1981-04-10

ROUTINE PROCEEDINGS


Mr. Mel Gass (Malpeque):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In February the Minister of National Revenue (Mr. Rompkey) visited Prince Edward Island fishermen and assured them they would be dealt with fairly and reasonably with regard to a tax audit of their income. The fishermen have indicated that they do not trust the government, and they fear that their unemployment insurance cheques will be garnisheed. Therefore I move, seconded by the hon. member for St. John's East (Mr. McGrath):
That this House instructs the minister to assure the Fishermen of Atlantic Canada that their UI cheques will not be garnisheed.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EMPLOYMENT
Mr. Bud Bradley (Haldimand-Norfolk):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. Unemployment rose from 12.9 per cent to 13.4 per cent among young people in Canada in March. The young people of Canada are concerned about job prospects in the future. They want to know what their future will be. Therefore I move, seconded by the hon. member for Simcoe North (Mr. Lewis):
That this House condemns the lack of action by the Minister of Employment and Immigration to produce a co-ordinated program designed to employ Canadians, especially young people.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


DEPARTMENT OF EMPLOYMENT AND IMMIGRATION
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam Speaker, I rise under the provisions of Standing Order 43. Owing to the fact that the Winnipeg office dealing with the Canada community development projects for 1980 advanced moneys to a project before the zoning, bonding or building permit requirements were met by the application sponsors, and that the Winnipeg office further extended the deadlines set for funding the project, I move, seconded by the hon. member for Red Deer (Mr. Towers):
That the Minister of Employment and Immigration launch an immediate investigation into these unorthodox practices at his regional offices which undermine the work of members of Parliament and constituency advisory groups.
Until this matter is clarified and corrected, members of Parliament and their advisory groups will not be able to review these applications.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


BANKS AND BANKING
Mr. Nelson A. Riis (Kamloops-Shuswap):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of very urgent and pressing necessity. Some of Canada's chartered banks claim they are losing money or barely breaking even on their credit card operations. I find this extraordinarily hard to believe, considering that banks receive 1.5 per cent per month from at least half of their ten million card holders. In addition, they receive up to 5 per cent per month from merchants who accept credit cards from their customers, which compounds annually to more than 85 per cent. There-

April 10, 1981
fore, I move, seconded by the hon. member for Beaches (Mr. Young):
That the government examine rates of 21 per cent and 85 per cent and that the Minister of Finance examine this practice of the banks of Canada to ensure that they are not charging Canadians rates which could only be described as usurious.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


PRICE OF GASOLINE ON PRINCE EDWARD ISLAND-MOTION UNDER S O. 43
Mr. Tom McMillan (Hillsborough):: Madam Speaker, I rise under the provisions of Standing Order 43. On the eve of his election campaign visit to Prince Edward Island in February, 1980, the Prime Minister (Mr. Trudeau) said that the price of gasoline under a Liberal government would not rise more than 14 cents. Since then his government has allowed gasoline prices on Prince Edward Island and elsewhere in Canada to increase by more than 40 cents. I move, seconded by the hon. member for Malpeque (Mr. Gass):
That this House censure the Prime Minister for being the only federal party leader not to visit Prince Edward Island during the federal by-election in Cardigan and, further, that the Prime Minister make a statement on motions indicating whether his refusal to come to Cardigan was because he could not face the wrath of the people of Cardigan in light of his broken promise to keep gasoline prices down.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

[DOT] (mo)


THE PRIME MINISTER
Mr. Girve Fretz (Erie):: Madam Speaker, I rise on a matter of urgent and pressing necessity. Given that consumer prices have risen unmercifully since 1976 to the point where the inflation rate is spiralling out of sight, and given that it has been several years since the Prime Minister (Mr. Trudeau) boasted he had wrestled inflation to the ground, I move, seconded by the hon. member for Simcoe North (Mr. Lewis):
That this House urge the Commissioners of Internal Economy to budget for the services of a professional wrestling coach, someone like the member for St. John's West, for instance, who can show the Prime Minister the real way to wrestle inflation to the ground.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Miss Pauline Jewett (New Westminster-Coquitlam):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of most urgent and pressing necessity. In view of the brutal massacre of 1,500 Salvadoran refugees in a cavern near the Honduran border, a massacre initiated and carried out by the Salvadoran army with the aid of the Honduran military, I move, seconded by the hon. member for Cowichan-Malahat-The Islands (Mr. Manly):
That this House unanimously condemns this wanton massacre of 1,500 innocent people and urges the government to protest this outrage in the strongest possible terms to the Salvadoran and Honduran governments.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


SEARCH AND RESCUE
Mr. Stanley Hudecki (Hamilton West):: Madam Speaker, I rise to repeat a motion under Standing Order 43 at the request of the hon. member for St. John's East (Mr. McGrath), to draw attention to the heroic efforts of the search and rescue arm of the armed forces. I move, seconded by the hon. member for St. John's East:
That this House recognize the daring search and rescue effort by the crew of a Greenwood, Nova Scotia based Aurora aircraft, who, under adverse flying conditions, 300 foot ceiling and a one and a half mile visibility, on their own initiative during a two hour search on Monday played a key role in saving the lives of four people on a raft adrift on the North Atlantic.


Madam Speaker:: Motions under Standing Order 43 are not meant to be repeated in the House once they have been dealt with. This is a congratulatory motion. I am sure that the House would want to express its sentiments by applauding.


Some hon. Members:: Hear, hear!
April 10, 1981


THE LATE GENERAL OMAR BRADLEY
Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, I rise on a matter of some importance under the provisions of Standing Order 43. United States General Omar Bradley, a Second World War hero and last of the American five-star generals, died Wednesday of a heart attack, at the age of 88. It has been acknowledged by those in the allied forces who either had the privilege of serving with him or who were able to witness and appreciate his leadership-and this includes thousands of Canadians-that General Bradley was an able and courageous leader and a fine gentleman. I therefore move, seconded by the hon. member for Winnipeg-Assiniboine (Mr. McKenzie):
That this House, on behalf of the people of Canada, and in particular the Canadian veterans of the Second World War, extend an expression of our deepest sympathy to General Omar Bradley's family and to the American people.


Madam Speaker:: Here again, the House will note the sentiments that are expressed in the motion.


Some hon. Members:: Hear, hear!


EXTERNAL AFFAIRS
Mr. John Kushner (Calgary East):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of critical importance to world peace and security. I move, seconded by the hon. member for Edmonton North (Mr. Paproski):
That this House go on record as being in support of a peaceful resolution to the crisis in Poland and in opposition to outside military intervention and interference, and further, that this House go on record as commending the initiatives of individual Canadians in sending food aid to Poland as a humanitarian gesture in a time of difficulty.


Madam Speaker:: Is there unanimous consent for the introduction of this motion?


Some hon. Members:: Agreed.


Madam Speaker:: Does the House agree to the said motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
Oral Questions


Mr. Doug Lewis (Simcoe North):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. The March unemployment figures showed a rise in the seasonally-adjusted unemployment rate from 7.2 per cent to 7.4 per cent. Canadians are especially concerned about the future of young people in the country, since employment dropped in the 15 to 24 age group by 14,000 jobs.
What action is the government taking, on a co-ordinated basis, to stimulate jobs for young people?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, in response to the hon. member I should like to point out that the unemployment rate for this March is still lower than it was for last March. Furthermore, in the first three months of this year we have created close to 140,000 new jobs in the country. It is the tenth month in a row in which we have had a rise in employment. It is the best record of any industrial country in the western world at this point in time.
However, it does not necessarily mean that we take great satisfaction from the fact that there are unemployed. It means that with all the various pressures we face in the world, particularly with the increases in pricing of oil and other energy commodities, the Canadian economy is still performing very well and is still providing good employment for Canadians.


PLANS TO COMBAT URBAN UNEMPLOYMENT
Douglas Grinslade Lewis: Madam Speaker, despite the suggestions of the minister, unemployment is still a problem. It continues to be a problem which the government has failed to solve despite a year in office.
In typical cities such as London, Ontario, the unemployment rate has risen from 5.5 per cent in March, 1980, to 8.1 per cent in March, 1981. Does the minister have any specific plans to attack the unemployment problems in Canadians cities?


Lloyd Axworthy: Madam Speaker, if the hon. member had been in the House over the past several months he would know that a number of initiatives have already been taken. The Minister of Finance announced a $350 million industrial adjustments program, designed specifically to respond to communities which are hard hit by lay-offs, such as many of those in southwestern Ontario. The program is being implemented now in those communities. It is providing major assistance in additional industrial grants and new jobs, as well as providing a number of labour market subsidies for new retraining programs. The

April 10, 1981
Oral Questions
industrial adjustments program is a very innovative and useful tool which is being applied directly to those communities about which the hon. member talks.


INDUSTRIAL DEVELOPMENT STRATEGY
Douglas Grinslade Lewis: Madam Speaker, to the best of my knowledge, London, Ontario, is not included on that list of cities.
Employment in the manufacturing sector was down by 10,000 jobs in March, 1981. The minister will know that the Minister of Industry, Trade and Commerce has often claimed to be developing an industrial strategy for Canada. The government has been in office for a year, and it has not come forward. How much has the failure of the Minister of Industry, Trade and Commerce to present such a strategy hurt the minister's efforts to develop an employment strategy?


Lloyd Axworthy: Madam Speaker, contrary to the assumption of the hon. member, I have found that the efforts of the Minister of Industry, Trade and Commerce to respond to the needs of industry, just as those of the Minister of Finance and all economic ministers working together in an attempt to put together a co-ordinated approach to deal with the economic issue, have been extremely helpful.
It would be worth while for the hon. member and other members of the House not to focus simply on the statistics for one month, but to take a look at the last three-month period in which manufacturing and goods producing have shown a marked improvement. We cannot take only the month of March as a measurement; we must look at the entire first quarter in which goods producing, construction and manufacturing have risen substantially.


THE ECONOMY
Claude Girvin (Girve) Fretz: Madam Speaker, my question is directed to the Deputy Prime Minister and Minister of Finance. The minister is well aware that inflation in Canada is going up faster than Space Shuttle Columbia. He should know that it now costs $211 to purchase goods which in 1971 would have cost only $100.
Does the minister have any plans for introducing policies of fiscal responsibility to deal with the complex problems of inflation, or will he remain content to fight inflation on the backs of the middle-class who are caught in a wage-price
squeeze?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: No, Madam Speaker.


INCREASE IN FOOD COSTS-REQUEST THAT PRODUCERS RECEIVE OIL SUBSIDY REBATES
Claude Girvin (Girve) Fretz: Madam Speaker, the minister is also aware that the Department of Agriculture released figures which show that the cost of a nutritious diet for a family of four rose 1.2 per cent in one month. That means that the yearly increase in the cost of feeding a family of four will be 14 per cent, which is even higher than the projected rise in the consumer price index. In light of this increased burden on families, has the minister any plan to reintroduce the PC policy of allowing the producers of our food rebates on the cost of the oil necessary to produce that food so that food costs could be kept down for the consumer?


Allan Joseph MacEachen: Madam Speaker, the hon. member has referred to a release of the Department of Agriculture indicating an increase in food costs. Fie will be aware, as well as I am, that that increase is basically due to improved returns for producers in agriculture and it is also due to shortages of various crops throughout the world. Also, future trends will depend to some extent on access to markets abroad. The movement in the food price index is caused by a number of complex factors.
I do not believe the hon. member is very consistent in asking me in his first question to practise fiscal restraint and then, in the second question, to ask me to launch a new program of spending in order to assist the farmers. That is the kind of assistance in formulation of policy that I do not need at the present time.


Some hon. Members:: Hear, hear!


REQUEST FOR INTRODUCTION OF SPRING BUDGET
Mr. Bob Rae (Broadview-Greenwood):: Madam Speaker, my question is for the Minister of Finance. In light of the figures released this morning by Statistics Canada which show that there are 9,000 fewer jobs in the economy this month than last, and that we have 60,000 more unemployed, and in light of the fact that the minister's forecast in his budget with respect to inflation has now been proved to be wrong by about 20 per cent, and in light of the fact that his earlier predictions that the interest rates we suffered last year were merely temporary and not a permanent feature of our economy-we have seen how wrong that prediction was-is the minister in a position to say that we should have a budget in the spring, since the constitutional fandango appears to be winding down, which will relate to the economic problems which we are facing now? With these economic problems even more serious than they were last year, is the minister willing to show the Canadian people that the government is prepared to deal with the problems which really concern the people right across this country?


Some hon. Members:: Hear, hear!
April 10, 1981


Allan Joseph MacEachen: Madam Speaker, the hon. member included many points in his question. With respect to the unemployment situation, he knows as well as I do that the unemployment rate we have been experiencing in 1981 is better than that forecast in the budget. The economy is stronger and the rate of growth in the economy is stronger, otherwise we would not be experiencing the kind of inflationary pressures that the hon. member is mentioning.
With respect to the question of employment, there has been a change from last month to this month, with a slight increase in the seasonally adjusted unemployment rate. But I would remind the hon. member that a year ago the seasonally adjusted unemployment rate was higher than it is today, and that in the past year we have created 321,000 new jobs. In addition to that, the performance on the unemployment side of the economy is better this quarter than it was in the immediately preceding quarter.
I mention some of these other elements to indicate to the hon. member that I do not think that his suggestion that I bring in a budget at this stage to counteract what he considers to be excessively high unemployment is a very good idea. If the hon. member had focused his attention on inflation and could produce some new policies in that field, then it might be interesting for the House to consider that kind of an approach.


QUERY RESPECTING INDUSTRIAL STRATEGY
Bob Rae: Madam Speaker, I am glad the minister mentioned the word "focus", because it is the lack of focus of this government on the basic problems affecting the Canadian people which is the real problem facing the country right now.
When the minister talks about focus, I would like to ask him what has happened to the government's so-called industrial strategy which was promised to the Canadian people in the election and which was promised to the Canadian people in the Speech from the Throne. The word "immediate" was used in the Speech from the Throne. It said there would be an immediate industrial strategy.
What has happened to the over-all focus of the government on the basic economic problems facing the country, and why has the government taken the decision to shelve the industrial strategy just at a time when it is clearly something which the Canadian people want and expect from their government? Why is the government abdicating its economic leadership, just at a time when it is exactly what the Canadian people are expecting?


Allan Joseph MacEachen: Madam Speaker, the question is obviously filled with rhetoric, and not being accustomed to dealing in rhetoric myself, I-


Some hon. Members:: Oh, oh!
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An hon. Member:: Even the Prime Minister is laughing!


Allan Joseph MacEachen: -I find it difficult to answer the question. But let me tell my hon. friend that in the budget the necessity of improving performance in the economy, through increased productivity and increased economic development, was recognized through the increased spending which was made available in the economic development envelope, a very substantial increased spending. It is within that envelope that the Minister of Industry, Trade and Commerce, the Minister of Science and Technology, the Minister of Employment and Immigration and other ministers have been developing-within that over-all framework-particular approaches to important sectors of the economy.
I disagree with the hon. member who says that we have made no progress and that we have not developed any industrial strategy. He must accept, as I do, the importance of adjustment in the country as part of an industrial strategy. We just recently announced the designation of several communities which are facing particular adjustment problems. I regard that as an important part of industrial strategy, and if I were not conscious of you, Madam Speaker, I might take some more time and talk about other components of the industrial strategy. But really one cannot deal with that rich subject on the orders of the day.


Mr. Crosbie:: You can't deal with it at all, twenty-four hours a day.


GOVERNMENT PLANS TO DEAL WITH HIGH INTEREST RATES
Bob Rae: Well, for someone who does not know anything about rhetoric, the minister did rather well in his answer, rather well in terms of rhetoric. He failed, in terms of substance, because he did not tell us anything at all about why the government has shelved the over-all economic strategy which it promised us during the election and which it promised in the Speech from the Throne. We have had a year pass, and we have had nothing from the government in terms of a basic approach to the economy.
My final question to the minister has to do with interest rates. The minister has been on record as saying, last year in the Speech from the Throne that the interest rate phenomenon was a temporary one, that it was something which would pass, and that relief would be provided to those people who are most seriously affected. I would like to ask the minister now whether he is not pausing to reflect a little bit on the fact that we have been living with interest rates in the stratosphere for an awfully long time, that they show no signs of coming down, and that they are having a devastating effect on the construction industry, on the housing industry, on the car industry, on the forest products industry, and right through the economy.
Does the minister not think that it is time that the government should take the opportunity to say that the interest rate phenomenon is a very deep and difficult one and that the government is prepared to deal with it through the tax system or the monetary system, in order to provide the relief which is

April 10, 1981
Oral Questions
necessary, and in order to get investment up and the economy going, and to provide jobs for the Canadian people?


