do not know why they had to get there, but apparently they had to in order to stay alive. Therefore our engineers were instructed to ensure we would not kill the fish in that stream.
There are many ways in which the environment is affected. As the hon. member said a few moments ago, we need people who are trained. We must know all the answers before we start dealing with poisons which can affect the lives of this generation and future generations.
As I mentioned a few moments ago, it is pretty thoughtless-I do not believe anyone would do it deliberately-to allow these sprays to be spread in a schoolyard. That should never happen. I hope it never happens again. I am not going to make any amendments because I know it would be useless if they came from this side. I would like to see a member on the government side move an amendment placing some responsibility on the health minister and the environment minister.
I wish to point out one other sad fact. This is an important agriculture bill. Where is the Minister of Agriculture (Mr. Whelan)? Maybe he has something important to do. This bill could affect the lives of human beings, animals and our soil, and the minister is not here to listen to the arguments. I hope he reads them in Hansard. I hope he sees the responsibility of the government, particularly with regard to the effects of tests on human beings and the environment to ensure that we leave for future generations clean air, water and soil.


Mr. Blaine A. Thacker (Lethbridge-Foothills):: Mr. Speaker, I wish to say a few words on Bill C-45. Our party agrees this bill should pass. It makes the Pest Control Products Act binding on the provincial and federal governments and their agents. I understand all provinces agree with this. Therefore, it should be quickly implemented.
December 18, 1981

The recent exposure of the tests at the Industrial Bio-Test Laboratories where over 100 pesticides were improperly tested means that we must do our tests in Canada. While this bill does not provide for the testing to be done in Canada, that is the next major step the government must take.
We believe it is a very legitimate role for government to be testing dangerous chemicals, pesticides and herbicides. This is an area where the government should act quickly, and I hope it will.
Canadians should clearly understand the whole area of crop production and pest control. There is one undeniable fact in Canada, the United States and the world in general. Without pesticides and herbicides, Canada, the United States and indeed the world would not be self-sufficient in food production. Without pesticides we in Canada would be much less sufficient in food.
At present Canada is a major importer of the basic foods we consider essential for our table each day. That should not be the case because we have the agricultural skills in our farm people and a lot of land which could be put into agricultural production. Without pesticides we cannot feed the people of the world today. The spotless apple, Mr. Speaker, is a product of chemicals and of good farm management. The healthy beef, dairy animals, sheep and hogs are all the result of excellent farm management, good veterinarians and the case of chemicals. There is no doubt that in the past there have been major abuses. Many of those abuses have been committed by those of us who have been on the land. 1 can remember within my own life experience when chemicals were first starting to come into major use, during the late 1940s and 1950s, and how we as farmers were really very careless with them because we just did not know of their effects. The accumulated experience of danger had not yet built up. That experience is now built up and we find that, as a matter of fact, the farming community is much more careful in its handling and use of these chemicals.
There used to be a philosophy that a little was good, a lot was a whole lot better. That does not apply in the case of chemicals. It is often true that if the instructions say two ounces per acre, that is sufficient and it does an excellent job, whereas five or six ounces would build up a residue in the soil that can destroy future crops and can affect that very intricate microcosm of bacteria, fungi and single cell organisms that work in our soil. The improvement has come largely as a result of excellent research being done at our research stations and through our provincial associations and agrologists being imparted to the farms.
It is clear that in the future we will need more biological control of pests and of weeds other than the use of chemicals. We need to develop more resistant strains of crops and more specific chemicals that can be brought in under unique circumstances and used. The only way we can get to that point is by more research and development. If one needs evidence to find out that a dollar spent on research returns itself many times
Pest Control Products Act
over, I will read from a report by the Agricultural Institute of Canada. On page 2 of that report it states as follows:
The benefits accruing from agricultural research have been well documented. The safeguarding of wheat from the ravages of rust provided a benefit to cost ratio of 482:1; research leading to the reduction of fallow acreage in Manitoba provided a benefit to cost rates of 278:1 but the benefit should continue to accrue for decades ahead: a benefit to cost rates of 260:1 was estimated for R & D on chicken broilers; in Ontario input cost of $32 million for the improvement of corn provided additional returns of $2.6 billion or an investment return of 80:1.
One can see that for every dollar that is invested, the economy has $482 returned to it on rust research alone. Clearly we need to do more of that. I believe the government can be quite properly criticized for its lack of emphasis on agricultural research and development.
In 1970 the statistics showed that 3.7 per cent of the over-all federal budget was spent on agriculture. By 1979 that had dropped to 1.9 per cent spent on agriculture. Of the 1.9 per cent, only 11 per cent of that was for agricultural research and development. The result has been a deterioration of our agricultural research physical plant and the obsolescence of the equipment and the high technical equipment that is needed for proper research. We also find ourselves at the point where we have too few scientists.
I sat on a fiscal task force this past summer that was called "Fiscal Federalism in Canada". While we were in British Columbia, we heard evidence from Dr. Kenny who is the president of the University of Victoria. As to the need for researchers in Canada, the report states at Page 124:
... It is clear that, if Canada is to achieve its goal of R & D expenditures ... it will be necessary to increase substantially the . .. rate of production of highly qualified manpower ... Canada needs an estimated additional 1,500 researchers by 1985 to meet the federal target of 1.5 per cent of GNP to be spent on R & D by the mid-1980s. Canada needs ... 8,000 . .. foresters over the next decade, or twice the number now graduated in Canada. Canada needs ... 740 Ph.D.s in agricultural science between 1980 and 1986, but... is only turning out 49 graduates per year... Canadian universities have about 300 openings for business professors and yet... 15 to 20 Ph.D.s will be graduated annually. This shortage ... will prevent students from studying in Faculties of Commerce ...
It is patently obvious, and everyone within the establishment of higher education is aware of it, that we have a crying need for our youth to be given the opportunity to become researchers. But they do not have that opportunity because we do not have the infrastructure en place in order to process them. The reason we do not have the infrastructure is that the government has chosen to put its research dollars in other types of programs, rather than in basic research, even when the rate of return is in the order of $480 for each dollar expended.
One of my colleagues has handed me a note stating that President Kenny is not the president of the University of Victoria but the president of the University of British Columbia. I make that correction in my comments.
From comments that the Minister of Agriculture (Mr. Whelan) has made, it is clear that he appreciates the great need for research and development in Canada in agriculture. Unfortunately he is one person out of 36 in the cabinet who appreciates that need. I am certainly asking members on the opposite side-we will certainly back them up in this, as will the university system-that they put pressure on each and

December 18, 1981
Pest Control Products Act
every cabinet minister to give high priority to dollars being used on research and development in this country. I hope that Canadians will put sustained pressure on all Members of Parliament to allocate money to research and development so that our youth can respond to the real challenge of choosing these research projects, thus bringing a tremendous economic return to our country.


