1981-05-27

ROUTINE PROCEEDINGS


Mr. Peter Elzinga (Pembina):: Madam Speaker, I rise under the provisions of Standing Order 43. In light of there being
600,000	women in Canada who are over the age of 65 and who are single, widowed or divorced, and in view of the fact that 60 per cent of them are living in poverty, I move, seconded by the hon. member for Edmonton South (Mr. Roche):
That the government be condemned for its inability in dealing with the needs of Canada's senior citizens and that the government take positive steps in resolving this grave situation.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


LABOUR RELATIONS
Mr. Gordon Towers (Red Deer):: Madam Speaker, a work stoppage by 200 rail workers in British Columbia is causing havoc with shipments of western grain. In Alberta there are 1,500 fully loaded railway cars sitting on sidings, some trains being a mile long, which cannot proceed to their destinations because of the tie-up. Canada's reputation as a reliable supplier of quality grain is being jeopardized.
I move, therefore, seconded by the hon. member for Medicine Hat (Mr. Hargrave):
That the minister responsible for transport and the Wheat Board intervene personally to get this dispute settled and get western grain moving again to the markets of the world.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NECESSITY FOR PRICING AGREEMENT WITH WESTERN PROVINCES-MOTION UNDER S.O. 43
Mr. Len Gustafson (Assiniboia):: I rise under the provisions of Standing Order 43, Madam Speaker. Given the fact that oil production cutbacks in western Canada, and more particularly in the Weyburn area by PanCanadian, an operator of the units of 65 companies, last week resulted in the cutback of 75 per cent of their production from some 480 producing wells for which they receive $17.75 a barrel at the wellhead while the government continues to pay $40 a barrel for offshore oil, and given the fact that the gasoline price at the gasoline pumps has increased in the last year by 50 cents a gallon, I move, seconded by the hon. member for Edmonton East (Mr. Yurko):
That the Minister of Energy bring an end to the cold war between the east and the west which he has created and address the very serious situation, which is his responsibility, of a pricing agreement with the provinces of western Canada, which will allow western Canada to make its contribution to the energy of this great nation.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. Nelson A. Riis (Kamloops-Shuswap):: Madam Speaker, I stand under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Recognizing that the prime rate last week in West Germany was 13.8 per cent, in the United Kingdom 13 per cent, in The Netherlands 12 per cent, and in Switzerland and Japan was 6.5 per cent, and recognizing that there is not a mass flow of capital out of these countries into the United States with its prime rate of 20.5 per cent, and recognizing that the government says Canada must tie its rate to that of the United States of America I move,

May 27, 1981
therefore, seconded by the hon. member for Broadview-Green-wood (Mr. Rae):
That this House request the Minister of Finance to admit to the Canadian people that the policies of this and former federal governments have relegated our country to the status of a 51st state.


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


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


Some hon. Members:: Agreed.


Some hon. Members:: No.


TOURISM
Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, under the provisions of Standing Order 43 I rise on a matter of some urgency. Statistics Canada has reported that the tourist deficit in this country for the first three months of this year was almost $1 billion, which was almost the same figure as for the same quarter of last year. In light of the potential of the tourist industry to assist in generating extra income for all sectors of the economy, and because in addition to ignoring this potential the government has placed the entire industry in jeopardy as a result of high interest rates, I move, seconded by the hon. member for Erie (Mr. Fretz):
That the government cease its imitation of the Peace Tower clock and start working again to get the mechanism of the economy moving forward.
This government should stop talking and start ticking.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


WILLIAM HAMILTON MERRITT
Mr. Girve Fretz (Erie):: Madam Speaker, I rise on a motion which I am sure will receive the unanimous consent of the House. Last century there was a man who had a dream and who had the courage and determination to bring that dream to life. The man was William Hamilton Merritt, and his dream was the Welland ship canal, which is now an integral part of the St. Lawrence Seaway. In order to honour the memory of the man who brought the Welland Canal into being, I move, seconded by the hon. member for Nepean-Carleton (Mr. Baker):
That this House agree that consideration should be given by the Canadian Coast Guard to naming a vessel The William Hamilton Merritt.


HOUSING
Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, I too rise under the provisions of Standing Order 43. Some years ago the government encouraged home ownership through the AHOP program. Today, because of its calamitous interest rate policy, the same government is threatening to deprive hundreds of their homes due to the necessity of remortgaging at 18 per cent, 19 per cent and more. I move, seconded by the hon. member for Kamloops-Shuswap (Mr. Riis):
That the government institute a six-month freeze on remortgaging in cases where the new interest rates will consume in excess of 30 per cent of the family income for house payments and, failing that, the government extend the subsidy, without ceiling, to the same hardship group.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


SMALL BUSINESS
Mr. Otto Jelinek (Halton):: Madam Speaker, I rise under the provisions of Standing Order 43. Despite the fact that our small business community makes a tremendous contribution to the economic well-being of the country, is our number one creator of new and productive jobs, and is innovative and counterinflationary, the Liberal government has refused to recognize the devastating effects its misguided budgetary policies and high interests are having on this vital sector and, in turn, on the country as a whole. Because of the fact that our party can be singularly credited for forcing into effect those assistance programs which do exist, I move, seconded by the hon. member for Pembina (Mr. Elzinga):
That the Minister of State for Small Businesses and Tourism, who obviously does not have the attention of his senior colleagues in the cabinet, cross the floor of this House and join the ranks of the Progressive Conservative party where he will be able more effectively to exercise his responsibilities.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
May 27, 1981


CANADA PENSION PLAN
Mr. Vince Dantzer (Okanagan North):: Madam Speaker, I rise under the provisions of Standing Order 43. Whereas pensioners are among those who suffer most from the impact of high inflation which, under this government's management, has reached the ridiculous rate of 13 per cent, and whereas the government's policy of indexing the Canada Pension Plan on a yearly basis causes a loss to pensioners, due to inflation, of over 6 per cent of their yearly pensions, or about one month's rent every year-a loss they can ill afford-I move, seconded by the hon. member for St. John's East (Mr. McGrath):
That the government immediately institute a policy of indexing the CPP on a quarterly basis to ensure that Canadian pensioners do not suffer needlessly because of the government's mismanagement of the economy.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


TRANSPORT
Mr. J. R. Ellis (Prince Edward-Hastings):: Madam Speaker, last week the chairman of VIA Rail announced that after June 1 the regular Ottawa-Toronto trains would bypass Belleville, which has been a rail centre since Confederation. I therefore move, seconded by the hon. member for Parry Sound-Muskoka (Mr. Darling):
That the Minister of Transport request a study of the material used in this terrible decision before the changes are instituted.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Hon. Sinclair Stevens (York-Peel):: In the absence of the Minister of Consumer and Corporate Affairs I would like to put my question to the Prime Minister who confirmed yesterday that the inquiry into the uranium cartel is now complete.
Oral Questions
As the Minister of Consumer and Corporate Affairs stated on March 4 in this House that when the inquiry was completed the director's findings would be made public, and as in 1977, when the inquiry was commissioned, the then minister of consumer and corporate affairs also said that the findings of the inquiry would be made public, would the Prime Minister now inform us when he intends to make these findings public?


Right Hon. P. E. Trudeau (Prime Minister):: Well, it would not be for me to set the date, Madam Speaker. If the minister gave that undertaking I will consult with him and see what his intentions are. The competition bureau, as I said yesterday, has referred the matter to the attorney general, and of course if he decides to lay charges the whole matter will become public in court.


POSITION OF FORMER MINISTERS-APPOINTMENT OF LEGAL COUNSEL
Sinclair McKnight Stevens: Madam Speaker, again in the absence this time of the Minister of Justice perhaps I could put my follow-up question to the Prime Minister. Is the government presently retaining independent counsel for certain former ministers, deputy ministers and other civil servants who had some involvement with respect to the uranium cartel? Namely, are you presently retaining counsel for certain former ministers such as Mr. Macdonald or Mr. Gillespie?


Pierre Elliott Trudeau: Not to my
knowledge, Madam Speaker, if he is referring to the matter of the report of the competition bureau. If, however, the hon. member is referring to actions taken in the United States courts which attempted to summon Canadian ministers before those courts, I do recollect some years ago that the Department of Justice was authorized to provide advice to a former minister which, as of course the hon. member would recognize, is very proper.


IMPACT OF CARTEL ON CANADIAN CONSUMERS
Sinclair McKnight Stevens: Madam Speaker, I would suggest that the Prime Minister might check his records and perhaps report later in the day to the House concerning whether such independent counsel have in fact been appointed and are still being retained by the government on behalf of certain ministers and civil servants in connection with the uranium cartel combines investigation in Canada.
As my final question, would the Prime Minister indicate, since he sanctioned the various orders in council and regulations, and took other steps with respect to the activities of the uranium producers, including Crown corporations, during the period 1972 through 1978, whether he was ever aware of the implications such a cartel had for Canadian consumers, in short, that the price rigging, quota setting and other activities of this cartel were having an impact on Canadian consumers, and not only at present but in the future?

May 27, 1981
Oral Questions


Pierre Elliott Trudeau: Madam Speaker, as I indicated yesterday in an answer to the House, the intent of these regulations was quite clear. It was to protect Canadian citizens and corporations from the extraterritorial effect of U.S. law. That was the intent of the regulations. If the competition bureau has uncovered anything which is otherwise illegal, then I imagine they will be reporting it and it will be in the hands of the attorney general. This I do not know.


Sinclair McKnight Stevens: Let us see the report.


Pierre Elliott Trudeau: However, I made it quite clear that the intent of the regulations was to protect the Canadian uranium industry, and not in any sense to put pressure on the Canadian consumer. On the contrary, it was to keep alive a Canadian industry which was being very severely discriminated against by United States regulations respecting the free entry of Canadian products into their market.


JUSTIFICATION OF MARKETING PRACTICES
Mr. Chris Speyer (Cambridge):: Madam Speaker, my question is also for the Prime Minister. It is clear that the methods of marketing utilized by the uranium cartel involved a scheme of bid rigging, and what happened is that there would be a true bidder designated by a secretariat in Paris, and a secondary sham bid. Senior Canadian officials participated in establishing the rules of the cartel, and the cabinet over which the Prime Minister presided implemented the regulations which gave effect to these artificially high prices. In light of this fact, how does the Prime Minister justify the marketing? Is it not just plain cheating and fraud on the purchasers of uranium?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, this matter came before the House in great detail during past years. The situation is still exactly the same. I do not know why the opposition chooses to deny the fact that the American industry used American law in order to protect that American industry from international competition, against the rules of GATT and of free trade.
Canada, along with several other countries producing uranium, took protective measures. We found it was our duty; we still believe it was our duty. I am surprised we do not have the support of the opposition to protect Canadian producers and workers against discriminatory measures taken in the United States.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Chris Speyer: Madam Speaker, the Prime Minister has just said that any means justifies the end.


Some hon. Members:: Oh, oh!


QUERY RESPECTING LEGAL OPINIONS
Chris Speyer: Madam Speaker, my supplementary question is directed to the Minister of Justice. Does any letter of opinion or any indication exist within the Department of Justice which would immunize against prosecution any firms that were members of the cartel? Does the Minister of Justice have an independent legal opinion, in light of the potential conflict of interest his department might be in, in circumstances which might prove that there will be a prosecution in the offing?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, I just received a report from the investigation and research branch. We are studying the report at this time. When we are ready to decide whether or not we have to prosecute, we will decide it. I will try to act as quickly as possible. If I feel there is some difficulty for me in making up my mind about this problem, of course I will be happy to seek some outside opinion. But in the last analysis the Minister of Justice and the Attorney General of Canada will have to make the decision.


THE ECONOMY
Mr. Bob Rae (Broadview-Greenwood):: Madam Speaker, in the absence of the Minister of Finance I should like to direct my question to the Prime Minister. It concerns the evidence given yesterday to the Senate Committee on National Finance by the Governor of the Bank of Canada, Gerald Bouey. Governor Bouey indicated to the committee that he felt the Canadian economy was working at virtually full capacity, and that unemployment was still too low. He described the labour markets as being very tight in Canada.
Does the Prime Minister regard an economy which is working at around 80 per cent capacity as being full capacity? Does he share the view of the Governor of the Bank of Canada that unemployment right now is too low in Canada?


Pierre Elliott Trudeau: Madam Speaker, I read hastily the statement prepared by Governor Bouey. I saw nowhere in it that he indicated unemployment was too low. If the hon. member has a quote, I would stand corrected, but I have not seen any such words from the mouth of the governor. Perhaps the hon. member read them in the press, but I do not believe he heard them from the governor.
As to operating near capacity, the hon. member knows the figures. In the last quarter of last year the economy was operating at a real growth rate of 8 per cent on a real basis. In this first quarter it is 6 per cent on a yearly basis. We do not know if these trends will continue. We do know they are very high growth rates, indeed very much higher than the growth rates in other industrialized countries. These growth rates have caused a fall in unemployment rates, not a rise.
May 27, 1981


GOVERNMENT'S VIEW ON UNEMPLOYMENT
Bob Rae: Madam Speaker, when the transcript of the evidence of Governor Bouey is available, I think it will indicate that the governor said the labour markets were tight and that the economy needed to produce more slack before he felt the war on inflation would be won. In that light I would like to ask the Prime Minister, since we now have over 900,000 unemployed soldiers in the trench war on inflation and like some First World War general, Governor Bouey is saying, "Let us send another half million into the trenches in order to fight inflation", if it is his view, and the view of his government, that unemployment should increase. If that is the view, how high should unemployment go? Is the Prime Minister prepared to accept the policy of the Governor of the Bank of Canada in this regard, and will he come clean with the Canadian people and say just how much unemployment he thinks is necessary in order to fight this useless trench war against inflation?


Pierre Elliott Trudeau: Madam Speaker, the hon. member asks if it is the view of the government or of the Governor of the Bank of Canada that unemployment should be higher. It is certainly not the view of the government, and I just challenged the hon. member to indicate where the governor had ever used such words. The hon. member tells me that when the transcript is available we will see. I suggest that the hon. member should come clean and tell us now that he is only fantasizing from headlines and not from words which were actually spoken.


Some hon. Members:: Hear, hear!


GOVERNMENT POSITION ON INTEREST RATES
Bob Rae: Madam Speaker, the Prime Minister is an expert on fantasizing. I simply indicate to him that when the Governor of the Bank of Canada states that in his view labour markets are very tight and the economy is working at capacity, that means he thinks we have to reduce capacity in order to fight inflation, which means he thinks a higher rate of unemployment is acceptable.


Some hon. Members:: Oh, oh!


Bob Rae: Among other things Governor Bouey also said he thought that the government had made a mistake and that he had made a mistake in reducing interest rates in the period between April and July of last year. Since the government took great credit for the fact that interest rates went down during that period, and since it was regarded as an act of deliberate policy-in fact part of the genius of the Minister of Finance- I would like to ask the Prime Minister whether he agrees with Governor Bouey that the government made a mistake in reducing interest rates at that time. Can the Prime Minister tell us whether it is his intention to reduce interest rates over time, or whether it is the intention of the government to maintain interest rates at the level which Governor Bouey
Oral Questions
again indicated yesterday he regarded as entirely acceptable and ones which were, in his view, necessary to carry out the policies of the government?


Pierre Elliott Trudeau: Madam Speaker, I would suggest that the genius of the Minister of Finance speaks for itself.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: As to carrying the responsibility for interest rates, every member of this House knows the rules. When interest rates go up, the government blames the opposition, and when they go down they just say it is chance.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: That is the rule the hon. member follows, the rule every member follows.


Some hon. Members:: Oh, oh!


Mr. Nielsen:: You have it topsy-turvy.


CANADA DEVELOPMENT CORPORATION
Hon. John C. Crosbie (St. John's West):: Madam Speaker, I would like to praise the government, but in all justice I cannot do it.
My question is for the Prime Minister. Last Thursday the shareholders of the CDC met at Winnipeg to re-elect a board of directors and to have their annual meeting. The government nominated four directors to the board, led by Maurice Strong, the Prime Minister's pet fixer, and three other Liberals. Is it correct that the deputy minister of finance, Mr. Ian Stewart, met with the board of directors of CDC previous to the shareholders' meeting, and advised them that the government wanted two other directors appointed, Mr. Joel Bell, the vice-president of Petro-Canada, and Mr. David Beatty, a former partner of Mr. Jim Coutts in the firm of Canada Consulting, that these two gentlemen also had to be appointed or the government would vote its shares to dismiss all of the directors of CDC if they did not carry out the government's wishes? Is that correct?
It is obviously correct that the board refused, of course, this extraordinary and astounding threat, and that the government withdrew it just before the meeting. Can the Prime Minister confirm whether that in fact happened, and whether Mr. Stewart was authorized by the government to do those things?
Would the Prime Minister also explain the reasons for that kind of action, and would he agree to a public inquiry into the whole situation surrounding the Canada Development Corporation over the last month or so, its future direction, what will

May 27, 1981
Oral Questions
happen to the board of directors, or a reference to the House of Commons finance committee?


Pierre Elliott Trudeau: Madam Speaker, as to the little story of what happened in Winnipeg, I will inquire and will perhaps be able to inform the member of the opposition. As to the direction of the CDC, it is contained in the law which set it up. The CDC has certain goals and objectives which are set out in the law.


Mr. Andre:: Does the law say all must be Liberal hacks?


Pierre Elliott Trudeau: The Minister of Finance made it quite clear that he had no intention of introducing any changes in that law. The whole action of the government, and I wish the hon. member would realize it, was intended to ensure that the major shareholder, the shareholder owning 75 per cent to 80 per cent of the equity, being the people of Canada, represented under the law by the Minister of Finance, had some say in the choosing of the chairman of that corporation. Once again I will challenge the hon. member, who seems to know a lot-


An hon. Member:: What about the other two?


Pierre Elliott Trudeau: -about money-making, does the hon. member know of any corporation the major shareholder of which is not ever even consulted or informed on the naming of the chairman of the board? If he does, then I wonder how he made his money?


REPORTED THREAT TO DIRECTORS
John Carnell Crosbie: The Prime Minister fails to understand the seriousness of this situation, and he did not answer my question. Does the Prime Minister remember that in 1971 he gave a letter to Mr. Hampson, the president, and to the directors, as did his Minister of Finance in 1972, containing written assurances that the board of directors would be free of political intervention and would be permitted to exercise their business judgment as directors of the Canada Development Corporation, as was said in the debate when the bill went through this House? Does the Prime Minister remember that and, if he does, will he so state to this House? I happen to know this is correct, as I have checked it myself.
Did the government instruct the deputy minister of finance to go to Winnipeg and make a threat to fire the whole board of directors of Canada Development Corporation if they did not elect Joel Bell and David Beatty to the board of that company, together with the other four Liberals who had been proposed in accordance with section 40 earlier? Did that happen and, if so, why did it happen, and will he permit a public investigation of the whole situation?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, the answer to the first part of the question is yes.
Indeed the directors are expected to exercise their business judgment in matters of business. The law states as much. The undertaking we gave to the first directors named was to that effect, and nothing in the recent actions of the government indicates any intention to change that direction.


John Carnell Crosbie: What about the threats that you made?