Allan Joseph MacEachen: Madam Speaker, the hon. member refuses to acknowledge the fact that at present there is considerable strength in the Canadian economy, and its performance has been much better than anyone would have projected last fall, both on the employment side and on the production side.
The hon. member talked about construction. He ought to know that employment in the construction industry recorded strong growth in March, for the first quarter as a whole. Construction employment rose 5.1 per cent following five consecutive quarters of decline. That is improved strength in the construction industry, which the hon. member singled out for better attention.
He talked about high interest rates. As far as I am concerned, it is quite a mistake to talk about controlling high interest rates unless we control over-all inflation. That is the problem we face.


EMPLOYMENT
Thomas Michael McMillan: Madam Speaker, my question is for the Minister of Employment and Immigration. When the government took office on March 4, 1980, the unemployment rate on Prince Edward Island was 13.4 per cent. Figures released today by Statistics Canada reveal that the unemployment rate on Prince Edward Island soared to 16 per cent for March. How does the minister account for that sharp increase in the unemployment rate on Prince Edward Island, and what specific steps does he intend to take to deal with the crisis?


Lloyd Axworthy: Madam Speaker, I want to point out to the hon. member that one important step that we took, immediately upon becoming the government, was to reintroduce direct employment programs for Prince Edward Island that the hon. member's government had cancelled so that there was no opportunity whatsoever for any additional federal systems to provide employment on that island. We have now spent several millions of dollars on that island for the provision of direct employment assistance through the community development project. If the hon. member is looking for an answer to how the people of Prince Edward Island have been helped, they have been helped by electing a Liberal government.


AID TO REDUCE BURDEN OF HIGH INTEREST RATES
Thomas Michael McMillan: Madam Speaker, my supplementary question is for the same minister. In the House of Commons on October 29, 1979, the minister said:
If there is a requirement to raise interest rates, there is an equal requirement to help those people hurt by those interest rate increases.
The prime bank rate when the minister made that statement in the House was 15 per cent; it is now 17.75 per cent.
To deal with the unemployment crisis on Prince Edward Island, which the policies of his government have done nothing to help but, rather, have hurt, would the minister begin by urging his colleague, the Minister of Finance, to reduce the burden of high interest rates at least on primary producers, in particular fishermen and farmers?


Lloyd Axworthy: Madam Speaker, the Minister of Finance, as we well know, is well able to answer these questions for himself. I would point out to the hon. member that again one of the major changes that was introduced by this government was a budget which puts together a regime of lower energy prices which helped all Canadians, particularly those on lower incomes. Furthermore, we established a major income supplement program for the elderly to cushion the effects of higher costs and inflation, again adhering to the basic commitment of this government to help those who have the greatest difficulty in our society.


Mr. Clark:: You know as little about the island as you know about Manitoba.


INCOME TAX
Melbourne Alexander Gass: Madam Speaker, my question is for the Minister of National Revenue. The minister is aware of the tax audit of the fishing industry in Atlantic Canada. While the minister was in Prince Edward Island in February he assured the fishermen that they would be dealt with fairly and reasonably in repaying money owing in back taxes. The provincial director, on the other hand, states that he personally does not see any justification for special treatment of the fishermen.
Can the minister assure the fishermen, not only in P.E.I. but in Atlantic Canada, that he will live up to his promise and that he will not take such drastic steps as garnisheeing their UI cheques?


Hon. William Rompkey (Minister of National Revenue):: Madam Speaker, I want to repeat that commitment made to the fishermen in Prince Edward Island that indeed they will be treated fairly and equitably, as will all fishermen and all taxpayers in the Atlantic area. There are a number of ways of collecting back taxes; garnisheeing is only one. I responded
April 10, 1981

just recently to the brief presented to me by the P.E.I. fishermen setting out the way in which we intend to approach the problem. Taxpayers in all parts of Canada must pay taxes, Madam Speaker, but, on the other hand, they must be treated fairly and equitably, and I intend to see that that is done.


Melbourne Alexander Gass: I wish to direct a supplementary question, Madam Speaker, to the same minister. Could the minister confirm reports that the tax audit of the fishing industry in Atlantic Canada has been halted in the federal riding of Westmorland-Kent by his colleague, the Minister of Fisheries and Oceans, who, by the way, is the member for Westmorland-Kent? Is the same type of investigation being carried on in Westmorland-Kent and, if not, why not?


Bill Rompkey: Madam Speaker, the audit is being carried on all across Canada, in the Atlantic area and on the west coast, as a whole. It is an industry audit; it is an audit that we do normally every year in various types of industries.


Mr. Trudeau:: Started by the Tories.


Bill Rompkey: It was begun by the previous administration and is being carried on under this administration. It is being carried on fairly and equitably in all areas.


HEALTH AND WELFARE
Mrs. Margaret Mitchell (Vancouver East):: Madam Speaker, my question is for the Minister of National Health and Welfare and it concerns the children of the working poor in Canada. Last May the minister stated to the Commission for the International Year of the Child that the child tax credit should be increased, funds should be redirected to children who need help most, and that the current exemptions help the rich more than the poor. We know that this was substantiated by the National Council on Welfare this week. What specific changes does the minister recommend that will benefit poor children and when will these be implemented?


Hon. Monique Begin (Minister of National Health and Welfare):: Madam Speaker, one step that I suppose would help a great deal to put the message across and convince people of the importance of redirecting money that goes to middle-class families in Canada and families with good money, to lower-income families-and it is not for me to prejudge the report- would be to include that as a recommendation of the report of the special subcommittee of the Standing Committee on Health, Welfare and Social Affairs of the House of Commons in which the hon. member is a participant.
Other than that I must say that, from a social policy viewpoint, we have put on our priority list work showing the benefit that an increased child tax credit, possibly financed from the child tax exemption that exists now, would be in helping the half million working poor in the country. We are
Oral Questions
proceeding with it through the normal procedures in the government system.


REQUEST THAT WORKERS ENGAGED IN COMMUNITY PROJECTS BE PAID HIGHER WAGES
Margaret Anne Mitchell: Madam Sepak-er, my second question concerns the same subject and is directed to the Minister of Employment and Immigration. We know that the Welfare Council has documented that one million working poor in Canada include workers who are on government grants and who are performing essential community services. When will the government stop promoting national poverty through the minister's department, raise pay levels for these workers, and make these essential services permanent in communities?


Lloyd Axworthy: Madam Speaker, the hon. member would know that the employment programs that we provide through the federal government have, as their basic minimum, the minimum wage standard set in each of the provinces. I suggest to the hon. member that if she has some concern about the level of salaries paid, the real answer resides at the provincial level where minimum wages are set.
That is the standard we use to ensure that we also get the largest distribution of the moneys we have available to provide direct employment for people and to provide, in those employment programs, very specific priorities that are set by the local communities regarding what is important in terms of the kinds of public works or facilities that they need. We have established the principle of the local communities setting priorities through the local advisory boards set up by Members of Parliament.


FEDERAL-PROVINCIAL FISCAL ARRANGEMENTS TRANSFER PAYMENTS TO PRINCE EDWARD ISLAND
John Carnell Crosbie: Madam Speaker, my question is for the Minister of Finance. Food prices are up, inflation is up, the cost of living is up, interest rates are up, unemployment is up, the minister has given up and the public is fed up.


Mr. Nielsen:: And we are all going to throw up.


John Carnell Crosbie: My question to the minister is this. Is he going to add to the problems of the people of Prince Edward Island and other disadvantaged provinces by carrying out the statement in his budget of October 28, that a large element of our expenditures "especially in the social affairs envelope consists of transfers to the provincial governments and we expect significant savings here"? Is the minister going to reduce transfer payments to Prince Edward Island, for example the

April 10, 1981
Oral Questions
$193 million in transfers that they receive in equalization, hospital insurance and medicare? Will he enlighten the people there in time for Monday's election? Are they supposed to vote Campbell for more cunning cuts?


Mr. Lawrence:: Now 'fess up.


Allan Joseph MacEachen: Madam Speaker, the hon. member was incomplete in his preamble when he said the Canadian people were fed up. I thought they were pretty well fed up with the hon. member and his budget, and showed that quite a bit. The hon. member is asking an electorally directed question. His sudden interest in Prince Edward Island is edifying. It will probably disappear after Monday next. However, it gives me the opportunity of saying that, of all the Atlantic provinces, Prince Edward Island benefits more from, for example, the development programs of this government.
Transfers to Prince Edward Island through DREE are very much higher than Nova Scotia, New Brunswick, and Newfoundland for that matter. They are much higher than any of the other Atlantic provinces. There is a 15-year development plan that has been financed by the federal government to the extent of 80 per cent. It is up for renewal at the present time, and there is a request to the federal government for an additional $80 million to finance that development program. All the fears expressed by the hon. member are unfounded, electorally directed, and if he wants to get on the bandwagon and support equalization, which is proposed in the constitutional bill, why does he not support that and help Prince Edward Island?


John Carnell Crosbie: Madam Speaker, is the minister saying that he does not tell the truth in his budget speeches? He said in his budget speech that he is going to save money by cutting back on transfers to the provincial governments in the social affairs envelope. Will he answer the question for a change and deal straight with the public? The public loved my budget after having seen his.


Some hon. Members:: Hear hear!


John Carnell Crosbie: Is the minister saying he is a man who does not tell the truth? Is he or is he not going to cut back on social transfers to the provinces, for example, in P.E.I., the $193 million? The minister's officials are now meeting with provincial officials. They are telling them they want to save $1.5 billion in transfer payments for post-secondary education and the like. For example, the $701 million they are paying-


Madam Speaker:: Order. I ask the minister to be brief as well.


John Carnell Crosbie: My question then to the minister-


Madam Speaker:: Order. I have heard the question. There was a question asked. I heard it.


John Carnell Crosbie: Will the minister answer the question?


Allan Joseph MacEachen: Yes, Madam Speaker.


John Carnell Crosbie: A supplementary, Madam Speaker.


Madam Speaker:: Order, please.


John Carnell Crosbie: A supplementary, Madam Speaker.


Madam Speaker:: The hon. member for Saskatoon West.


John Carnell Crosbie: Madam Speaker, the minister did not understand the question.


Madam Speaker:: Order.


CRIMINAL CODE
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, my question is for the Minister of Justice. We are all aware of both the extent and the importance of the computer revolution in our society. While technology has evolved swiftly, our laws have remained largely static. In July, 1980, the Supreme Court of Canada, in a case called R. v. McLaughlin, ruled that Section 287 of the Criminal Code, the section dealing with the theft of a telecommunication service, did not cover the unauthorized use of a computer facility. The law was proven to be woefully anachronistic. Can the minister advise the House when we can expect the introduction of legislation which will bring the law respecting computer crime up to date?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, this is a very important and difficult question which involves a lot of fundamental legal issues. It is being reviewed in the department at this time. We have been in communication with the Canadian Bar Association on this subject. We are studying the problem at this time with the Law Reform Commission, and have been in touch with the provinces on this matter. It is a very complex new development in law. We are working on it. I am not in a position to tell the House when we will be ready to bring forward legislation on the subject.


Ramon John Hnatyshyn: As the minister will know, the Canadian Bar Association has requested speedy action in this area. Will the minister commit himself to introducing a separate bill with respect to this matter at an early date, rather than waiting until the omnibus bill on the Criminal Code amendments comes forward at the next opportunity? Will he give specific priority to this study so that we can have early legislation?


Joseph Jacques Jean Chrétien: Madam Speaker, it would be very helpful if the hon. member were to guarantee swift passage in the House of Commons. There are many bills in front of the House at this time and they are not being sent to committees very quickly because of time being spent on other matters.
April 10, 1981


FEDERAL-PROVINCIAL FISCAL ARRANGEMENTS TRANSFER PAYMENTS TO PRINCE EDWARD ISLAND
Charles Joseph Clark: Madam Speaker, I have a supplementary question for the Minister of Finance who was asked whether he stood by his budget statement that the Government of Canada was expecting savings in payments to provincial governments. He answered that question with a yes. Can he now give us a guarantee that Prince Edward Island can continue to count on the $193.8 million it receives in transfer payments from the federal government? That is a simple question, and a direct figure. Can the Minister of Finance give us that assurance now that Prince Edward Island can continue over the next two, three, or four years to count upon that amount of transfer payment from the federal government.


Allan Joseph MacEachen: Madam Speaker, as the Leader of the Opposition knows, the whole question of fiscal transfers is now a matter of discussion between the Government of Canada and the provinces. It is under study by the parliamentary task force. The Leader of the Opposition talked about the figure of $193 million. It may be that, as a result of changes that take place in the transfer system, Prince Edward Island might even increase. I don't know.


John Carnell Crosbie: It might decrease.


Allan Joseph MacEachen: I said it might increase. I did mention, when I was in Prince Edward Island a week ago tonight, at Saurio where I followed the right hon. gentleman at a meeting, the whole question of fiscal transfers. I pointed out, for example, that in 1979 the per capita revenue from resources in the province of Alberta was about $1,800, while in the province of Prince Edward Island it was $3. That is not the kind of revenue distribution that we on this side of the House stand for, but it is espoused over there.


Charles Joseph Clark: Madam Speaker, the Minister of Finance promised in his budget that he would realize savings by cutting back on transfer payments. He has now resisted answering a straight question regarding payments to the province of Prince Edward Island. He said they might increase, which means that they might very well decrease. We on this side of the House suspect that he is planning a decrease in the amount of money which will be available to the people of Prince Edward Island, and that he is trying to avoid questions in this House by hidding behind the task force that has been established.
What we want to know now is whether the Minister of Finance will give a guarantee that the new formula which will be worked out will guarantee the people of Prince Edward Island that they will receive at least as much in the future in transfer payments as they are receiving now. Will he give us that simple guarantee, and will he give it to us now?


Mr. Baker (Nepean-Carleton):: Yes or no.
Oral Questions


Allan Joseph MacEachen: Madam Speaker, the Right Hon. Leader of the Opposition is really quite unrealistic. He would probably be the first to criticize if I, at this moment, decided what will be the result of negotiations with all the provinces, and what will go into a form of agreement with the provinces. It is absolutely a fact-and I do not withdraw from the budget statement at all-that we hope to achieve savings in the transfers to the provinces. We have not decided yet where those savings will take place, or in what programs. We have not decided how a new fiscal system will operate. All of this is up for discussion. I think it is quite unfair for the Leader of the Opposition to pick a figure out of the atmosphere and say, "Yes, stand by that," even before negotiations with the provinces have commenced.


AIRPORTS
Hon. Bud Cullen (Sarnia-Lambton):: Madam Speaker, I have a question for the Minister of Transport. Yesterday the minister indicated that he was prepared to consider another privately financed terminal at Toronto airport. It is appropriate that most of the airports which are discussed in this House are the larger ones, the Montreal airport, the Toronto airport, the Winnipeg airport, etc., but across the country there is a series of smaller municipal airports, quite often funded by the federal government and administered by the local municipalities. Many of these now have master plans, and they are significant to the economy of those particular regions.
I wonder if the Minister of Transport is prepared to indicate today that he will take a careful look at the smaller airports and to set some priority there, because they are fast becoming out of date in terms of not serving communities and certainly in terms of not serving the air industry of Canada.


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, the only thing I can say rapidly on this subject this morning is that my department's budget for airports over the last years had been declining quite substantially. I made a presentation to my colleagues on this subject, and I think they will be very sympathetic. Notwithstanding the fact that the needs for local airports are almost unlimited, I now hope that in the coming months I will be in a slightly better position to do more than has been done recently for medium-sized and smaller airports.


EMPLOYMENT
Mr. David Orlikow (Winnipeg North):: Madam Speaker, I would like to direct a question to the Minister of Employment and Immigration. In answer to an earlier question he pointed

April 10, 1981
Oral Questions
out that 140,000 new jobs had been created in the last few months. I point out to the minister that, according to figures released today, there are over 450,000 young people unemployed. That is more than 45 per cent of all the people unemployed. We are going into a period when high school and university students will be coming onto the job market, and I want to ask the minister whether he has any plans to expand the job-creation programs of his department to take care of a substantial number of those young people who are now or will in the very near future be unemployed.


Lloyd Axworthy: Madam Speaker, as the hon. member knows, we have been trying to re-orient our job-creation programs to target in on those groups in the community which have the most difficult employment problems, and to concentrate our resources on giving them some opportunities and on bringing down work barriers.
As the hon. member knows, a new program beginning on May 1 is designed to create jobs for the handicapped and those who are the hard core unemployed in our communities. We will be concentrating our efforts in those areas to try to break those barriers down, in addition to maintaining broader based programs such as the student employment program, which will provide opportunities for students.
Where we are concentrating a large part of our resources is in the job centres across Canada. There will be 300 or 400. We will try to develop job opportunities in the private sector for students. Under that program there were close to 300,000 placements last summer, and we hope to have an even better record this year by making sure that the private sector provides the fullest opportunity for students and young people during the forthcoming months.