Thomas Michael McMillan: Mr. Speaker, my comments on Bill C-45 will be brief. I believe the points to be made have already been argued with some felicity by my colleagues on this side of the House.
We are debating an act to amend the Pest Control Products Act, Bill C-45. The explanatory note points out that the Pest Control Products Act is being amended so that regulations under it will be applicable to Her Majesty and any agencies of Her Majesty, thereby providing legal authority to control the use of pesticides by departments or agencies of the federal or provincial governments.
At present, Mr. Speaker, as other members have pointed out, the Pest Control Products Act is not legally binding on the federal government and on Crown corporations, nor is it legally binding on provincial governments and their agencies. In effect, what we are doing is broadening the force of the Pest Control Products Act such that it will apply to the provinces and to the federal government, not just to the private sector, I welcome the bill because I think that in many ways it will make the PCPA a more effective instrument of public policy.
I want to stress that we in Canada are blessed with a country that is rich in geography. We are unique in that we are bordered by three oceans. We have more geography in fact, than any other country, except one. While harsh, our climate is nevertheless able to provide us with a healthy quality of life. We derive from our land a standard of living which, because of mismanagement on the part of this government, is falling, but which is still high by practically any reasonable standard. From the beginning, the country has relied on its soil and on the richness of the land, and agriculture remains a major industry. In the Atlantic province, where I come from, it is the main industry.
As the hon. member for Bow River (Mr. Taylor) pointed out, it behooves us to exercise good stewardship over the land and to manage it so that we can pass it on to future generations in as good shape as we ourselves received it. But the land is now in peril, partly as the result of pesticides.
Some of my colleagues in the House will know that prior to 1940, pesticides were rare in Canada and in the rest of the world. The few that existed were largely ineffective. There were crop losses and declines in productivity due to our inability to control pests. Crop yields were much lower than they are today. The development of pesticides and related products has greatly improved yields since then.
The rapid rate of development of pesticides came around 1945, when progress in chemistry provided effective pest control products. This helped immensely to increase crop productivity and to give us access to a wider range of foods than had hitherto been possible.
Pesticides are not only useful in the production of fruit and vegetables; they also serve to protect livestock from biting flies and other parasites. Development in that area has had an important effect on the development of better animal health and on enhanced meat and milk production. There are now something like 500 different pesticides on the market, whereas in 1940 there were probably only a few dozen. Each of these pesticides plays a distinct role and many are essential to food production. Although pesticides have played a large role in the success of agriculture, they have also caused disasters. A few of the problems that result from the use of pesticides have been resolved but many remain to be dealt with.
Science has allowed us to develop more and more chemicals-pesticides and others-but this progress has outstripped our capacity to manage those chemicals effectively in order to protect the environment against their adverse effects.
If we can do nothing else in this country except restore some of that imbalance, we will have gone a long way toward proper husbandry of our natural resources.
A major point that needs to be stressed is that we cannot continue to go on as we have done, relying on other countries for research and development in the pesticide area. A certain report has been in the public domain for a few years now, authored by Dr. T. H. B. Symons of Trent University. It is the Report of the Commission on Canadian Studies. In great detail the report shows the extent to which our country has indigenous and distinctive research needs which must be responded to by government, the universities and other bodies. In the past we have relied too much on the qualified personnel and scientific enterprise of other countries. We cannot continue to rely on foreign research, Mr. Speaker. Our needs are distinctive and in the context of pesticides, it must be acknowledged that many of our crops are distinctively Canadian. It seems to me that it is in our own environment that we must determine the safety of pesticides for the sake of man and his physical surroundings.
The extent to which we have fallen into the trap of over-reliance on foreign data has been well documented by speakers who preceded me. I shall not go into detail on that subject except to say that the United States Environmental Protection Agency and the Food and Drug Administration combined to audit something like 82 laboratories which were conducting research on pesticides in that country from 1977 to 1980. Of those 82, about 25 were found to have serious deficiencies in their work. Minor problems were found in the work done by all but two of the remaining laboratories. There is a report on the performance levels of the different laboratories and the problems found in each.
I will not quote from the report at any length other than to give one fairly typical example. It concerns the Harris Laboratory of Lincoln, Nebraska. The Environmental Protection Agency found that the record keeping there was poor and that scientific reports were missing. It found that rats used for
December 18, 1981

experimental purposes that had been listed as dead were also listed in the same set of records as having been mated at the identical time. Rats were also listed as having died twice and tumours and other adverse effects appeared to have been under-reported, the EPA said.
I could give other similar examples but I will not except to make the point that we cannot continue to rely on such undependable data from other countries. We do not have control over it and so cannot be sure that it is reliable by scientific standards or that it is sufficiently relevant to our own circumstances to be useful.
The government has recently admitted that hundreds of scientific studies done outside Canada and upon which the government itself has relied have been found to be useless because of fraudulent and careless laboratory work. 1 think the point has been made: we must have a scientific research and development strategy on pesticides which is our own and which is tailored-made to our distinctive conditions, problems, and goals. That is not to say that we should shut our windows or our doors to the rest of the world. Science is international. We belong to an international community. We should draw on the expertise, resources and data resulting from the accomplishments of scientists throughout the world. However, while doing that, we should also exercise a healthy degree of skepticism, which is the hallmark of the scientific mind, to ensure that our own scientific house is in order.
In my concluding remarks I would like to suggest such a strategy, a scientific approach to pesticides and pesticide control which will meet the problems I have identified. The strategy will ensure that we in Canada are sufficiently on top of the subject to protect our own environment and the health of our people. The first recommendation is that we greatly strengthen the research capability of the country, especially in the university sector. We need more research of both a basic kind and a mission-oriented kind. We need to expand our base line of knowledge relating to pesticides.
Second, by research done outside government itself should be more carefully monitored. Again, we must not rely exclusively on government research, but should also draw on research outside government. Still, we must ensure that research beyond the direct control of the government is done by people using the highest scientific standards.
Third, I think we must rely less than we now do on scientific study done outside the country, as I have suggested. To buttress our own resources and capability in this area, we should look very carefully at providing tax incentives and write-offs for industrial research and development.
Fourth, I think we should substantially strengthen our capacity to list pesticides which are already in use and to test these pesticides which are being proposed for entry into the market. Testing should be done prior to their entry, and not afterwards. Pesticides later identified to be troublesome, dangerous or environmentally harmful should be immediately pulled from use. We should not wait, as this government has
Pest Control Products Act
done too often, until long after other countries have already abolished pesticides before we do as well. We should identify those pesticides which are harmful and immediately ban them from the marketplace.
Fifth, we should step up our public information capacity. We should get more information out to the users of pesticides, particularly in the farm community. They need to know an awful lot more than they now do about what particular pesticides they should use and should not use, and how pesticides can be used safely. The object should be to minimize inherent dangers in the use of pesticides. Pesticides will never be 100 per cent safe, but we should ensure, through public information and other avenues, that we maximize the benefits of pesticides and minimize their disadvantages.
May I conclude by lending my own support and, I think, the support of the Progressive Conservative Party for Bill C-45. I speak in favour of the bill in my capacity as the environment spokesman for the party. I am not quite sure why it was brought up to the top of the agenda at this time. Nevertheless,
I welcome the fact that the government has given it that degree of priority. My hope is that the government will increase its consultations with the provinces to ensure that they are at one with Ottawa on the provisions of the bill. My party welcomes the fact that the legislation is being debated today. For my part, I urge all hon. members to give it speedy passage.


Mr. Deputy Speaker:: Is the House ready for the question?


David P. Smith: Mr. Speaker, I believe there has been an agreement outside of the House that this bill should be dealt with in all stages today. Accordingly, we should go into Committee of the Whole, rather than sending the bill to the standing committee. Therefore, I so move.


Mr. Deputy Speaker:: Mr. Fox on behalf of Mr. Whelan, seconded by Mr. Joyal, moved:
That Bill C-45, an act to amend the Pest Control Products Act be now read the second time and, by unanimous consent, referred to Committee of the Whole.
Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Francis in the chair.
Ian Deans: I have a point of order, Mr. Chairman. I wonder if Your Honour might identify exactly who will answer on behalf of the minister in Committee of the Whole.


Erik Nielsen: Good question!


Cyril Lloyd Francis: The motion was moved by Mr. Fox, on behalf of Mr. Whelan, seconded by Mr. Joyal.