Pierre Elliott Trudeau: I repeat, Madam Speaker, that the major shareholder considers that it is entitled to be informed about the choice of a director. I told about the choice of a chairman. I informed this House that the earlier chairman had been chosen with my knowledge and with information given to me. None of the directors found this scandalous, nor saw any reason to resign, nor indeed did the then opposition find any reason to complain. That is because in those days members sitting opposite knew something about how corporations operate and how shareholders' interests should be respected.

[ Translation]


PRESENCE IN GALLERY OF MADAM N'KANZA, DIRECTOR OF U N. SOCIAL AND HUMANITARIAN AFFAIRS CENTRE
Madam Speaker:: I have the honour of drawing the attention of hon. members to the presence in our gallery of Madam N'Kanza, director of the United Nations Social and Humanitarian Affairs Centre and Secretary General for the International Year of Disabled Persons.


Some hon. Members:: Hear, hear!


CANADA DEVELOPMENT CORPORATION
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, my question is a supplementary to the preceding question to the Prime Minister, in the absence of the Minister of Finance. The government, by its hanky-panky in connection with putting its own appointees, Liberal supporters, on the board of directors, has put in jeopardy the investment of many pensioners and of other small investors and widows who invested in this corporation. The value of the shares has gone down. There has been interference by the government by virtue of its actions.
At the time this legislation was introduced, Mr. Benson, the then minister of finance and spokesman on behalf of the government, indicated that the Canada Development Corporation was "placed in the hands of a very independent board of directors because when social or political objectives intervene in business decisions, business judgment suffers". I ask the Prime Minister, in view of the fact that during the last election he stated that he wanted to convert the CDC into a PetroCan
May 27, 1981

mould as a tool of government policy, whether he now renounces that position and will allow the board of directors to operate independently and choose their own directors as an independent corporation?


Harvie Andre: Come on, be honest. Admit you have changed.


Pierre Elliott Trudeau: Madam Speaker, I think that is a preposterous suggestion that we put in jeopardy the investment of people because as major shareholders we want to have a say in the choice of the directors of a corporation and the choice of a chairman of a corporation. I repeat the challenge to the opposition. If they know of any shareholders in the private sector who, owning a majority of the shares of a company, are not interested or do not have a word to say in the choice of a chairman, I would like them to give some names today, tomorrow or the next day.


Harvie Andre: Are you going to interfere, or are you not going to interfere?


SUPPORT URGED FOR CORPORATION'S POLICIES
Ramon John Hnatyshyn: The fact of the matter, and the Prime Minister knows it, is that his action and the action of his government in attempting to interfere with the operation of this business are in fact, a political ploy and have seriously impeded the corporation.


An hon. Member:: Sell CDC. Sell your shares. [DOT]


Ramon John Hnatyshyn: He has caused a substantial loss. It is contrary to the principles involved, and the fact is that it is a reflection on the way in which the corporation has operated in the past.
I want to ask the Prime Minister whether he will give a commitment, on behalf of those representatives of himself and the government, that they will give a full vote of confidence and will continue to support the successful policies which Mr. Hampson and the board of directors have demonstrated, up to this point.


Mr. Lalonde:: We have appointed a board.


Pierre Elliott Trudeau: Quite honestly, Madam Speaker, I do not think the hon. member is qualified to say how a Crown corporation should be run, let alone the CDC.


Ramon John Hnatyshyn: It is not a Crown corporation.


Pierre Elliott Trudeau: We know from the hon. member that he tried to destroy Petro-Canada, so he obviously cannot have any understanding of the CDC.


Some hon. Members:: Hear, hear!
Oral Questions BANKS AND BANKING


PROFITS OF CHARTERED BANKS
Mr. Ray Skelly (Comox-Powell River):: Madam Speaker, I would have addressed my questions to the Prime Minister, but his grasp of economics and his answers have deteriorated since the people dealt with him previously in May of 1979. I direct my question to the Minister of State for Finance. There was notice today that bank profits for the second quarter of this year are holding a very strong and, I would suggest, outrageous position. The president of the Bank of Nova Scotia has indicated that the reason for this very strong earning position is basically the high interest rate policy of the government and the high spreads of interest rates. Given that the Minister of Finance has said that he would keep a close eye on this trend and could not operate on a single quarter, and that these profits are maintaining a high role, would the government be prepared to put a special tax on bank windfall profits?


Hon. Pierre Bussieres (Minister of State (Finance)):: The
question of bank profits has been raised a few times in the House and it has been linked as well to certain economic events. I would be tempted to give an example which 1 borrow from Plato. When Socrates would dip a stick into water and ask, "Is the stick straight?" people would answer, "No, it is bent since the water bends the stick." He would draw it out and say: "You were mistaken because you were looking at reality from too close a vantage point, the stick is really straight." 1 suggest the hon. member is making the same mistake. He is looking at reality from too close a vantage point, he lacks perspective to be able to judge the true profitability of banks. However, the Minister of Finance did indicate that he had asked his department to take a close look at the situation and that if abuses are uncovered he would take the necessary corrective measures.


REQUEST FOR REFERENCE TO STANDING COMMITTEE
Raymond John Skelly: Madam Speaker, if the point of the short story was that the Liberals then took the stick from Plato and jammed it up our nose, 1 think he is correct. The question would go a little further. Since it has been acknowledged by the banks that their strong earning position is coming from a very large spread in interest rates and the high interest rate policy of the government, since there has been a substantial and continuing profit, and since they put out a document of half truths and distortions, like Plato's stick, would the minister be prepared to recommend to the government that it refer the question of bank profits and this document to the committee on finance to examine the problem, if the government is unwilling to do anything about it?

May 27, 1981
Oral Questions


Pierre Bussières: Madam Speaker, a few days ago the Standing Committee on Finance, Trade and Economic Affairs had the opportunity of examining the estimates of the office of the Inspector General of Banks. The issue of bank profits was raised and I can only repeat to the hon. member that the close examination undertaken by the Minister of Finance will lead to certain measures if they are justified by the facts brought to his attention.


HAZARDOUS SUBSTANCES
Mr. Stanley Hudecki (Hamilton West):: Madam Speaker, my question is directed to the Minister of National Health and Welfare. As the minister is aware, there is an increasing amount of carefully researched medical evidence that marijuana, with its 60 psychoactive and biologically active chemical ingredients, is both physically and psychologically harmful. In particular, there is positive evidence that use of marijuana can and does produce brain dysfunction, significantly increases the risks of emphysema, chronic bronchitis, and lung cancer, and has a detrimental effect on hormone production. It is clear that these effects make the user dangerous, not only to himself or herself but to the community at large.


Madam Speaker:: Order, please.


Some hon. Members:: Hear, hear!


Madam Speaker:: We are just about ready for the question.


Stanley Hudecki: In light of the above health considerations, and in light of the mounting advocacy by some members in this House and the press at large-


Madam Speaker:: Order, please. Would the hon. member put his question?


Stanley Hudecki: -for the relaxation of the laws in regard to possession of marijuana, will the minister's department take equally aggressive action to warn and educate the people of this country by every means possible, of the-


Madam Speaker:: Order, please.


THE CONSTITUTION
Hon. Jake Epp (Provencher):: Madam Speaker, I should like to direct my question to the Minister of Justice. Twice this past week the minister stated that if the Supreme Court
declares that the federal government's constitutional package is illegal, the government will retaliate by applying the Constitution, in the minister's words, "to the letter", and will refuse to renegotiate federal-provincial agreements. Could the minister explain whether the government is threatening to withdraw its support from programs such as medical services and postsecondary education in Canada if the Supreme Court does not rule in its favour? Why does the minister make these idle threats-if they are idle-and why does he insist on attacking Canadians-old people, those who need medical help, and students who want to go to university?


Joseph Jacques Jean Chrétien: Madam Speaker, the answer is very simple. I just said that there are two options. One is to start again after 54 years of negotiations-


Some hon. Members:: Oh, oh!


Joseph Jacques Jean Chrétien: -to go back and renegotiate, or to do what the hon. member from Halifax was asking the Prime Minister to do last week on the offshore, when he asked why we do not refer the case to the Supreme Court and let the Supreme Court decide. This is a very valid option because we have a Constitution and it is the prime law of the land. To say, as Minister of Justice, that this act can be respected and judged by the Supreme Court of Canada, makes no threat. It is a correct interpretation of the legal situation.


GOVERNMENT'S ROLE IN FEDERAL-PROVINCIAL NEGOTIATIONS
Arthur Jacob (Jake) Epp: Madam Speaker, I should like to direct a question to the Right Hon. Prime Minister. In view of the statement that he made on May 1 namely, "- some gestures toward conciliation certainly would be welcome on everybody's part", can he tell the House whether this is the government's new form of conciliation? Was the Minister of Justice speaking on behalf of the government when he said that if the government did not have its way with the Constitution it would use threats on programs that have been established for a long period of time? Is this the new method that the Prime Minister is going to use in federal-provincial negotiations should he not get his way?


Pierre Elliott Trudeau: Madam Speaker, the hon. member is just showing that he did not listen to the answer given by the minister.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: It is very simple. We have been trying to change the Constitution by discussion over the past many years. We have always tried to seek agreement on modifications which were needed in the Constitution. We have tried to seek agreement on who would regulate and manage the offshore. This has been the procedure of this government. What the minister is saying is exactly what the hon. member's colleague from St. John's said a week ago-


John Carnell Crosbie: Not from St. John's.
May 27, 1981


Pierre Elliott Trudeau: -I am sorry, from Halifax-


John Carnell Crosbie: Right.


Pierre Elliott Trudeau: -said a week ago, "Why don't you refer the matter to the Supreme Court?" The Minister of Justice is saying that-if we cannot reach agreement with the provinces, it will be the Supreme Court which will have to decide where the law lies.


Miss MacDonald:: That is not what he said.


AIR SAFETY
John Raymond Ellis: Madam Speaker, I have a question for the Minister of Transport. In about 15 minutes the minister will table the report of the commission of inquiry into air safety. Would he give the House a commitment now that when he tables that report he will, at the same time, refer it to the Standing Committee on Transport for deliberation?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I have not tabled it yet so it is a bit difficult to anticipate. My answer at the moment would be simply to say that the report I am going to table is Volume I of what will be a three-volume report. I would not know exactly what to refer. My hon. friend would probably like me to refer the whole subject. That would not be possible because I have only received the first of three reports. Be that as it may, I would think that some legislative action will follow the first of the reports, and consequently I would hope that there would be some interesting material for the permanent committee on transport to work on in the fall.


John Raymond Ellis: Madam Speaker, if I may answer the minister's question, he can refer the first volume and the subject matter to the committee. Frankly, I think it is not good enough to wait until the fall. I ask the minister again if he will not refer the subject matter and Volume I to the Standing Committee on Transport, on which the government has a majority of members, so that it can deal with it in the next six or seven weeks before the recess and perhaps also through the summer. The subject matter is extremely important.


Jean-Luc Pepin: Madam Speaker, everyone recognizes the importance of the subject, indeed. As I said, the first volume will most probably lead to legislative action. I would think this would be quite sufficient for the committee. If, as I expect- Mr. Justice Dubin is in the gallery and we salute him en passant-the other two volumes are in by the fall, then reference to the committee of legislative action on part of it, with the totality of the information in front of us, would be a very constructive way to proceed.
Oral Questions


CANADIAN BROADCASTING CORPORATION
Mark Willson Rose: Madam Speaker, my question to the Minister of Communications concerns the CBC strike. NABET members are being told by their superiors that the federal government supports and endorses the CBC's determination to extend the practice of contracting out. Since the government is forever telling us, when questions are posed to it, that the CBC makes its own administrative decisions, may I ask if it is true that the government endorses contracting out at CBC?


Hon. Francis Fox (Secretary of State and Minister of Communications):: Madam Speaker, whenever there is a strike in the public service, as in the CBC, this is of course something that we deplore. We would like to see that strike settled as soon as possible. As far as the government is concerned, we would like to see the CBC produce a lot more Canadian programming. One of the ways suggested by CBC management is to have greater recourse to production through the private sector. In that sense, the government would like to see the CBC use its funds as effectively as possible to stimulate the development of a good Canadian program production industry.


PROGRESS OF NEGOTIATIONS TO END LABOUR DISPUTE
Mark Willson Rose: Madam Speaker, it appears to me that the minister's answer is yes. This party also supports more Canadian programming, but we do not support union busting. It looks to me as if that is exactly what has happened.


Some hon. Members:: Hear, hear!


Mark Willson Rose: NABET people are also being told by their superiors that the CBC can manage without their services until the end of the summer and that the corporation is not interested in a settlement until September. May I ask the minister if that is true and if the government agrees with it?


Francis Fox: Madam Speaker, the hon. member is obviously raising a most interesting question. I am somewhat surprised to see members of the Conservative party applauding, since the member for Vancouver Centre not too long ago criticized the CBC for not devoting enough of its budget to the independent program production centre. Be that as it may, the hon. member does not seem to be aware of the fact that the CBC in its negotiations with the union has undertaken to guarantee that there will be no loss of jobs, and that the number of programs presently produced in-house by the CBC will not be diminished.

May 27, 1981
Oral Questions


ENVIRONMENTAL AFFAIRS
Mr. Tom McMillan (Hillsborough):: Madam Speaker, my question is directed to the Minister of the Environment. A front-page article in the Washington Post yesterday revealed the contents of a secret internal report of the U.S. environmental protection agency, which concluded that the United States government should take little action against acid rain until further research is done. How does the minister reconcile such a position, taken by the major agency in the U.S. government responsible for the environment, with what the minister has been telling Parliament, namely, that the United States government is eager to work closely with Canada to combat acid rain in both countries?


Hon. John Roberts (Minister of State for Science and Technology and Minister of the Environment):: Madam Speaker, I am always a bit skeptical as to the accuracy of the contents of leaked material. As the hon. member knows, I have had meetings with the Secretary of the Interior of the United States who has spoken to us very strongly of his desire to move. The administration has indicated it intends to begin formal negotiations on the treaty in the third week of June. The environmental protection agency administrator was confirmed in office just a few days ago, so I have not yet had a chance to meet her, but I expect to do that very shortly.


POSSIBILITY OF LEGAL ACTION AGAINST UNITED STATES INDUSTRIES
Thomas Michael McMillan: The Minister of the Environment is practically the only person in all of North America who does not believe that Canada's negotiations with the Americans on acid rain are, in fact, in very deep trouble.
If the Canada-U.S. negotiations toward an accord on acid rain do not materialize, which seems to be the case, does the Canadian government have a contingency plan to deal with the problem? If so, what is that contingency plan? Does it include the possibility of the Canadian government actually taking legal steps against industries in the United States which pollute the Canadian environment?


John (Moody) Roberts: As I indicated, Madam Speaker, the administration is committed to beginning formal negotiations with us next month.


Flora Isabel MacDonald: When?


John (Moody) Roberts: In the third week of June. If the hon. member for Kingston and the Islands had listened to me yesterday and earlier today, she would have known that in the third week of June those negotiations are going to begin. I would hardly think it useful to assume immediately that these negotiations are going to fail and then describe what possible alternatives
we might have in that situation. We have a commitment from the U.S. administration, we intend to pursue it, and I am confident we will make progress next month.


CANADA DEVELOPMENT CORPORATION
Right Hon. Joe Clark (Leader of the Opposition):: Madam Speaker, I have some questions for the Prime Minister relating to the propriety of activities by governments under his leadership. The first relates to the Canada Development Corporation. The Prime Minister did not reply to the question put by my colleague from St. John's West. We would like a reply. First, we would like to know whether it is a fact that the deputy minister of finance went to Winnipeg and threatened the dismissal of members of the board of the Canada Development Corporation if they did not name the two Liberal nominees, Joel Bell and David Beatty. Second, we would like an undertaking from the Prime Minister that the whole question as to the future of the CDC and its treatment by this government will be referred to a committee of this House of Commons.


Pierre Elliott Trudeau: Madam Speaker, I answered the first question by saying that I did not know the answer but that I would inquire. I doubt very much if that is the case, but I will inquire.


John Carnell Crosbie: It is the case.


Pierre Elliott Trudeau: If the hon. member knows the answer, why does he ask?


John Carnell Crosbie: We want you to find out and confirm it. You are the Prime Minister.


Pierre Elliott Trudeau: Well, he can state his case, he has the floor every day in this House. He can make his case if he wants. I would say, so what?


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: There was a second question, Madam Speaker.


Charles Joseph Clark: The Prime Minister would probably say "so what" to the right of Parliament to inquire into the abuse of the Canada Development Corporation, just as he said "so what" to the idea of a deputy minister threatening members of the board of directors of the Canada Development Corporation.


Some hon. Members:: Hear, hear!


Charles Joseph Clark: Let this "so what" Prime Minister consult his memory, consult the record, and come back and answer the questions as to whether or not that threat was issued and
May 27, 1981

Oral Questions CONSUMER AFFAIRS
whether or not there will be a willingness to refer the matter to a committee of this House.


RESTRICTIVE TRADE PRACTICES
Charles Joseph Clark: I would now like to turn the Prime Minister's attention back some years, again on the question of the propriety of actions of his government, to the question and the time of the formation of the uranium cartel. The Prime Minister knows full well that there were diverse instruments available to the Government of Canada to protect the interests of Canadians at the time the cartel was formed. There was an instrument that was within the law, the establishment of a marketing board, and an instrument which was outside the law, the establishment of a cartel. Will the Prime Minister tell the House of Commons why a government he led chose an instrument outside the law, the formation of a cartel, rather than choosing an instrument inside the law, the establishment of a marketing board?


Pierre Elliott Trudeau: Madam Speaker, the right hon. member is begging the question. He states that the forming of an international agreement is outside the law. I would challenge him on that, and I would say that it is not.


Charles Joseph Clark: The Prime Minister is consistent in his refusal to respond today. We look forward to receiving the Bertrand report as to whether the matter is within the law.


QUERY RESPECTING EXISTENCE OF LEGAL OPINIONS
Charles Joseph Clark: Let me
go to another question that the Prime Minister did not answer when it was posed by my colleague from Cambridge, that is, whether there has been any commitment, opinion or undertaking by the Department of Justice or any other department or agency of the Government of Canada which would protect or shelter any Canadian company or any Canadian individual against prosecution for violation of the law of Canada in relation to matters covered by the uranium cartel.


Pierre Elliott Trudeau: Madam Speaker, I can only say I know of none, but I indicated that the whole purpose of the legislation was to protect Canadians from the application of the law of the United States. Returning to the earlier question, I ask the hon. member does he know what law would prevent Canada from entering into an international agreement on trade? There is obviously no such law. He knows that. He is just trying to mount a case against the government, spuriously, as he always does.


INSPECTION OF RETAIL SCALES-LACK OF DEPARTMENTAL MANPOWER
Mr. Geoff Scott (Hamilton-Wentworth):: Madam Speaker, my question is for the Minister of Consumer and Corporate Affairs, but in his absence I will direct it to the acting minister, whomever he or she is. The government will know that a senior official in the weights and measures branch of the Department of Consumer and Corporate Affairs has publicly stated that federal inspection of retail scales has been carried out on only half of the 600,000 measuring devices in the country in the past year because of the tremendous workload and understaffing. Will the consumer and corporate affairs ministry consider reallocating its existing resources to enable the weights and measures branch to increase the number of inspectors so that retail scales may be more efficiently regulated, and so that consumers will run the least possible risk of rip-offs?