INCREASE IN UNEMPLOYMENT IN MANITOBA
David Orlikow: Madam Speaker, I know the minister pays particular attention to the problems of our province. I am sure he has noticed that the number of unemployed, according to Statistics Canada, has increased from 30,000 last month in Manitoba to 35,000 this month and that the real rate of unemployment is not 35,000 but 51,000. The minister will know that in some areas of our city of Winnipeg the unemployment rate is not 10 per cent or 15 per cent but 50 per cent or more.
I want to ask the minister what plans he has, and what has happened to the $4 billion western development fund. Rather than seeing an improvement in Winnipeg, we are seeing a further deterioration of a very serious situation.


Lloyd Axworthy: Madam Speaker, as the hon. member knows, those of us who live in Manitoba must suffer because of the fact we have a provincial administration with a peculiar monetary policy. This has resulted in the fact that we do not have much of an economy or much economic development. Therefore we
are doing our best to compensate for the lack of effort in that province.
I point out to the hon. member that we are negotiating at the present time a major program for the core area of Winnipeg. The objective is to provide close to 3,000 or 4,000 jobs for the hard core unemployed in that area. That program was initiated by this federal government. We are asking for a response and for the co-operation of the other levels of government. I hope my colleague, the Minister of Regional Economic Expansion, and I will be able to finalize that agreement within a very short period of time so that we can get down to assisting those in the downtown area of Winnipeg who have the most serious employment requirements.


POST OFFICE
Hon. Steven E. Paproski (Edmonton North):: Madam Speaker, my question is directed to the Postmaster General. The Knights of Columbus will be celebrating their one hundredth anniversary next year. Will the Postmaster General ensure that a centennial stamp will be struck in 1982 for such a worth-while fraternal organization?


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs and Postmaster General):: Madam Speaker, in reply to the question asked by the hon. member, I am happy to tell him that I have already received representations from members on both sides of the House on this matter, and there is every reason to believe that the committee responsible for selecting the design of stamp issues will agree to commemorate this event next year.


THE ADMINISTRATION
Mr. John Thomson (Calgary South):: Madam Speaker, my question is directed to the Prime Minister. In view of the increasing importance of trade to Canada-trade represented some 31 per cent of our gross national product in 1980-I wonder if the Prime Minister would consider separating the trade portfolio from the Department of Industry, Trade and Commerce so that it might function with a greater degree of autonomy and responsibility.


Pierre Elliott Trudeau: Madam Speaker, that is a suggestion which is made from time to time. The hon. member will recall that it was in the mid-1960s that the departments were united. At that time the argument was
April 10, 1981

in that direction. I think this government has met the difficulty which the hon. member sees in asking his question by the fact that we not only have an excellent Minister of Industry, Trade and Commerce, but we also have helping him an excellent minister responsible for international trade, the Minister of State for Trade, and another excellent minister, the Minister of State for Small Businesses and Tourism. In this way this government explains why it has been doing so well in increasing its foreign trade balances.


Some hon. Members:: Hear, hear!


John William Thomson: Madam Speaker, I think it is clear that the Department of Industry, Trade and Commerce has so many functions to carry out, and that the trade function will be of such vital importance to Canada in the future, that creating a separate portfolio for this function warrants the consideration of the Prime Minister.


RESPONSIBILITY FOR TRADE COMMISSIONERS IN CANADIAN EMBASSIES
John William Thomson: Madam Speaker, does the Prime Minister believe that it is wise to proceed with the integration of the trade commissioner service under the Department of External Affairs when trade is of such national importance?


Pierre Elliott Trudeau: Madam Speaker, the logic of the question is difficult to follow. In one instance the hon. member wants us to separate departments, and in another he argues about the Department of External Affairs.


Mr. Kempling:: What?


Pierre Elliott Trudeau: The argument about External Affairs, as I understood it, was that we have put foreign trade officers abroad under the ambassador. The object in both cases is the same, Madam Speaker. It is to ensure integration in our policies, that we should tend in industry to produce things we can sell and that in our external relations we have one person speaking for Canada, that is the Canadian ambassador, under whose authority come the various departments which operate abroad. That is true for foreign trade, and it is also true for immigration and health services.


AGRICULTURE
Mr. S. J. Korchinski (Mackenzie):: Madam Speaker, my question is for the Minister of Agriculture. Since the minister has castigated the banks for charging high interest rates and not assisting farmers, does he have any plans to increase the amount of money available to the Farm Credit Corporation,
Oral Questions
say in the amount of $150 million asked for by the Canadian Federation of Agriculture?


Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, we have a lot of plans for the Farm Credit Corporation. The hon. member will have to wait and see.


PLIGHT OF FARMERS AFFECTED BY BANKRUPTCY OF MACHINERY DEALER
Stanley James Korchinski: Madam Speaker, since the minister has a lot of plans but no money for the Farm Credit Corporation, does he have any plans to change the legislation which would make it possible for farmers to avoid having to go to banks and financial institutions in such situations as has developed in the North Battleford area where farmers have had to pay twice for machinery as a result of a bankruptcy?


Eugene Whelan: Madam Speaker, the hon. member mentioned a very sad state of affairs where farmers paid a dealer who did not submit the money to a finance company, so now they are being asked to pay again. There should be some law which protects the innocent purchaser of any product when this kind of situation occurs. It is hard to understand that this can happen in our society today.
However, when the hon. member speaks about the Farm Credit Corporation I would say to him that we do have plans which we will be submitting to the House, I hope shortly, which will allow us probably to increase our lending capacity substantially. We have plans also which will enable young farmers in particular starting out, to take out beneficial types of loans, perhaps at no interest rate for the first three or four years, and with no capital payments, so they can establish themselves.


PENITENTIARIES
Mr. Alex Patterson (Fraser Valley East):: Madam Speaker, my question is directed to the Solicitor General. Can the minister advise the House of the reasons for what has been termed the shocking cutback in security staff at the Matsqui institution in Abbotsford, British Columbia?


Hon. Bob Kaplan (Solicitor General):: Madam Speaker, there is a proposal to reduce the number of positions on the security staff of that institution, but I do not think it is shocking. The background of it is that the correctional service in Canada is developing national standards to try to assess the proper level of security across the system. We have learned from experience in other institutions, and these national standards indicate it, that some institutions have more security than others in the same category, and that some have less. We are trying, in a rational way, to balance the system.

April 10, 1981
Privilege-Mr. Nielsen
Security is, in a certain sense, endless. One can always demand and justify increasing the number of guards in the system, and to a certain extent that has happened in the past. I want to resist those kinds of demands to increase security constantly or to cut back constantly the amount of freedom given to inmates within the institution. I regret incidents, but incidents do happen, and they can be prevented. However, I reject the solution of always increasing the amount of staff and limiting the freedom of inmates in the institutions. I do not think that, in the end, that is an acceptable solution.


Alexander Bell Patterson: May I say that what has transpired recently has certainly been a shock to the people of that community because of the cutback. In view of the past security problems associated with the institution, such as escapes, violations of passes, and so on, what measures will the minister take to ensure that the public is properly protected, and will he reconsider the cutback which is being implemented at present? This is something that has been of major concern to my community, and I believe that the minister should reconsider his decision on what is actually a cutback, not just holding the line.


Robert Phillip Kaplan: I do not disagree it is a cutback but 1 do disagree that serious or any additional risks are created to the surrounding community. I can assure the hon. member that it is the view of the correctional service of Canada that the level of security that will be provided will be adequate, and 1 justify that in terms of the performance of that level of security across our system from coast to coast.

[ Translation]


Madam Speaker:: Hon. members will have noticed that the order for resuming debate on Bill C-42 and the amendment of the hon. member for Mississauga South (Mr. Blenkarn) is not included in today's Order Paper. This was caused by computer trouble probably connected to that of Columbia. The order will be printed next Monday.


PRIVILEGE
Madam Speaker:: On Thursday, March 26, 1981, the hon. member for Yukon (Mr. Nielsen) raised a question of privilege on which I would like to rule today. The question of privilege dealt with the illegal use of governments funds by the hon. Minister of Indian Affairs and Northern Development (Mr. Munro), affecting his rights and responsibilities as a Member of Parliament and impairing his ability to carry out the duties expected of him.
The hon. member has invited me to search Treasury Board guidelines for the establishment of ministerial offices in order that the Chair might share the view, as stated by the hon. member for Saskatoon West (Mr. Hnatyshyn), that the said guidelines had been breached and that the minister had acted illegally.
The hon. member for Yukon was kind enough to provide me with a copy of the guidelines on the terms and conditions of employment for ministerial staff, presumably issued by the Treasury Board secretariat. It has been ruled consistently that the Chair does not decide questions of law. Also, the Chair is not responsible for the interpretation of departmental guidelines or for determining whether or not it is illegal to breach such guidelines. These matters are, quite obviously, outside the ambit of the Standing Orders of this House.
The hon. member for Yukon also stated that, in establishing a ministerial office in the constituency of Yukon, the minister "is impeding my ability to perform my responsibilities as a Member of Parliament representing that constituency". In this argument, the hon. member was supported by some of his colleagues, including the House leader of the opposition, who asked that not only the Standing Orders but also the customs, traditions and precedents of the House be taken into account in this regard.
Other members also claimed that the establishment of ministerial offices in their constituencies impaired their ability to represent their constituents and infringed their privileges in ridings where ministers were not elected to represent the constituents. The inference appears to be that only the member elected in a particular constituency has the prerogative to represent the constituents of that constituency.
It might be useful at this point to quote in part Citation 17 on page 14 of Beauchesne's fourth edition, which reads as follows:
Every member as soon as he is chosen becomes a representative of the whole body of the Commons, without any distinction of the place from whence he is sent to Parliament.. . that every member is equally a representative of the whole has been the constant notion and language of Parliament. Every member, though chosen by one particular district, when elected and returned, serves for the whole realm. For the end of his coming thither is not particular, but general, not barely to advantage his constituents, but the commonwealth.
Hon. members have not claimed that there has been any physical molestation, as the hon. member for Saskatoon West admitted, to prevent them from discharging their duties in this chamber, and I must therefore rule that the rights of the hon. members have not been infringed in any manner by the establishment of ministerial offices in their regions.
Finally, the hon. member for Yukon and others have alleged that the establishment of ministerial offices in their regions was an illegal use of public funds and a violation of the equality of treatment of the members in terms of their constituency offices.
April 10, 1981

Constituency offices were established by the House for its members out of funds appropriated by Parliament. Although it has been suggested that constituency offices were created so that Members of Parliament for respective ridings in Canada could serve the people, no allegation has been advanced that any member was prevented from doing so or that such funds were used illegally by anyone.
Ministerial offices, on the other hand, are apparently established and maintained with funds appropriated by Parliament and allocated to the various departments. It is not the responsibility of the Chair as a matter of privilege to decide whether or not illegal use is made of such funds. It must be pointed out that the House has the opportunity to scrutinize such expenses before giving its approval to supply bills, and to check them after they are made through, for instance, the Office of the Auditor General or the Standing Committee on Public Accounts. The government can be challenged on the use it makes of such funds on motions of no confidence or substantive motions.
Therefore, it is apparent that the House, through its normal operations, can adequately deal with the alleged difficulties raised by the hon. member for Yukon, and I must rule that a prima facie case of privilege has not been established.


Erik Nielsen: Madam Speaker, I rise simply to give you notice today that it will be the intention on Monday to raise a question of privilege which has nothing to do with Your Honour's ruling just now. The question of privilege concerns certain remarks made by the Prime Minister (Mr. Trudeau). The question will be raised through proper notice to the Chair, either by the Right Hon. Leader of the Opposition (Mr. Clark), the opposition House leader or myself.


Madam Speaker:: I take that notice, but I remind the hon. member that I do not need a verbal notice. I need a statement of what the question of privilege consists. As long as I have such a statement, I am willing to hear the question of privilege.



ROUTINE PROCEEDINGS


[Stage Direction]
Order Paper Questions
Motion agreed to, bill read the first time and ordered to be printed.
Madam Speaker:: When shall the bill be read the second time?


Some hon. Members:: Later today.


Madam Speaker:: Later today, by unanimous consent of the House?


Some hon. Members:: Agreed.


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. 1,638, 1,883, 2,169, 2,194, 2,200 and 2,268.
[ Text]


Mr. Herbert: In each of the past five years, what amount was contributed to the Canadian Crafts Council by (a) the government (b) provincial governments (c) other levels of government and what was the total budget of the council in each year?
D. M. Collenette (Parliamentary Secretary to President of the Privy Council): (a) In so far as the Department of Communications is concerned:
1975/76
1976/77
1977/78
1978/79
1979/80
Arts and Culture Grant $ 75,000 $ 70,000 $ 70,000 $ 77,000 $ 77,000
In so far as the Department of Industry, Trade and Commerce is concerned:
Arts and Culture Grant 1975/76	$11,650
1976/77	$ 10,300
1977/78- 1978/79-	1979/80-
Payment of a contribution to the Canadian Crafts Council for the production of a booklet.
In so far as the Department of the Secretary of State is concerned: The following funds were awarded from the citizenship and official languages sector of the department:
Hon. Yvon Pinard (for President of the Treasury Board)	Student Community Service Program moved for leave to introduce Bill C-64, to amend the Auditor General Act.


[Stage Direction]
April 10, 1981
Order Paper Questions Official Languages in the Private Sector
1974/75	$	2,7451976/77	$	3,6001977/78	S	2,1251980/81	$	495(b)	The subject matter of this part does not fall within the administrative responsibility of the government of Canada.(c)	Other levels of government: The subject matter of
this part does not fall within the administrative responsibility of the government of Canada.
CCC Operating Budget
1975/76	$	100,3081976/77	$	129,4751977/78	$	118,8431978/79	$	92,5161979/80	$	124,255
Mr. Cossitt: 1.	What is the exact salary being paid, by the government, at the present time to Mr. Michael Pitfield, Secretary to the Cabinet and Clerk of the Privy Council?
2.	What is the total of indemnities received by the Prime Minister, from the government, at the present time?
3.	Is Mr. Pitfield receiving more in salary than the Prime Minister, as Prime Minister and as a Member of Parliament and, if so (a) what are all the reasons to justify such a situation (b) are Mr. Pitfield's services considered by the government to be more valuable than those of the Prime Minister?


Pierre Elliott Trudeau: 1. Mr. Pitfield is paid in the salary range for the DM-3 level, which is $68,900-$85,700. Salary administration at this level in the public service is based on the principle of assessed performance, with progression through the range being a function of the assessed level of performance of the individual executive.
2.	The Prime Minister receives the same indemnity as all Members of Parliament, $32,700. As provided in the Salaries Act, the Prime Minister receives an additional salary of $40,400. The Official Residences Act provides the Prime Minister with two staffed residences, lodging for the Prime Minister's chauffeur, food, hospitality, and other expense allowances.
3.	As a governor in council appointment, the salary range for the DM-3 level is set by the government, taking into account the advice of the advisory group on executive compensation in the public service. The salary, indemnity, and living expenses allowances of the Prime Minister are enacted in statute and as such are determined by the Parliament of Canada. There is no direct relationship between the two salary determination procedures.


Mr. Schellenberger: 1.	Did the Department of Indian Affairs and Northern Development reclassify the hot lunch program for New Brunswick schools from a non-discretionary item to a discretionary item in the 1980-81 budget and, if so, for what reason?
2.	Were the amounts initially allocated for the program transferred to other programs in the 1980-81 budget and, if so, to which programs?
3.	Were New Brunswick native groups consulted prior to the department's decision to discontinue the program and, if so, which groups and on what dates were they consulted?
4.	Was the program discontinued in New Brunswick schools during 1980-81 and, if so, for what reasons?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: 1. The noon lunch supplement was never identified by the department as a non-discretionary service.
2.	In 1980/81, $34,200 was spent for the noon lunch supplement during the months of April, May and June. The remainder of the allocation was used to fund other elements of the education program, such as: post secondary education assistance program and the contributions to bands program.
3.	Discussions concerning this program were held with the executive of the Union of New Brunswick Indians on July 16, 1980, at Fredericton, New Brunswick, and on August 20, 1980, at Oromocto, New Brunswick.
4.	The program was discontinued during 1980-81. Regional allotments were insufficient to fund this discretionary program.


Mr. Beatty: 1.	Was the city of Toronto's Mayor's Task Force on Disabled and Elderly invited to the National tensions Conference in Ottawa and, if not, for what reason?
2.	What groups or individuals were invited to the conference to represent the disabled in Canada?


Mr. Doug Frith (Parliamentary Secretary to Minister of National Health and Welfare):: 1. No. Because of severe space limitations and the need to ensure a balanced representation from governments, the private sector, pensioners and women's groups, it has been necessary to restrict invitations to national umbrella organizations.
2. The Coalition of Provincial Organizations of the Handicapped have been invited to provide representation for the disabled in Canada.