Mr. Kempling:: It can't work.


Mr. Munro (Esquimalt-Saanich):: Further to that inquiry, I am just wondering whether we can proceed as agreed in the absence of the Minister of the Environment (Mr. Roberts),

December 18, 1981
Pest Control Products Act
because, after all, it was he who introduced the bill. He is not here. There is not anyone who can reply.


Erik Nielsen: Good point.


Cyril Lloyd Francis: By unanimous consent, we are now in committee of the whole.


An hon. Member:: There's the minister!


Some hon. Members:: Hear, hear!


Erik Nielsen: There is the biggest pest of all!


Donald W. Munro: No control over that pest!


William James Kempling: The original boll weevil!


Cyril Lloyd Francis: Shall Clause 1 carry?
On Clause 1-Act binding on Her Majesty


Simon Leendert de Jong: Mr. Chairman, 1 would like to place a few questions before the minister concerning the amendment we are considering today. My first question concerns the testing of new pesticides and herbicides. Is the minister aware that the testing procedures not only of the 1BT labs, but also those of other labs, are questionable? Is his department looking into any products which have been registered, based on the results of these other labs? Is his department looking into those results as well?
I also question the necessity of this amendment. What are the incidents in which Crown corporations and other agencies of provincial government have used chemicals which have not been registered in Canada? Could he tell us when these incidents took place? Can he identify the Crown corporations or provincial authorities which have used chemicals which were not properly registered in Canada? I think it would be useful for the House to know where and when these products were used and the types of product used.
In the minister's speech introducing the bill he mentioned the good work of his department in trying to develop other forms of biological pest and weed control. I wonder as well if he could enumerate these projects and perhaps give us an indication of the dollar amounts involved when he stands up to answer. My understanding is that roughly only $500,000 is expended for testing non-chemical forms of weed and pest control.
I would also like to ask the minister a question concerning correspondence between his department and the Department of National Health and Welfare, particularly concerning a letter which was sent to his department on July 16, 1980, by the Deputy Minister of National Health and Welfare. The deputy minister made the request that the Department of National Health and Welfare be specifically mentioned in the Pest Control Products Act, and that if the Department of Agriculture were to introduce any new amendments, serious consideration should be given to specifically mentioning the Department of National Health and Welfare. Her request is as follows:
That is, groups outside the Federal government do not see an active role within the present act for the Department of National Health and Welfare. Perhaps such a misunderstanding could be eliminated if this department was named in the act at some time in the future, when Agriculture Canada presents to cabinet proposed changes to the Pest Control Products Act. Such an action would place more emphasis on the health aspects of pesticides-
What was the response of his department to that request from the Deputy Minister of National Health and Welfare? Why was the Department of National Health and Welfare not listed as one of the responsible departments under the Pest Control Products Act? I made a suggestion in my speech to the minister, a suggestion that I have made to him in committee and on the floor of the House, that he seriously consider supporting the motion of a parliamentary inquiry into the whole chemical area so that all members of the House can take an in depth look at what is occurring and what possible alternatives there could be, such questions as the contamination of the environment, conceivable health defects to both users and consumers of agricultural products. I would like to hear the minister respond to the motion of a parliamentary inquiry being set up to look into all of the implications and questions concerning chemical uses in agriculture.


Eugene Whelan: Mr. Chairman, I do not have the time to go over all the questions which the hon. member asked. I do not have all of the information with me. As I outlined when we presented the bill, it was a very simple one, and not that detailed. I outlined why the amendments were needed. I can get evidence for the hon. member if he wants it, and submit it to him as to why we wanted one body on which the provinces could depend; also, if I am aware of other groups that carried out testing that was not legitimate. Even with the control of expenditures in our department that is why spent several million dollars on new equipment of our own. We feel we can do a legitimate job of testing, but it is going to take some time. If we can find the people, and I do know there are some, we can farm out some of this work to them and that is what we will be doing. However, we think that every chemical should be constantly brought up to standard by double checking to make sure that the proper ingredients are there.
The hon. member talks about biological control. 1 do not know whether the hon. member has visited the station that is situated in the city of Regina, but it is doing some amazing work. When you talk to people there and hear what they are projecting for the next two to five years, you find they feel they are well on their way to controlling many pests on which he used pesticides. They are even making sure that some of the insects chewing up the bad weeds do not get out of control and are safe. All those tests have to be gone through.
Maybe we are not spending as much money, but we are signing agreements with other countries and having an exchange of scientists who do that kind of work. The most recent is with the U.S.S.R. Some people may scoff at that. When we were there we visited their orchards. We know they are doing good work. If we can find out one new way from them or vice versa and perhaps put them together, it could mean a tremendous saving for both our countries in terms of
December 18, 1981

the environment etc. We will all benefit and it will be a less costly way to produce products. I am optimistic about what we are doing. We have sent one of the scientists from the Regina station to Australia for a year to learn new methods from them.
Concerning health and welfare being named in the legislation, all I can say on that is that the Minister for National Health and Welfare (Miss Begin) and myself are both members of the cabinet committee which goes over the legislation before it is put before cabinet and presented to the House. We both agreed that it was not necessary in this legislation at this time.
To support the hon. member's suggestions on an independent committee, I am sure the hon. member is aware that we have an independent committee now headed by Dr. McGugan, who picked his own members to study Captan. We made suggestions to him about who should serve on the committee, but he would not take the chairmanship of the committee under those terms, so I allowed him to choose his own members, people he thought were qualified to bring in an independent report. If that report is as he says it will be, an independent, thorough report, then we hope to be able to give him more work of that kind, if he will do it for us. There are other people in a similar capacity to Dr. McGugan who can do that sort of thing for us. We will abide by their findings. As far as I am concerned, they are highly qualified people. They come from universities and from the sector that is best qualified. I believe that is all I can say, Mr. Chairman.


Gordon Edward Taylor: Mr. Chairman, 1 have two questions for the minister. The bill binds provincial governments. Have all provincial governments agreed on that or are the provinces being bound unilaterally?
Second, we have the Minister of the Environment (Mr. Roberts). He is trained to deal with the environment. His responsibility is to make sure that we leave a good environment for our children. Why does this bill not involve the Minister of the Environment?


Cyril Lloyd Francis: I see hon. members rising, and the Chair has an eye on the clock. Perhaps other hon. members may be recognized and then the Minister of Agriculture can speak.


Thomas Michael McMillan: Mr. Chairman, my question very closely parallels that of the hon. member for Bow River. I am puzzled that the Minister of the Environment is not here. In his absence, one could be forgiven for wondering whether the Minister of the Environment has been consulted about this bill. Has he had any input? Does he agree with it? Why is he not here?


Donald W. Munro: Mr. Chairman, my question relates to the fumigation of the golden nematode. 1 am sure the minister is aware that fumigation has taken place and that it has not been effective. Could the minister, perhaps not today but by correspondence, give me some indication of what plans there are to make sure that those golden nematodes,
Pest Control Products Act
which are causing such damage in the Saanich peninsula, can be eliminated?


Dave Nickerson: Mr. Chairman, I have one question. Would I be correct in assuming that, if this bill is passed into law, the Pest Control Products Act would then be binding upon the Department of National Defence with respect to defoliants used for military use? If that is indeed the case, what consultation has taken place on this matter between the Department of Agriculture and the Department of National Defence?