Mr. Gary F. McCauley (Parliamentary Secretary to Minister of Consumer and Corporate Affairs and Postmaster General):: Madam Speaker, I thank the hon. member for his question and his concern. I want to assure him that the government is always reviewing the nature and adequacy of its weights and measures program in terms of problems in the marketplace, as the hon. member indicated. Of late, as he can well imagine, technological change has been presenting additional challenges. Solutions being employed at the present time include changes in inspection techniques and strategies, and also include assessment of resource needs. He can be assured that the government will continue to take appropriate action to ensure that Canadian buyers and sellers benefit from accurate measurements.


ACCURACY OF SCALES CONVERTED TO METRIC MEASUREMENT
Geoffrey Douglas Scott: Madam Speaker, I can imagine that the words technological change largely mean conversion of scales to metric. That will mean that the weights and measures branch will have a very real and even more desperate need for manpower. What assurances can the Ministry of Consumer and Corporate Affairs give this House and the consumers of Canada that these scales that are being converted to metric will indeed be checked for their accuracy, as Canadians may run the very real risk of some businesses accidentally or deliberately cheating people as we are being forced to understand metric measurement?


Gary Francis McCauley: In reply to the hon. member, Madam Speaker, I would tell him categorically that we will take every precaution to see that the consumers of Canada are given a fair shake when this change takes place.

May 27, 1981
Oral Questions


RESTRICTIVE TRADE PRACTICES
Hon. Walter Baker (Nepean-Carleton):: Madam Speaker, my question to the Prime Minister is supplementary to questions asked earlier with respect to the cartel. The Prime Minister has given an opinion to the House of Commons that a cartel is not illegal. That is his opinion. If he is not giving that opinion, there remains a question outstanding in the Prime Minister's mind in respect of the legality of a cartel. The Bertrand report obviously deals with a cartel and the question of illegality. In view of what has occurred today, and in view of the position in which the House now finds itself, will the Prime Minister undertake immediately the release of the Bertrand report, because it obviously has some effect upon the combines law of Canada, one way or another, and I think it is time the House had that matter before it as quickly as possible.


Erik Nielsen: You promised to do it.


Pierre Elliott Trudeau: Madam Speaker, I must clear up the confusion in the hon. member's mind. I did not say a cartel was not illegal.


An hon. Member:: It is not illegal?


Pierre Elliott Trudeau: I said that an international agreement entered into by Canada and other countries relative to trade, is not illegal. That is what I said and it is as simple as that. I do not see why the hon. member is attempting to distort my words.


An hon. Member:: With a domestic implication?


Pierre Elliott Trudeau: He asks about the report. I would point out to him that under the law, as voted by this Parliament, these inquiries must be conducted in secret, and Section 27 makes it quite clear that it is then, after being conducted in secret, handed to the Attorney General of Canada for a judgment by the Attorney General as to whether there are any illegalities in the report. If there are, the matter ends up in front of the courts, and then the matter becomes public. It is as simple as that.


Walter David Baker: Madam Speaker, I think the Prime Minister and the government have suddenly changed their position. On March 4, 1981, the minister said in answer to a question in the House of Commons, as reported at page 7878 of Hansard:
In relation to the second question of the hon. member regarding the uranium inquiry, this inquiry by the director is not completed. Obviously, when it has been completed, his findings will be made public.
It would be made available by the government, of course, which follows from that implication, and not as a result of court action. Will the Prime Minister live up to that undertaking by his minister, and will he tell us, however this is described, as an international agreement, a cartel or however, how such an agreement which has domestic implications, which has to be so in order to contravene the combines act,
could possibly be legal, and given the questions that arise therefrom will the Prime Minister reconsider this change in the position on the part of his government?


Pierre Elliott Trudeau: Madam Speaker, again I will attempt to clarify the situation. An international agreement made between various countries on restraining trade is not illegal in Canada. Once again I challenge any lawyer to tell me the contrary. After that agreement is set up it is possible that the people who operate under that agreement-


John Carnell Crosbie: Oh, blame them now.


Pierre Elliott Trudeau: Blame them? Will the member suggest who we are going to blame, the government of France or the government of South Africa?


John Carnell Crosbie: The Government of Canada.


Pierre Elliott Trudeau: I do not know what he is driving at.


An hon. Member:: Answer the question.


Pierre Elliott Trudeau: Madam Speaker, I cannot answer all the questions at the same time. If I have one at a time I will answer them.


PRIVILEGE
John Carnell Crosbie: Madam Speaker, this question of privilege has to do with a letter that was sent by the Minister of Employment and Immigration (Mr. Axworthy) to the member of Parliament for Gander-Twillin-gate (Mr. Baker), which letter subsequently came into my possession and the possession of other members of this House. It involves a written misleading and false reply contained in that letter. I have to give Your Honour some background first.
Last summer of 1980 the government announced the Canada community development projects program for 198081. The total funding for that program for all of Canada was $105.5 million. The amount of the funding for the province of Newfoundland was $17,376 million and the funding was supposed to be spent in accordance with the level of unemployment in various areas of Canada.
Under that program the deadline for projects to be submitted if they were to receive approval for funding was September 29, 1980. If you put in an application from any district of the country after that date, under the guidelines sent out by the minister and his department it could not be considered for funding after that date. I will come back to the importance of that date in a few moments. As a matter of fact, I know of projects that were submitted two days after September 29, 1980 which the minister's office rejected and said could not be processed because they were late and outside the guidelines.

May 27, 1981

It was also part of the guidelines for the program that projects had to start by February 2, 1981. The guidelines were sent to every member of Parliament and widely publicized across the whole country.
During October, 1980, in Newfoundland the provincial boy scouts' council requested the seven members of Parliament for Newfoundland to allocate some of the funds for their districts to a project for the boy scouts that was going to be constructed in the district of Gander-Twillingate. The basis of their appeal was that this facility would benefit boy scouts all over Newfoundland and they needed the help of the MPs from all over Newfoundland to fund that project.
As a result I, the hon. member for St. John's East (Mr. McGrath), the hon. member for Bonavista-Trinity-Conception (Mr. Rooney), the hon. member for Burin-St. George's (Mr. Simmons) and the minister for Grand Falls-White Bay-Labrador (Mr. Rompkey) agreed to allocate $25,000 each from funds allocated to their districts to build this project in the district of the hon. member for Gander-Twillingate. The project was a project of the provincial boy scouts council.
On October 23, for example, I received a letter from the hon. member for Gander-Twillingate thanking me for that co-operation. One Newfoundland member did not contribute, the hon. member for Humber-Port au Port-St. Barbe (Mr. Tobin).
In the fall or early winter of 1981 $2 million in additional funds were made available to the minister to spend on this program in whatever way he liked, in whatever political way he wished. A few weeks later, in February 1981, a further $4.9 million was made available secretly by the government to the minister to spend across Canada on these projects.


Madam Speaker:: Order, please. I want to ask the hon. member to please come very soon to the matter which is the basis of his question of privilege. He is giving me a lot of information about what those guidelines were. I do not know for what reason he is referring to them. I do not know yet why the guidelines are important or why it is important to read them out to the House. I would ask him to come very soon to the matter of the question of privilege, otherwise I will interrupt him.


John Carnell Crosbie: Madam Speaker, the relevance of all this will very soon become apparent.
There was $4.9 million made available, unknown to ordinary Canadians and members, in additional funding for this program for the minister to spend at his discretion. The minister decided to allocate $275,000 of that funding for the province of Newfoundland. Now I am coming to the relevancy and you will see that all this is relevant, Madam Speaker.
The hon. member for Gander-Twillingate apparently did not hear of any money being made available for his district, so he wrote the Minister of Employment and Immigration on February 26 asking whether additional funds were to be allocated to Gander-Twillingate under this program. The minister answered him in a letter dated April 14, 1981. In the mean-
Privilege-Mr. Crosbie
time, of the $275,000 allocated for Newfoundland the minister made $150,000 available to the district of Grand Falls-White Bay-Labrador for a 1982 Winter Games Association, Incor-prated project 2855 MA9 submitted by the people of Labrador City-Wabush and signed by one Gordon Manstan. The application from that group was dated February 5, 1981. It was received by the department February 23, 1981, five months late-five months after the deadline for that project. Despite violating all these guidelines the Minister of Employment and Immigration allocated $150,000 to his colleague the Minister of National Revenue, for a project that did not meet the guidelines of the program at all. It may be a good project, but it should be funded from sports and recreation, or wherever, not in violation of the employment program.
In this letter, and I have a copy in my hand now, from the Minister of Employment and Immigration (Mr. Axworthy) to his Liberal colleague, the hon. member for Gander-Twillingate (Mr. Baker), he is responding to a letter of February 26. He tells him that his constituency received an allocation of $3 million originally, and then he goes on to say this in the third paragraph:
Federal constituencies in Newfoundland received $275,000 of the incremental funds which were distributed amongst the five constituencies which had transferred a portion of their initial allocations to your constituency.
There is not a word of truth in that paragraph because in the district of St. John's West not one cent was received of the $275,000 incremental funds to repay St. John's West for the contribution of $25,000 to the member of Parliament for Gander-Twillingate's boy scouts project. Not a cent of those funds went to the district represented in this House by the hon. member for St. John's East (Mr. McGrath). Whether any of the other three districts got anything, I do not know, and no funding went to Gander-Twillingate. So, Madam Speaker-


Madam Speaker:: Order, please. Can the hon. member confirm something for me? I suspect he is now telling me that the basis of his question of privilege is that some members did not receive funds to which they felt they would be entitled or that funds were allocated while not following the guidelines which had been set forward by the minister. Is that what the hon. member's question of privilege is all about?


John Carnell Crosbie: No, Madam Speaker, it is not about that at all. My question of privilege has to do with a letter sent by a minister to a member of Parliament which contains false and misleading information and which, therefore, interfered with and breached his privileges as a member of this House, breached the privileges of this House generally and that of every other member who was sent a copy of the letter. It has no connection with the violating of the guidelines of the program.
I am giving the background so that this letter can be understood, and this is based on a precedent of this House to which I will come in a few minutes and in which a prima facie case of privilege was found by Mr. Speaker Jerome in 1978.

May 27, 1981
Privilege-Mr. Crosbie
Just to finish this background, how did the hon. member for St. John's West get a copy of this letter containing false and misleading information from the Minister of Employment and Immigration? A copy was sent to me by the hon. member for Gander-Twillingate with a note dated April 16 which reads as follows:
John,
As you can see by the attached letter your constituency received an additional amount of money to compensate for your constituency contribution to the boy scout camp.
Congratulations!
The hon. member was congratulating me for receiving this additional funding. He was pleased to see that I got this additional funding for making $25,000 available to the district of Gander-Twillingate during the fall.
What is the nature of the complaint? The outline of the facts here shows, of course, that the program was violated. The guidelines were ignored by one cabinet minister listening to a supplication from another cabinet minister. Dozens of projects were turned down as being late. Five months later one was allowed, and $150,000 went to it, although it did not meet the guidelines of the program at all. That was to the detriment of many dozens of other projects submitted in Grand Falls-White Bay-Labrador and all over Newfoundland, but that is not the complaint. The complaint is that the minister, having done that, wrote a letter to a member of Parliament, a colleague of his in his own party, and deliberately gave him wrong information.


An hon. Member:: False information.


John Carnell Crosbie: False information. In other words, he was saying to the member of Parliament for Gander-Twillingate, "You didn't get any of this $275,000 because I took that $275,000 for Newfoundland and repaid the five districts that helped you out in your boy scouts project." That is what the program means. We have two members in this House who can testify to the falseness of that information, and the minister had to know it was false.
What about the precedents? I have a motion here that I am ready to move. I am fully aware that the function of the Speaker is to decide whether there is a prima facie case of privilege or not, and if she finds that, the matter then has to be debated and voted on by the House.
I want to refer Your Honour to a recent precedent. If you look at Hansard for November 3, 1978 at page 111, you will see a similar kind of complaint made by the hon. member for Durham-Northumberland (Mr. Lawrence). There was a letter from a minister of the Crown which misled the hon. member for Durham-Northumberland several years earlier. It was not even in the same year; it was in a different Parliament. The minister of the Crown had sent him a letter with misleading and false information and, in turn, the hon. member for that district had misled his constituent. There was a written misleading and false reply sent to that member which directly affected his capabilities and attitudes in the House with respect to his duties as a member of Parliament.
This program is one of the more important programs, I can assure you, in Atlantic Canada where employment is very, very badly needed and where there are thousands and thousands of projects put forward by communities and groups. Nothing could be more important in creating employment in our rural areas. Yet we were given misleading and false replies by the minister as to how the funds were being spent.
As it was said then, and I repeat now, I should be able as a member of Parliament, as should the hon. member for Gander-Twillingate, both in and out of this House, to trust the word of a minister of the Crown. Surely if a minister writes us a letter stating that certain things have happened and that certain funds have been distributed in a certain way, we are expected to trust his word as a member of Parliament and minister of the Crown. If we cannot trust his word, the whole system collapses. That is what affects the privileges of this House and members of Parliament. We should be able to trust the word of such members.
I will not read long citations from May. I presume Your Honour will be looking them up because this is a very serious question of privilege. The nineteenth edition of May at page 67 deals with what constitutes privilege:
The distinctive mark of a privilege is its ancillary character. The privileges of Parliament are rights which are "absolutely necessary for the due execution of its powers". They are enjoyed by individual members, because the House cannot perform its functions without unimpeded use of the services of its members; and by each House for the protection of its members and the vindication of its own authority and dignity.
We as members need to be protected from any suggestion or any possibility that other members of this House or ministers of the Crown will deliberately mislead us. If we do not have that kind of assurance and if we cannot be absolutely sure of that, then this whole system of Parliament founders.
I want to refer Your Honour to page 141, which deals with acts or conduct constituting a contempt of Parliament and an abuse of our rights:
It is a breach of privilege to present or cause to be presented to either House or to committees of either House forged, falsified or fabricated documents with intent to deceive such House or committees or to subscribe the names of other persons or fictitious names to documents-


Madam Speaker:: Order, please. I believe those quotations are not very relevant. I ask the hon. member to concentrate his argument on something else. When he quotes May, he is speaking of conduct of ministers or statements of ministers which would impede members in the House. Up until now the hon. member has spoken of nothing that happened in the House, but of a letter which was written to another member of Parliament in which some information, the hon. member alleges, was false. Up until now the hon. member has not indicated to me how his function in the House has been impeded by the fact that a particular letter was written.


John Carnell Crosbie: Madam Speaker, if I might just make one further point, how have my actions in the House been impeded as a result of receiving this false information? Every member of this House is involved in carrying out, supervision of and checking upon public programs. This is a public program that
May 27, 1981

took place in Newfoundland. I have the right to come here to this House and criticize how the program is administered. I have the right to go to committees on the estimates and to ask questions on how it is being administered and whether it meets the guidelines.


Madam Speaker:: Yes, the hon. member has that right, and that is what he should do, but he should not raise a question of privilege about it. Of course the hon. member has the right to criticize actions of ministers or the government and to ask questions about what a particular minister has done, about which the hon. member might have a grievance. I have heard the hon. member for more than 15 minutes and I must interrupt him now, because if he has not proved to me in the course of 15 minutes that he has a question of privilege, I do not think he will be able to do so in the next five minutes.
The letter and the precedent to which he alludes are quite different. That precedent has to do with a letter which had been improperly drafted by the RCMP and which they admitted had been improperly drafted, and which probably allegedly impeded the hon. member for Durham-Northumberland (Mr. Lawrence) in performing his duties in the House. So that precedent does not apply; it is a completely different type of letter.
The hon. member probably has a grievance, he wants to levy some kind of criticism of the minister in question and he is quite entitled to do that, but not under the guise of a question of privilege. I must therefore rule that he does not have a prima facie case of privilege.


John Carnell Crosbie: There is a precedent of your predecessor but I am not even allowed to quote the precedent?


Madam Speaker:: Order, please.


John Carnell Crosbie: A minister can lie to a member of Parliament and it is not a question of privilege?


An hon. Member:: Order.


John Carnell Crosbie: Order yourself.


Madam Speaker:: Order, please. The hon. member has quoted a precedent, the contents of which have been communicated to me by the Table. I said the precedent was not applicable and 1 do not think the hon. member can contest that. In any event, in the course of his more than 15-minute intervention he has not indicated to me that he had a prima facie case. I have now ruled on that and I am afraid that I will not be able to hear the hon. member further.


John Carnell Crosbie: I rise on a point of order.


Madam Speaker:: Order, please.


John Carnell Crosbie: On a point of order.
Privilege-Mr. Crosbie


Madam Speaker:: Just before I hear the hon. member's point of order. I just want to warn him that he cannot now transform his question of privilege into a point of order, because I will not hear him. If he has another point of order and it does not refer to my ruling, I will hear him.


John Carnell Crosbie: Madam Speaker, my point of order refers to the fact that when a similar question of privilege was raised in 1978 the member was given a good 30 to 40 minutes to explain and cite the precedents.


Madam Speaker:: Order, please.


John Carnell Crosbie: That was a question of privilege on exactly the same point.


Madam Speaker:: Order, please. That might be true, and in some cases I have allowed longer interventions on questions of privilege feeling that I needed further information; but in the course of the hon. member's 15 minutes, and after my repeated requests to the hon. member to be more precise on what exactly was the basis of his question of privilege, he did not come up with anything that convinced me there was a question of privilege. Therefore, I must tell him that I can hear him no further on that particular question of privilege.


John Carnell Crosbie: The judgments of your predecessor do not matter to you.


Hon. James A. McGrath (St. John's East):: Madam Speaker, on a point of order, perhaps you could assist me because I am involved in the same question of privilege and I had hoped to be able to make an intervention, to-be able to give arguments in support of the arguments put forward by my colleague, the hon. member for St. John's West (Mr. Crosbie). I think it is an important matter, but obviously I am not permitted to present that argument now because Your Honour has in fact ruled. How can I then raise it? Do I raise it as a grievance or as a-


Madam Speaker:: Order, please. I have ruled on it. I have ruled that there is not-


John Carnell Crosbie: The minister is a liar, a damned liar.


Madam Speaker:: -a prima facie case of privilege. The hon. member did say that he wanted to speak on the same question of privilege. I have ruled that there is no question of privilege. If the hon. member had another question of privilege not related to that one, I can hear him at another time but not today. I have ruled on it and I cannot hear the hon. member.


Hon. William Rompkey (Minister of National Revenue):: Madam Speaker-


Madam Speaker:: I am sorry, is this a point of order?


Bill Rompkey: On a point of order, Madam Speaker. My question is really the same as that of the hon. member for St. John's East (Mr. McGrath). I had also hoped to make an intervention on the same question of privilege-

May 27, 1981
Privilege-Mr. McKinnon


Madam Speaker:: Yes, but the hon. minister, I am afraid, is out of order as well.