Mr. Herbert: Does the government record the annual ton/mile movement of (a) grain (b) potatoes, as a percentage of total rail transportation movement and, if so, was there a significant change in the past ten years?


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: The Canadian Transport Commission records Canadian ton-mile figures for Canadian National and
April 10, 1981

Canadian Pacific. The figures below show grain and potato movements as a percentage of total domestic traffic (i.e., transborder movements excluded) for these two railways. Data for other railways are not available. According to the Statistics Canada publication "Railway Transport-Part V", the two railways combined move about 99 per cent of the potatoes and 96 per cent of grains (such as barley, oats, rye and wheat) which travel by rail. The figures for 1971 through 1977 are taken from the CTC's computer database. Figures for 1978 through 1980 were obtained by phone from the information centre of CP Rail and the marketing and sales department of CN Rail and should be considered as approximations.
Movements of Grain and Potatoes CN and CP Combined Canadian Traffic 1971-1980 Tonmiles ('000)
Year	Total Traffic	Grain	Percent	Potatoes	Percent1971	69,181,688	19,527,530	28.23	252,144	.361972	75,644,772	27,144,002	35.88	275,320	.361973	74,923,104	22,939,780	30.62	239,801	.321974	78,409,960	21,377,118	27.26	206,218	.261975	77,753,610	22,455,424	28.88	204,074	.261976	73,177,309	19,794,282	27.05	161,252	.221977	79,215,956	24,563,023	31.01	140,418	.181978	93,792,930	26,690,417	28.46	170,389	.181979	100,239,370	27,301,876	27.24	127,088	.131980	104,432,020	32,720,744	31.33	102.744	.10


Mr. Herbert: 1.	Did the President of the Treasury Board express concern that the government regularly lost its best administrators to the private sector?
2.	What is the turnover rate for senior public servants?
3.	Does the President of the Treasury Board consider that changes to relevant salary scales are essential to attract and retain senior personnel?
4.	Did the President of the Treasury Board conduct an inquiry into possible shortages of senior-level personnel and were certain departments identified as not having enough competent senior management personnel to adequately carry out their mandate and, if so, which departments?


Hon. Donald J. Johnston (President of the Treasury Board):: 1. In his address to the Seventh Annual Conference on Compensation and Human Resources of the Conference Board of Canada on January 14, 1981, the president stated that, "As good managers become increasingly in demand in the private sector, we are likely to see a rapid and irreversible erosion in our management ranks".
2.	In 1980, of a population of 1309 senior executives, 110 terminated their service for reasons of: resignation (45), retirement (57), layoff (5) and death (3).
3.	The president also stated on January 14 that "With budgetary expenditures of 60 billion dollars, I think you will agree that we need the best managers in the country, yet all analysis clearly shows that many of our managers lag their private sector counterparts"; and, further that "(managers)
Auditor General Act
who accept responsibility and who discharge it effectively and efficiently on behalf of taxpayers must be rewarded accordingly." The president elaborated on compensation for managers as follows, "Let me make it clear that compensation improvements that I advocate for public service managers need not cost Canadian taxpayers significantly more. Rather I envisage a restructuring of our manager's compensation package to provide real financial incentives for high achievers while ensuring that mediocre performance is penalized".
4.	The president's statement quoted in response to question 1 is a general comment on the potential impact on the Public Service of the prospect of an increasing national demand for managers. In the opening remarks of his address on January 14 the president made it clear he will "draw heavily on input from my own bureaucracy ... particularly where technical matters are very much the focus of the remarks" but that in this address he had elected to offer "my own views ... untouched by bureaucratic expertise". In this context a specific inquiry regarding shortages of senior-level personnel was not conducted in relation to this address.


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


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


Hon. Yvon Pinard (for President of the Treasury Board) moved: that Bill C-64, to amend the Auditor General Act, be read the second time and referred by unanimous consent to the committee of the whole.
He said: Madam Speaker, the professional's role in our society, namely the person who provides services to his clients according to the rules of professional ethics, is in many respects of major importance for the success of government institutions and society as a whole. Thus, we know that members of the medical profession are devoted to the protection of life itself. Members of the bar defend the rights of individuals according to the laws approved by this Parliament and others before it. A professional practises a profession that requires highly specialized knowledge and lengthy and inten-

April 10, 1981
Auditor General Act
sive university studies to which must be added a high degree of technical and ethical excellence.
One of these professions is that of accountant and auditor, one of whom serves Parliament. Madam Speaker, I am speaking about the Auditor General of Canada, with whose duties all members of this House are familiar.
His office plays a role without which it would be difficult for us to assume our own responsibilities to the Canadian people. The Auditor General is one of the main protectors of public interest. The complete integrity, the technical knowledge and competence, the honesty and the devotion which has characterized this office throughout the years make this appointment one of the most important and influential in the country. [English]
The contribution of the Office of the Auditor General of Canada to the profession, both within Canada and internationally, gives us all a right to be proud. The Office of the Auditor General plays a major role in the assurance of responsible government within a parliamentary democracy. The existence of financial and other analyses of the highest quality are essential if many of the activities of the House are to be soundly based.
The purpose of this bill is to recognize the increasing importance of the office, not just to Parliament but within the profession and, not incidentally, the increasing importance of the accounting profession within our society. Accounting professionals are guardians within our economic system, much as the medical and legal professions to which I referred earlier are guardians of our lives and rights.
The Auditor General is a servant of Parliament. It is appropriate that we take the occasion of the appointment of Mr. Kenneth Dye to recognize the importance of the office by equating it to that of a puisne judge of the Supreme Court of Canada.


Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, the bill before us today is another of those small ones on which I have often been called upon to comment. This bill has only two clauses, and the other one upon which I was called to comment had one. But like some of the small bills, it has big consequences, particularly for the new Auditor General.
The Auditor General has been in office now for ten days. If this bill is passed today, it will give him a salary increase of $5,000, the way I read the provisions of the existing act and of the bill before us.
There have been other bills which were of more consequence to the new Auditor General. Of course, one of those was the Judges Act amendment which Parliament recently passed. I will say more about that later on.
In introducing the bill, the minister said that the Auditor General is a friend of Parliament. There is no question about that. He will be the watchdog for Parliament, for the Standing Committee on Public Accounts and, indeed, for all taxpayers of Canada. The man who is in this job right now is Mr. Kenneth Dye, who comes from Vancouver. He has had an
exemplary career in his profession of chartered accountancy and in the British Columbia Institute of Chartered Accountants, where a year ago he finished a term as president.
In addition to being a friend of Parliament and of taxpayers, Mr. Dye is also an old friend of my daughter. In fact, my daughter can claim to have known Mr. Dye for almost all her life. When she was six weeks old last June, she attended the annual general meeting of the British Columbia Institute of Chartered Accountants over which Mr. Dye presided as the then president. In case there is any doubt in the House, I must say that she behaved in an exemplary manner. Only at one time, when a speaker had gone on for too long a period, did she make any noise; perhaps it was a good sign because by then he had been going on for too long!
Mr. Dye will also be a friend of another young lady named Tasha, who was born six weeks ago in South America. She is the granddaughter of the hon. member for Okanagan-Similk-ameen (Mr. King). She will be moving with her parents to Canada in a few weeks. I am sure all new Canadians, like Tasha, will be very concerned and happy that Mr. Dye, the Auditor General, will be looking out for her welfare in the future.
I think we should examine what is proposed in this bill. The wording of the bill itself seems simple enough. It says simply that the Auditor General shall be paid a salary equal to the salary of a puisne judge of the Supreme Court of Canada. The wording in the existing Auditor General Act is that the Auditor General shall be paid a salary equal to that paid to the Chief Justice of the Federal Court of Canada.
By making that fairly simple change from Chief Justice of the Federal Court to puisne judge of the Supreme Court, Mr. Dye has achieved an increase in his basic salary of $5,000, from $62,000 to $67,000. But the situation is better than that for Mr. Dye because, as I remarked last week, this House has passed the Judges Act amendment. Under that act the salary of the Auditor General is tied, of course, to that of the judges of the Supreme Court. That measure gave those honourable gentlemen a retroactive increase of $7,000 effective April 1, 1979 and, another retroactive increase of $7,000 effective April 1, 1980. An additional clause provided that all judges, like Members of Parliament and perhaps other officials who are paid by the public purse, would have an automatic increase so that ad hockery would not be necessary every time an increase was needed. The judges' bill provided that all judges would receive an increase every year on April 1 to a maximum of 7 per cent. It would be less than that if certain federal indexes are less than 7 per cent. When Mr. Dye accepted this position last fall, he thought he might be receiving a salary of $62,000. He now finds himself, effective April 1 of this year, with a salary of $86,660, as I have calculated it. I am sure Mr. Dye will be very happy to be receiving roughly $24,000 a year more than he thought he would receive when he took the job.
There is another notable beneficiary of this piece of legislation whom I must just mention in passing. That beneficiary is,
April 10, 1981

of course, the past Auditor General, Mr. J. J. Macdonell, who retired last year. He will be the beneficiary of the retroactive provisions of this bill. As 1 calculate it, Mr. Macdonell will be receiving a retroactive bonus, as soon as these measures are worked through the system, of about $10,000.
It is all very well to talk about these high salaries, but I think we must have a basis for comparison. I checked through some records which were available to me to see what this kind of salary might compare with and whether it was a reasonable salary or not, since it certainly sounds high to some people. I referred to the report of the commission to review salaries of Members of Parliament and Senators by Dr. Mclsaac and the Hon. Leon Balcer. The recommendation in that report is that ministers of the Crown should be paid a salary for their position as ministers and another salary for their position as Members of Parliament, for a total as of April 1, 1980, of $80,000. To that figure of last April 1 must be added a 7 per cent escalator which is in the legislation. Of course, this is dependent on the legislation being passed, so it is hypothetical at the moment. That 7 per cent increase would bring salaries of ministers to $85,600 this month, which is almost parallel with the $86,600 this bill would provide to the Auditor General.
I also made a comparison of the amount paid to an SX-4, which is just about the deputy minister level. As near as I can calculate it, an SX-4, just below the deputy minister level, would now be earning about $77,000, possibly $78,000.
I did another comparison with respect to salaries of people who might be in the executive category, and so on, elsewhere in the country. I found that the president, the chief executive officer of Westcoast Petroleum, receives a base salary of $110,000. At the other end of the scale, the highest paid executive in Canada that anyone has been able to find so far is Mr. Sinclair, chairman of Canadian Pacific Limited, whose base salary is $568,000. So one can see that there is a fair range of opinion in industry as to what certain executive officers are worth.
Mir. Knowles: You mean, what they get paid.


William Hillary (Bill) Clarke: As my hon. friend to the left says, what they get paid. The shareholders or taxpayers had better think these people are worth what they are paid or else there may be some changes made.
I also thought it would be useful in establishing a base salary for our new Auditor General to make a comparison with what professionals like him might be earning if they stayed in the profession from which Mr. Dye comes. He was a senior partner in a national firm of chartered accountants stationed in Vancouver. I found that chartered accountants in British Columbia who graduated about 20 years ago, in the period from 1959 to 1965, were earning an average of $69,000. If they had left British Columbia to live elsewhere they were earning an average of $77,000. The older vintage of chartered accountants, those who graduated in the 1950 to 1958 period, were earning an average of $70,000 in British Columbia and $88,000 if they had left British Columbia. I cannot tell from
Auditor General Act
the survey done by the Institute of Chartered Accountants of British Columbia whether those figures apply to members who remained in practice or to members who went outside. I know something of the profession and those who practise as partners in large firms. I think it is safe to say that our new Auditor General, Mr. Dye, is certainly making a financial sacrifice to come and be the servant of Parliament. I think that is true not only of Mr. Dye but of the judges whose salaries he is tied to. I am sure it is true of a great many, if not all, of our deputy ministers who work for the government and the taxpayers, although the taxpayers may sometimes have cause to question that.
Recently we hired a chief financial officer for the Government of Canada, the Comptroller General. He is rated as a DM-3, which is the highest ministerial salary range. The medium salary range for that post right now is $77,300, with a maximum of $85,000.
I think it can be seen that the proposal in this bill to tie the new Auditor General's salary to that of the judges' salaries is not unreasonable, although it seems that way to many people.
I would now like to ask myself and the House why it seems unreasonable to have these very high salaries. If we look back in time we can see that not so many years ago very high salaries like this were not in existence at all. As recently as eight years ago, when I came here as a member, the salary was $18,000. It is now nearly double that amount. I can very easily lay the blame or the reason for all of that on the fact that government policies have made it necessary for people to get these very high salaries, that these very high salaries would not be necessary at all if it were not for inflation caused almost completely by the government's fiscal and monetary policies. Only the government has the power to overspend by the billions of dollars, something which has become a habit in recent years. Only the government has the power to increase the money supply, thus creating this terrible inflation which has caused endless problems in Canada today. This month in Ottawa there was a very important conference on pensions. That conference was a direct outflow of the inflation caused by policies of this government opposite.
We can look back to the days before the present administration took office in this country when inflation was almost negligible and interest rates were very much lower than they are today. People could borrow from the banks at 6 per cent or less instead of three times that rate now. Of course, one cannot expect people to invest their money with financial institutions at a rate of interest which will cause them to fall behind the rate of inflation and actually suffer permanent loss of purchasing power. That results directly in higher interest costs for individuals who want to borrow for personal or housing purchases, because investors in our society insist upon receiving a rate of interest which reflects the current rate of inflation and also compensates them for the temporary loss of spending power. Then, of course, banks and other financial institutions must have their spread in the middle to cover their operating

April 10, 1981
Auditor General Act
costs, the return to their owners, shareholders, or what have you.
The amount that this government has been overspending and the extent to which it has been increasing the money supply is absolutely straggering. Any taxpayer who might be listening or who would care to read these remarks will be astounded, because the amount of borrowing which we have just recently approved, $14 billion, which is to cover the current monetary needs of the government's operations, is equal to the total amount of all personal income taxes paid by taxpayers in Canada in 1978. In 1978 there were 14 million taxpayers who filed returns in Canada. Including those who had losses and no tax payable, on average $1,000 per person was paid in income tax, for a total of $14.2 billion. This year the government has asked Parliament to approve the borrowing of $14 billion just to cover overspending in one year. Because of this continuing policy which has aggravated the economic situation and led to inflation, we have a situation where the total debt of Canada is probably unknown precisely, but is certainly over $100 billion now.
With the government having to pay the interest rates that it, like everyone else, has to pay, in the current estimates for the 1981-1982 fiscal period there is provision for over $12 billion just to pay interest on the outstanding debt. That is a figure approaching the total of all personal income taxes paid by taxpayers in 1978. That figure, because it is in the estimates, ignores the interest burden shouldered by all the Crown corporations. Unless one is a wizard or whatever, those figures are an unknown quantity. However, they would certainly put the total up to the $14 billion range. So one can see where the comparison lies.
Granted, these highly paid executives of ours, servants of Parliament, civil servants and so on, need this money; but then the average man on the street also needs raises. That is why we have a lot of labour strife, and pensions conferences to find out why people cannot afford to pay these high prices.
We once had a debate respecting the salary of a certain minister opposite who had retired to his home in Vancouver. We discussed the indexed pension he would receive as a former minister of the Crown, and we found that he would have an enormous pension if he lived to be 75. Based on projections that were made at that time-that was a few years ago-this retired minister would need all of that money because when he was 75 years old he would have to pay $60,000 to buy a Ford car and $7 for a loaf of bread. If he wanted to get the plumbing fixed or something, and if he would have to employ a plumber, it would cost him $250 to get the kitchen sink drain repaired.
We are a few years along that road now. Who would have thought a few years ago that we would now be at the age of the $10,000 Volkswagen? In fact, I think it probably costs a lot more than that, but $10,000 is about the minimum cost of a Volkswagen. If one wanted to buy a Mercedes-Benz, one would have to pay about $55,000.


William James Kempling: If you can't afford it, don't ask the price.


William Hillary (Bill) Clarke: The day of the $100,000 Rolls-Royce is gone. We are already pretty close to the $1 loaf of bread. I guess,
with the rates that plumbers and other trades people need to charge these days, we are well along the road to the $250 visit from the plumber.
We have agreed to have a fairly limited debate on this bill, so I do not think I need detain the House any longer. However, it is absolutely essential when considering simple little bills like this with two clauses which have a great impact on a couple of Canadians, that we look beyond the two clauses to see why it is necessary to fix the salaries of a servant of Parliament. I suggest the whole structure of our monetary system is in jeopardy because of the policies that this government opposite has been following for at least the last 13 years, maybe longer than that. If we say that often enough in the House and outside the House, I just hope we can convince the government opposite that the policies it is pursuing are an absolute disaster and mean ruin for our pensions system, for our monetary system and probably for the whole fabric of our society. We very much want hon. members opposite to learn the consequences of their deeds before it is too late.