Eugene Whelan: Mr. Chairman, I will make this as short as possible. The bill, I understand, is by agreement with the provinces. They want the over-all kind of legislation for all producers. I understand that has been taken care of. As far as the questions concerning the Minister of the Environment is concerned, I want to say that he has certainly been very much involved. We had a very close working relationship with his department and with the Department of National Health and Welfare.
Concerning the question of the golden nemathodes, I can give the hon. member that kind of information. What we have tried to do has been very costly. In essence, what we are going to do is to ban the growing of potatoes there and work out some kind of a compensation program for the farmers in that area.


Erik Nielsen: Mr. Chairman, perhaps hon. members might find a disposition not to see the clock until third reading has been completed.


Gordon Edward Taylor: Mr. Chairman, did the minister answer the part about the provinces and the provincial governments?


Eugene Whelan: Yes, Mr. Chairman. We have an understanding with the provinces. The hon. member asked about the military. We still work very closely with them in recommending any of the products. In case of war though 1 do not know whether we would have any authority for them at all.


Cyril Lloyd Francis: Is the House ready for the question?


Some hon. Members:: Question.


Cyril Lloyd Francis: Shall Clause 1 carry?


Some hon. Members:: Carried.
Clause 1 agreed to.


Cyril Lloyd Francis: Shall the title carry?


Some hon. Members:: Carried.


[Stage Direction]
Title agreed to.
Cyril Lloyd Francis: Shall the bill carry?


Some hon. Members:: Agreed.


Cyril Lloyd Francis: Shall I rise and report the bill?


Some hon. Members:: Agreed.

December 18, 1981
The Budget
Bill reported.


Mr. Deputy Speaker:: When shall the bill be read the third time; by unanimous consent now?


Some hon. Members:: Agreed.


Eugene Whelan: that the bill be read the third time and do pass.
Motion agreed to and bill read the third time and passed.



ROUTINE PROCEEDINGS

["It being 5.02 o'clock p.m., pursuant to an order made Thursday, December 10, 1981, this House stands adjourned until Monday, January 25, 1982, at two o'clock p.m., pursuant to Standing Order 2(1).\nAt 5.02 p.m. the House adjourned until Monday, January 25, 1982, at 2 p.m.", 'Monday, January 25, 1982']
Mr. Deputy Speaker:: Pursuant to the order made earlier this day, the House will now revert to statements by ministers.



Allan Joseph MacEachen: Mr. Speaker, in the budget on November 12 I addressed the main obstacles to sustained economic growth, which are inflation and high interest rates. Through a strategy of deficit reduction, the budget combats inflation and reduces upward pressure on interest rates. It is a strategy for creating permanent jobs and growth, not just for this month and next month, but for next year and the years after that. I am convinced it is the right strategy and the one we must continue to follow.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: Within the framework of that strategy the question was not whether to raise additional tax revenues, but how. Should I raise tax rates, or should 1 focus on broadening the tax base? Should 1 increase the load on those already carrying it, or should I spread the burden more evenly? I chose to spread the burden more evenly. 1 designed a tax package which reduced tax expenditures. These benefits in the tax system reduced taxes for some, but they inevitably had to be financed by taxes on those who did not or could not benefit from such incentives. At the same time I proposed a reduction in tax rates for many Canadians. This meant that I was able to carry on the fight against inflation without increasing taxes for the vast majority of Canadians.
In my view it is the tax package that will improve the basic fairness of the tax system and ensure that tax preferences are more carefully targeted to economic objectives. Those are the fundamental principles of the tax measures and I have no intention of altering those principles; not today or at any time during the consideration of the necessary legislation.
Yet, Mr. Speaker-


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: -tax changes are rarely popular when new revenue must be raised. The groups and individuals who experience tax increases naturally seek relief. That is part of the inevitable dynamics of the post-budget period. The government then must continue to ensure that the common interest of all Canadians is preserved while legitimate particular interests are taken into account.
Over the past few weeks I have received many representations.


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: That, Mr. Speaker, is probably the understatement of 1981.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: 1 have listened carefully, and 1 must say I am grateful to those who have made responsible submissions. The dialogue I have conducted with many delegations and with many citizens has given me an opportunity to explain the budget and to remove many misunderstandings. Even the most concerned groups have found that the budget is far more beneficial to them than the rhetoric of some spokesmen has indicated. 1 believe, for example, that the impact of the tax measures on investment is becoming better understood. Many of the tax preferences-


Some hon. Members:: Oh, oh!


An hon. Member:: That is why we are here today.


Allan Joseph MacEachen: Mr. Speaker, many of the tax preferences which the budget eliminated were inducing people to invest in relatively safe shelters at the expense of investments in shares of Canadian corporations and other risk ventures. I also believe that investors are becoming more aware of the very positive impact on investment of the cuts in tax rates and the strategy of reducing inflation and interest rates.
The other positive consequence of the intensive dialogue over the past few weeks is that 1 have received several useful suggestions for improvements within the main framework. 1 must say that I am particularly thankful for the advice and support 1 have received from my friends in the Liberal caucus-


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: -and from supporters of the government throughout the country.


Some hon. Members:: Oh, oh!


An hon. Member:: All two of them.


Allan Joseph MacEachen: As you have noticed, Mr. Speaker, there have been no defections from this caucus.


Some hon. Members:: Hear, hear!
December 18, 1981


Allan Joseph MacEachen: After a careful analysis of the representations, I have come to several conclusions.
First, there are a number of cases where taxpayers had completed or nearly completed financial undertakings before the budget and should be allowed to receive the tax treatment which existed before the budget.
Second, there are some areas where a transitional period is justified to allow individuals and businesses to adapt their affairs to the new tax rules.
Third, there are a number of measures which can be redesigned to bring them more closely in line with the over-all objectives of the tax package.
I am tabling today a document which describes the tax treatment which is to be accorded to arrangements completed or nearly completed before November 13. These changes affect, for example, the calculation of capital cost allowance, purchases of income-averaging annuity contracts, interest on non-resident loans, soft costs on real estate investments and reserves for property disposition. The document also lists measures for which there will be a transitional period. In particular, the provisions relating to professional work in progress and interest-free housing loans will be phased in over a three-year period.
Mr. Speaker, I am rather surprised at the reaction of the opposition who have been asking for adjustments for more than four weeks-


An hon. Member:: You finally woke up.


Allan Joseph MacEachen: -for changes to the measures that were tabled. Today they seem to find those adjustments objectionable.


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: I am proposing a one-year delay in measures relating to corporate organizations to allow for a thorough discussion prior to their implementation. Individuals who are members of an employee pension plan will be permitted to transfer retiring allowances to an RRSP of up to $2,000 for each year of service. That will help low and middle-income Canadians who are members of pension plans and who receive severance pay in order to supplement their pension income. The reserve provision in the budget is being redesigned to accommodate genuine business circumstances while still limiting unwarranted deferrals of tax. An extended reserve period of ten years will be permitted in the case of inter- I generation transfers of farm property and small business assets.


Charles Joseph Clark: The budget is gutted.


Allan Joseph MacEachen: To further assist farmers and small businesses, the 6 per cent threshold for small business bonds will be removed. This will permit a 3 per cent reduction in interest charges on such bonds.


Some hon. Members:: Hear, hear!
The Budget


Erik Nielsen: Resign.


Allan Joseph MacEachen: Finally, Mr. Speaker, I am redesigning the restriction on the deductibility of interest expense in order to increase the incentive for Canadians to acquire shares of Canadian corporations. They will now be able to offset against non-investment income up to $10,000 of interest expense on loans to purchase shares of Canadian corporations. Interest expense incurred by significant shareholders of private corporations to acquire shares of such corporations will be excluded from the definition of the restricted interest expense.