MR. McKINNON-ALLEGED ATTEMPT TO ALTER RECORD OF COMMITTEE PROCEEDINGS
Hon. Allan B. McKinnon (Victoria):: Madam Speaker, my question of privilege, I am thankful to say, is not on the same point although the similarity of what I am complaining about will be clear.
1 delivered this morning to your office, Madam Speaker, a statement of my question of privilege and I intend now to speak to you and the House on it in order to enlarge somewhat on my question of privilege. It involves an attempt to change the wording in the minutes that reflect what happened in the Standing Committee on External Affairs and National Defence.
At a meeting of that committee on May 14, the Minister of National Defence (Mr. Lamontagne) gave an opening statement of which he appeared to be reading part and ad libbing part. He did not circulate a copy of the text from which he was reading although he did at a later meeting circulate a copy of a NATO press release.


Madam Speaker:: Order, please. I am very sorry but the hon. member's question of privilege relates to deliberations which took place in a standing committee. The hon. member knows that deliberations taking place there cannot be dealt with in the House until such time as the committee reports back to the House. Therefore, I am afraid I have to advise him that the place to deal with his particular question of privilege would be in the standing committee and not in the House.


Allan Bruce McKinnon: There are two points I would like to make on that, Madam Speaker. First, I know of no method whereby the chairman of the standing committee could refer the matter to the Standing Committee on Privileges and Elections. Second, part of the offence did take place in this House on May 20 when the minister misled the House during part of the same nefarious conduct that I am complaining about. I was hindered in my duties as a member of Parliament by a misleading and untrue statement that he made in the first part of his answer to my first question that day.
Now, if I may proceed, Madam Speaker? When speaking of possible NATO commitments outside of the recognized NATO boundaries, the minister said:
Canada has made a new commitment to deploy its NATO forces outside the normal NATO treaty area.
I was rather surprised and said that I hoped the minutes of the committee would reflect his ad libs as well as his written statement. On May 15 the unedited transcript of the minutes were sent to my office and it confirmed the remarks that I heard, which were:
Canada has made a new commitment to deploy its NATO forces outside the normal NATO treaty area.
In the second meeting of the same committee the minister, in reply to questions from two Liberal MPs, said there was no
new commitment. 1 assume that he was contradicting himself as he sometimes does. He made no comment that his remarks of May 14 were in error.


Madam Speaker:: I must warn the hon. member that I can only listen to what happened in the House. It is quite clear to me that the hon. member is referring to an incident in the standing committee. It is true that the matter came back in the House on May 20, and I now have in front of me the answer given by the minister in the House. Therefore, the hon. member is discussing that aspect of the question he is raising now; but if he has a question of privilege arising from the deliberations of that day, that is to say May 20, that was the time to raise it. Furthermore, if he is not satisfied with an answer that a minister has given in the House, no matter in what way he is not satisfied, it does not constitute a question of privilege.


Allan Bruce McKinnon: Madam Speaker, I thank you for your advice, which I will try to follow and restrict myself to what happened on May 20. I will ignore from now on my allegation and contention that he has tampered with the record of the proceedings in a committee, which he certainly has done. As he said at that time-


Madam Speaker:: Order, please. If the hon. member alleges that some minister has tampered with the proceedings of a committee, as he is now doing, that he must do in the committee. Now, the hon. member asks how that can be dealt with because that committee does not have the authority to refer the matter to another standing committee.
The procedure would be that if the standing committee found the minister had tampered-allegedly tampered-or had done whatever the hon. member says he has done, the committee would report such action to the House. Then the House would be able to deal with it by referring it to another committee in order for the committee to pronounce on that particular action. This would be the procedure, and this is the way to deal with that kind of matter.
If the hon. member can state his case without arguing that he is not satisfied with the answer given the House, I can hear him.


Allan Bruce McKinnon: fered with my privileges. I spent hours on this during the rest of the week. I was hindered in that question period by following up with the question I had intended to raise, and I was impeded in my duties as a member of Parliament for several days afterward trying to track down actually what the minister had said.


Some hon. Members:: Hear, hear!


Allan Bruce McKinnon: In view of that and the curtailment Your Honour put on the rest of my point, which I will defer, as you suggested, to the committee, I would like to move, subject to Your Honour finding there has been a prima facie case in this instance of the minister's misleading myself and the House, that it be referred to the Standing Committee on Privileges and Elections for an investigation and a recommendation.


Madam Speaker:: The hon. member would like me to be the
judge-


Erik Nielsen: A member wants to be heard.


Mr. Chas L. Caccia (Davenport):: Madam Speaker, I would like to intervene along the lines you have suggested on this question of privilege to submit that there is no question of privilege as far as the House of Commons is concerned. As far as the committee is concerned, we debated this matter yesterday and we will do it again.
In the House of Commons, as the hon. member quite correctly quoted, the minister said that he had made no new commitment. This is consistent with the quotation he read and with what the minister said in the House. Therefore, I submit that there is no question of privilege; there is no contradiction. The minister said in the House what the member just repeated by reading from the transcript. Therefore, there is no discrepancy in the statement made by the minister in the House.


Walter David Baker: Madam Speaker, 1 happen to know that you have in front of you a very complete treatment of this matter by the hon. member for Victoria (Mr. McKinnon). It amounts to a three-page letter of notice which alleges a number of things. Among them is what the hon. member has attempted to allege about something which occurred in the committee that Your Honour has said strictly and narrowly cannot be dealt with in the House. Also there is an allegation of something that occurred in the House of Commons to which he has been able to speak. This indicates clearly, whether or not he knew it or for whatever reason, that the House and the hon. member was misled by the answer of the Minister of National Defence (Mr. Lamontagne). Those are the two things Your Honour has.
The third thing you have in that letter is a sense of concern that ought to be in the minds of every hon. member and ought to carry beyond the mere technicalities of narrow questions of privilege. One privilege we are supposed to enjoy in the House is some assurance that there will never be an attempt to tamper with the records of the House of Commons, which includes the records of the committees of the House.


Some hon. Members:: Hear, hear!
Privilege-Mr. McKinnon


Walter David Baker: I have read the letter submitted by the hon. member for Victoria (Mr. McKinnon) who, by the way, has listened to the tape. It is a matter of some concern to me as a member of the House of Commons that this should be confined merely to the narrow question of privilege as to whether it occurred in the committee or in the House of Commons. We are talking about the integrity of the record-keeping of the House of Commons, which I think ought to involve the concerns of everyone. It is the integrity of that, not with respect to those who operate the system, but with respect to what is contained in there about attempts to change the minds or the view respecting the operation of the system.
That is why I think, in this case particularly, that when the hon. member for Victoria has submitted such a very elaborate submission to Your Honour, it goes far beyond that mere point and involves the privileges of all hon. members of the House of Commons. I say with respect that elaborate submission ought not to stand in the way of the oral argument which may be necessary to encompass and develop the case.


Madam Speaker:: The hon. member for Victoria had a chance to discuss that aspect of what he felt was a question of privilege which took place in the House. I reiterate that the other aspect of it has to be dealt with in committee. I urge the hon. member to clarify this matter in the committee.
What I want to say about what happened in the House is that the hon. member is asking me to be the judge of the veracity of any statement made by the minister, its veracity or compatibility with whatever he said in another place. Obviously that is not the role of the Chair and the Chair cannot determine on such a basis that there is a question of privilege.
The hon. member has a place where he can seek redress for his complaint, and that is in the standing committee. As for what happened in the House, I cannot determine whether an hon. member has made a statement which was true or untrue. The only thing upon which I could rule is if the hon. member stated that the minister had deliberately misled the House by saying one thing or the other, and that he has not mentioned. On that basis I am afraid I must rule that the question must be dealt with somewhere else.
As to what happened in the House on May 20, that ought to have been raised immediately at the time it happened. 1 find that there is no question of privilege on this particular statement of the minister.


Bill Rompkey: Madam Speaker, the hon. member for St. John's West (Mr. Crosbie) put certain allegations on the record with regard to my riding. It is the duty of a member of the House to promote his riding, to defend and to speak for his riding. It seems to me he has the privilege of straightening the record as to certain facts. If not, I would ask Your Honour how I could correct the record within the confines of the House. Also I would ask for time to straighten the record with regard to the comments of the hon. member for St. John's West.

May 27, 1981
Privilege-Mr. Cossitt


Madam Speaker:: I am sure the hon. minister will find many occasions to straighten the record. I try to keep questions of privilege fairly short; I do not want to allow too many interventions. I ruled on that question of privilege. I know the hon. minister wanted to speak on it, but I did not allow it. Therefore, I ask him to seek other occasions-and I know he can find them-to straighten the record.


Hon. Stanley Knowles (Winnipeg North Centre):: Madam Speaker, 1 rise on a point of order in the hope that by doing so we can avoid a hassle tomorrow about any changes in the record. As Your Honour will recall, during the question period all of us heard the Prime Minister (Mr. Trudeau) say quite clearly that when interest rates go up the government blames the opposition.


Arthur Jacob (Jake) Epp: That is right.


Stanley Howard Knowles: It may have been a "tingue-twuster". Perhaps care should be taken, since if that sentence in Hansard is changed we will spend another half hour on questions of privilege tomorrow. I do not think it will hurt the Prime Minister for the record to be printed in the way he actually said it.


Madam Speaker:: We will have to see about that tomorrow.


PRIVILEGE
Mr. Tom Cossitt (Leeds-Grenviile):: Madam Speaker, my question of privilege arises from an incident which occurred at approximately 6.35 p.m. last evening when my wife and I were leaving the Centre Block of the Parliament Buildings to proceed along our direct and usual way in exiting from Parliament Hill. My wife was driving our vehicle, which clearly bore House of Commons special licence plates as issued by the province of Ontario with the customary prefix MHC. I was sitting in the front of the car on the passenger side.
Before proceeding further, I would like emphatically to state that nothing I intend to say, or will say, is meant to detract from what I am sure we all agree are the very necessary stringent security regulations protecting the Prime Minister (Mr. Trudeau), particularly in light of the recent incidents involving President Reagan in the United States and His Holiness Pope Jean Paul II in Rome. Also, before proceeding further may I say to you, Madam Speaker, that I realize the hon. member for Annapolis Valley-Hants (Mr. Nowlan) raised a question of privilege a few days ago on which you gave a ruling yesterday. I hope I will have the opportunity to
illustrate that my question of privilege is sufficiently different from the one raised by the hon. member for Annapolis Valley-Hants and that it cannot be said that I am speaking on something about which you have already ruled.
I would now like to return to the incident in question. As we were signalling a left turn to proceed toward the members' entrance of the Centre Block, with the intention of proceeding down the hill to Wellington Street, an RCMP constable somewhat frantically rushed out from our left and ordered my wife to come to a full stop and then to turn around and proceed in the opposite direction at once. I got out of the car and asked the officer what this was all about. He replied, "I cannot tell you, just move at once; 1 have my orders". I then identified myself as a member of Parliament travelling with my wife-


An hon. Member:: You are a Canadian like anyone else.


Thomas Charles Cossitt: I am a Canadian like what, did you say? If hon. members opposite will stop their silly shenanigans, I might be able to proceed.


Mr. Cousineau:: Stop yours and we will stop ours.


Thomas Charles Cossitt: I am telling you, Madam Speaker, they started them when they started as a party and they will continue them until they cease to exist as a party, which may be sooner than they like to think.
To get on with my question of privilege, Madam Speaker, having identified myself as a member of Parliament travelling with my wife I offered identification and again demanded to know why my exit was being impeded from the Hill. Again I drew attention to my MHC licence plate as identification and offered to produce my House of Commons identification. The RCMP constable replied, "I am not permitted to answer your questions. How do I know you are really an MP? Move out."


Some hon. Members:: Shame!


René Cousineau: And thus the hon. member was prevented from carrying out his duties.


Thomas Charles Cossitt: I told him I had a right to an explanation and that I had absolutely no intention of moving until I was given one. I asked him-


Madam Speaker:: Order, please. The hon. member does have the right to an explanation in this particular case. He must tell the Chair how he was impeded in the performance of his duties as a member of this House because of this incident. I understand he was leaving the House, but there might be some catch to that-


An hon. Member:: You have jurisdiction over them.


Madam Speaker:: The Speaker has no jurisdiction over the grounds, the RCMP has. However, I want the hon. member to concentrate on telling me how this particular action impeded

.


May 27, 1981

him in the performance of his duties as a member of Parliament in this House since he did raise another question of privilege.


Thomas Charles Cossitt: Madam Speaker, when I finish outlining the incident, 1 believe that will become apparent. I am approaching the crucial point of the incident.
1 asked the RCMP constable if there was something wrong here. I asked, "Has there been an accident? Is someone coming out of the members' door?" I asked him if no member was allowed to go in that door. He replied, "I have orders. I am not allowed to say whether anyone is coming or going at that door. Hurry up and move."
It was at this point that I noticed that the Prime Minister of Canada (Mr. Trudeau) was standing on the sidewalk adjacent to the members' entrance along with the Minister of Justice (Mr. Chretien). I observed that everything on the Hill had been brought to a complete standstill by the police, including the stoppage of the House of Commons buses which were proceeding to the Hill. I cannot prove this, but I would presume that the buses carried members of Parliament who were proceeding to the Hill to perform their duties as members of Parliament. Of course, the public were stopped as well.
The Prime Minister and the Minister of Justice were obviously not engaged in a serious conversation but in a conversation which could have waited until later. By his actions the Prime Minister was holding up the entrance to-and I emphasize that point-and exit from the building. He was guffawing and giggling and the Minister of Justice was also doing a good job of guffawing and giggling. I feel that if the Prime Minister requires security, and I agree that he does, he should not take advantage of that security by tying up all of Parliament Hill for the purpose of giggling and guffawing and holding up everyone else who has plans, as members, to come into the building to carry out their functions in the House or to attend committee meetings, etc., or even to leave the buildings to speak at a function, as we are obligated to do as part of our duty as members of Parliament.
I contend that the Prime Minister, not the RCMP-I do not fault the RCMP for this at all since I feel they were carrying out their orders-was misusing his office and the security which has been and should be afforded to him in a way which was actually impeding the work of any number of members of Parliament. While I saw some members in the area, I am not sure how many there were at that particular time. I did not actually go around to the buses to see how many members of Parliament were on them.
This was a disgusting and disgraceful display. If it is still going on, and I have no reason to believe that it is not, I believe it should be fully investigated and that it should stop. If the Prime Minister wants to leave the Hill with protection, why does he not simply go to his car and leave instead of standing around and impeding the duties of members of Parliament? That is what he was doing and there is no question about it.
Privilege-Mr. Cossitt


Marc Lalonde: Use another door.


Thomas Charles Cossitt: You over there are impossible.
In conclusion, Madam Speaker, I feel that the Prime Minister of Canada was, in effect, impeding the ability of members of this House to perform their duties as members. I would not criticize the right hon. gentleman if it was something crucial which required him to be where he was. The silly part of it is that he was simply giggling and guffawing and making jokes on the sidewalk. He caused everything to come to a standstill. I think it is a disgrace.
If you do find that I have a question of privilege, Madam Speaker, I would like to reserve my right to move the appropriate motion.


REQUEST FOR CLARIFICATION RESPECTING APPOINTMENT OF RCMP DEPUTY COMMISSIONER
Thomas Charles Cossitt: Madam Speaker, I do have one other point. It may be that you would prefer me to raise this point subsequently, since it is not absolutely connected with my previous point. My point concerns a very important question of security in this building. I will raise the matter now if you wish. It will take approximately 60 seconds or so.


Madam Speaker:: If the hon. member promises to make his point in 60 seconds I will hear him now.


Thomas Charles Cossitt: Madam Speaker, I rise to ask if the Chair would clarify for the benefit of all members of this House that the deputy commissioner of criminal operations of the Royal Canadian Mounted Police, J. R. R. Quintal, has been, in effect, appointed-I have not heard it announced so I presume he was secretly appointed-director of security for Parliament Hill.
The reason I ask for clarification on this point is that we now have two good men, Mr. Sandy Cunningham, who runs the protective staff, and Mr. Gene Grace, who runs the plain clothes security staff; and there is now being brought in someone to be put between these two gentlemen, if this report is true, and the Sergeant-at-Arms. In other words, an expensive messenger boy to rush back and forth. That hardly seems necessary. I would just like to ask, has Mr. Quintal been appointed, or is he about to be appointed, and is he presently a deputy commissioner of the Royal Canadian Mounted Police?


Madam Speaker:: I would like to remind the hon. member that while he is arguing that he has been impeded in some of his duties as a member of Parliament by the actions of an officer of the Mounted Police outside the building, he did not tell me which ones.


Thomas Charles Cossitt: By the Prime Minister, Madam Speaker.


Madam Speaker:: It has not been made very clear what kind of impediment he has suffered because of that particular incident. However, I do want to remind the hon. member that

May 27, 1981
Privilege-Mr. Cossitt
there is a distinction to be made between the different duties of a member of Parliament which are considered essential to his function, and he did not consider that; nor did he tell me which of these duties he was not able to perform because he was accosted by one of the officers of the Mounted Police.
I do not know whether the hon. member was in the House, but he did refer to my ruling on the matter raised by the hon. member for Annapolis Valley-Hants (Mr. Nowlan). I did tell the House that, for reasons of both security and safety, procedures for directing traffic on the Hill, and particularly the buses, have been revised periodically. Yes, some new procedures have been adopted as a consequence of that revision.
Because some hon. members have complained about the way in which the Mounted Police are carrying out these new procedures, I have asked the Sergeant-at-Arms to discuss these matters with the Mounted Police. What I do want to assure hon. members is that, whatever changes are made in those procedures, I will try to ensure that they are made with the minimum interference with members of Parliament.
As for the nominated or about to be nominated new director of security, I can tell the hon. member that nominations of House of Commons staff are made in the usual way and not in the House.


Thomas Charles Cossitt: Madam Speaker, I was simply asking, not how the appointments were made, but for clarification as to whether the deputy commissioner, J. R. R. Quintal, of the Royal Canadian Mounted Police has, in effect, been appointed and it is an accomplished fact.


Madam Speaker:: If and when any nominations of this type are made, they will be made in the usual manner and the hon. member will be informed.


Thomas Charles Cossitt: It has been done, Madam Speaker.


Madam Speaker:: The hon. member knows that if he wants any information on this kind of matter he can either come to my office or write a letter and he will get it.


Mr. Gordon Taylor (Bow River):: Madam Speaker, might 1 ask, when the RCMP stops a person and that person asks a reasonable question, why should the constable not answer in a civil way? We are surely entitled to an answer.


An hon. Member:: You are never reasonable.


Madam Speaker:: Whatever happens outside the House, of course, is not under my jurisdiction, but I can ask-


Some hon. Members:: Oh, oh!


Madam Speaker:: Well, that is absolutely correct. I have no jurisdiction outside the House. Security and safety on the Hill is the responsibility of the Mounted Police. However, what I can do to accommodate hon. members is to ask the Sergeant-at-Arms to inquire about this kind of conduct on the part of
officers on the Hill. I will do just that in the name of the hon. member.