Mr. Doug Anguish (The Battlefords-Meadow Lake):: Mr. Speaker, I would like to say a few words on behalf of the New Democratic Party. As Treasury Board critic for our party and as a member of the Public Accounts Committee, I deal fairly closely with the Auditor General and we have had several occasions to deal with the Auditor General's office over the life of this Parliament so far. I would like to take this opportunity, before saying anything about Bill C-64 itself, to congratulate Mr. Kenneth Dye, the new Auditor General, who will be acting as an officer of this Parliament to keep control over the purse strings, over the spending presented by the government, authorized by Parliament, and then disbursed in the proper manner. I think he performs an important role in our society by being the watch dog over or guardian of the purse strings of this country.
I would like to say that we favour speedy passage of this bill whereby the Auditor General of Canada would move from a classification comparable to a Chief Justice of the Federal Court to a puisne judge of the Supreme Court of Canada. As the hon. member who spoke just previously to me pointed out, the salary range for the Auditor General of Canada will now be in the range of $80,000 to $90,000 per year. I recognize this is a high salary, but I have been assured by the hon. member for Winnipeg North Centre (Mr. Knowles) that we will be discussing the subject of high salaries when we review the salaries of Members of Parliament. This matter will be coming before us in the near future so I will not dwell on it now.
A salary range of $80,000 to $90,000 a year reflects the importance of the position of Auditor General of Canada. I am certain that Mr. Kenneth Dye and his predecessor, Mr. J. J. Macdonell, could have earned that type of salary in the private sector as professionals. I should like to say, Mr. Speaker, that we favour speedy passage of Bill C-64.


Some hon. Members:: Hear, hear!
April 10, 1981


The Acting Speaker (Mir. Blaker):: Is the House ready for the question?


Some hon. Members:: Question.


The Acting Speaker (Mr. Blaker):: I understand there is a disposition to put this matter through all stages.


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time, considered in committee, reported, read the third time and passed.
 * *

Hon. Pierre Bussieres (Minister of State (Finance)) moved: that Bill S-17, to implement conventions between Canada and New Zealand and Canada and Australia for the avoidance of double taxation with respect to income tax, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, the purpose of Bill S-17 is to implement conventions negotiated and entered into between Canada and New Zealand on the one hand, and Canada and Australia on the other hand, for the avoidance of double taxation with respect to income tax. Hon. members will recall that we considered a similar bill to implement tax treaties with several countries a few months ago, and the bill before us today is of the same type, includes the same provisions as Bill S-2 which we considered earlier, and confirms more or less some well-known negotiations and agreements.
Hon. members will recall that at the time of tax reform, Canada had tax treaties in force with over 15 countries. Of these 15 or 16 countries, Australia has had a tax treaty with Canada since 1967, and New Zealand since 1948. As you will recall, since the tax reform, we have invited several countries to enter into negotiations with Canada in an attempt to conclude treaties designed to avoid double taxation. We have now renewed and renegotiated such conventions with 32 countries, and it is expected that other countries will be added to that list.
As in the case of similar tax treaty legislation approved by Parliament in the past, this bill contains a special provision dealing with any future changes to the conventions. Part III of the bill is designed to ensure that the tax treaties can be kept up to date as the result of changes in the tax system of Canada or of the other countries. The mechanisms provided for under this bill are similar to those agreed to previously. In addition, the bill provides that the governor in council may, subject to a
Tax Conventions
resolution of Parliament, give effect to any supplementary convention.
The two tax treaties under consideration follow the general pattern of the treaties concluded with other countries after tax reform. They also follow to a large extent the format and language of the latest model double taxation convention published in 1977 by the Committee of Fiscal Affairs of the Organization for Economic Co-operation and Development, or OECD. Hon. members will recall that, when we were considering Bill S-2, we spent a great deal of time in the standing committee reviewing this standard or model treaty prepared by the OECD and that we also compared this model treaty with the various ones contained in Bill S-2.
The treaties generally provide that dividends can be taxed in the country of source at a maximum rate of 15 per cent. A general rate of 15 per cent is also provided for in the case of interests originating in one country and paid to a resident of the other country. With respect to royalties, the treaty with Australia provides for a general rate of 10 per cent, and the one with New Zealand provides for a rate of 15 per cent. The only limitations provided for under the old agreements were 15 per cent in the case of dividends with Australia and an exemption for copyright royalties with both Australia and New Zealand. I should now like to go over briefly the provisions concerning capital gains which preserve the right of the source country to tax gains arising on the sale of real property, business assets and shares in real estate companies.
Contrary to other tax treaties concluded by Canada, the treaties with Australia and New Zealand do not contain an article on non-discrimination. It is those countries' firm policy not to include such an article in their tax treaties and, as a matter of fact, the existing agreements already reflect their position. No special concession for teachers is included in the tax treaties. The reciprocal exemption now granted teachers under both the Australian and New Zealand agreements will consequently be terminated. Under the existing agreements, pensions and annuities are taxable only in the country where the recipient resides. Under the new conventions, Canada has preserved its right to tax pensions paid to residents of the other countries; in the case of New Zealand, there is however a special provision whereby that right will be exercised only if a pension within a year exceeds $10,000. The country in which the recipient of the pension resides retains its full taxing rights.
Double taxation of foreign source income of Canadian residents is alleviated by way of a foreign tax credit. In addition, an exemption is granted for certain dividends received from a foreign affiliate of a Canadian company. In order to promote the flow of capital and investments, the tax treaties also ensure that proper relief will be granted in the other countries in respect of taxes paid in Canada. On balance, Mr. Speaker, the terms of the tax treaties provide an equitable solution to the various problems of double taxation existing between Canada and these two countries. Mr. Speaker, I therefore commend

April 10, 1981
Tax Conventions
this bill to the most favourable consideration of this House, and I appeal to the usual co-operation of members on both sides of the House so that this bill may be passed very quickly.
I would have liked, Mr. Speaker, to be in a position to comply with the wishes of certain members and to provide information on or to update the status of the convention between Canada and the United States, which is extremely important, as has already been pointed out in the House. However, I have not yet received the information related to this convention, but if the House will allow me to do so, 1 shall be happy to give this information later in the course of this debate.


John Carnell Crosbie: Mr. Speaker, this legislation concerns tax conventions entered into between Canada and New Zealand and Canada and Australia, as the minister explained. There is one thing about the Minister of State for Finance (Mr. Bussieres); when he speaks you can understand him. He does not consider his main purpose in life to "obsfucate", as the Minister of Finance (Mr. MacEachen) does. The chief duty of the Minister of Finance is to "obsfucate".


Mr. Knowles:: To what?


John Carnell Crosbie: o-b-s-f-u-c-a-t-e-"obsfucate".


Stanley Howard Knowles: That's a new one for the dictionary!


John Carnell Crosbie: In that way no one will understand what he is saying or doing. We had an example of that in question period today, where the Minister of Finance continued his practice of the last 13 months, which is to say nothing and say it in the vaguest way.
In his colleague, the Minister of State for Finance, we have the opposite. He is a man who knows his business. He has obviously studied his brief. He has the expertise and he is not afraid to say what he means. He has said quite plainly that this is a tax treaty between Australia and Canada and New Zealand and Canada. If the Minister of Finance was introducing this bill, we would not know that yet. We would have no idea in the world what this was or who this convention was between.
It is also noticeable that this is a tax convention between Canada and two other Commonwealth countries. I am glad to see that the relationship between these two countries and Canada appears to be going along pretty smoothly. Apparently Canada has not told Australia and New Zealand that they should hold their noses as they pass these tax conventions. Canada has been a bit more diplomatic. It is not like the poor old mother country. The Prime Minister (Mr. Trudeau) has told the mother country, the United Kingdom,-it is still called the mother country in Newfoundland-from which some of us have sprung, to hold their noses while they pass the constitutional resolutions, if they ever get to the United Kingdom. That is not calculated to improve relationships between two countries of the Commonwealth. I am glad to see the Minister of State for Finance has not exacerbated our relationships with New Zealand and Australia by doing anything like that.


Stanley Howard Knowles: We need a new dictionary today!


John Carnell Crosbie: The House leader of the New Democratic Party has had a rough week. If he has not heard the word "obsfucate" before, I am deeply shocked. He has been in Parliament since 1900. I think his record is 81 years. Perhaps it is only half that. Therefore, I am dumbfounded about that.
Our party has no objection to this legislation. It is sensible with countries with which we have a lot of commerce that we have legislation designed to deal with the question of double taxation and to relieve that burden from those who do business in both places. Australia is dynamic, growing and rapidly industrializing. There is a considerable Canadian investment there and a considerable amount of business done between our two countries. New Zealand is a much smaller country and we do not have as much commerce with it, but we need this tax convention with both countries.
We on this side are not going to divide on this. We will assist in putting it through the House with all reasonable speed in view of the reasonable and clear explanation we have had from the Minister of State for Finance. I only hope his senior partner will watch how he operates, try to emulate him and be a little more forthcoming in telling us what his policy is or is not than he has been to date.


Stanley Howard Knowles: Mr. Speaker, this is more or less a routine bill. We have these tax convention treaties with a number of countries and they have to be updated from time to time. As far as we can ascertain, there seems to be no reason for delaying passage of this bill.
I was interested not only in the new words that the hon. member for St. John's West (Mr. Crosbie) coined today-he has added a few to any dictionary that I know-but I was also interested in the reference he was able to make to some things that were not exactly within the pages of this bill. Maybe I can do the same, briefly, but maybe I can be a little more relevant.
Since we are talking about tax convention treaties with certain other countries, I hope that at some point when we are dealing with this bill, whether in the standing committee or in committee of the whole, the minister can bring us up to date on the tax treaty between Canada and West Germany. This is a treaty that has been around for a long time. I hope very soon now there can be an agreement which can be confirmed by the legislative bodies of both countries. There are many former citizens of West Germany living in Canada who are affected by these tax arrangements. I hope the Minister of State for Finance, (Mr. Bussieres), who has been very generous in the past on updating us on the Canada-West Germany situation, will bring us further up to date.
While talking about treaties with other countries-here I stray a bit but I will be off it before Your Honour can call me
April 10, 1981

to order-I hope that the discussions that are going on for reciprocal social security treaties with other countries will be pressed. Many Canadians are puzzled as to how we can have reciprocal treaties with so few countries. I believe we have them with Portugal, Italy, West Germany, and there is the possibility of one with the United States, but still none with the United Kingdom. I trust that the Minister of State for Finance will press his colleague, the Minister of National Health and Welfare (Miss Begin), to do as he has done to get her to obtain these agreements.
With those pleas to the government, we are prepared to give second reading to this bill.


Mr. Evans:: On a point of order, Mr. Speaker. In the same spirit of parliamentary progress in which we have come to agreement among the three parties on other matters, there might be agreement to put this bill through Committee of the Whole and third reading. If that is so, I would ask Your Honour not to see the clock until we can complete that business.


The Acting Speaker (Mr. Blaker):: If the disposition exists, we will proceed in that fashion. Is that agreed?


Some hon. Members:: Agreed.


Stanley Howard Knowles: Mr. Speaker, as the parliamentary secretary knows, I have been trying to carry on some long distance discussions with my colleagues. I would be much happier if we proceeded only with the Committee of the Whole stage and let third reading stand on the order paper until some further date. However, we are prepared to agree that, instead of sending this bill to the overworked Standing Committee of Finance, Trade and Economic Affairs, we deal with it in the Committee of the Whole. As far as I and my whole party are concerned, we are prepared to do that before one o'clock.


John Leslie Evans: Mr. Speaker, that is agreeable.


The Acting Speaker (Mr. Blaker):: Provided there is not too much obfuscation in the chamber at the moment!


Stanley Howard Knowles: That is a proper word!


The Acting Speaker (Mr. Blaker):: Over the lunch hour perhaps those who work in Hansard might appreciate instructions as to how they are to proceed on the matter of obfuscation.
Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time, considered in committee and reported.
Pierre Bussières: Yes, Mr. Speaker, a while ago at the end of my comments, I indicated that the hon. member for St. John's
Meat Import Act
West (Mr. Crosbie) and other members had shown their interest in the tax convention between the United States and Canada and wanted to know where we stood. I would like to say first that the convention has been signed and that in January we issued a press release stating the general outline of the convention as understood by the negotiators. Some papers still need to be completed. However, the government intends to act as quickly as possible as soon as everything is formally finalized. That is the information I wanted to give Mr. Speaker.


Stanley Howard Knowles: What about Canada and West Germany?
[ Translation]


Pierre Bussières: Mr. Speaker, as for the negotiations concerning the tax convention between Canada and the Federal Republic of Germany, there was one round last June. Some important questions were still in abeyance. If I remember well, there will soon be some other negotiations and meetings between the representatives of the Federal Republic of Germany and their Canadian counterparts in order to arrive at a final agreement respecting the convention.


Stanley Howard Knowles: "When shall the bill be read the third time?"


The Acting Speaker (Mr. Blaker):: When shall the bill be read the third time?


Stanley Howard Knowles: At the next sitting of the House.


The Acting Speaker (Mr. Blaker):: At the next sitting of the House?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Blaker):: With thanks to the hon. member for Winnipeg North Centre (Mr. Knowles) for his assistance.
It being one o'clock, I do now leave the chair until 2 p.m.
At 1.06 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Eugene Whelan: that Bill C-46, to regulate the importation into Canada of fresh, chilled and frozen meat and to amend the Export and Import Permits Act, be read the second time and referred to the Standing Committee on Agriculture.