Some hon. Members:: Resign.


Allan Joseph MacEachen: The same treatment will apply to interest expense incurred by employees of such corporations up to the limit of their remuneration from the corporation.
There will also be a transitional provision so that taxpayers will be able to offset the restricted interest expense against up to two thirds of their total income in 1982 and one third in 1983.


Arthur Jacob (Jake) Epp: Why don't you resign?


An hon. Member:: You should be fired for fraud.


Allan Joseph MacEachen: In addition to what I have said, Mr. Speaker, given appropriate parliamentary arrangements, I am prepared to consider referring several matters to a parliamentary committee.


Some hon. Members:: Oh, oh!


Harvie Andre: What were you saying about Jerusalem?


Allan Joseph MacEachen: Mr. Speaker, I have not been saying anything-


Some hon. Members:: Oh, oh!


Charles Joseph Clark: You don't dare say anything.


Allan Joseph MacEachen: I have not said anything about Jerusalem, but I have not decided yet to move the budget to Jerusalem.


Some hon. Members:: Oh, oh!


An hon. Member:: It is nothing you could stand behind anyway.


Erik Nielsen: Just move it out.


An hon. Member:: You have moved everything else.


Allan Joseph MacEachen: These matters include rules relating to corporate reorganization, taxation of whole life insurance-


Some hon. Members:: Two.


Allan Joseph MacEachen: -charitable foundations-


Some hon. Members:: Three.


Allan Joseph MacEachen: -retirement allowances-

December 18, 1981
The Budget


Some hon. Members:: Four.


Allan Joseph MacEachen: -and work-in-progress.


Some hon. Members:: Five.


Allan Joseph MacEachen: Mr. Speaker, these decisions are the result of what I consider to be a valuable process of consultation.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


An hon. Member:: Try another one, Allan.


Allan Joseph MacEachen: They respond as well to legitimate concerns that have been raised by many citizens and delegations-


Arthur Jacob (Jake) Epp: Thousands.


Allan Joseph MacEachen: -who have visited me since November 13.


Charles Joseph Clark: If they could find you. If they were in Scotland.


Allan Joseph MacEachen: There will be ample opportunity for Parliament to examine all budget measures when legislation is under consideration. Finally, I believe, Mr. Speaker, that as Canadians focus more on the main thrust of the tax measures, the benefits of a fairer tax system and more effective incentives will be clear. I am also confident that the strategy of reducing inflation and interest rates will prove to be the surest and most direct route to create more permanent jobs and stronger growth in the Canadian economy.


Some hon. Members:: Hear, hear!


An hon. Member:: You are going to be shuffled.


An hon. Member:: So long.


Michael Holcombe Wilson: Mr. Speaker, Christmas is coming close and I think we have seen for the first time ever that a minister of finance will be eating crow at Christmas instead of turkey.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: The minister has chosen today to make this announcement. It is the last hour of the last day of this session, just before Christmas, when the galleries are empty-fortunately, there is a few of the media here-but he has chosen today in order to hide his own embarrassment.
Let us not be too speedy about this. This is another MacEachen trick, another trick by the Minister of Finance (Mr. MacEachen) similar to what I referred to on the night of November 12. It is another step, a giant step, toward the complete and total abandonment of this budget.
If this minister were honest, he could end all the speculation about what other changes will be made and admit that this amounts to a total withdrawal of his November 12 budget.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: Anyone who pretends that these are minor or technical changes, would argue that the budget is a major shift in the direction that the country is going, and that this has not done enough to change that direction.
The minister has abandoned his own budget. This should be the end of the budget and the end of the minister. Today the minister should offer his resignation.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: I suggest to you, Mr. Speaker, that the performance this afternoon has done great things for Edgar Benson and Walter Gordon.


Some hon. Members:: Oh, oh!


Michael Holcombe Wilson: We are not looking at a few inconsequential changes in this budget. We have already had changes in the MURBs prior to today and we have had changes in the merger provisions. We now have 17 changes in a document that is longer than the minister's budget speech itself.
It is not just an embarrassment for the minister, it is not just an embarrassment for the Prime Minister (Mr. Trudeau) or the government or the Liberal Party, it is a major blunder and, if I may say so, it is a major setback to the minister's own ambitions toward switching one seat over.


Some hon. Members:: Oh, oh!


Michael Holcombe Wilson: Let us study this budget in the context of last year's budget as well. There were many warnings at the time of last year's budget about the impact it would have on the oil and gas industry and the energy future of this country. That was borne out by the fact of so many rigs leaving the country, the impact on employment in the very valuable oil service industry sector of the province of Alberta. That was followed by major changes last summer. These changes did not set the matter straight, but did do something toward changing the disaster which had been visited upon that industry.
The blame then was shared with the Minister of Energy, Mines and Resources (Mr. Lalonde) but let us not forget that it was the budget of this minister. This year, the budget is all his responsibility. We have had the same result, same disruption and same drop in confidence. This year, the impact is much broader.
The minister himself referred to the mammoth amount of criticism which has come into his office. It has also come into my office. I receive copies of many letters, and I am just astounded by the amount of mail which has come in over this past month as a result of the budget. The minister did not have the common sense to test the effect of his budget on many factors, many people and the many companies which would be affected. The transitional impact has been devastating. The impact on transactions which were already in place was devastating. The minister has had to step back from many of the
December 18, 1981

proposed changes, and he has done this in many of the changes proposed here today. He was too lazy to consider the impact of certain parts of the budget on people and companies in the country. Just to underline that point let me refer to a letter given to me by the hon. member for Calgary West (Mr. Hawkes). The letter says that on November 27 the minister promised a study dealing with indirect taxes and their impact on senior citizens. Just today he responded to the hon. member for Calgary West saying that still no study has been done on the impact on those people in our country. 1 see the Prime Minister is leaving. I suppose this is too much for him. The embarrassment is too much for the Prime Minister.
The budget itself displayed an incredible lack of understanding of the tax system of the country, the budget's impact on business and its effect on capital formation. The minister should resign because of incompetence and incompetence alone.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: Mr. Speaker, let me refer you to Standing Order 35, which says:
No member may reflect upon any vote of the House, except for the purpose of moving that such vote be rescinded.
I believe that the extent of these changes is sufficient to draw into question the vote taken in the House on the budget.
I noted that the minister did not move that that vote be rescinded, and I ask Your Honour to put that question to the minister, because 17 items have been changed by this statement today. More than 17 resolutions are affected. These have all been voted upon in the House. They are now subject to change. Major revisions to the budget are necessary. In addition, in the statement he has just read, the minister has said he is considering referring several other matters to committee. Some of these matters are corporate organizations, charitable foundations, taxation of life insurance and work in progress. I contend that this constitutes a major substantive revision to the budget and is thereby a reflection on a vote already taken in the House on the budget. Therefore, it falls squarely within the purview of Standing Order 35. I say to you, Mr. Speaker, that the minister should move that that vote be rescinded.
The minister should also resign because he has departed from a very sound principle of introducing tax changes of this magnitude not by way of a white paper but through the budget. This was a major fault of the budget. It is something which should have been done differently. It should have been done in the way it has been done in the past, which is the fair and democratic way of doing it.
This budget introduces fundamental changes to the incentives system, to the investment system and to the nature of capital formation. As a result, there are significant changes in the way people will conduct their business activities, and the minister has the audacity to call those incentives he has changed loopholes and to make those people who took advantage of those incentives offered to them by previous governments to feel dirty. That is the deceit of that budget of November 12, and that has not changed as a result of the
The Budget
statement today. The minister should have used a white paper.
I think he knows it. I think he understands that now because of the fact that he is proposing to introduce five items of the budget to a parliamentary committee, but I suggest to him that he should withdraw those completely from the budget, present them in a white paper and then let us have a look at them in committee.
The budget was not just to hit the rich. It affects three quarters of Canadians through dental care and health care programs and through employee benefit programs. If affects farmers, small businessmen, high technology companies and small oil, gas, and mining companies. These are not big companies. These are small and medium-sized companies. The big companies are not affected by this budget. It hardly touches them at all. Smaller companies, Canadian-owned companies and individuals are directly affected by this budget. That is why the minister's approach is wrong. This backtracking today is not good enough. It is not good enough to bring this in at four o'clock on the last day of sitting before Christmas.
Let us look at the substantive nature of these changes. There are some improvements; I have to agree with the minister when he says that. He has taken a step in the light direction. He has listened, but how could he help but listen? Some of the major deficiencies in this budget remain, and we will be attacking them further when we get back to the Committee of the Whole on the ways and means motions. We will also be hearing representations from Canadians from across the country on the nature of the impact of the budget through a Progressive Conservative special committee on the budget which will be sitting during the Christmas recess.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: What we have here today is a series of 17 changes. On the question of reserves, the minister recognizes that, in his words, there is hardship and disruption as a result of the changes. Pre-budget there was unlimited provision for reserves. Under the proposal set out today, they are limited to three years. That is insufficient for farmers and other businessmen who are selling assets they have nurtured all their lives and assets which are to be their pension funds and their source of income during their retirement.
With respect to capital cost allowances, the minister again has noted the impact of the budget as being disruptive and needing an orderly transition, but there is no change which will affect transactions entered into after November 12. For those transactions which are short term in nature, there will be no relief as a result of today's statement, and for the minister to compound the problems he created on November 12 when he cut the capital cost allowance in half when he knows that now the recession is deeper than it was and deeper than he knew on November 12, I say is criminal.