Gordon Edward Taylor: I have had no experience on the Hill-


Some hon. Members:: Hear, hear!


Gordon Edward Taylor: -but whenever I have had an experience with the RCMP and they have stopped me, I ask why and 1 have always had a civil answer. I cannot see why that should not be so on the Hill as well.


Madam Speaker:: I am sure the director of operations on the Hill will want that to be so, too. As I said, the Sergeant-at-Arms will have a consultation with the director.


POINT OF ORDER
Stanley Hudecki: I rise on a point of order emanating from the question period. At Your Honour's indication, I went directly to my question and proceeded with it when I was really closed off and told that the question had not been put forward. I think that the error occurred in that there was a delay with the sound equipment. I did present the question. The sound equipment was not in operation. 1 have evidence from witnesses both on this side of the House and from the hon. members opposite that the question was put forward.
In view of the importance of that question, I wonder what mechanism I have of putting that question forward before the House again.


Stanley Howard Knowles: Tomorrow.


Madam Speaker:: I did call the hon. member to order at least two times and perhaps a third time. I cannot remember that, but I do remember at least two times. His question was very long. I do not know whether it had been put right at the beginning, but his question was too long and on two occasions I got up and asked the hon. member to put an end to the question. He continued to ask his question.
Perhaps I have been a bit hard on the hon. member. He is new in the House. However, whenever the Speaker gets up, the hon. member has to resume his seat. If the Speaker indicates that the question, in her view, is too long, usually hon. members co-operate and go to the question immediately. If I did not hear that the question had been posed in the very first sentence, I do apologize and I will try to recognize the hon. member another day on the same question providing, of course, it is short.



May 27, 1981


PRIVILEGE
Mr. Howard Crosby (Halifax West):: Madam Speaker, I have a question of privilege which I can state very briefly, but it is nonetheless one of great importance to me and to the people of Nova Scotia. It arises from remarks made during the question period by the Minister of Justice (Mr. Chretien) and repeated indirectly by the Right Hon. Prime Minister (Mr. Trudeau).
The remarks were to the effect that I asked the government and the Prime Minister to refer to the Supreme Court of Canada the question of the ownership of offshore resources; that is to say, the ownership of the minerals, hydrocarbons and the submarine lands off the coasts of Nova Scotia and Newfoundland. The remarks of the Prime Minister and the Minister of Justice relate to a debate which took place in the House on May 20, 1981, in which this matter was raised. I said then what I say now.
The Minister of Justice and the Prime Minister misinterpreted the nature of that exchange in that I had said that this question ought to be referred to the Supreme Court only if the Prime Minister and his government were unwilling to continue the political action of negotiating with the provinces of Nova Scotia and Newfoundland over the settlement of the ownership of those resources. 1 want to say to Your Honour, to all hon. members of this House and to the people of Canada that this question of ownership of offshore resources is just as important to the people of Nova Scotia as it is to the other provinces.


Madam Speaker:: Order, please. I am sure the hon. member will find other occasions to say just that, if he wishes. He is entering into a debate. This is obviously not a question of privilege. He feels the Right Hon. Prime Minister has misinterpreted the situation and he wants to put the facts right. That is obviously debate, not a question of privilege.


Howard Edward Crosby: I am sorry, Madam Speaker. Your Honour cut me off before I even got to the mention of privilege. It is a matter of privilege of the hon. members of this House when the Prime Minister and the Minister of Justice indicate that they have taken a legal position which they have not, in fact, taken. Is that not a misrepresentation of what was said? The record will speak for itself.


Madam Speaker:: It will indeed. The hon. member should know that hon. members constantly question the interpretation put on hon. members' words. This is the whole purpose of debate in the House of Commons. That is exactly what debate is. 1 cannot allow it as a question of privilege. It is obviously a difference of opinion between the two hon. members. That is quite legitimate and can be debated in the House; but it is certainly not a question of privilege.


Mr. Waddell:: Madam Speaker, on a point of order, today is a Conservative opposition day and we have just heard an hour
Order Paper Questions
of questions of privilege from the Conservative party. I wonder if they have any more questions of privilege. If we knew, we could either go back to our offices and get on with other work or go into the Conservative debate.


Marc Lalonde: The great Tory filibuster.



ROUTINE PROCEEDINGS


[Stage Direction]
Sixth Report of Standing Committee on Transport-Mr. Dionne (Northumberland-Miramichi).
[Editor's Note: For text of above report, see today's Votes and Proceedings.]

Jean-Luc Pepin: With your permission, Madam Speaker, I would like to table, pursuant to the provisions of Section (2) of Standing Order 41, in English and in French, the report of the Commission of Inquiry on Air Safety-

-a document which will soon become, if it has not already become, the Dubin report.


Some hon. Members:: Hear, hear!


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. D. M. Collenette (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 1,217 (Revised), 2,135, 2,144, 2,208 and 2,223.
I would ask, Madam Speaker, that the remaining questions be allowed to stand.

MR. MICHAEL PITFIELD Question No. 1,217 (Revised)-Mr. Cossitt:
1.	Was Mr. Michael Pitfield, secretary to the cabinet and Clerk of the Privy Council, absent from his job at any time since he re-assumed his position and, if

May 27, 1981
Order Paper Questions
so (a) for how many days and on what dates (b) for what purpose and where (c) was he paid his usual government salary during the days absent and (i) if so, under what authority (ii) if not, what amount was deducted for each day absent or part thereof and what was the total amount deducted to the date this question is answered?
2.	Did his absences include first class transportation to Boston and, if so, was such travel made at public expense?


Pierre Elliott Trudeau: 1 and 2. Since his reappointment as Clerk of the Privy Council and secretary to the cabinet on March 11, 1980, Mr. Pitfield has not been absent from his job save for normal holiday leave. During the period immediately following his reappointment, and in accordance with arrangements made at that time, Mr. Pitfield's family continued to reside in Boston, Massachusetts, until the end of the 1979-80 academic year. He made regular visits there to visit his family and to complete his teaching obligations to Harvard University. Mr. Pitfield was authorized to use first-class transportation where circumstances required. See also reply to question 2,386 answered May 25, 1981.


Mr. Cossitt: 1.	Did the Canadian National Railway recently place advertisements congratulating the Canadian Pacific Railway on its anniversary and, if so (a) at what cost (b) for what purpose (c) what are the names of all the newspapers in which the advertisement was placed (d) what is the name and job designation of the highest ranking person authorizing the advertisements?
2.	Is it government policy to scrutinize the spending by a Crown corporation on such advertisements and, if so, in this case did the government scrutinize such spending so that there would be no waste of taxpayer's money?


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: The management of Canadian National Railways advises as follows: 1. Yes.
(a)	$ 64,244.
(b)	The purpose was to congratulate Canadian Pacific on its one hundredth birthday and to recognize the great contribution that company has made to Canada.
Together CN and CP form an industry that forged the links of nationhood and the ad was meant to draw attention to this fact as well as underline the important role this industry will have in the future development of Canada.
(c)	Moncton Times Transcript, Halifax Chronicle-Herald/Mail Star, Montreal Gazette, Quebec Chronicle Telegraph, Toronto Globe and Mail, Toronto Star, Ottawa Citizen, Calgary Herald, Edmonton Journal, Regina Leader-Post, Saskatoon Star-Phoenix, Winnipeg Free Press, Vancouver Sun-Province, Moncton L'Evangeline, Quebec Le Soleil, Montreal La Presse, Montreal Le Devoir, Toronto L'Express, Ottawa Le Droit, Edmonton Le Franco Albertain, Regina Journal L'Eau Vive, St.
Boniface La Liberte, Vancouver Le Soleil de Colombie.
(d)	R. A. Bandeen, president and chief executive officer.
2. Transport Canada advises as follows: it is government policy to review annual forecasted budgets of capital and operating expenditures. Ongoing day to day operating expenditures are not reviewed as this is more properly considered the responsibility of Canadian National Railways management.


Mr. Herbert: 1.	What amount was charged, if any, for the use of the facilities, on the weekend of February 14, 1981, at the National Revenue Buildings, Rigaud, Quebec, by the city of Ottawa for city council budgetary studies?
2.	Are other municipal councils offered similar use of the facilities?
3.	What is the policy of the government concerning the use of the Rigaud facilities by other public or private bodies?


Mr. Claude Tessier (Parliamentary Secretary to Minister of National Revenue):: 1.	$1,437.35.
2.	Yes.
3.	Consistent with the government's program of decentralization, the facilities at Rigaud can be made available to other private or public bodies, but only under strict conditions, and only when not otherwise occupied to meet operational requirements.


Mr. Cossitt: 1.	Is the CN Express giving consideration or has it decided to shut down its express service in and out of Brockville, Ontario and, if so, for what reasons?
2.	Will the government give a positive guarantee that the express service at Brockville will not be closed down?
3.	What are all the reasons justifying the consideration of any shut down in view of the large revenue obtained by CN Express at Brockville as revealed in the answer to question No. 4?


Robert Theodore Bockstael: 1.	Brockville has been identified as one of some 30 express terminals CN intends to retain as part of their network of core terminals for express operations.
2.	It is not felt necessary for the government to give such a guarantee. CN is committed to maintaining express service across the country, sometimes by interlining to serve the smaller, light density market areas.
3.	At the present time, closure of the Brockville express terminal is not being considered.
May 27, 1981


Mr. Herbert: 1.	Did the Canada Mortgage and Housing Corporation refuse to insure mortgages for houses sold by the corporation after acquisition and, if so, for what reason?
2.	Are the purchasers of the houses able to obtain insurance in the private sector and, if so, is the total interest for both the insurance and the mortgage different from the total for a mortgage insured by CMHC?
3.	Was a study undertaken to determine whether or not an increase in the cost of insurance and interest rates for a mortgage affected the selling price of a house and, if so, what were the results?


Hon. Paul J. Cosgrove (Minister of Public Works):: I am
advised by Canada Mortgage and Housing Corporation as follows:
1.	In general, houses acquired by CMHC qualify for NHA insured mortgages when they are sold. However, in isolated cases mortgage insurance has been refused because of the poor physical state of the unit. In such cases the sale is on an "as is" basis at an appropriate price, and insurance is refused because it is not known whether the unit will be repaired to acceptable standards.
2.	Canada Mortgage and Housing Corporation does not compile data regarding this subject and is therefore unable to provide relevant information.
3.	Canada Mortgage and Housing Corporation has not undertaken any such study.


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


Some hon. Members:: Agreed.


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


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


Some hon. Members:: Agreed.


Madam 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 S-19, an act to provide for state immunity in Canadian courts, to which the concurrence of this House is desired.
National Energy Program



GOVERNMENT ORDERS


Hon. Michael Wilson (Etobicoke Centre) moved:: That this House condemns the government's National Energy Program because of the substantial adverse impact it has had on energy development in Canada, and on those parts of the economy which supply goods and services to the oil and gas industry.
He said: Mr. Speaker, I should like to thank hon. members opposite for their patience in waiting for my speech. I want to assure them that, like a good wine, my speech has improved with age!
Yesterday we debated Bill C-57. During the opening speeches on that bill we discussed amendments to delete the production tax and the excise tax on natural gas, principally because of the damage it is doing in the area of supply, the area of energy development and the deadlock that has caused the megaprojects to be put on hold, as well as the consequent very dangerous exposure which this country faces in view of the increasing reliance on the Middle East.
As I said yesterday, these taxes are at the heart of the problems that we will encounter in the years ahead. But there is another side to this issue, and that is the immediate impact of the government's energy program on the economy today. It is a very visible side of this issue. As I have said in the past in this House, 139 rigs have left the country since October 28; drilling activity is down in excess of 50 per cent this year compared to the same period last year, and in addition land sales on petroleum properties have declined about 70 per cent. All this is having a ripple effect throughout the entire economy. It is that aspect of the energy program that I wish to debate today.
We on this side have discussed the effects of this energy program on individuals, businesses, different sectors of the economy, not just in Alberta, Saskatchewan and British Columbia, but also in parts of eastern Canada which are important suppliers to the oil and gas industry. Many of us in this House met with representatives of the oil service industry. They told us about small companies of five, ten, 15, 30 and 40 people and stated categorically that if no changes are made in the situation as it is today, about half of them will be out of business within six months and about 70 per cent will be out of business within one year.
A very urgent problem faces us, Mr. Speaker, and that is the reason for the motion we are debating today. The motion stands in my name but I am proud to make it on behalf of the many people in my party who have felt directly the concerns of the people so severely affected by the program brought forward by the Minister of Energy, Mines and Resources (Mr. Lalonde) and his colleague, the Minister of Finance (Mr. MacEachen), on October 28-the energy program.
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May 27, 1981
National Energy Program
Let me just read the motion quickly:
That this House condemns the government's National Energy Program because of the substantia] adverse impact it has had on energy development in Canada, and on those parts of the economy which supply goods and services to the oil and gas industry.
As I mentioned earlier, some of the service companies have been to Ottawa to discuss the very real problems that affect them, the people who work for them and the people in their communities. I should like to refer briefly to some of these. One individual had seven leases of rental equipment cancelled outright with the resultant loss of $500,000 to him and to his small company when the equipment had to be returned to the bank. Another person, also in the equipment rental business, who one year ago employed 26 people, now employs 11 people. There is a contractor who, in 1980, employed 50 people but this year employs only 20. Another construction company had 137 people in 1980 and now has only 27.
We would not ordinarily think of hotel owners being in the oil and gas business, but they accommodate the people who work on the rigs. A particular hotel owner had 68 employees in 1980; now he has 38, the loss of business being directly attributed to the National Energy Program.
I should like to refer to a survey conducted by my colleague the hon. member for Peace River (Mr. Cooper) on companies in his constituency. Ele asked: "Has your firm experienced an actual reduction in financial activity in the last six months?" Mr. Speaker, 82 per cent replied that they had. The average amount of the decrease was 41 per cent, so it is a substantial decrease and it is much greater than in other parts of the economy.
The next question was: "Has the change in financial activity been a direct result of the National Energy Program?" About 50 per cent of the companies canvassed responded to the questionnaire-and that is a high number, Mr. Speaker-and 88 per cent replied that the change had been a direct result of the NEP.
About 55 per cent of the respondents are involved directly in the oil and gas industry. I should point out that 81 per cent of the companies are 100 per cent Canadian owned. This is the result of the Canadianization program that the Minister of Energy, Mines and Resources has introduced.
Unemployment has increased in the riding of Peace River. Last year employment was about 4,000 people-3,964. This year it is down to 3,065, a decrease of about 22 per cent.
Finally, "Could you indicate the amount of capital you spent and what you plan to spend within the Peace River constituency in the following years?". In 1979-80, it was around $35 million or $37 million. In 1981-82, these companies are projecting about $18.5 million, a decline of about 50 per cent. There are very real indications of the disastrous effect this policy has had on individual business, small business, Canadian-owned business, businesses that are the heart of the economy of this country.
Let me also refer to the effects of this on companies in eastern Canada. There is a very direct impact. The Alberta government, in conjunction with companies in the industry, did a survey on the economic impact of the Alsands and Cold Lake projects. The purpose of this was to show that the economic activity generated by these projects in Alberta was about 42 per cent, and in Ontario and Quebec the total amount was 35 per cent; a little over 25 per cent in Ontario and a little over 9 per cent in Quebec. Therefore, these projects have a very direct impact in eastern Canada.
The megaprojects have been put on the back burner for some considerable length of time as a result of the discussions and disagreements that have taken place between the Alberta government and the federal government. We are at a very serious point in time where these projects just may not go ahead, in particular because of the deadlock between these two levels of government and because of the effect of the taxes, specifically the production tax, on these projects. In addition, the pricing schedule of the energy program has been stated quite categorically to be insufficient to bring forward the investment necessary.
Foster Associates did another broader impact study on conventional and megaproject investment as it relates to the rest of Canada. Of every dollar that is spent on both sides of the business, the megaprojects and conventional projects, 42 cents is spent in Ontario, 13 cents in Quebec, 16 cents in other provinces and 29 cents in Alberta. Therefore, this is not just an Alberta problem, or a British Columbia problem, but a Canadian problem. That is the point we want to make in the debate today.
The Foster Associates study went on to say that for every job created in Alberta by these projects, two additional jobs are created in the rest of Canada. The impact on the rest of Canada is not as massive as it is in the provinces of Alberta, Saskatchewan and British Columbia. Other of my colleagues will be discussing those specifically today. I would like to talk about some of the broader elements of the slowdown in the industry so that we can have a better understanding in this House of the impact of the policies the government is following.
Ralph Hedlin Associates completed a very intensive report entitled "Some Implications of the National Energy Program on Ontario and Quebec manufacturers". Let me just refer to the broad range of industries that are affected by the National Energy Program: the rubber industry, steel industry, wire rope, structural steel, fabricated pipe, boilers and pressure vessels, valves, turbines, pumps, controls, electrical equipment, transportation, measurement and control equipment. I would imagine that covers well over 75 per cent of the total manufacturing range of industries in this country. It is a very broad problem that we face.
Let us look at the compressor industry, one of the industries that is hardest hit. One firm in this industry estimates that losses of $40 million are due to cancelled, reduced or delayed orders. Another firm reports a fall-off from $17 million in sales about a year ago to $1.7 million, a 90 per cent drop in
May 27, 1981

sales in the two-month period of January and February. One company reports that under normal business conditions they would bid on 30 to 40 projects per month. Now they are bidding on three to four in the oil and gas industry. This is a serious situation that is growing worse daily.
Let us look at the rubber industry. They had anticipated orders of about $22 million for the Alsands project. These are delayed, I guess you could say indefinitely because the minister has been unable to make any progress as a result of the decisions he has taken in the negotiations with the Alberta government. They attribute these delays directly to the National Energy Program.
One structural steel company predicted about $100 million in potential business for western Canada. This is now on hold as a result of the program. One fabricated pipe manufacturer, who unfortunately had expanded production facilities prior to the National Energy Program, is now operating far below capacity with very substantial interest rates to maintain, as a result not just of the slowdown in the energy industry but the very high interest rate policy of this government.
Finally, in the electrical industry one company had planned to establish a research and development capability but it has now put that on hold pending resolution of the energy deadlock in this country. With the uncertainty and the direct impact of this energy policy, there is substantial loss of economic activity and loss of potential to the economy of this country that must be addressed very quickly or we will face very serious consequences throughout this country.
Let me draw some conclusions from the Fledlin study which I believe it important for members of this House to consider. The first is obviously the very broad relationship of the oil and gas industry to the total manufacturing economy of this country, not just in western Canada but all of Canada. This is a very important relationship that we must learn to better understand in this House.
Second, the immediate impact that the Hedlin study has observed is not nearly as much as the medium or longer-term impact, as the over-all result of this loss of business starts to affect orders that will be lost, sales that will be lost, lost employment opportunities as well as investment opportunities or the creation of new plant and equipment which generates economic activity in this country.
The key is that the next 12 months is a critical period for all of these industries. That is the period during which the direct impact will be felt by the country. If the megaprojects, the Alsands and Cold Lake projects, are delayed, the impact on this country will be disastrous, not just in lost supply so important to us in 1990, but in the economic activity that we need so desperately in this country today.
The intransigencies of the minister and the provocative approach that he and the Prime Minister (Mr. Trudeau) took to these oil negotiations last year at this time have resulted in the most serious government-induced slowdown in our economy that I think anybody in this House can remember, and
National Energy Program
perhaps I could say it is the most serious government-induced slowdown of our economy in history.
The Alberta reaction which resulted in cutbacks and putting these megaprojects on hold was a predictable reaction. In face of the way the minister and the Prime Minister conducted the negotiations last summer, it is clear there were few options the government of Alberta had when the energy program finally came out and showed, if you can believe it, a less satisfactory offer to the provinces than had been offered to them back in July. It was no surprise. I think anybody could have predicted it and we were predicting it in this House prior to the energy program, if there was not a more realistic approach when the energy program was finally brought down.
Today the outlook for the Canadian economy is not good. We had unexpected strength in the fourth quarter of last year and the first quarter this year, but with the high interest rate policy that this government has maintained throughout this whole period and with increasing interest rates, it is clear to me that the economy cannot stand that sort of stress and still maintain any degree of economic growth. The future is very cloudy indeed, and we need desperately this energy development to be brought forward to take up the slack in this economy.
I am not the only person saying that. If you read economic reports, including the one of the Economic Council of Canada, you will see stated very clearly in the last report that the key hope for this economy is energy development in this country.
Let me refer briefly to a statement made by the Governor of the Bank of Canada yesterday when he was before the committee in the other place. He said:
-a settlement of energy disputes probably ought to be given the highest priority in economic policy these days ... I think the settlement might very well help us on the exchange rate and might improve the investment climate.
I believe you know, Mr. Speaker, that the Governor of the Bank of Canada is a very subdued and soft-spoken individual, but I think that is a very powerful message he has given us to date. What he is saying to us is that because there is uncertainty about future energy development in this country in face of the real energy problems the world faces, there has been downward pressure on the Canadian dollar-the exchange rate, to use his words.
He also indicated previously in his testimony that if there was not that pressure on the exchange rate he would have an opportunity to reduce the level of interest rates in this country. Quite clearly, the direction the Governor of the' Bank of Canada has followed is in maintaining an interest rate policy which clearly has an eye to the level of the Canadian dollar, because if the dollar falls further than it has to date it will generate further inflationary pressures in this country.
Let us be quite clear. When you cut through it all what we are referring to is jobs-jobs of individual Canadians in small businesses, medium-sized businesses and very large businesses. This is most visible in the province of Alberta but we are starting to see it more and more from statements being made in the provinces of Ontario and Quebec.