April 10, 1981
Meat Import Act
He said: Mr. Speaker, I am pleased today to speak to Bill C-46. I will take just a few minutes on this occasion to give hon. members the background of this legislation and why it is vital to the 69,000 cattle producers in Canada. At present, Canada is the only major beef importing country in the world that does not have an ongoing beef import policy. Without such an import policy, this nation is vulnerable to market fluctuations and international price swings which are beyond our control.
As hon. members know, Canadian cattle production generally follows an eight to ten-year cyclical pattern. When beef prices are as low as they were in 1976, cattlemen start to lose money. First, the feedlot operator, then the cow-calf producers are squeezed, breeding herds are reduced, and distortion takes place in the whole beef industry. For a while this leads to more beef on the market because the producers are selling off their breeding herds, and consumers enjoy for a short time bargain prices. Generally it is for a short time; sometimes it becomes quite a lengthy time.
However, over the following few years there are fewer calves and feeder cattle to be sold and slaughter cattle prices rise. Before long, consumers find themselves paying a lot more for a pound of steak and cattlemen start to make a profit again. It takes a full three years between the decision to expand the breeding herd and when beef supplies are increased at the retail level.
Some people leave the impression that a farmer or rancher can produce this biological entity called the beef animal almost overnight; that the amount of beef which will be consumed can be placed on the market at the whim and fancy of anyone in the entire industry-the packing and retail industries-as well as the consumer. It is not that easy; it takes three years to increase production.
In recent years an international cattle cycle has developed. Production in most beef exporting countries now follow very similar patterns. When our beef production is up, so is the production in the United States of America, Australia, New Zealand and generally Argentina. When beef is in short supply in North America, usually the production cycle is turning down in New Zealand, Australia and other beef exporting countries. As this international beef cycle has developed, the fluctuations in world beef supplies and prices have become wider. Most major beef importing countries have acted to protect their cattle producers from the worst effects of these fluctuations.
For example, beef and veal imports into the United States have been regulated under its meat import law since 1964. Beef exporters face restrictions when selling to the United States, but the Canadian market is open. Obviously this can lead to our market being loaded with cheap beef. Furthermore, this situation upsets our normal trade pattern in beef and cattle with our United States neighbours.
We saw this happen in 1976. Imported beef was taking the place of Canadian beef on our retail markets and in our
restaurants. At the same time, our cattlemen were exporting more live cattle to the United States. Why? Because they could not ship beef cuts and carcasses, since access to our beef was limited by United States meat import law. So they shipped live cattle, and soon U.S. producer groups were calling for controls on live cattle trade as well as beef.
We well remember the road blockades which were placed at certain border crossing points where trucks were hauling live cattle. The Americans were concerned about the importation of live cattle from Canada hurting their markets. When it was pointed out to them that the sale of live Canadian cattle into their markets, even at the highest point, would not affect 1 per cent of their market, I remember that one of the leaders of the opposition to Canadian cattle going into the United States said, "If a person is standing in a pool of water and is just bearly able to breathe, that extra little water in the pool will mean that he or she drowns".
If we shipped every head of cattle we have in Canada to American markets, we would only take over about 10 per cent of their total domestic kill for a few short days. Then we would not have any more cattle in Canada and they would not have to worry.
In the last month, the Americans have substantially increased their sales of live cattle into Canada because the prices are a bit better here and they have a surplus of huge, fat cattle. Our packing firms are buying those cattle, bringing them into Canada and depressing the prices to Canadian beef producers. In many instances they are producing below the cost of production at the present time. Many people are hit by high interest rates because they borrow huge amounts of capital to buy feeder cattle and to keep them on their farms all winter to supply the market in the spring and early summer months.
I talked to one young farmer the other day. I call him young because he is three or four years younger than I, so he is still a very productive person! He owns a farm in Ontario which consists of 450 acres. Nearly 400 acres of it are tile-drained; the buildings are very modern. He and his wife fed 450 cattle over last winter. His wife works as a registered nurse. Mr. Speaker knows how hard registered nurses work. His wife has worked in order to supplement their income, but over the last three years they lost money. With her wages, etc., they worked for nothing to supply some of the highest quality beef to the Toronto market. Fie told me, "I am selling my farm. If you can find me some foreign buyer for my farm"-and I am sure there will be some because they look upon land in Canada as much cheaper than land in Europe-"I could sell my farm, and most investment companies, trust companies or banks would give me more income, and I would do nothing for the interest I receive". He referred to the effort that they had put into the farm over their lifetime. It is a family farm; it was owned by his father before him. He said, "I will not mortgage it; I will sell it."
He did not say what he would receive for it, but I know that his farm should probably sell on today's market for close to $1 million. He could invest that money and a reasonable return
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would be about $120,000 per year; he would not have to do a thing. Right now he is a very productive person, investing various amounts of money in the production of corn on his farm in order to feed the cattle, yet he does not receive enough money to make a living. This is very wrong.
This bill does not protect trade in live cattle. Last year we sold $300 million worth of cattle in the United States. In turn, the Americans shipped to us over $90 million worth. Shipping $300 million worth of cattle into a population of over 240 million, and then shipping $90 million into a population of 24 million, will have slightly different economic effects per capita on the total industry.
I can just imagine what would happen in the United States of America if we took over 10, 12 or, in some instances, 20 per cent of its slaughter market for weeks at a time. Can one imagine what form of revolt would take place in that country? We only have to remember how excited the Americans become when we take over 1 per cent of their market; they almost call it a marketing catastrophe. Yet our country is supposed to accept their exports without any concern.
As I said, Canada is both an importer and exporter of beef. I am referring to beef not on the hoof. For instance, in 1980 we imported approximately 115 million pounds of fresh, frozen and chilled beef and veal and exported approximately 100 million pounds. The United States market has been and will continue to be our best export market for beef and cattle.
I pointed out some of the disadvantages of what we call that best market and how disruptive it is, since the only time those live cattle come into our country is when our market is better. The only time our cattle go to their country is when their market is better. You can see the tremendous changes which take place when the market is that way, with some 100,000 head of cattle shipped into Canada and maybe some 7,000 to 9,000 shipped into the U.S. because of the price differential.
Our ad hoc, year-by-year policy of restricting imports up to now has led to uncertainties-uncertainties for the Canadian meat industry and for our trading partners. It is time we put permanent import controls in place. Again I must put on the record, Mr. Speaker, that these important goals are not for live cattle. I believe some time in 1974 I persuaded the government to place controls on live cattle. The United States retaliated. We allowed 100 per cent of their five-year average of imports into our country. They did not fill one third of the quota given to them yet they retaliated and placed controls on our beef, pork and veal going into their country. We had to lift those quotas after one year. So they can be very powerful. The United States is a very restrictive trading nation in many ways. We have been a much freer trading nation in foodstuffs, generally speaking, than has the United States.
What this legislation does is to set annual quotas on imports of fresh, chilled and frozen beef and veal. These quotas are based on the historical level of imports in the 1971-75 period, but adjusted each year to take into account changes in the amount of beef consumed in Canada and the number of cows
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and heifers being marketed. Factors such as the supply and price of other meats, and changes in any restrictions affecting our cattle or beef trade with other countries, will also be considered in determining whether import quotas should be increased, decreased or suspended.
What that means, Mr. Speaker, is that if we have tremendous amounts of poultry or turkey meat in storage, that will have an effect on what the quota will be. This is slightly different from some of the meat import acts which other nations have. We think it is to our advantage because, for instance, when we see overproduction of pork in Canada selling below cost of production, it has a depressing effect on other meat suppliers, such as poultry and beef suppliers in Canada. At the present time pork producers are selling their product at $20 to $30 below cost of production.
Consumers today, in some instances, are paying the lowest prices they have ever paid for meat, especially pork products, when you consider their earning power. It would be as if it were given to the consumers free in the depression period, the prices are that low. So when people complain about high prices, it must not be forgotten that last year we put approximately $46 million into hog support prices.
The estimates for the year 1980, because so much was produced below the cost of production, had a depressing effect on other meat production entities. Our very rough estimate now is that we will have to use about $140 million for stabilization, so they can remain in business. What we are doing is exporting the surplus product on world markets at the same price as it fetches on domestic markets. Any other country would be foolish to enter into a pork production entity when Canadians are so stupid that they are producing the product below the cost of production, thus supplementing the treasuries of such countries as Japan and the U.S.S.R. We are so efficient that we produce some of the highest quality meat products in the world, yet we have not learned how to market that product in a proper fashion. For example, if the U.S. decides to suspend meat import restrictions in a particular year, there would normally be no reason for Canada to apply import restrictions. But that would be left to our discretion.
An advisory committee made up of representatives of the beef industry and consumers would be set up under this legislation. When considering annual import levels the Minister of Agriculture would seek the advice of this committee.
Bill C-46 is broadly parallel to the U.S. meat import law which was revised by the U.S. government in 1979. Under the old U.S. law, when production declined so did import quotas. When production was on the upswing, import quotas were increased proportionately. This reinforced the swings in the international cattle cycle. With the new U.S. formula, import levels are generally increased when domestic supplies are falling, but restricted when U.S. supplies are adequate. The counter-cyclical formula in Bill C-46 works in the same way. This legislation will provide increased stability for the beef industry.
Some members examined this bill after it was given first reading some months ago. We call this our bill because it was

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drafted by myself and my officials when I was minister, because I took that short sabbatical. It was also looked at by my colleague, the Hon. John Wise, when he was Minister of Agriculture. So the bill was drafted several times before it was finally presented to the House. It is really amazing to me that we are at the stage of giving this bill second reading today. The committee will be studying it and they may have certain amendments to present. As long as they are responsible and constructive suggestions, we will take a very good look at them.
We think this legislation will provide increased stability for the beef industry. This legislation will not over everything that people want. They will at least know that this legislation is on the books and that they will be able to abide by it. It will give Canadian cattlemen some of the assurances they need to plan beef production in the years ahead. You will notice, Mr. Speaker, I said "some of the assurances". This legislation will help stabilize beef supplies and prices to consumers. It will let our trading partners know where we stand on beef imports.
I am sure that a matter of such importance to Canadian farmers and consumers will receive the full support of hon. members. I will be happy to supply further details and respond to questions as the debate on this legislation proceeds.


Mr. Bert Hargrave (Medicine Hat):: Mr. Speaker, I would like to say that I agree with the last thought that the minister expressed. He said it is rather strange that it has taken us this long to get this very important agricultural bill to second reading stage in the House. After all, the whole idea was first started by the cattle producers back in 1970. At that time the Canadian Cattlemen's Association made a proposal to the Hon. Bud Olson when he was minister of agriculture. So that shows how long cattlemen have been interested in this worthwhile project.
I had a brief meeting with the minister yesterday. At that time I referred to this as a bill which relates to meat imports. I attach a somewhat different reference to that phrase than the minister does, since I think we began a little earlier than the minister. However, I will say this. We in the official opposition fully support the broad principles of the bill. We are in agreement that second reading should take place today, followed immediately by the appropriate reference to the Standing Committee on Agriculture for a thorough examination, with ample opportunity to call interested and concerned witnesses.
The minister will well remember our Progressive Conservative efforts on this same subject during our period of government in 1979. These efforts included a very worth-while beef import consultative committee that did the necessary background consultation with all segments of the cattle and beef production and marketing chain. This was followed by our beef import bill, as we called it at that time, which was scheduled for first reading the day after our government was defeated. We on this side of the House are pleased to note that Bill C-46 is in general agreement with the broad principles of
our earlier legislative plans. There are a few details that we would like to see changed, and I will comment on these a little later.
First of all, let us look at the need for beef import legislation. Canada's beef cattle industry is desperately in need of a shot of self-confidence, especially in the long term. Our well-known ten-year commodities cycle and traditional short-term ad hoc policies simply are not enough. We must have longterm policies. The longer the commodities cycle, such as ten years with cattle, the more important that is. Our cattle industry must have long-term policies which will provide genuine incentive to cattle producers to come back into the industry, or to start for the first time; or, more importantly, to start to rebuild our breeding herds.
I suggest it is highly significant that our Canadian beef cattle industry is still at the bottom of the cow or breeding cycle and the beef supply cycle. We have been on that low cycle point for about three years with very little evidence of any upturn. This meat import bill could make a good start at providing the beginning of that long-range incentive for our cattle industry. This legislation could indicate that the government does indeed understand the problems of cattle producers and genuinely wants to listen and respond to the concerns of major food producers in Canada.
Why, after three years, has there been no significant upturn in our cow and beef supply cycles? There are several basic contributing factors to this situation. First of all, 1980 was a bad year for cattlemen, especially cattle feeders, who suffered a net loss position across Canada of $129 million. That is the worst loss position since these kinds of records were started back in 1970.
Second, beginning in 1980, we have been experiencing the highest interest rates in our history-along with every other part of our nation, of course-with no sign of relief. In addition, there are the companion factors of steadily rising feed grain and other production costs. These apply particularly to our cattle feeding sector.
Third is the whole subject of drought in western Canada. The natural and quite proper reaction to drought in the cattle industry is to reduce our numbers to fit available supplies of grass and forage feed. There has been a sequence of recent drought years. In fact, they now appear to be almost ongoing. In 1977 there was a single, one-year drought, but a very severe one. This was followed by the first six months of 1980 which impacted much more severely on western cattle producers than on their grain producing neighbours.
Today, in early spring, there is already yet another prospect of widespread prairie drought which appears to be part of a larger drought pattern across the western United States. Available forage feed supplies for next winter will be severely restricted, and we know that already because there has been a lack of snow run off so necessary for local flood irrigation feed projects. Here I am not referring to the concentrated irrigation districts in southern Alberta.
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The fourth item is that the cattlemen have long and very bitter memories of, 1976 when they suffered through enormous, uncontrolled offshore beef imports from Australia and New Zealand at a time when we permitted unrestricted access to Canadian markets. This single factor may very well be the most important to cattle producers in their reluctance to rebuild their breeding herds. By the same token, this factor may be the most important reason for the need for this meat import legislation.
I would like now to make some comments about the proposed meat import legislation itself. We should not be timid in formulating our first Canadian meat import legislation along the lines of somewhat similar United States legislation. After all, they have had their legislation since 1964 and have recently amended their act to recognize recent changes in meat import trading patterns.
From our point of view as Canadian cattle producers, there are possibly four principles which should be recognized in any system that regulates meat import levels. First, there is an historic basis. Obviously, any new meat import policy must take into account our previous import levels and the historic market share enjoyed by our trading partners. Essentially, only three other countries are involved: the United States, Australia and New Zealand. While there are other countries, the volume of their meat trade is not significant.
The second factor is predictability. Both exporting countries and our domestic producers should be able to plan ahead with some guarantee of import levels, under what circumstances these levels may be expected to change, and by how much.
Third is the relationship to domestic consumption. There should be some reasonable provision for import growth with an increase in our domestic market, but not to such a degree that it discourages our domestic production.
Fourth is the relationship to domestic supply. It is not widely accepted that the concept of counter-cyclical quota levels is to guarantee Canadian producers that during the peak cycle periods we will not be overwhelmed with imports as we were in 1976; and conversely, at the low cycle points, such as we have now, increased imports might be expected.
It is worth noting that presently all four countries concerned-Canada, the U.S.A., Australia and New Zealand- are experiencing the same low point in the breeding cycle and, to a slightly lesser degree, also in the beef supply cycle. Because of this, Australia and New Zealand were unable to fill their quota allocation in 1980, and very likely this will happen again in 1981. However, the North American continent is not short of meat or meat supplies in any form because of very generous supplies of pork in both Canada and the U.S.A. It is also worth noting that domestic pork production in Canada is now equal to, or slightly higher than, beef production.
Under the heading "Interpretation" in Bill C-46, since the proposed act is somewhat parallel to the United States meat import act, it is worth noting that, like the U.S. act, it does not include live cattle, pork or canned meats. We on this side agree with this interpretation. I would add, as a comment on that,
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that the two-way live cattle trade between Canada and the U.S.A. is of such special historic significance as to preclude live cattle from the provisions of this meat import bill. We in Canada should never forget that we are next door to the highest and most dependable cattle and beef market in the world. However, we would suggest that under "Interpretation" the term "meat" should include mutton and goat meat. After all, we have a sheep industry that is presently enjoying a modest comeback.
If the United States' approach of using voluntary quota levels for exporting countries is to be followed, then the so-called trigger level must be very carefully determined as the result of recent levels of guaranteed minimum access and the anticipated human growth factor in Canada.
In this respect, many Canadian cattle producers feel that the problems created for this proposed bill by the agreements negotiated under the last GATT are so serious as to question seriously the anticipated usefulness of this meat import law. I think the effort is worthwhile but the implications of the last GATT exist. I know the minister is well aware of this. In my opinion, what is necessary is that the government renegotiate the last GATT agreements with respect to Canada's guaranteed minimum access levels and the human population growth factor with our trading partners. Quite frankly, in my opinion, in those last GATT negotiations Canada was clearly out-negotiated, particularly on the human growth factor. It is highly significant that the United States did not agree to a similar condition.
We are concerned that unnecessary and excessive discretionary powers have been provided in the bill by the minister. We suggest there is room here for political manipulation of quotas. These discretionary powers should be very narrowly prescribed and clearly defined. Surely this is another case where the ultimate opportunity to amend the legislation and bring it back before Parliament still rests with the government.
While the bill provides for establishment of an advisory committee, we feel that there should be a direct requirement in the act that the Minister of Agriculture (Mr. Whelan) consult with the industry, since it might be possible under this proposal that the minister would consult his advisory committee only and not the commodity groups that are ready and able to give experienced and competent advice.
In conclusion, I want to suggest that Canadian cattlemen have always felt that some reasonable beef import legislation is an essential element in any policy designed to stabilize beef supplies in Canada. Both before and after the passage of this bill, Canada will still have the most lenient and generous beef import policy of any major beef importing country in the world. I know the minister would agree with that. But let us not forget 1976!
The Canadian Cattlemen's Association has been promoting such legislation since 1970. As I outlined in my opening remarks, it first proposed the concept to the then minister of agriculture, the Hon. H. A. Olson. After second reading today,

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the bill should be referred to the Standing Committee on Agriculture, and that committee should encourage every interested group to come before it and give it the benefit of their experience.
I hope that other related items could also be reviewed in that committee under the same referral. I am sure that it will not surprise the minister when I suggest that one of them might very well be the recent extreme market disturbance this year by the 30,000 head of live fat cattle imported into southwestern Ontario in the first five weeks of this year. That situation still remains, although it is not as extreme as it was.
I thank you for your patience, Madam Speaker.


Some hon. Members:: Hear, hear!