Mr. Deputy Speaker:: Order, please. The Chair has a problem at this point in connection with Standing Order 15(3), which provides:

December 18, 1981
The Budget
On Statements by Ministers ... a Minister of the Crown may make a short factual announcement or statement of government policy. A spokesman for each of the parties in opposition to the government may comment briefly thereon-
The original statement lasted 13 minutes.


Erik Nielsen: Eighteen.


Mr. Deputy Speaker:: The original statement by the minister lasted 13 minutes.


Erik Nielsen: Eighteen.


Mr. Deputy Speaker:: I am going by the record handed to me by the Clerks at the Table, and 1 invite the hon. member for Etobicoke Centre (Mr. Wilson) to make note of this. The Chair is in the hands of the House, but the usual practice is that the length of statements by leaders of the opposition should not exceed the length of the original statement.


Erik Nielsen: Mr. Speaker, I rise on the point of order raised by the Chair. Never in my time here have we ever embarked upon such an unusual procedure as a minister of finance swallowing himself to the extent this one has. The hon. member for Etobicoke Centre (Mr. Wilson) has spoken only eight minutes.


Mr. Deputy Speaker:: The Chair is guided by the rules of the House. Is there unanimous consent for the hon. member for Etobicoke Centre to continue?


Erik Nielsen: On the point of order raised by the Chair to which I have the right to speak-


Mr. Deputy Speaker:: Certainly.


Erik Nielsen: There can be no question that what we are embarked on here is a highly unusual procedure which 1 have never seen in my experience here. We need to have adequate time to respond, as does the spokesman for the New Democratic Party. If there is any question about that at all, I will move a motion now just to see what the attitude of the government is going to be to hearing out members on this side with regard to the highly unusual statement by a minister who has swallowed himself so completely that he should resign. Therefore, pursuant to the provisions of Standing Order 6(5)(a), I move, seconded by the hon. member for Nepean-Carleton (Mr. Baker):
That this House shall continue its sitting this day until it has finished the procedure on the statement on motions by the Minister of Finance.
I do that to provide adequate opportunity for our spokesman, adequate opportunity for the spokesman for the New Democratic Party and adequate opportunity for all members who wish to question the minister.


Some hon. Members:: Hear, hear!


Mr. Deputy Speaker:: The hon. member has moved a motion according to the provisions of Standing Order 6(5)(a). According to the Standing Orders, this motion is not subject to
debate or amendment. I shall now ask those who object to the motion to rise in their places.
And more than ten members having risen:


Mr. Deputy Speaker:: According to the provisions of Standing Order 6(5)(b), "If ten or more members then rise, the motion shall be deemed to have been withdrawn."
Motion withdrawn.


Some hon. Members:: Oh, oh!


Mr. Deputy Speaker:: I draw to the attention of the hon. member for Etobicoke Centre the problem of the expiration of his time.


Ian Deans: Mr. Speaker, on a point of order. I do not think we wanted to engage in a discussion of allocation of time. I hope the hon. member for Etobicoke Centre (Mr. Wilson) will recognize that the hon. member for Broadview-Greenwood (Mr. Rae) would like to make his comments.


Michael Holcombe Wilson: I only require another two or three minutes to complete my remarks, if I could have the indulgence of the House.


Mr. Deputy Speaker:: Is there unanimous consent that the hon. member for Etobicoke Centre be given an additional three minutes to complete his remarks?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Michael Holcombe Wilson: Thank you, Mr. Speaker. I thank hon. members for their courtesy. I was just discussing some of the substantive changes that are referred to in the statement by the minister.
The next one I would like to refer to is the change in soft costs. We have already seen the disruption in MURBs. That was brought to the attention of the House by my colleague from Vancouver Centre (Miss Carney). I should point out to the House that the changes that are referred to in this statement are only transitional in nature. The loss of the reserves plus the changes in the capital cost allowance, plus the change in the capital gains reserves are sufficient to result in a significant decline in the housing activity in this country, and this, at a time when we are having a housing crisis, is totally wrong.
The minister referred to the changes in interest deductibility. The minister must realize that $10,000 exemption will not be sufficient for many small businesses to finance themselves at a time when we have 20 per cent interest rates. That represents a loan of about $50,000. The minister is saying that that interest deductibility change was not to affect the small businessman, but I draw to his attention the fact that many individuals finance small businesses with loans on their own credit. They are reinvested in small business.
The Small Business Development Bond still remains the small business bail-out bond. The removal of the 6 per cent
December 18, 1981

threshold is sensible, but it is not a development bond. It is a bail-out bond. The money is still not available for companies to expand and grow to develop this country. It is still a bail-out bond.
The changes under the heading of reorganization which extend these terms until 1983 still do not address the problem of the reorganization changes to small businesses, to high technology companies, oil and gas companies and so on. It does not do anything to the big companies. The big companies will not be affected, just the smaller companies.
Let me just wind up. The minister referred to five items that will be referred to a standing committee of this House. That is another indication of a total withdrawal of the budget. This budget is a disaster. It is a failure by the Minister of Finance to address the problems of the country, concerns that were stated by many Canadians this past month. It is a continued attack on the free enterprise system in this country, on the average Canadian and on the small business community. It still reflects a lack of understanding by this minister and his officials on the impact of the budget on many Canadians. It should be withdrawn and the new budget that we see in the House should be brought in by a new minister of finance.


Some hon. Members:: Hear, hear!