May 27, 1981
National Energy Program
Let us not forget that last November and December we on this side of the House, as well as many other observers in the country, warned the Minister of Energy, Mines and Resources, the Prime Minister and the Minister of Finance that the policy, if followed through, would result in the disasters that are starting to fall around us right now. We did predict oil drilling activities and we did predict the drop in land sales. Now this is a fact.
How long is the minister going to sit there nodding his head saying yes, yes, yes, when we talk about the broader economic effects of this policy and do nothing about it? The statistics we see today clearly demonstrate that we knew what we were talking about in November and December, and the statistics of later on this year will prove that we know what we are talking about today. Very few people in this country disagree with us.
Let me refer to another element which I think involves an important message which I am receiving from people in my constituency and others who are directly affected, and that is the oil brain drain. This is quietly happening today, Mr. Speaker. Canada is not an island unto itself in energy development. We have to be conscious of what is happening in the rest of the world. We are part of a broad, worldwide oil and gas industry. I do not think there is another country in the world which has taken the approach that Canada has to oil development. Other countries are aggressively pursuing exploration and production of oil and gas. They are valuable commodities to these countries, so we have a competitive situation here. Our young men and women are being drawn away from Canada because of uncertainty and the lack of jobs in this country, jobs which are available for them in spades in many other countries of the world, most particularly in the United States because it is right at our doorstep.
Mr. Gerry Maier, chairman and chief executive officer of Hudson's Bay Oil and Gas Co., recently made a speech on this subject. He said:
As long as Canadian energy policy results in cash flow cutbacks and reduced profits for the industry, the temptation to move to greener pastures will remain strong.
He goes on to say:
In the U.S.A. reducing dependence on foreign petroleum has become a virtual crusade, and Canadian recruits are being welcomed with open arms.
The prospects clearly are better in other parts of the world. The uncertainty which has been created by this energy program in Canada is pushing our technologists, our highly technical experts, out of the country to other parts of the world. The industry and the governments in these other countries have accepted as a common goal the need for greater production. We must accept that today or we will lose more of our highly technical people.
The result of this will be that when these projects are to be developed the people we need to bring them on stream will not be available. What that means is that we will get the second best talent, which will result in longer times to bring the project on and it will result in mistakes. The net result of that is that the consumer in this country will pay more for energy
developments that could be under way today if this government had any sense.
In face of these clear signs of deterioration, whether it is from conventional drilling, delay in the megaprojects or from the oil brain drain, it is hard to understand the complacency of the Minister of Energy, Mines and Resources. He is saying they have a majority in the House of Commons and they are going to ram this program through. They do not have to listen to anybody. They can build the monument to Marc Lalonde.
Another statement he has made which disturbs me tremendously is that if they are going to get beaten in the next election they should get beaten by something they really believe in; not what the people want but what they, Marc Lalonde and other members of the government, feel is important to their small little world.


The Acting Speaker (Mr. Ethier):: Order, please. Hon. members should be referred to by the names of their constituencies, or by their departmental titles if they are ministers, but not by their names.


Michael Holcombe Wilson: Thank you, Mr. Speaker, for drawing that to my attention. I will try to do better next time.
What we are forgetting here is that people are losing jobs. We are creating tremendous oil supply insecurity in this country, and we are losing the technological brains which would be tremendously important to this country in the years ahead. The minister must not sit and build his own oil and gas Utopia in which things are done just according to what he says. He must learn, he must pay attention and he must be sensitive to what is happening in the rest of the world. He must pay attention to the decisions which are being made by people in the industry and by individuals who are going to those green pastures to which Mr. Maier referred. If the minister does not do these things, his Utopia will force Canadians to accept lower living standards, less economic security and a much more uncertain and cloudy future than we see even today.
[ Translation]


Marc Lalonde: Mr. Speaker, I am glad to see that we finally got around to debating this motion which the Progressive Conservative members of the opposition surely deemed very important and very urgent, but which they even came close to stranding completely because of the altogether unfounded questions of privilege raised during a full hour by various members opposite.

For an hour we listened to a number of frivolous Conservative questions of privilege and points of order. The hon. member for Halifax West (Mr. Crosby) tried to back away from a position he impressed upon the Prime Minister (Mr. Trudeau) a week or two ago. Having reflected upon his attitude at first, the hon. member tried to back away from the position he took in this House. As the hon. member himself
May 27, 1981

said, the record will speak for itself. It is there for everyone to see.
[ Translation]
The motion before the House today reads very simply as follows, and I quote:
That this House condemns the government's National Energy Program because of the substantial adverse impact it has had on energy development in Canada, and on those parts of the economy which supply goods and services to the oil and gas industry.
If the Progressive Conservative members of the opposition had the courage of their convictions, they would have drafted a much clearer and much simpler motion. They would have said quite simply that the Progressive Conservative Party urges the government to raise consumer prices so as to give more money to the oil industry and to the producing provinces. Basically that is what the Conservative members have been advocating here and there and everywhere in the country, and we had the best example of that earlier from the hon. member who spoke on behalf of the Progressive Conservative opposition. In fact, what the Progressive Conservative Party is doing, and I quote, it "condemns the National Energy Program" as a whole. I see Conservative members opposite, the hon. member for Victoria (Mr. McKinnon) who nods his head in agreement. It is important that Canadians know what the Progressive Conservative members object to when they say: We reject the National Energy Program. What they reject, Mr. Speaker, is a whole series of measures whose aim is Canada's self-sufficiency by 1990; what they reject is a whole series of measures to ensure that that industry will be controlled and owned by Canadians by 1990; what they reject is a price system which will be fair to consumers and to the various regions of the country as well as to the Canadian government and the government of the producing provinces. That is what the Progressive Conservative members reject. They should have the courage of their convictions. The National Energy Program provides for billions of dollars in grants to help Canadian consumers improve energy conservation through the Canadian Home Insulation Program, for instance, in which we pay half the cost of insulation up to $500 for each home. That is what the Progressive Conservative members reject. Similarly they reject measures to promote the replacement of petroleum by other forms of energy, something which must be done as quickly as possible because that is what will make Canadians self-sufficient in the short term. Thanks to the measures I announced on Monday, Mr. Speaker, we will be able to reduce oil consumption in Canada by 300,000 barrels a day. Canadian consumers will be eligible for up to $800 for each home to convert their oil heating system to a heating system operating on gas, electricity, wood, propane gas, solar energy or other forms of energy. That is what the Conservatives are condemning and rejecting. Let them have the courage of their opinions, let them stand up and be counted! The Canadian consumers will know how to judge their position on this subject.
National Energy Program
What else are they rejecting? They are rejecting the extension of the gas pipeline for the citizens of Quebec and the maritime provinces, which is an integral part of the National Energy Program.


The Acting Speaker (Mr. Ethier):: Order, please. The hon. member for Etobicoke Centre (Mr. Wilson) on a point of order.


Michael Holcombe Wilson: Mr. Speaker, I hesitate to interrupt the hon. minister's speech, but he is attributing a large number of statements to this side of the House, which is a total distortion. If the minister is going to make those statements, I ask him to substantiate them.


The Acting Speaker (Mr. Ethier):: Order, please. The hon. member had 30 minutes. He had a chance to make his point of view known, whether he was accusing the government of mismanagement or of having a bad energy program. Now the government is defending itself. I think the Chair is here to listen to both sides, and that is what we will do.


Marc Lalonde: Mr. Speaker, the Conservatives wasted an hour of the time of the House this afternoon with flimsy questions of privilege and points of order. I hope the time taken by the hon. member in raising this latest flimsy point will not be considered part of my time.
I am not attributing any intentions to the Conservatives. I am reading their own motion, which says;
That this House condemns the Government's National Energy Program-


An hon. Member:: That is true.


Marc Lalonde: An hon. member says that that is true. I will tell hon. members opposite what they are condemning. They should stand up and be counted. They are condemning conservation measures. They are condemning measures which will encourage consumers to use substitutes for oil. They are condemning the Canadianization program of this government which will ensure that before the end of this decade Canadians will control the petroleum industry, which at the present time is over 70 per cent controlled by foreigners. That is what the Conservatives are rejecting.


Gordon Edward Taylor: We won't even have a country if you are there for long.


Marc Lalonde: With the support of the people of this country, before the end of this decade this government will see that the people of Canada own over 50 per cent of this industry.


Gordon Edward Taylor: If there still is a Canada.


Marc Lalonde: They will control the major companies in this industry. Through their government the people of Canada will have a larger ownership than they had before, and this will benefit Canadians.


Gordon Edward Taylor: If there still is a Canada.

May 27, 1981
National Energy Program


Marc Lalonde: We hear them now. We know what they are condemning. We can hear hon. members opposite talk and shout. What they are condemning are measures in the energy program which provide that Canadians will pay a predictable price for their oil. They will pay a price which will increase, but it will increase on a gradual basis. The price of oil will not be subject to the rapidly escalating and unpredictable prices determined by OPEC. That is what the Tories are fighting. With respect to distribution between the regions of this country, the Tories are against the proposition that the national government should get a larger share for the benefit of all Canadians. This is what they are fighting, Mr. Speaker. This is what the Tories cannot see.


Gordon Edward Taylor: Fifty dollars to Mexico.


The Acting Speaker (Mr. Ethier):: Order, please. I thought the House had recognized the Minister of Energy, Mines and Resources (Mr. Lalonde) and it is very difficult for the Chair to hear the discussion when there is shouting. I think courtesy was extended to the previous speaker and I would invite the hon. members to be as courteous to the present speaker.


An hon. Member:: Ask him to leave the House if he does not want to listen.


Marc Lalonde: I think we have clear evidence that the truth hurts and it seems to hurt very badly over there.


Michael Holcombe Wilson: It is not true, though.


Marc Lalonde: In effect what we are proposing is that the people of Canada, through the energy program, should be entitled to 23 cents out of every $1 that comes out of that industry while the industry will still get 33 cents and producing provinces will get 43 cents. That is what the Conservatives are fighting. They think the people of Canada, who have been paying through their taxes the overwhelming part of the industry incentives, are not entitled to more than 9 cents. Well, we think 23 cents is a very fair and very low payment to the people of Canada for everything they have put into that industry over the years, and that is for all the people of Canada.


Michael Holcombe Wilson: That is a distorted figure.


Marc Lalonde: So when the Conservative party puts a motion condemning the National Energy Program globally as they are doing in this debate, let us remember what they are condemning.


Gordon Edward Taylor: Fifty dollars to Mexico, SI5 to Alberta, that is what we are condemning.


Marc Lalonde: What I would like to cover more specifically is some points raised by the hon. member.

I believe that it is important, Mr. Speaker, to recall once again what it is that the Conservatives are opposing. What
they oppose is the National Energy Program as a whole, that is a good program for the Canadian consumers, a good program for Canadian ownership and Canadian control of this industry, and a program which will ensure energy self-sufficiency by 1990, which means that we shall no longer have to import foreign oil.
The Conservatives' answer would be to increase consumer prices and give more money to the corporations and the producing provinces even though in no other federal system in the world producing provinces receive as much as they do in Canada, and this under the National Energy Program. [English]
Now, the spokesman for the official opposition has depicted a very gloomy picture of the situation and I would like to draw to his attention a few facts. I will begin with what is happening in the Canada lands, Mr. Speaker. These lands are the exclusive responsibility of the Government of Canada, and if any blame is to be attributed, you cannot parcel it out. If something goes wrong in the Canada lands, the responsibility is that of the Government of Canada. However, if something good happens there, then the Government of Canada should get the credit. And what have we seen? The hon. member talks about the oil and gas industry. I would urge the official opposition to look at the oil industry in global terms, not just to look at Alberta and say that that is the end of it. Look at the situation in Saskatchewan, British Columbia and the Canada lands.
What is the situation in the Canada lands, Mr. Speaker? Well, I have no doubt that the Conservatives do not know what was spent there last year. Total expenditures by the oil and gas industry in the Canada lands last year was $345 million. And after the National Energy Program was announced in 1981, Mr. Speaker, how much is the industry going to spend there? It is going to spend $630 million, almost double what it spent last year. Then we go to next year and the year after. The forecast for 1982 is $880 million, and for 1983 it is $1,035 billion. That is the kind of action taking place in the Canada lands with the oil and gas industry. The Tories will not talk about that, they do not know any better. They like to believe the stories they are being told by some spokesmen for the industry and they do not want to look at the whole forest; they look at a few trees and knock their heads against them and refuse to see what is happening in the industry.
What is happening in the provincial lands? Well, I will not quote internal statistics because they will be challenged as being inaccurate; I will quote the opposition's preferred source, namely the industry magazines, such as Oilweek, for one, which I am sure is known if not read by some members on the other side, and what do we see there? They talk about wells disappearing or a small number of wells being drilled. Well, let us face it, we have a situation in this country where we have had a surplus of natural gas, and that has been going on for quite a while. People recognized this well before the National Energy Program was brought in, Mr. Speaker. That program had nothing to do with capped wells in Alberta or in other
May 27, 1981

provinces. They were there well before the NEP was announced, so much so that a spokesman for the gas industry said, well before the program was announced, that there would be a very substantial decline in drilling activity in western Canada in 1981. This is what the oil and gas journal said in quoting the executive director of the Canadian Association of Oilwell Drilling Contractors before the NEP came into being. He said that no more than 5,000 wells would be drilled in Canada in 1981 compared with 8,300 wells in 1980, a drop of 40 per cent. That is not the government's policy, not the government's decision and not the National Energy Program.


Michael Holcombe Wilson: Read the rest of the quote.


Marc Lalonde: It is a fact that the Canadian Association of Oilwell Drilling Contractors stated, before the National Energy Program was announced, that because of a surplus of natural gas they would have a very drastic reduction in the number of wells drilled in this country in 1981 and, significantly, that is what has happened.
What do we see in Oilweekl Comparing the first quarter of 1981 with the first quarter of 1980 we see that the number of wells in development for natural gas has gone down. There is no surprise there. That was foreseen by the industry at least a year ago. Development wells are down from 641 to 457. And we see, in spite of the gloomy stories we hear from the opposition, that the number of exploration and development wells for oil has not gone down, Mr. Speaker, but has increased. Oil exploration wells went up in the first quarter from 162 to 253, according to Oilweek. Oil development wells have gone up from 284 to 400 and therefore, the total for oil has gone up from 446 to 653, over 200 more in the first quarter of 1981 compared to the first quarter of 1980. If you add all the wells together, including the gas wells, you end up with a larger number of wells in the first quarter of 1981 than in the first quarter of 1980. It went up from 2,004 to 2,235. These are the statistics, the facts, the reality of what is happening.
The situation for natural gas is indeed serious and one we have had to live with, as I said, well before the National Energy Program.


Thomas Gordon Towers: Mr. Speaker, I rise on a point of order. Does the minister not realize that the figures he is quoting are the result of budgets established well before the National Energy Program, and that we are now just coming to the time when there will be a downturn? Surely he has the intelligence to understand that.


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


Marc Lalonde: Mr. Speaker, I hope the time taken up for this point of order will be deducted from my time. There are so many inaccuracies and wrong statements made by the opposition that I will need all my time to answer them. We are not talking about previous budgets; we are talking about the first quarter of 1981-
National Energy Program


Thomas Gordon Towers: But it is a result of previous budgets.


Marc Lalonde: -which is several months after the October 28 budget came into effect. These are the facts as put out by Oilweek.
Obviously there are some problems. I indicated that as far as the Canada lands are concerned, we are seeing more activity under the National Energy Program than we have ever seen before. This is taking place, thanks to the National Energy Program. It benefits oil and gas companies, mainly Canadian gas companies. For the first time in the history of that industry, junior Canadian companies are involved in exploration.


Michael Holcombe Wilson: In the United States.


Marc Lalonde: They are involved in exploration on the east coast and in the Arctic, which did not happen before. Also this is thanks to the National Energy Program. Most of those companies are from Calgary and Alberta.


Some hon. Members:: Hear, hear!


Ian Gardiner Waddell: Like Mobil!


Marc Lalonde: There are problems in some areas. After having indicated the areas where the federal government alone is responsible, I would like to indicate that there are problems in some provinces.
I would like to say a word about those provinces because while we are exclusively responsible for the Canada lands, everyone recognizes the provincial governments are getting the largest share of the benefits. They have responsibility as well as the national government when it comes to provincial lands. As a matter of fact, they like to claim that it is all theirs, but when it comes to paying their contribution or their share of the costs, they are not so eager.
Let me look at the situation in some provinces. If we look at the situation in Saskatchewan, for instance, we see royalties in the province which are higher than in any other province in Canada. We have a situation where some of those wells are being closed at the present time. I am sure the hon. member for Assiniboia (Mr. Gustafson) will want to talk about this. Some of those wells are being closed, but why? It is because of the excessively high royalties in the province of Saskatchewan. The royalties are higher than in any other province, royalties which the industry itself is blaming for the current closing down of a large number of wells in that province.
I hope the government of Saskatchewan will reflect upon this and realize that it must do something about this. What is the situation in Saskatchewan? Saskatchewan royalties are twice as high as Alberta's on the production of an average well; they are twice as high as those of its neighbouring province.


Gordon Edward Taylor: So what?


Leonard J. Gustafson: But our production is three times as low.

May 27, 1981
National Energy Program


Marc Lalonde: For an average well in Saskatchewan producing about 30 barrels per day, the royalty on old oil is 51 per cent in Saskatchewan and 24 per cent in Alberta. Lower rate producers are hit even harder. A ten-barrel per day well pays 37 per cent royalty on old oil in Saskatchewan and only 8 per cent in Alberta.
The hon. member for Assiniboia can complain as much as he wants but those figures indicate clearly that if those wells were in Alberta, they would be still producing. They are being closed down at the present time because of the excessive royalties the government of Saskatchewan has imposed.


Allan Bruce McKinnon: Speak louder.


Marc Lalonde: Now I would like to turn to British Columbia. We have heard a lot of noise from the hon. member for Victoria (Mr. McKinnon) earlier. What is the situation in British Columbia? Gas pricing in British Columbia is lower for the producer than it is in Alberta. The producer in British Columbia receives about $1.45 per thousand cubic feet for old gas after export adjustments. In Alberta the same producer receives $2.62. This is under the same National Energy Program. The situation in British Columbia has nothing to do with the National Energy Program. It has to do with the Socred government there and the type of decisions that government has taken. It is not the National Energy Program that is the cause of the difficulties in the industry in British Columbia at the present time. This has been repeated over and over again by the industry when representatives appeared before the British Columbia Utilities Commission.
I left Alberta to the last. Certainly Alberta has some problems. We have met with the service industries; many of them came from Alberta. Certainly these people attract our sympathy. It is sad to see many of those little Canadian companies suffer.


Thomas Gordon Towers: What will you do about it?


Marc Lalonde: I have had several meetings and discussions with these people. Their attitude is more responsible and rational than that of the Conservatives on the other side of the House. In all the meetings these people said that both orders of government must settle this, that both orders of government must move, and that there must be some compromise. They recognize that since the National Energy Program was announced, we have made some moves, some adjustments, and have shown some compromise.


Leonard J. Gustafson: To take over the industry.


Marc Lalonde: To the contrary, and I will quote the hon. member for Assiniboia. In the parliamentary committee last night he said that the producing provinces have not budged an inch. We can check the blues; he had better not change them.


Leonard J. Gustafson: They should not budge an inch.


Marc Lalonde: This is what the hon. member for Assiniboia said.


Leonard J. Gustafson: Why should they?


Marc Lalonde: I presume he was speaking for the Tory Opposition when he spoke like this last night.


Gordon Edward Taylor: Why should they?


Marc Lalonde: Now we hear from another member from Alberta, the respectable hon. member for Bow River (Mr. Taylor). He is asking "why should they?" That is the attitude of the Conservatives: sock it to the consumers, give more money to the industry, give the producing provinces whatever they want; they should not compromise.


Gordon Edward Taylor: You give Mexico $50 and us $15.


Marc Lalonde: I am glad the ministers of energy for the producing provinces and the premiers, particularly the Premier of Alberta, have more judgment and are more reasonable than the hon. member for Bow River.


Gordon Edward Taylor: That is why you have not reached an agreement.


Marc Lalonde: They are ready and willing to make some concessions. I will meet with the minister of energy for Alberta on June 10; I am looking forward to that meeting. At our last meeting, we indicated that we were willing to be flexible and to compromise. There was such a recognition of this fact by the spokesmen for Alberta that they agreed to have another meeting to look at whatever flexibility they could introduce in their position. In that sense, they have shown a lot more judgment than the Conservative members from Alberta who are sitting in the House, particularly the hon. member for Bow River.


Gordon Edward Taylor: Try telling them why you pay Mexico $50 and us only $15.


Marc Lalonde: Indeed we have indicated that there must be a settlement.


Gordon Edward Taylor: You will not answer that, will you?


Marc Lalonde: It is a matter of high priority. The Governor of the Bank of Canada said yesterday that it was a matter of the highest priority. We agree with that. On November 2, the Prime Minister stood in the House and said that Alberta does not like the program and that we were ready to sit down and talk about improvements and adjustments to it.


Gordon Edward Taylor: It took you about eight months to decide that.


Marc Lalonde: What happened between November 2 and early April? We have not been able to obtain a meeting with the government of Alberta. That is the situation; that has been the situation.


Gordon Edward Taylor: Now you blame Alberta.


Marc Lalonde: There was a cutback of 60,000 barrels by the government of Alberta.
May 27, 1981


Gordon Edward Taylor: And it could be even more.


Marc Lalonde: The hon. member for Bow River is shouting that there will be another one on June 1. How will that help the negotiations? How will that help the average Canadian?


Gordon Edward Taylor: Buy it from Mexico at $50 a barrel.


Marc Lalonde: We know that it will not help the average Canadian, it will hurt him, because he will have to pay even more.


Gordon Edward Taylor: Buy it from Mexico at $50.


Marc Lalonde: We hear that the industry hurts. In its last report, the Alberta Energy Conservation Board said that at worst the National Energy Program in Alberta, perceived in its worst possible context, might reduce production by 50,000 to 60,000 barrels in Alberta by 1990. But that board, which is a board of the Alberta government, said that what was most damaging to the industry in Alberta at the present time was the cutbacks imposed by that government, and that those cutbacks this year would cut production by 180,000 barrels and would have an impact on the industry of over $200 million in Alberta. This is what is happening with the decisions of the government of Alberta, not the Government of Canada.


Gordon Edward Taylor: Pay us a proper price then.


Marc Lalonde: The hon. member for Bow River says, "Pay us what you want."


Gordon Edward Taylor: No, pay us a proper price.


Marc Lalonde: That is the position of the Tories in this House.


Gordon Edward Taylor: Fifty dollars for Mexico, $15 for Alberta.


Marc Lalonde: The Tories say that any provincial government may dictate to the national government what should be the national policy. We do not believe in that.


Gordon Edward Taylor: Fifty dollars for Mexico, $15 for Alberta.


Marc Lalonde: We believe in compromise and good sense. We believe in national responsibility for all the people of this country.


Some hon. Members:: Hear, hear!


Marc Lalonde: We will fulfil our national responsibility.


Gordon Edward Taylor: Fifty dollars for Mexico, $15 for Alberta.


Marc Lalonde: We will negotiate and arrive at a deal which will be fair to all Canadians.


Some hon. Members:: Hear, hear!


Ian Gardiner Waddell: Mr. Speaker, I know that the minister must leave, but I hope that he will stay
National Energy Program
and hear me for a short while. When I listened to his speech he reminded me of a man whom Oscar Wilde described as someone who knows the price of everything and the value of nothing.


An hon. Member:: Right on!


Ian Gardiner Waddell: It seems to me that once again the minister has thumped, pumped and spoken. It was not a speech he gave, it was more of a tirade, which indicates to me that the minister must be in trouble with his National Energy Program.
The message we received on this side of the House was the same old message: Ottawa knows best what is good for the west. Before the minister leaves I wish to quote-


Mr. Evans:: When will you say something of substance?


Ian Gardiner Waddell: If the hon. member for Ottawa Centre (Mr. Evans) would listen for a moment he will see that I will deal positively with how I think we can solve this problem with western Canada.


John Leslie Evans: Proceed.


Ian Gardiner Waddell: Mr. Speaker, I would remind the minister of a speech given in this House by the Right Hon. Lester Pearson on April 14, 1964, as reported in Hansard at page 2145. I see the minister is leaving, but he can read my remarks in Hansard tomorrow. At page 2145 of Hansard for April 14, 1964 Mr. Pearson was dealing with co-operative federalism. He said:
It is the task of Parliament, without regard to party; it is the challenge of statesmanship rising above faction, to find the solutions to our problems which are now more serious and more difficult than any we have faced in peacetime since 1867.
Mr. Pearson was dealing with the problems of Quebec in the 1960s. He was dealing with a quiet revolution in Quebec, which in a strange way has certain similarities to the kind of economic revolution which is happening in western Canada at the moment. As I understand it, that was the reason why members such as the Minister of Energy, Mines and Resources (Mr. Lalonde) were elected to Parliament. Maybe the minister has forgotten some of the words of his mentor, the Right Hon. Mr. Pearson. The speech goes on:
We must find these solutions by agreement, not force them by compulsion. We cannot hope to find such agreement in our country if we cannot find a basis for it in our Parliament.
And what did we receive in this House today? A tirade mainly against the Conservative opposition, and secondly, against the provinces with regard to the whole energy problem.
The minister has left the chamber, but I offer three quite obvious points to him to which I hope his parliamentary secretary will reply. One, we do not have a pricing agreement with Alberta, and on June 1 Alberta will turn down the tap further and Canadian consumers will have to pay more for gasoline. It will be another "Lalonde levy", as we call it here. The Liberals call it a "Lougheed levy". The Albertans call it a "Lalonde" levy and I call it a "Lougheed-Lalonde levy". In any case, it will be an additional tax to pay for imported oil.

May 27, 1981
National Energy Program
That is a ridiculous situation, Mr. Speaker. The minister cannot just get up in the House and blame it on hon. members to my right, or on the provinces, although in a great many ways it is a shared blame. The minister is part of those negotiations. He must be flexible in the agreement. Is the minister or the parliamentary secretary prepared to stand up in this House and say, "Mr. Speaker, all right, we will withdraw the 8 per cent wellhead tax. We will withdraw it, change it, and we will be flexible"? Saying that would go a long way toward reaching an agreement. But you can bet your bottom dollar and your bottom barrel of oil that neither one of them will stand up in the House and say that. The minister is one of the inflexible parties.
The second point I offer to the government speakers to reply to is simply this. We heard from the hon. member for Etobicoke Centre (Mr. Wilson) of a downturn in the west, in Alberta, in oil exploration. I have the same figures and I could quote them. All the figures are before us and they will appear in Hansard as cited by the hon. member for Etobicoke Centre. The minister stood up and quoted figures from Oilweek, which I personally think are old figures. They are really last year's projections before the National Energy Program came into effect. Those figures will not be borne out. There will be a downturn in the Alberta oil and gas economy, also in the economies of Saskatchewan and British Columbia. I do not believe any of those figures. I do believe the guys who came into my office. They are working men, and they also went to the minister's office. I see a member to my right nodding, they also went to his office. I looked at them, and as a lawyer the minister knows that the best evidence is live evidence, what we lawyers call viva voce evidence. I could judge their credibility. It seemed to me they were credible. They were small time industry workers and they told me they were suffering. I believed them. They are suffering from the National Energy Program. For the minister to stand up and say that they are not suffering is simply hogwash. It goes against the best evidence there is-they were there and they were suffering.
The third point I offer to the government arising out of the minister's speech is the fact that the minister says we are developing Canada lands. He is asking us to look at all the exploration which is taking place, for example Dome Petroleum and others who, with all that public money, are exploring and developing Canada lands. "Canada lands" means the north and the offshore, it does not mean Alberta, Saskatchewan and British Columbia, where the minister cannot be the dictator. I ask this question of the government for reply in this debate: why develop Canada lands when you have Alberta, Saskatchewan and British Columbia to develop? That does not make any sense to me. Why go to the high costs in the Arctic and offshore when you have Alberta with conventional gas? This does not make any sense to me. I submit that it does not make any sense to the average Canadian either. As the hon. member for Bow River (Mr. Taylor) was saying, and I do not agree with his philosophy, why buy imported offshore oil when we have Alberta oil? It does not make sense for the minister to say, "Let us develop Canada lands", except if we
accepted a rather Machiavellian interpretation of what the minister is doing. Is he saying that he will go around Alberta, Saskatchewan and British Columbia rather than deal with them? That is exactly the opposite of what Mr. Pearson said in the House in terms of co-operative federalism.
The minister said in the House, as well, that well before the end of the decade, by 1990, the people of Canada will own over 50 per cent of the industry. We support that. Who doesn't? Maybe a few hon. members to my right who have an ideological hang-up on public ownership do not agree, thereby going against the entire Canadian social history and the history of their own party. But other than those few members, we on this side of the House support that effort. In Sault Ste. Marie in 1974 the Prime Minister (Mr. Trudeau) said that we would own 50 per cent of the industry by 1980. Mr. Speaker, there is just no credibility there.
I would like to deal, in the time I have left, with what I consider are now the positions of the three political parties in Canada on energy. I hope that when I am outlining our position I can suggest some principles upon which we can settle by negotiation the dispute with Alberta. I agree with all speakers that this is the number one problem. It is one of the big problems in the Canadian economy today.
I should say right away that both the Conservative spokesman and myself do not think that the National Energy Program is working. It was supposed to help Canadian companies; but these little guys, these Canadian companies, are telling us they are going out of business. Something is wrong there; and I will tell you what is wrong. What is wrong is that the major foreign-owned companies are making their profits downstream. By that I mean in marketing, in pipelining and in selling gasoline at the pumps. The little Canadian companies make their money and do their work in exploration and development. So what does the government do? It puts an 8 per cent wellhead tax at the exploration and development stage. Whom does this hurt? The little guys? One does not hear the big companies squealing. One hears the little guys squealing. So what kind of a Canadianization policy is that? To me it does not make sense, and that is one of the reasons we are opposing the National Energy Program. They are scared. My colleague said they are scared of the big companies. I will come back to that in a moment.
With respect to the Conservative policies outlined by the hon. member for Etobicoke Centre, it seems to me it is simply that the industry should be given a free hand. He said, and I quote, "The pricing schedule is not sufficient to bring about new investment". That is the industry line: "Give us more and more and more." That is the line my friends to the right are taking. They believe it. They are advancing it. However, it seems to me it will result in high profits to the industry. There have been record profits over the past few years. It will result in continued foreign ownership. We must tackle that problem. There is no way of getting around it. Either we tackle it or we do not tackle it, and that kind of "let the industry have a free
May 27, 1981

hand" will mean continued foreign ownership. Finally, with continued foreign ownership, it will always mean pressure for high prices.
What is the Liberal policy? We have had a lot of fancy talk. In 1973 we had a national energy program. The Prime Minister said:
Its prime objective, to be reached before the end of the decade is self-sufficiency in oil and oil products.
In 1973, the big target was 1980. Now, in 1980, the target is 1990. The fact is that the government has not done anything very much in the past to really tackle the oil industry. What is it doing now? The minister says it plans to support renewables and conservation, but it gives $20 million to Canartech and $40 million to Imperial Oil to continue on with its development in the tar sands. Mr. Bertrand came out with a report in which he said the oil companies made excessive profits over the time the government was in office, and the time that the Conservatives were in office as well, and that these excessive profits and rip-offs were continuing. What did the government do? Well, Mr. Bertrand was moved; he went to the Antidumping Tribunal. He was dumped on the Anti-dumping Tribunal, and that is what happened.
The minister also talks about opening up the north. As we found out, the National Energy Program, in the opening up of the Canada lands in Bill C-48, has, in fact, brought problems to the north. The northern governments are upset and the native people are losing their rights. Because it cannot solve its dispute with Alberta, this government is prepared to bring in a national energy policy which will destroy the lands, in my submission, destroy the environment of Canada's north and destroy the native people in Canada. That is the bottom line.


An hon. Member:: Come on!


Ian Gardiner Waddell: The hon. member does not believe that. He should read the submissions which were made to the committee. There are all kinds of government reports to say that if the north is opened up too quickly, that is what will happen.
I wanted to say something about the position of our party. 1 can see an hon. member saying, "It is about time." He should talk about his own party and stop criticizing. What I would basically like to set out today is the position of our party. It is very simple. We believe in Canadianization; but to us Canadi-anization does not mean to take over Petrofina, number eighteen from the list of companies. We would make Petro-Canada number one in the oil industry by taking over Imperial Oil. Second, we believe in conservation and renewables. We will put a massive effort into conservation and into renewables, not this picky little effort of the government, and we would follow some of the recommendations of the recent report of the task force of the House of Commons.
Third, we believe in provincial ownership. This is essential. I heard the hon. members applaud when the minister gave his last statement. I asked the hon. members on the opposite side, on the Liberal benches, to think about what the minister said. The fact is that the resources belong to the provinces, and that
National Energy Program
is in the Constitution. It is in the British North America Act. It is in the new Constitution, and that is generally accepted.
The provinces have been painted as the bad guys here. They have said that in spite of the fact that the resources belong to them, they are prepared to share. They are prepared not to ask for world price, but only for 75 per cent of the world price. They are even prepared to share the revenue they then get, recognizing that oil prices are extraordinary. We in the New Democratic Party reject world price. We do not believe in the world price; but we are prepared to listen to the provinces when they request their share and the prices they want.
For the federal government's share, if the federal government wants to subsidize oil prices in this company, then the federal government must take less of the amount. In a way, that respects the principle of provincial ownership, and it respects the problem we have in this country of not rushing the high oil prices right away. So in this country we can, in fact, have lower oil prices, but we can meet the requirements of the provincial governments. We can take off the 8 per cent wellhead tax and we can take off the 30-cent per thousand cubic feet gas tax because they are discriminatory taxes. They fall against the west.
I just returned from Alberta and from Saskatchewan. The producing provinces in the west are incensed with that tax. It is all very well for the majority in eastern Canada. I say this as a member of Parliament from British Columbia, which is both a consuming and producing province, and as one who might stand in the middle, as a member of the party which represents producing and consuming provinces, not like the hon. members opposite who only represent consuming provinces. If they continue to treat the west the way they are, they will have a separated west, or they will have-


An hon. Member:: Come on!


Ian Gardiner Waddell: Do not say, "Come on", to me.


An hon. Member:: Why not?


Ian Gardiner Waddell: There is deep discontent in the west, and it is about time this government realized that.
[ Translation]


Mr. Tousignant:: I rise on a point of order, Mr. Speaker.


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


Henri Tousignant: Mr. Speaker, the hon. member seems to be suggesting that the provinces should receive more royalties. Can he tell us what the Americans and the American states-


The Acting Speaker (Mr. Ethier):: Order, please. If the hon. member wants to ask a question, he must have unanimous consent.