Mr. Bob Rae (Broadview-Greenwood):: Mr. Speaker, if one thing is clear in all the discussion of conversions on the road to Damascus and the fact that the minister is not moving anything to Jerusalem, this is one budget that is certainly not engraved in tablets of stone. In fact, the minister should have had it written on a blackboard with pieces of chalk so he could make the kinds of changes he has made.
Unlike the hon. member for Etobicoke Centre (Mr. Wilson), I do not intend to focus on the extent to which the minister has retreated. The minister has responded to many of the criticisms that have been made in the country. The principle of being able to respond to changes and to demonstrate some flexibility is not something to which I object or to which those in this party object. Let me make it clear. We had a task force led by my colleague, the hon. member for Kamloops-Shuswap (Mr. Riis). We made representations to the government.
I want to make it clear to the minister that he operates on the principle of reacting to public demonstrations such as the one of over 100,000 Canadians which took place on Parliament Hill in response to the government's over-all policy and the fact that the minister has made a statement. 1 do not care when he makes it. He could make it here in the House of Commons at two o'clock in the morning, and we would be here to congratulate the minister on the fact he has responded. What is a problem, however, is the fact that the minister responded to those with the loudest voices. He has not responded with one particular exception. The question of transition is an arrangement that has to be made for those people to meet various business arrangements. If you overlook the question of what has been referred to committee, and there are some major items such as corporate reorganization, when you come right down to it, there have been five changes of any importance. Only one change can be really said to benefit the
The Budget
average worker or, in this case, the average retiring, fired or laid-off Canadian. That has to do with the changes which the minister announced for retirement allowances.
I want to indicate to the minister, as he will know since we have made representations in this particular regard from the beginning of the budget, that we welcome the fact that the minister has moved on retirement allowances. I think it is a tribute to those many Canadians who have written to the minister and to the many trade unions that have made representations. I pay tribute to that.


Some hon. Members:: Hear, hear!


Bob Rae: When one looks at what else the minister has done and one asks what are the major problems facing the Canadian economy, who has the minister responded to? He has responded to those interests, to those people who can make the most powerful claim, but he has not responded to those who are not in the position to make the same kind of technical and powerful claim on the minister's conscience.
The basic problem facing the Canadian economy at the present time is that we are in a recession and that we had a budget on November 12 which was designed to cool out a boom. The minister, his advisers and the Bank of Canada are bringing in policies which have been rejected even by the Economic Council of Canada itself.
I just want to give one example to the minister to demonstrate the hypocrisy, the uneven standard that the minister has applied. If he looks on page 15 of his statement which deals with the problem of employer housing loans which were deemed to be a taxable benefit and to which an imputed rate of interest would be applied, we are now told it will be phased in over two years. Let me make it clear, Mr. Speaker, that I do not particularly object to the principle of the phase-in. I want just to read to the minister one sentence which I think indicates the standard which the government applies in some cases but not in others. It says, "It is proposed that this change be phased in for existing housing loans to allow employers time to work out remuneration arrangements for their employees who are affected by this measure." Mr. Speaker, what about the medical and dental plans? Is the minister seriously arguing that they do not affect the remuneration arrangements of literally hundreds of thousands of employees in this country?


Some hon. Members:: Hear, hear!


Bob Rae: Is the minister arguing that they are somehow less important than those people who are the employees of banks and other large corporations, managerial employees who are receiving those benefits? There is one difference between people who are receiving employer housing loans and people who are receiving medical and dental plans under collective agreements. One group are managers and the other group are workers. That is the only difference.


Some hon. Members:: Hear, hear!

December 18, 1981
The Budget


Bob Rae: If we ever needed an indication from this government that it is a government that responds to managers-


Donald W. Munro: You put them in.


Bob Rae: 1 say to the member for Esquimalt-Saanich (Mr. Munro) that the people of Canada voted them in and the people of Canada voted the Tories out. Do not forget that either.


Some hon. Members:: Hear, hear!


Bob Rae: I hear the minister in the House every day talking about the importance of providing equity, the importance of seeing that employees are treated equally. Where is the equity? Even in the retreat there is a double standard and even in the retreat there is something special worked out for people who are managerial employees. No similar arrangements are worked out for people who are living with collective agreements that cannot be changed, collective agreements that cannot be affected, because the minister has said that the only kind of changes that he is responding to, in effect, are the changes requested by people with the loudest voices, those who work for the banks and others who will benefit, and no one else.
When the budget came out, I said that the minister proved himself to be a very poor fisherman, that he has cast his net upon the waters, that he has managed to avoid fishing through the Grand Banks, taking the benefits that could be gained by going after those who are really powerful and by casting a net which has the miraculous ability of only catching the small fish.
1 wish 1 could say, Mr. Speaker, that in the changes the minister has announced today he has improved in his qualities as a fisherman, that he had improved in dealing with the real problems facing the Canadian economy. The basic difficulty of the budget was that it did not deal with the fact that we are in a recession, that it provided no stimulus, that the fairness in it was not real and there was no basic stimulus to investment, growth and to jobs in the Canadian economy. I am sorry to say that in the transitional and other announcements that have been made today by the minister, embarrassing as they are personally to him as much as they show a general lack of understanding and a real sense of ineptitude and uncertainty in decision-making in government, they do not get to the core of the economic difficulties facing the country.
Unlike those who would object to the fact that the minister is forced to make a retreat, we do not object to the retreat. We are glad, in fact happy, to be part of a process which has forced the minister to make a retreat. Our sadness is that in making the retreat the government has, once again, demonstrated that it is truly incapable of understanding the human impact of unemployment, high interest rates and inflation. It has instead chosen to make a series of technical changes which, while they will be beneficial in some respects to certain groups-and we certainly do not begrudge those changes, Mr. Speaker-will not get at the basic and real problem facing the economy, that is to say the fact that we live in an economy in a
state of crisis and we live with an economic policy which is one of tremendous unfairness.
I want to put the minister on notice that we will continue to fight the budget, not on technical or narrow grounds, but on the grounds that it fails to address the fundamental problems facing the people of Canada. We will continue to oppose that budget precisely for that reason.


Donald W. Munro: I have one question for the minister. Will the minister tell the House and the country, or give us an idea in dollar terms, millions or billions-whatever it might be-of the loss in the 1982-1983 revenue consequent on the 17 amendments in the five referrals to committee that he has just made in his retreat from the chilly winds of popular opinion, from the budget proposals he tabled on November 12, as well as, in percentage terms, the percentage that this amount represents of the total revenue he was hoping to collect under those earlier proposals, from which he has now so desperately retreated?


Mr. Deputy Speaker:: The Chair calls the attention of hon. members to the fact that they need to keep questions short.


Allan Joseph MacEachen: Mr. Speaker, the question raised by the hon. member is quite relevant because citizens and others will be wondering whether the changes that have been made will damage or derange the fiscal framework. I will tell him that over the five-year period, for which I made my projections, the preliminary estimate 1 have is that the loss of revenue on the average would be about SI50 million per year, as against the objective of the new taxes which was to raise $1.2 billion on average per year.


Mr. Doug Lewis (Simcoe North):: Mr. Speaker, my question is directed to the Minister of Finance (Mr. MacEachen). Despite the rhetoric from the member for Broadview-Green-wood (Mr. Rae), the minister will know that it was the Progressive Conservative Party that questioned him on the taxation of medical and dental plans. Is the minister still planning to tax union and non-union workers for medical and dental plans, or does he have plans to change too?


Allan Joseph MacEachen: No, Mr. Speaker.


Mr. Deputy Speaker:: The hon. member for Broadview-Greenwood (Mr. Rae) may have the floor, briefly. It is not normal for the same member to speak again for the party, but in view of the fact that he is keeping it short-


Bob Rae: Mr. Speaker, do you recognize me to ask a question?


Mr. Deputy Speaker:: Yes.


Bob Rae: My question for the minister concerns IAACs. I know that the only change the minister has introduced was of a transitional nature rather than a fundamental nature, this
December 18, 1981

morning and later, in answer to a question put by the hon. member for Yorkton-Melville (Mr. Nystrom) about forward averaging. Could the minister tell us if he is prepared to table for the benefit of the House the figures which will show the comparative effects of IAACs and forward averaging? It would be useful if the House could have the benefit of the information which the minister seems to have given to a number of groups so that we can realize in money terms what the comparative advantages and disadvantages are. Our impressions, from talking with a number of farm organizations, are very much the opposite-


Mr. Deputy Speaker:: Order, please. The hon. member has made a comment. At this stage he can ask a short question. The Minister of Finance (Mr. MacEachen).


Allan Joseph MacEachen: Mr. Speaker, I think the question asked by the hon. member is very relevant. Not until one looks at the comparative figures is it possible to draw a conclusion about the advantages or disadvantages of one system over another. Based upon that analysis, it is my view that in general the forward-averaging system is likely to provide more flexibility to farmers and others. As I stated earlier, Canadian cattlemen reached that conclusion after discussions with us in Oshawa.
With respect to the detailed analysis, I am sending comparative statistics on the impact of both systems upon farmers and others to members' offices. I am quite concerned that the new system should not disadvantage the farming population which in certain circumstances have come accustomed to the use of income-averaging annuity contracts.


Frederick James (Jim) Hawkes: I am concerned about the social impact of this budget and the things that are not changed. There is no change in the relation to increased health care costs, the hidden taxes that still effect the poor and lower-income Canadians in a devastating way, and there is on the income tax side and on the capital gains side an attack on the institution of marriage or a reward for the dissolution of marriage. I am also interested in the issue of charitable donations when it costs rich people half as much to donate to their church or charitable organization as it does poor people. The rich get $100 back on a $200 donation but poor people get nothing or maybe $12 back.


Mr. Deputy Speaker:: The hon. member is not permitted to make a statement at this point but he may ask a question.


Frederick James (Jim) Hawkes: I wonder if the issue is closed or if members of the House can further petition the Minister of Finance (Mr. MacEachen) to bring some social equity for poorer and lower-income Canadians back to the budget. Is that a foregone conclusion-we cannot do it or will we have the opportunity-


Mr. Deputy Speaker:: The hon. member should ask his
question.


Allan Joseph MacEachen: Mr. Speaker, of course, 1 disagree with the conclusions of the hon. member. It is my belief that the additional tax burden that has unue'ibtedly been placed upon
The Budget
citizens of Canada as the result of this budget, rests mainly upon the shoulders of those in higher-income groups and that in general, lower and middle-income Canadians are better off as the result of the budget. That is my belief and it is demonstrated in the tax tables that have been made available to hon. members.
With respect to the hon. member's reference to charitable organizations, it is true that certain proposals have been made in the budget with the objective of facilitating the disbursement of funds which are intended to be used for charitable purposes. Questions have been raised and I have agreed, if the House can make the arrangements, to have that question as well as a number of other issues studied by a standing committee. If hon. members have a better view, then I will be glad to consider it.
I find it rather strange that hon. members now have protested so violently against adjustments and proposals which I have made in response to citizens' representations, in response to representations from the Liberal caucus and in response to representations from the other side. What is democracy all about?


Blaine Allen Thacker: Mr. Speaker, my question relates to fiscal relations in the country. He will know that his budget provided for a cut of $5.7 billion in transfers to the provinces. As a result of closing what he called loopholes or investment credits, the provinces would have increased revenue of some $3.6 billion over the five-year period for a net loss of $3.1 billion. He has obviously reopened the investment credits and that will reduce provincial income tax. Is he going to take that into consideration when he is negotiating with the provinces?


Allan Joseph MacEachen: Mr. Speaker, if the provinces begin to acknowledge the benefits that flow to them from the tax changes, then of course it will be an encouragement for me to consider that question. Even though I made a determined effort in the budget to flow additional benefits to the provinces through tax changes, up to the present time they have not been ready to acknowledge that as an important factor in the over-all benefits to the provinces. I think I must get the acknowledgement before I begin to readjust the payments.


Mr. Rod Murphy (Churchill):: Mr. Speaker, I have a question for the Minister of Finance. Unlike the Conservative Party, we have already finished our economic tour of the country, and have heard from employers and employees. Workers who work in northern areas have traditionally received some subidy for the higher cost of living and for food in these northern areas. I wonder if the minister is still going to tax those benefits despite the fact that the Canadian Petroleum Association, the International Woodworkers Association, the Council of Forest Industries and others are concerned about the development of the north, with those benefits which are strictly work related being taxed.


Allan Joseph MacEachen: Mr. Speaker, I am glad that the hon. member asked that question because it gives me the opportu-

December 18, 1981
The Budget
nity once again to draw the attention of the House to the fact that the remission order that has been extended has exempted such benefits from taxation. That remission order has been extended within the designated area to which northern benefits apply. I must add that in addition, the so-called housing loan provision was also exempted within that designated area north of 60 and isolated posts. That has been the definition we have used. There has been absolutely no change in the pre-existing situation with respect to northern allowances.


Erik Nielsen: Mr. Speaker, the release that the minister tabled in the House tonight lists 18 changes to the budget. Previously there were another three, so that is 20 plus changes. Any other self-respecting minister of finance operating in a western parliamentary democracy would resign.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


An hon. Member:: Question.


Erik Nielsen: My question is, for the good of the country, will the Minister of Finance submit his resignation in recognition of his incompetence?


Some hon. Members:: Hear, hear!


An hon. Member:: Have a merry Christmas!


John Allen Fraser: Mr. Speaker, if hon. members on the backbenches of the Liberal Party would calm down. 1 have a question. 1 know this is very agitating for them.


Charles Joseph Clark: 1 have a question. No, my colleague-that is my colleague.


Mr. Deputy Speaker:: The Chair is in the hands of the House. However, if the Right Hon. Leader of the Opposition
wishes to be recognized, the Chair will recognize him at this point.


Some hon. Members:: Agreed.


Charles Joseph Clark: Mr. Speaker, I would welcome being recognized after my colleague, the hon. member for Vancouver South (Mr. Fraser), has completed his question.


Erik Nielsen: No more time! Muzzling us again!


Mr. Deputy Speaker:: It being five o'clock, p.m., pursuant to an order made Thursday, December 10, 1981, this House does adjourn.


Charles Joseph Clark: Mr. Speaker, I have a point of order.


Erik Nielsen: Point of order!


Charles Joseph Clark: Mr. Speaker, 1 rise on a point of order to see if the hon. members opposite will not reconsider their refusal earlier this day to gag the House of Commons and to stop us from examining what is, in effect, the presentation of a new budget. I am consequently asking for the unanimous consent of the House-


Some hon. Members:: Hear, hear!


Charles Joseph Clark: -to continue our questioning of the Minister of Finance (Mr. MacEachen). Mr. Speaker, may I have that unanimous consent?


Some hon. Members:: No, no!


Some hon. Members:: Agreed!


Erik Nielsen: Parliament is a nuisance to the Liberals!


Mr. Deputy Speaker:: It being 5.02 o'clock p.m., pursuant to an order made Thursday, December 10, 1981, this House stands adjourned until Monday, January 25, 1982, at two o'clock p.m., pursuant to Standing Order 2(1).
At 5.02 p.m. the House adjourned until Monday, January 25, 1982, at 2 p.m.

Monday, January 25, 1982