May 27, 1981
National Energy Program


Ian Gardiner Waddell: I asked the hon. member to listen to what 1 am saying. I am saying that we must try to meet the legitimate requests. The hon. member is a Quebecer, and I suspect that he understands the legitimate request of the province to control its own resources, to get a fair price for them, and to not be pressed or told what to do by the federal government and to not be discriminated against, but to work with the federal government. The government does not go around putting a tax on electricity going to the United States. That is what I am trying to say. Outside the House, or maybe later if I have time, I will talk to the hon. member about that.
I want to conclude by saying that it is no good to have a national energy policy without having an increased public sector role. That is really the kind of modern world we are talking about. If we are going to have Canadianization, we must talk about that. We must also talk a little bit about not giving away all this kind of money which we propose to give away in the north as direct grants without getting some equity for the Canadian people and without getting some control.
Finally, we must tie into a national industrial strategy. The people are groping with that in this House. The Conservatives have suggested that there will be an impact in Ontario if we slow down oil production. We must flush that out and bring in shipbuilding in British Columbia where I come from. We are interested in that development as well. So we must tie into an industrial strategy.
Let me just conclude by saying we do not think the National Energy Program is working. We applaud all these great statements of Canadianization, conservation, substitution and so on. We want to see it work in practice. Too many Liberal statements in the past have turned out to be just pious hopes. I have suggested today, in I hope, a very positive, Pearsonian spirit, that we can reach an agreement with the provinces based on the principles I have set out. I hope to speak further on these principles in the House at another time. I think we can get this agreement very soon. The world will pass us by if we do not get together to solve the energy problem in this country. We will all suffer as a result.


Leonard J. Gustafson: Mr. Speaker, it is a privilege to speak in this House on this very important subject. I am sorry that the Minister of Energy, Mines and Resources (Mr. Lalonde) is not present because I should like to bring a very positive direction to the energy question, particularly from those in the field and the people in the service and supply industry in my area who are suffering as a result of the energy dispute.
The minister referred to the import compensation program which he defended vigorously in the House just a few minutes ago. I should like to deal with the facts as they are in the field, with the international situation and also with the deficit that this country faces because of the import policies and compensation program of this government.
We import 150,000 barrels of oil per day from Mexico and Saudi Arabia which costs taxpayers $8.8 million per day. This is the equivalent of $1 million per hour for an eight-hour working day, to say nothing of the spin-off benefits that would accrue to the economy of the country if the minister would address the National Energy Program in a positive manner.
The National Energy Program should be the number one plank for solving the economic problems facing us today. Instead, it has become the number one business mistake made by any government in this century, particularly the government of which the Minister of Energy, Mines and Resources is a member.
I want to deal with the local conditions in the province of Saskatchewan which the minister addressed, Mr. Speaker. He said that royalties in Saskatchewan are high. They are. The minister did not explain to the people of Canada, and particularly the people of eastern Canada who are not aware of the situation, that Saskatchewan wells have low production. The average production of a Saskatchewan oil well is 19 barrels; the average production in Alberta is 60 barrels. The minister is unfair to the people of Canada when he neglects to clarify that point.
I want to bring to the attention of the members of the House and all those who are interested in the national energy policy a situation which arose this past week in my riding of Assiniboia. There are 480 wells of which PanCanadian is the unit operator, covering 65 other oil companies. Production at those 480 wells has been cut by 75 per cent because in the production of 14,000 barrels per day throughout the last year, the companies lost $564,000. The energy picture in western Canada has been clouded since October 28, at a time when it should be having the biggest boom in its history. If this is not a serious situation, then I do not know what is.
In the Williston Basin, which is 100 miles south, in the area of Estevan, Weyburn, Radville and Midale, and the oil field of southern Saskatchewan which is a part of the Williston Basin, production has decreased by 75 per cent but the production in Williston-North Dakota has increased by 75 per cent. Mr. Speaker, 139 oil rigs have left. I recall that I was one of the first members to rise in this House and ask the Minister of Energy, Mines and Resources if he did not fear that the oil rigs would be driven out of the country. He would not even admit to the possibility. That went on until last July and then began again last fall. We on this side of the House kept asking the minister whether he did not fear that his energy policy would drive the rigs out and he continued to defend his position, claiming that his policies would not have this effect. But, Mr. Speaker, we have lost 139 rigs.
As a result of Bill C-42, in 1972 we lost 65 oil rigs, not one of which has returned. Canada has one of the finest oil drilling fleets in the world, and it is being driven into the arms of Americans for their benefit instead of being used for the benefit of the Canadian people. All that drilling technology and so on is lost as well.
I should like now to turn to the service and supply industry. My colleague in the NDP mentioned that these people are
May 27, 1981

suffering very badly, and that is true. The industry is suffering as never before. There is about a 40 per cent reduction in employment, and small Canadian companies are being hurt.
The national energy policy pretends to address the Canadian situation and Canadianization of the industry, but in fact it is North Dakota, Montana and Texas which are being Canadi-anized. The rigs, the expertise and the investment capital are being driven out. All this will have far-reaching effects on our economy which will not soon be forgotten.
I should now like to turn to the matter of capital. For the past year I have been a member of the Standing Committee on National Resources and Public Works which deals with energy. One member of the committee invariably asks how much capital is being spent in Canada. In most cases, whether the company concerned was Canadian or foreign, it was a fortunate thing for the Canadian people if they responded that as much as 25 per cent or 30 per cent of their total capital investment is spent in Canada.
The outflow of capital due to the government's energy policy and the minister's direction, is a frightening thing at this time, not only on the provincial scene but in the Canada lands as well. The Canadian people should not forget about this question because it is a very serious one in terms of the outflow of capital. There was mention of $1.5 billion to be spent by 1983 in the Canada lands. In testimony at the committee, the Norwegians made it abundantly clear that it is important to have the participation of all the majors in a project as large as Hibernia and the North Sea development.
It is most important that our energy policy address itself to that. I would like to get back to the local scene in Saskatchewan and elsewhere in western Canada and to what is happening there. There is a job loss of about 40 per cent. Many small operators possibly will not be able to hang on beyond another month or two as a result of this energy policy.
About 120 service and supply people from Saskatchewan, Alberta and British Columbia appeared in Ottawa and painted a very serious and sad picture of the energy policy in Canada at this time. One hundred and thirty-nine rigs have left, as well as a great number of service rigs. There is 40 per cent unemployment and a 50 per cent cutback in exploration. The minister just said in this House that exploration would be up. It was intended that some 1,500 new wells would be drilled for exploration this year. It is now predicted that less than 700 new wells will be drilled. That is what is happening to our industry.
What about pricing? We now pay Mexico $42.50 a barrel for their oil. In Weyburn, Saskatchewan and in Alberta they pay $15.75 a barrel for heavier crude and $17.75 for lighter crude. This means a loss of jobs and a loss of opportunity for the people of this country. The minister of energy would prefer to buy oil from Mexico and Saudi Arabia at more than twice the price than give Canadians an opportunity to have jobs in their own country.
National Energy Program
What about the spin-off benefits for the people in Ontario, Quebec, those in the rubber industry and in manufacturing industries? I do not think there is one industry in Canada that would not be affected by the spin-off benefits from the production of oil in western Canada.
We have to be realistic. We in western Canada are good Canadians. We want to be a part of building this country. However, we want to be treated fairly. For 100 years the industrial sector of the world dominated the economic scene, not only in Toronto, Montreal, North America but across the world. Suddenly under OPEC, energy has become number one. Somehow western Canada is supposed to be second place to all of this activity and accept $15 a barrel while everyone else receives $40 a barrel. We are reasonable people. If the price of oil were increased by $4 a barrel, we would be receiving half the world price, which might be reasonable.
The members of this House and the people of Canada should start to think very seriously about what the minister of energy is doing to our country. As I said before, the people of western Canada are good Canadians. It just happens that we produce energy and food. I repeat, for 100 years the industrial sector of the world dominated the economic scene. Suddenly that sector is in trouble. The government which represents the golden horseshoe is saying to western Canadians that it will take with its big powerful hand of government what is necessary to keep this country going in the direction it has been. There is nothing wrong with that. We in western Canada think the federal government should have a fair share, but let us be reasonable. The future potential of Canada is great in manufacturing, energy and food, but we must work together as a country and a people.
When my colleague spoke previously, he warned about the dividing factor this energy policy has become under the direction of the minister of energy. It is very serious, and the frustration in western Canada is great. The minister must address the cold war between east and west as it relates to the energy policy.
I want to address another area of the energy policy. There is a very definite parallel in the direction in which the Prime Minister (Mr. Trudeau) is trying to lead this country with the Constitution and the energy policy. Make no mistake about it. I want to read a paragraph from the book "Reaction: The National Energy Program" put out by the Fraser Institute in Vancouver, British Columbia. I quote:
It is ironic that a program of government, designed to "secure the nation's energy future" should have such a damaging effect on the industrial sectors and the provinces uniquely capable of achieving it. Perhaps it is this inconsistency that has led some observers to claim that the new energy program is, in fact, a political document more concerned about short-run political objectives than energy security.
The direction of this government's energy policy is to nationalize the oil industry. Through Bill C-48, the move in the Canada lands and the 200-mile offshore in Canada lands, the federal government gives to the Crown corporation Petro-Can 25 per cent. There is a move to nationalize the oil industry. Through Bill C-48, it gives extraordinary powers and

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privileges to the minister of energy to take up as much as 50 per cent in some cases.
Because of my statement about the energy policy and the Constitution running parallel, I want to read something written by the Prime Minister on an earlier day when he wrote about the practice and theory of federalism dealing with constitutional reform and what he thought should happen to Canada in 1960, some 20 years ago. He wrote:
If the whole of the Canadian electorate could miraculously be converted to socialist ideals at one fell swoop, there would be no reason to discuss strategy in the present context. Socialism would be achieved with or without federalism, and socialist administrations would be installed at every level of governmental affairs, no matter the form of the Constitution.
I want to suggest to you that it is not by chance that running parallel with the nationalization direction and the Constitution of Canada is the energy policy. We are faced with a new direction that will lay an industry in western Canada flat on its back, if needs be, to achieve this end. That is exactly what is happening. The Canadianization program and the energy program of Canada at this time are taking that kind of direction.
What is the cost of the energy program to the people of Canada at this time? Some experts have projected that the cost of the energy program, including the cost of the spin-off effects amount to $1 million an hour, not taking into account the $8 million it is costing us to pay for the 150,000 barrels of oil we are bringing into Canada daily. 1 refer to the spin-off effects, the loss of jobs to Canadians, the loss to the car industry of Ontario and the loss to the manufacturing sector of Ontario.


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


Mr. Roy MacLaren (Parliamentary Secretary to Minister of Energy, Mines and Resources):: I find in listening to the debate this afternoon, Mr. Speaker, that there seems to be some confusion on the part of the hon. member opposite who moved the motion. His motion reads:
That this House condemns the government's National Energy Program-
Yet the hon. member for Etobicoke Centre (Mr. Wilson) the same member who moved the motion condemning the National Energy Program, stated on January 22:
-I am in agreement with the broad objectives of the program. Who in this country would not be in favour of self-sufficiency, an increase in Canadian ownership, and fairness in pricing and revenue sharing?
On the one hand the hon. member opposite condemns the program, and on the other hand he says he is in agreement with it.
I suppose one should not be too surprised by that contradiction because one has aften heard of similar instances during the course of our energy debates in this House. We have, for example, the hon. member for St. John's West (Mr. Crosbie) going to Alberta, urging the Alberta government to "hang tough" as I believe he put it, in discussions with the national government, in demanding higher and higher oil prices. Yet
that same member when he returns to his native province of Newfoundland, or indeed here in the House of Commons, deplores the impact of higher oil prices on our economy and particularly on inflation. I do not know how the hon. member is able to reconcile those two obviously contradictory points of view.
Of course, we know of the confused Conservative Party attitude toward Petro-Canada. We have seen a series of positions taken, starting with outright condemnation, to gradual acceptance, and then to full acceptance. The other day the Leader of the Conservative Party (Mr. Clark) said, yes, after all, let us have Petro-Canada. That did not deter the hon. member for Calgary Centre (Mr. Andre) who within a few days said, as reported in The Calgary Herald, that there are too many Crown corporations in Canada, let us get rid of some. Obviously, he added, Petro-Canada would be a good place to start. I do not think we need to feel any real surprise about the contradictions that are before us in this motion when we have, as I pointed out, the same hon. member supporting the National Energy Program and then turning around and condemning it.
In supporting the program, he specified three principal objectives: self-sufficiency in oil, added to the self-sufficiency in all other forms of energy which Canadians already enjoy; an increase in Canadian ownership; and fairness in pricing and revenue sharing. Let me deal with one or two of those points which, indeed, are principal objectives of the National Energy Program.
The petroleum industry is and will, of course, continue to be one of the largest and most prosperous sectors of our economy. The industry will benefit immensely from the effects of increased prices foreseen in the energy program, and particularly from the incentive grants to help ensure that Canadians achieve oil self-sufficiency, as well as benefiting from a greater degree of conservation and oil substitution.
We do not, however, accept that fundamental decisions affecting Canada's petroleum industry, that most dynamic sector of our economy, should be made primarily in the boardrooms of multinational companies outside Canada.
Since 1974, for example, the petroleum industry has been a major exporter of capital from Canada. Such capital exports would grow if we had not introduced the National Energy Program, and grow so substantially that our balance of payments situation would deteriorate causing yet further strain on the Canadian dollar and, indeed, fuelling inflation.
By ignoring the problem of foreign ownership and domination of the industry in the past, Canadians in fact forfeited a significant share of the benefits from the strong resource sector we fortunately have in this country. We have many sources of energy in rich supply, and we intend to ensure that our energy resources benefit all Canadians.
A recent report by the Royal Bank of Canada, noting the strong base for growth that we enjoy in this country, offered the following appraisal of the Canadian economy. It predicted that over this decade employment opportunities will increase
May 27, 1981

faster than the growth of the labour force. The Royal Bank estimated that the unemployment rate will fall to 6 per cent by 1985 and about 4 per cent by 1990, which is in fact, in the statistician's terms, almost no unemployment at all. The bank went on to suggest that Canada's potential growth rate will remain above that of the United States and rank second only to Japan among the seven major industrialized countries. I note these forecasts, Mr. Speaker, because that is the context in which the energy developments of the months and years ahead will bring benefit to all Canadians.
In the Atlantic provinces energy resources are behind much of the Atlantic renaissance, and that certainly will continue. Saskatchewan, British Columbia and Alberta will, of course, be the major beneficiaries of future energy developments in the area of conventional oil and in oil sands. It is against that background that we are working toward an agreement with the government of Alberta. I am sure that all members of the House look toward that agreement emerging in the time ahead.
[DOT] <1750)
Throughout the industrialized world, oil-fuelled inflation remains a persistent problem. We have noted how the two major OPEC-imposed price increases of 1973 and 1979 led to a rapid growth in inflation throughout the industrialized world. Yet we here in Canada have the opportunity to reduce that impact and to cushion the blow on our economy by developing our own resources.
Unlike hon. members opposite, we on this side of the House favour a made-in-Canada oil policy, not one that is made by OPEC, so as to benefit all Canadian consumers. Apart from sheltering consumers from the severe impact of unpredictable oil price hikes imposed from outside our country, we shall encourage all Canadian explorers and producers of oil and gas in Canada to participate to a yet greater degree in the industry. We shall do that through Canadianization and, through the activities of Petro-Canada.
I want to cite a few examples of the growing success of our Canadianization program. Obviously Canadian companies see the petroleum incentives program announced in the National Energy Program as a catalyst for putting together deals with largely foreign companies which control so much of the land both in the frontier areas and in the provinces. There is growing evidence too-we have seen articles and news announcements in profusion recently-about the reaction to the incentives which are being offered. There are high expectations for the east coast. Not only will the major Hibernia and Sable Island deposits bring great benefit, but other opportunities are also being identified, partly in response to the initiatives taken under the National Energy Program.
In the Arctic the recent discovery of oil by the Panarctic consortium is encouraging. In the Beaufort Sea, Dome's activities are clearly accelerating, and development will reach record levels. Other Canadian companies such as Norcen are joining with foreign-controlled corporations in the search in the Arctic areas as well.
National Energy Program
Therefore, there is certainly no need to be sombre. Indeed, there is every reason to be expectant and optimistic about the opportunities on Canada lands, the frontier areas of Canada. As the minister noted, oil exploration activity on Canada lands this year is at record levels. It shows every prospect of continuing and reaching much higher levels in the years ahead. That is an ample refutation of claims by hon. members opposite who continue to argue against the thrust of the National Energy Program.
I have cited several major activities on Canada lands, but I would not want to pass over the fact that other corporations have recently announced new initiatives. Husky Oil has indicated an intention to play a new role in offshores exploration. Real-West Energy Corporation has acquired potentially the largest single shareholdings in Asamera Inc. and United Canso, a step in the direction of Canadianization and further development. There is growing evidence that many foreign-owned companies are adjusting their ownership structures to take advantage of the incentives offered under the National Energy Program. The government's agreement with Dome Petroleum regarding the creation of Dome Canada is only the first example of many which I am sure will emerge in the time ahead.
I could cite, for example, the case of PanCanadian Petroleum which has formed a new east coast exploration group with Norcen and Roxy Petroleum. Another Calgary company, Ranchmen's Resources, has restructured its shares using the Dome Canada arrangement as a model.
I cite these examples to indicate to hon. members opposite that the National Energy Program constitutes a new and innovative approach to energy policy in Canada. For aggressive and forward-looking companies the program obviously offers immense benefits. Contrary to what the previous speaker said about his fears of some obscure move toward nationalization, we see in fact ample evidence of private entrepreneurs in Canada taking the initiative to ensure that the Canadianization goals set by the government will be achieved.
Of course, not all Canadians can hope to participate in the Canadianization of the industry through the acquisition of shares. For those who cannot take or do not take that route, participation is achieved through Petro-Canada. Canadians can all benefit through their own Crown corporation in major oil and gas activities. I find it ironic that we still hear from hon. members opposite attacks on Petro-Canada. Any brief review of the past years will indicate a remarkable confusion on the part of hon. members opposite about where they stand on the question of a national petroleum corporation.
I remind hon. members that in 1974 when we created Petro-Canada it was to provide a window on the industry. It was to provide a toe-hold, so to speak, at the exploration and research end of the petroleum industry, with an initial capital investment of some $500 million. I remind hon. members that at that time the Leader of the Opposition said that Petro-Canada would become a $500 million white elephant.
Through the 1979 election campaign confusion and contradiction in the Conservative ranks increased even further. The

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free enterprise hawks were whetting their appetites at the thought of the carrion which was about to be created from the national oil company. Yet that was the same year, 1979, in which the president of the Canadian Chamber of Commerce said of Petro-Canada said: "It is serving a purpose, and my own feeling is that it should be left alone". Indeed, in a very short time we noted the chairman of Imperial Oil and other leaders in the petroleum industry recognizing that there was an important role for Petro-Canada to play. Perhaps as a result of those or other factors, the Conservative party then changed course from its days in opposition, and when it came to power it passed through a remarkable series of acrobatics about who should own Petro-Canada, what its share structure should be, whether it should be a Crown corporation or not,
whether it should be partly owned by the public or through direct share ownership, whether it should be entirely in private hands, and so forth.
Finally, during the 1980 campaign the Leader of the Opposition asserted that Petro-Canada's mandate should be broadened-


The Acting Speaker (Mr. Ethier):: Order, please. It being six o'clock, it is my duty to inform the House that pursuant to Standing Order 58(11) proceedings on the motion have expired.
This House stands adjourned until tomorrow at 2 p.m., pursuant to Standing Order 2(1).
At 6 p.m. the House adjourned, without question put, pursuant to Standing Order.

Thursday, May 28, 1981