Mr. Vic Althouse (Humboldt-Lake Centre):: Madam Speaker, I rise to speak briefly in the debate on this bill. We agree that the bill should be referred quickly to the Standing Committee on Agriculture because the contents are relatively technical and cannot be dealt with adequately in the House.
I want to make a few brief comments about the bill. My first reaction is to say that at last we have some cognizance by this government and the immediately preceding government that there is a need to recognize the value of supply management in the Canadian beef market.
What we have before us is a very rudimentary move toward a supply management scheme. It applies only to offshore beef and to beef and veal of a fresh-killed or frozen nature. It ignores mutton, goat meat and lamb, but it is a beginning. This is the first time that any government has brought in a bill that gives some recognition to the fact that we need supply management in our beef marketing system.
The bill purports to be a supportive measure to the U.S. bill, which was revised in 1969 and is intended to be a beef import bill that would be counter-cyclical in nature. Stated simply, that means that we would allow more imports into our country when our beef cycle is low on the supply side. This is the kind of concept that no one can argue with, except that if you think about it you will realize that the major exporters of beef to this country, the New Zealanders and the Australians, see North America-in this case meaning Canada and the United States-as their major market. Once they understand that we have such a formula at work, and given the fact that they operate through single desk selling agencies, I can see that within one or two beef cycles they will be able to make adjustments so that they can manage to work the system to suit their production and price requirements as well. However, we will try it and see how it works.
Since I believe this to be a very rudimentary bill, I am, of course, distressed that it does not take into account the movement of live beef. This is very important to a country like Canada where we sit next door to a country whose beef production patterns and consuming patterns are very similar to ours. But we are only approximately one tenth the size of that country, both in terms of production capability and consumption capability, and certainly in terms of political clout when dealing with bilateral agreements.
I am a little distressed that the ministers who drew up this bill did not recognize the good work in the report of the Senate agricultural committee issued in 1977, which urged that the bilateral agreement be renegotiated to include live beef. I can readily see why the United States is not keen to renegotiate such an agreement. Their country is ten times the size of ours and when we have a short-term distress surplus of beef we can walk it across the border with little effect on their market. When they are in a similar situation, however, and have a 1 per cent or 2 per cent surplus in American terms, that translates into a 10 per cent or 20 per cent surplus when it crosses the border to our side. We feel it very much. At the beginning of this year there were weeks where imports were at the level of 3,000 or 4,000 head of fat beef coming into Canada. That had an effect on our prices and a lot of beef producers were hurt.
We insist on keeping the door open because most of us who are in agriculture have an optimistic view. We look forward to that great day when we will be surplus producers and can have a good calf crop. We will want to have access to the U.S. to sell our production.
That perhaps made sense 50 or 60 years ago, but the situation is changing. We should use a different form of analysis, a straight producer-consumer analysis. If we compare the total amount of beef produced in this country with what is consumed, we have to go back to 1967 to find a year where we produced more than we consumed. My figures only go to the end of 1979. There may have been a quarter in 1980 where that changed. However, for the 13 or 14 years previous to the end of 1979, our total production of beef was slightly less in every year than what we consumed.
Holding the door open, keeping free trade flowing and allowing meat to pass back and forth between the borders of our two great countries, only to take advantage of some time in the future when we may produce a surplus to what we consume, is no longer realistic. This situation should be looked at in today's terms. Thirteen or 14 years' experience gets us through one and a half or two beef cycles. In all that time we have not produced more than we have consumed. Therefore, holding the border open for those reasons no longer makes sense.
As I said at the beginning, the bill supplies us with a curious form of supply management patterned after a U.S. example. The formula presented in the bill leaves at least three spaces for ministerial discretion. There are three statistics we can plug into the formula which use estimates. This does not leave as much leeway as existed under the old system, where the minister and his department sat down toward the end of the year to decide whether the level should go up, down, or, as was done at the end of 1980, disappear altogether. Even though that discretion is no longer there, it is still a fair amount.
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If we want to use actual figures from previous years and plug numbers into the formula, by accepting a 10 per cent increase over the previous year or a 10 per cent decrease, depending on whether you want to make those kinds of discretionary moves, the import level could come down to 158 million pounds or go as high as 172 million pounds, which is a much larger move than that which is made by using ministerial discretion. Therefore, the possibilities of ministerial discretion are still there and they are still very great.
We have made a move toward the U.S. system. I am not sure we should do much more than that. Simply tying ourselves to the U.S. situation will not do that much for the beef producers in this country. If we want to co-operate with the United States for other reasons, perhaps it is something we can consider. However, it should be raised in bilateral talks under GATT when we begin to talk about live beef travelling back and forth. That is something we should remind the Americans about when we get into that kind of discussion.
The kind of interference which occurred in the market this winter with the sudden importation of a lot of live beef did not bring about the price increases that a great many feedlot operators anticipated. In fact, it did not result in the price increases that experts from the Department of Agriculture forecast at the Outlook Conference. Finished beef prices from the west have dropped to between 70 to 72 cents, occasionally moving higher. That is roughly the kind of price we are looking at.
For the producer who raises his calf and finishes it on his farm, with production costs in this drought year he receives about 20 to 25 per cent less than his cost of production. No wonder producers are having trouble meeting their payments. No wonder they are seriously considering selling the family farm and living off the investment, rather than struggling to stay in the beef business and subsidizing producers across this country for the privilege of producing beef.
There have been increases in pork production as well. Today we are considering a bill that will affect beef producers. If it creates anything, it will result in cow-calf producers deciding whether to continue holding the herd, cut it back or get right out of the business. This will send signals to the fellow producing the primary product, the calf. I do not think the signals will make him very optimistic.
Cow-calf producers have gone through a particularly tough year. Production costs were not met with calf prices achieved last fall. Those producers who attempted to hold the calves over the winter watched their inventory use up an awful lot of feed. It cost the producer a lot of money. The inventory at the end of the winter's feeding is worth very little more than it was last fall when he put them into the feedlot. They are looking for more than just a minor adjustment to the import laws. They want more than just following an example set by the United States, an example which does not provide a lot of protection for the U.S. cattlemen. The government should offer more. They should begin to renegotiate live cattle trade between our two countries.
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We are a much smaller country than the United States; therefore, equal dollar value trade is very inequitable to us. It is always inequitable when your trading partner is ten times as large as you are, and we think the United States should recognize that fact when we are bargaining back and forth in respect of the live cattle trade.
In review, we see the bill providing very little stability to the industry, with almost as much ministerial discretion as existed before. As I have said a number of times, there is no mention of control of the movement of live cattle back and forth. This bill in no way guarantees cost recovery for our producers or any order in the market. It does not assure any particular stability for consumers and, even worse, there is no stability for producers.
In short, we have to conclude that the bill will be of little real value to producers out on the land. It is of little value unless there is some political value in it for the government; it may be looking for another smokescreen or symbol which create the impression it is doing something, but achieves very little.


Mr. Marcel Ostiguy (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, I would like to contribute a few remarks on Bill C-46, the purpose of which is to control the importation into Canada of fresh, refrigerated and frozen meat, and to amend the Export and Import Permits Act. But first, in reply to our hon. friend opposite who has just stated that this bill will not have any impact on our farmers, I should like him to know that in its last newsletter of March 3, the Canadian Federation of Agriculture has indicated that this bill is of paramount importance for Canadian producers and that without this legislation to control the importation of meat, producers would have serious difficulties trying to increase their production. Besides, not only will this bill protect Canadian producers, but it will protect Canadian consumers as well.
In Canada, the cattle industry ranks in the forefront of our economy in the agricultural and manufacturing areas. During the period extending from 1975 to 1978, cattle and calf marketing accounted for approximately 22 per cent of all our national sales of farm products. Slaughtering and meat packing with sales totalling some $6 billion in 1976, ranked fourth among Canadian industries. Since 1969, Canada is no longer a net exporter of beef because of increased imports which create a major problem for producers. This problem has further increased since imported products, especially from Australia and New Zealand, have improved in quality and have cornered a larger share of our domestic market.
For lack of a consistent marketing policy and control over beef imports, Canadian producers have been exposed to the vagaries of a depressed market and have witnessed a reduction of their share of our domestic market. If the stability of the beef industries of both Canada and our trading partners is

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what we want, then we definitely need a consistent and long term beef import policy. Our Canadian producers and their supporters say that Canada needs legislation to control beef imports. On the other hand, there are others who claim that the current provisions of the Export and Import Permits Act could very well solve problem of excess imports. The beef industry, for one-and I refer now to Bill C-46 which is now under consideration-wants the government to come up with a solution which would neutralize the destabilizing factor which affects our industry and that of Canada's trading partners, and in the final analysis, and this is very important, consumer prices.
Canadian beef production and marketing fit into the over-all North American context. Our production cycles follow closely those of the American market although, when our prices are higher or when there are excess supplies, there is enough time lag for the Canadian industry to be vulnerable to the effects of American imports. Nevertheless, despite the considerable effect of American markets on ours, the United States remain a major outlet for our exports of feeding cattle, dressed cattle and, from time to time, surpluses of finished cattle.
Canada has often been a net exporter of beef and finished cattle in its trading with the United States. Before 1969, it was in that position with all other countries. Since 1967, the production of beef in Australia and New Zealand has increased sufficiently to meet the increasing demand on international markets and has become more than synchronized with North American production. At the time when Canadian producers started to enlarge their herds, as a result of grain surpluses which led to the building up of reserves and the growth of the beef market, the import market was also able to meet the demand for beef of lesser quality such as that used for minced beef. An increase in the quantity of beef imported from Australia and New Zealand, over six times the average volume imported in previous years, allowed us to meet the demand in 1969. Beef imports from those countries stayed at that level during the seventies while Canada had surpluses and consumption of Canadian beef increased. Since that time, Canada has become a net importer of beef.
From 1973 to 1980, beef imports in Canada reached critical levels; this led to a clamour for official and coherent control, specially in the form of laws and regulations. The problem was first felt during the last quarter of 1973. At that time, an unusual quantity of finished cattle was imported from the United States, following price controls in that country where beef supplies accumulated; as a consequence, prices deteriorated in Canada.
Beef imports from Australia were particularly high in 1973 with the result that total imports of beef made up 10.5 per cent of national consumption. The price of feeder steers went down in Canada and the price of feeder cows began to decrease.
Canadian production of beef went down to 10.3 per cent below that of the previous year, as slaughter of beef decreased and stocks of feeder cows were not further reduced.
The price of feeder steers went up until June to $80 the hundredweight. For the balance of the year, the price of feeder steers went down to about $5.50 below the record prices under the pressure of competition created by a plentiful supply of pork and poultry. As the production of beef decreased in Oceanic countries and in the United States, total imports of beef went down to 183, 407 pounds, namely 8.8 per cent of Canadian consumption at the time, or a drop of about 15 per cent from the previous year. Besides imports, interest rates during 1979-80 were another source of grave concern for beef producers. Interest rates stayed at about 15 per cent or more between October 1979 and April 1980. In spite of a slackening which lasted several months, the rates went over the 15 per cent mark again in early December 1980 and at the end of the year, unfortunately, they did exceed 17 per cent. The effect of such interest rates was to boost the cost of beef production and in some cases to dampen production in feeder lots with the result that the expansion of cow-calf operators was postponed.
It was in mid-1980 that Canadian beef producers really began to build up their herds. On July 1, 1980, the stock of slaughter cows was 4.8 per cent higher than it was one year earlier. Still, low production in cow-calf operations and droughts impeded the expansion of that market. The number of heifers set aside for reproduction was 2.8 per cent below what it was in mid-1979. In Saskatchewan and Alberta, the main beef producing provinces, the number of heifers kept for reproduction was down 2.7 per cent and 11.3 per cent respectively as compared with the previous year. Heifer and calf slaughtering increased mostly at the end of the year, particularly in western Canada. The higher number of heifers and cows shipped to slaughterhouses contributed to boost beef production by about 3 per cent over 1979 when it was expected that there would be a slow down in the herd build-up process. It was therefore the pressure exerted by a healthy supply of cut rate pork during the first half of the year which deflated the price of slaughter cattle between March and July below 1979 prices.
Of course Canadian pork production went up sharply in 1979 and 1980, and the same phenomenon will certainly be observed in 1981, a year during which at worst production might stabilize. Canadians have therefore become very important pork producers, with the result, of course, that beef prices declined. As recently as this week, Mr. Speaker, I attended the annual meeting of the Quebec Federation of Poultry Producers where I was told that chicken prices had gone down because of an overproduction of pork, so I suggest that perhaps beef producers are up against the same thing.
On most markets, prices recovered in August and remained stable until October, and then they went up slightly until the end of the year. The price of feeder cattle followed a similar
April 10, 1981

pattern. At the same time, owners of feed lots and other producers experienced higher costs due mostly to increases in interest rates and in the cost of feed grain. The price for feeder cattle both in Canada and in the U.S. collapsed in 1974, and the Canadian government decide at the time to set up a price stabilization program for beef which came into force on August 12, 1974, with the passage of the Agricultural Stabilization Act. This forced the government to control the import of slaughter cattle, beef and veal. Thus, livestock on the hoof weighing over 700 lbs. and intended for slaughter within 90 days after their arrival in Canada, as well as fresh or frozen beef or veal were added to the import control list, under the Export and Import Permits Act.
A total import quota of 82,835 heads of live cattle and of 125.8 million pounds of fresh or frozen beef or veal was applied for a one-year period starting August 12, 1974. This quota was equivalent to the average imports into Canada during the five previous years. The U.S. government took retaliatory measures and on November 16, 1974, imposed a quota of 17,000 heads of live cattle and of 17 million pounds of beef or veal, which was less than the normal level of exports from Canada. In August, 1975, Canada and the United States simultaneously removed their import controls on livestock on the hoof. And by the end of 1975, that phase ended with both countries removing their controls on beef and veal imports. On January 1, 1976, Canada reopened its market and at that time the only protection afforded the Canadian beef industry was limited to the minimum tariff of 1.5 cent a pound for cattle and 3 cents for beef. The impact of these measures was reduced due to the then high exchange value of the Canadian dollar. As Canada was the one and only market open to exporting countries the situation turned out to be most interesting for South Pacific exporters and Canadian importers. South Pacific beef entered the Canadian market during the second and third quarters of that year in much larger quantities and at prices often lower than those paid on the United States market.
Mr. Speaker, this bill introduced today by the minister of Agriculture is the result of many representations and has received the approval of just about all the agricultural organizations of Canada. The United Cooperatives of Ontario, the Federation of Agriculture and the Meat Packers Council of Canada have stated their support for such a legislation on beef import whereby maximum quotas would be set according to an anticyclical formula. These same organizations, Mr. Speaker, strongly support the stated principles of the Canadian Cattlemen's Association with respect to import quotas set by the act according to the following criteria. 1) any beef import program must take into account the previous import levels set by Canada and the share of the market taken previously by our trading partners; 2) domestic beef producers and exporting countries should be able to forecast import quota levels which, before being changed, should be discussed in consultation with
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our trading partners; 3) over the long term, imports should be increased in proportion to national consumption, and the share of the market they represent should not fluctuate; 4) any change in short-term import levels should be inversely proportional to the domestic beef production in terms of beef-type cows being slaughtered. The Ontario Cattlemen's Association proposed that beef imports, during the growth stage of the cattle cycle, should not exceed 10 per cent and should be lower than 8 per cent of the domestic consumption during the closing stage of the cycle, in order to avoid the levels reached in previous crises. Those organizations generally agreed that imports of live cattle should not be legislated. Many cattlemen's associations have insisted that the law should provide no discretionary power. It will be left to the regulations ensuring from the act to devise the most favourable and beneficial formula for Canadian producers so that all Canadian producers may be assured of a favourable production cycle.


Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, this bill is welcome in the House. I think the minister knows why and how long it has been requested. My remarks will deal with some general principles in the beef industry to back up what is in the bill.
I was very impressed with the analysis of the hon. member for Medicine Hat (Mr. Hargrave). The minister would be well-advised to use him as his main adviser for cattle problems in a marketing sense in western Canada.
The country should know that the livestock industry in western Canada is in a very bad way. This has a bearing on the people of Canada. It will show up very shortly in the price they will have to pay for beef. It is not a subject which concerns only a few people in Alberta and Saskatchewan. Presently*we are not only in a cycle of breeding in the slow-moving cattle industry, but we are in the seventh year of a drought which is affecting that part of the continental plains in North America.
Our fellow producers throughout the continent are suffering in the same way. None of us know for certain what will happen in this seventh year. We had a pretty bad taste of it in the sixth year when the accumulative water tables were down. The people in small towns suffered in the first instance. Since the drought is cumulative, we must expect it to hit very hard the dry areas of the southern parts of Alberta and Saskatchewan this year. If we are lucky and the rains come, we can get by. The minister has the support of every member in the House in getting ready to cope with the problem if it comes this spring; the spring is with us now.
The big reason the cattle industry is in a bad way in western Canada is not just the breeding cycle or the drought with which we must contend every 20 years; it is the fact that there is a new competitor for the land. That competitor is grain. Whether or not we like it, the world is hungry for grain cereals. Western Canada has the ability to produce it. The demand for grain, at least as far ahead as we can see, will keep
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April 10, 1981
Meat Import Act
the level of prices high for bread wheat, feed grains such as barley, and corn in other parts of the country.
This competitive rise in demand for grain products around the world, for which we are very skilled in finding markets, has an immediate effect upon the livestock industry. It takes so much grain to feed an animal in order to obtain a pound of meat that a farmer finds it more profitable to move into the growing grain activity. In the long run he knows this will be bad for him, but he can only take low prices for so many years before folding up. The question is, how can we, as parliamentarians in our limited way, do something useful?
At least on two different occasions it has been said in the House that the attack should not be against our allies, in an economic sense, such as the United States, Australia or New Zealand. The attack must be with regard to something which is missing that will provide permanent, long-term relief from the general problem or malaise of low beef prices. I am talking about how we market beef.
The great curse of the cattle industry in western Canada, every since I have known anything about it, which has been a long time, has been that livestock producers have never seriously gone outside Canada to look for any long-term markets. They have sat there, feeding grain to their cattle, sending their cattle to packing plants, and letting the packing plants do their marketing. Packing plants have a territorial area beyond which they do not go. So, the producers are faced with packing plant marketing area empires which hold them completely imprisoned.
The fault does not only lie with the government, it primarily lies with livestock producers who yell for help and do not realize that they must do the same thing grain farmers did, namely, get off their horses or jeeps for awhile and go out and do a little selling. Individuals have done it, but let me tell the House, with some feeling, that in the last number of years I have had the opportunity to talk about matters affecting meat consumption in Muslim-certainly I have not talked about them in Hindu countries-and in Buddhist countries. There is a tremendous demand for good grade meat. In hotels in Saudi Arabia, one pays $125 per night for a room into which one would not put a high quality cow. If one goes to the diningroom, one is served meat from a cow which was wandering over the hills in Turkey or Kenya for four years in a hot climate. The cattlemen of those countries have attempted to get enough meat on its bones to produce enough to sell. One is then faced with paying a high price for that beef.
We should realize that within 12 hours beef from western Canada can be put into the three main marketing areas of Saudi Arabia; in fact that meat could be on tables there in less than 24 hours. Why do we not do it? The answer is that it is a Muslim country and the church has a great deal of authority over certain matters. It is the same situation that existed when the Anglican Church used to have a great deal of authority over the matter of meat. Every Friday was fish day. This was their way of helping to stabilize the fish market over 500 years ago. The rule in Muslim countries is that one must consume meat the day it is killed. It is pretty hard to sell the notion to a
mullah of the Muslim church that when we fly over the pole, we get rid of a lot of time zones and we can place live meat before him, or meat in vacuum-packed form within 24 hours. That is the state of decision making now. It should not deter us because if they want the product live we will put it there live, within 24 hours.
There are airlines in Iceland, Great Britain, Sri Lanka, and all over the world which fly empty half the year because of cycles in air travel. These big airlines are just as happy to carry live cattle or vacuum packed meat as they are to carry human beings because the price is right. You can take a pound of meat produced in Saskatchewan or Alberta and deliver it any place in the world for a dollar a pound. When you are paying wholesale prices of $4 to $5 a pound I suggest the transportation cost is a reasonable fraction.
Without going into all the details I am suggesting that whether you are dealing with the rich areas of Singapore, Hong Kong, Tokyo or any large population which can absorb substantial quantities of meat-and they are very anxious to receive good meat-this can be done.
1 do not think this should be only the responsibility of the government. The farmers under the Canagrex proposal should take some responsibility. Frankly, I would use it as an organization with the beef industry and tell them to pick out their own people to go around to the various markets and set the system up. That would be more harmonious with the basic philosophy of the cattlemen as opposed to some completely civil service oriented group which goes around and performs this function.
I think there have to be people in this system who sell for themselves. That is what I am talking about; the nature of the beast. He does not like to be driven but I suspect he can be led by the nose if there are dollars at the end of the trail. The minister who has a great persuasive power would be better advised to take this approach with the beef farmers than to continue talking about this silly supply management.
Believe me, this philosophy came into this country from Europe about 30 years ago. It brainwashed all the economists in Canada and the United States. You will not be able to sell that type of civil service run, operated and decision-making to beef farmers. They will just not have it. It is a lynching proposal. The sooner the minister drops it the sooner the action will happen. Some 90 per cent of the beef farmers in the east and west will not accept supply management. They will take a look at their neighbouring industries, the dairy, poultry and the struggling hog producers and will decide to take their medicine their own way. If you allow them to get off their horses, or whatever it is they get off, and get into this selling operation, they will do well at it. They are born horse traders and traders.
I want to hurry on because I realize there are other members who wish to speak. In this legislation we have been wise because we have not gone in for a completely restricted market. The American market is a big asset to us. We have
April 10, 1981

been wise by not barring our markets to the Australians and New Zealanders, for very good reasons. We have been wise by not being so protective that we forced up the prices to the detriment of everyone. But the prices do have to rise, and they should do so in a genuine policy of obtaining markets for the products. It should be made to compete fairly with the pork and poultry markets.
If we push this idea it will not answer all the problems, but it will at least put the livestock people on notice that instead of allowing the individual farmers to get out of the business and go into grain they have some responsibility to save their own industry. They must get out and find a 2 per cent, 3 per cent or 4 per cent market which will take the excess off at all times and keep the prices buoyant here. When they can get out and do it themselves they are in harmony and it saves the government a great deal of money.
Finally, I want to talk about droughts. This has a bearing on this bill. I think the minister knows that my area of southeastern Saskatchewan produces more cattle per acre than any other area in the west. The figures will not be as good in the 1981 census as they were when the last census was taken in 1971. I see these farmers getting out of the business for economic reasons. It is hard work and when they get to be 55 or 60 years old they slow down a bit. They do not have sons who are willing to take up the business for the returns they receive. I see all the feed lots closing down, except for those that handle a few hundred head. I want to suggest a number of little things I think might help.
First, we have a signed agreement with the province of Saskatchewan that under this contract a minimum of 50,000 acres of land must be irrigated by the damming of the Diefenbaker Lake and the Saskatchewan River, the Gardiner Dam. I do not blame the government for not carrying this measure out in the earlier stages, since the price of grain did not make it worth while for grain farming. We now have this big cattle population, two and a half times as large as it was 25 years ago with 50,000 or 100,000 acres of irrigated land producing fodder two or three times a year, 20 to 40 acres per farm, or whatever is needed, you can live 20, 30 or 100 miles away and still have access to it. I think it is time we put the finger on the Saskatchewan government and told them to get some of that land under irrigation and let the cattle farmers for 200 or 300 miles around have access on the same terms as everyone else.
Second, the Department of Agriculture over 20 years ago spent a great deal of money, along with the provinces, mapping the underground rivers running under the prairies, including the Peace River, if my memory serves me correctly. All those maps are available in the research offices of each of the three provincial governments. If they cannot be found there then they are here in Ottawa. These aquifers are less than a thousand feet under the ground. Some are salty but some are fresh, and they are huge. The best one starts in the Peace River, B.C., comes all across northern Alberta into northern Saskatchewan, right down the centre of Saskatchewan, then turns east north of Regina and goes right through into Manito-
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ba. That is good water and the maximum depth would probably be about 500 feet. That is the Hatfield River. There must be 20 or 30 of these underground rivers.
I am not talking about the deep ones at 1400, 1700 or 2000 feet. Those are all salty down there. This one is fresh. We have enough technology, even if the water is slightly sodium based or calcium based in its salt form, to correct that to a degree which would make it potable for cattle. These wells are drilled on a grid system every 20 miles all across the prairies. You can get the figures for those wells and calculate where the water is close to your farm. But in the emergency we may be facing this year I think those maps should be in the hands of Members of Parliament. Many do not even know they exist, Mr. Speaker, but if those maps could be dug out and the members could be told what they mean, they could get them into the hands of the municipal sectors. Then when the PFRA goes out to help solve the water problem this year they will know where to look. In some places the wells are actually in place and can be piped around great distances.
I think that is my main suggestion, Mr. Speaker. I have just one more to make. I have tried it before, but I will try it again.
Farmers collect their cattle to feed. Perhaps they have 5,000 head or more. To my knowledge in Canada we have not recycled manure. Do not laugh; that manure is worth $200 a ton at present prices.


An hon. Member:: It's gold.


Francis Alvin George Hamilton: It is in the form of pure food, one can circulate right back to the cattle, whether they are dairy cattle or any other kind. I suggest all this knowledge is available. We had a conference in Regina about five or six years ago. This knowledge is in volume form and should be guided into the hands of the people who are talking about the beef problems. If a man can get more value from the manure of his animal, than he can from its beef, he should not bother holding his nose. He should just go and make the money. I have seen this done, but we were reluctant to talk about it. Believe me, in the state in which the cattle industry is now, we had better start considering this. It has to be done by large feeders, and maybe it has to be done by governments, but it is money-making operation for anyone ventures into it.
Thank you very much for letting me ramble on. I hope the minister-I know he has been listening-will grab at some of these ideas and maybe put a little pressure on the proper people. I think we would serve our industry well if we did that.


Mr. Arnold Malone (Crowfoot):: Mr. Speaker, I am pleased to rise to speak on Bill C-46. It is a commendable piece of legislation which will assist our farmers and ranchers. It has been spoken about in this House and, clearly in the speeches I have heard from all parties so far, hon. members have underscored that it will be of benefit to the farming and ranching communities. However, I think there has been a false impression left among the citizens of the country, that that is the

April 10, 1981
Meat Import Act
limit of the benefit. I would want to underscore the tremendous benefit in this legislation for the consumers of Canada.


Walter David Baker: Hear, hear!


Arnold John Malone: The truth of the matter is that if there is a belief in Canada today that we are paying too much for our red meat or beef, then we need only look back to the period of time from 1973 to 1976 when we opened the flood gates for beef from New Zealand and Australia. The consumers of Canada then had the tremendous benefit of cheap meat without realizing the day of payment was coming. While they had the luxury of good cheap protein on their plates, the truth of the matter is they have now end up paying because the farmers have had to decrease their breeding herds to the extent we now have a shortage of breeding stock in the country.
There are a number of things I would like to say in commencing this speech. First of all, there has been some credit given to the Minister of Agriculture (Mr. Whelan), who is present with us today for the consideration of this bill. 1 want to give him credit, too, for bringing the legislation to the House; but I am sure the minister will join with me saluting the hon. member for Medicine Hat (Mr. Hargrave) who took a very major part in drafting a similar piece of legislation for our party in that short period of time we were in the government through 1979. In many ways, what we have before us today is really a piece of legislation carried over from the previous government, and that has been mentioned previously.
While we endorse this piece of legislation and believe it will do a considerable amount of good in giving regulation to the inflow of red meats from the continent, the truth of the matter is that the amount of ministerial discretions, which is a change from the piece of legislation we introduced, is a change which 1 think has the potential for some dangerous politics in the beef industry.
I can easily foresee a period of time when we will have a situation, as we are going into an election, and recognizing that by far the majority of Canadians are housed in Toronto, Montreal and Vancouver-the large consumer markets- where the government of the day, irrespective of party, may be pressured into trying about food prices, making them cheaper and having ministerial discretion within that act. I think that is an unfortunate fact, because we could have better legislation with better protection for both consumers and producers, with greater security and sense of predictability, had we had a piece of legislation not allowing for that kind of ministerial discretion working towards the short-term benefit, but against the long-term gain for all of Canadians.
I also want to say I believe this piece of legislation will auger very well for us in future years. It will probably become ever-increasingly important as we get into that period of time some 20 or 30 years from now.
In this Parliament, at this time, the great debate in the country is on the constitution and energy. 1 submit that those issues will not have near the significance of the issues which we will be debating when the century turns. I am convinced that
the big debate-not just in this country, but in the world-will be on food production and food distribution.
We have a world situation today where every day 12,000 children under the age of five are dying from starvation, and where four-fifths of our world population suffers from malnutrition. An alarming figure of some 70 million people a year suffer from permanent and irreversible brain damage due to a lack of protein in their diets. Against those awesome figures is the fact that the world's population is increasing at a rate of some 77 million people every year. That is an alarming figure, when you stop to recognize that 77 million people is equivalent to three times the population of Canada. Every year that kind of population figure is added.
The reason I raise this at this time, in respect of a piece of legislation which deals with meat imports, is that, to a large extent meat will be a product that will gravitate back to its production from grasslands, at least to a greater degree than at the present time. I say this because of the fact that a human being can live on two pounds of cereal grain in his diet per day. He can also live on about two pounds of meat per day. However, it takes 18 pounds of grain to produce two pounds of meat. Therefore, with much of the black and good growing soils of the country in the years ahead there will be increasing pressure to move back into cereal production, human beings will be eating cereal foods, and meat will be treated more as a luxury. Because of that situation, this piece of legislation is important now. It will give stability and predictability to the industry. However, it is in the long run that this kind of legislation will have its greater sense of balance.
I noted that my good friend from the New Democratic Party, the hon. member for Humboldt-Lake Centre (Mr. Althouse) stated he was somewhat concerned that we live so close to the United States and felt some threat in the fact that it has ten times our population. I only want to say that for our farmers and ranchers, that should auger for nothing but good. As we produce in this country and recognize that we have a market ten times our domestic size that means a potential for holding the price in that area so our farmers and ranchers will be guaranteed some kind of an equitable income, with the provision that we are not opening the flood gates to Australia and New Zealand for the import of beef.
I want to just take a moment to disassociate myself from that. I believe if this legislation is passed, we should feel somewhat comforted that we will not again experience in the beef industry the situation we experienced in 1973 through to 1976, the results of which we are living with today, because the price of producing cattle was almost analogous to the Canadian mint production costs. Most people who have watched how to make a penny in Canada realize that it takes between two and 2.5 cents to produce a penny. That is what happened in the ranching industry from 1973 to 1976 it cost one more to produce an animal than what one was able to get when it was sold. Because of that fact, the farmers sold off large portions of their breeding stock.
April 10, 1981

Today Canadian consumers are paying a high price because the government of that time had a policy which allowed an inflow of beef to this country. That was very appealing to the consumer at the time but the price the consumer is paying now is the result of mismanagement in an earlier day.
In my constituency there was a cattleman who collected 5,000 signatures on a petition that was tabled in this House. It has taken six years for the legislation requested, in part, in that petition to be introduced. I submit that the cruel experience of those ranchers is now begining to bear fruit.
I should like to commend the legislation and to say if there is any way, now or in the future, we can do away with some of the ministerial discretion in the legislation which is so politically damaging in the long run, then the bill ought to do a great deal of good for both consumers and producers.
I will take my seat now, Mr. Speaker, knowing there are others who want to speak on the bill. I commend the minister for paying close attention to the remarks of my good friend, the hon. member for Medicine Hat, and also for bringing this legislation forward for the benefit of all Canadians.


Some hon. Members:: Hear, hear!


Stanley James Korchinski: Mr. Speaker, I will just speak for a few moments but I want to cover a couple of matters I think should be brought up at this time.
I was interested to hear the hon. member for Humboldt-Lake Centre (Mr. Althouse), from my neighbouring constituency, say that we do not even consume the amount of beef we produce. The question that came to my mind was, why in the world would we need supply-management if we have to import beef in order to meet our own requirements? If that is the case, then obviously we do not need government interference.
I know the minister has been a strong advocate of supply-management in the cattle industry as being the answer to the problem. I want to ask him, just on that score, why we need supply-management since we certainly do not produce enough for our own requirements? In addition to that, I think the minister knows that statistics show we are approaching the point where there will be more civil servants than farmers. Supply-management will reduce the number of producers and will lead to other problems and added production costs. Quotas will have to be bought, as is the case in milk production, so all that will be introduced is another cost. Surely that is not what we need at this time of high interest; the high cost of land, machinery and all other costs that go into cattle production. What we need is efficient producers.
Some 14 to 15 years ago when I was in Poland I heard officials in that country quote reams and reams of statistics. Today, when I heard the Parliamentary Secretary to the Minister of Agriculture (Mr. Ostiguy) quote all kinds of figures to show that production is going this way, that way and in all directions, I thought of the situation in Poland now where people stand in line waiting to get maybe half a pound of meat. This is what happens with a supply-management
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situation. I fail to see why you need any more dramatic illustration than that.
The absolute requirement is to eradicate fluctuations such as took place in the first five weeks of this year when prices were depressed as a result of the importing of fat cattle in from the United States. Perhaps the minister should consider a freight movement policy, since he indicated in his comments he has paid out something like $46 million for hogs this year and estimates that next year he will have to pay out about $140 million. Obviously, under any kind of supply-management program, a certain amount of money is involved. If in the situation we had this year-


Eugene Whelan: There is no supply-management involved.


Stanley James Korchinski: Yes, there is, in the sense that the province of Saskatchewan has a program. The minister knows that programs are in place at this particular time.
I suggest to the minister that if he wants to eliminate the effect of the price of cattle coming from the United States, he should put in place a freight assistance program. If the price is depressed by cattle moving into the Montreal or Toronto market from the United States, then certainly we should move our own cattle. We do not have to move live cattle; we could move slaughtered cattle. We should move enough supplies so that even if the price is depressed, it is with our own cattle, and is only temporary. The situation could be controlled by removing the freight assistance. American cattle certainly would not come in if the price was lower or if there was not a buck to be made. This would not interfere with any GATT arrangement and the result would be the same.
We need more people in the production cycle. At the moment, even the grain industry is gearing up for more production and it will soon be in a similar situation. If we do not produce enough for our own requirements we should not put these people out of production. Once they are out, they stay out for a long, long time and many of them will never come back.
Mr. Speaker, I do not want to hold this bill from going to committee, so with these few remarks I will sit down. Thank you very much.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Question.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Agriculture.
Mr. Deputy Speaker:: It being four o'clock p.m. the House will now proceed to the consideration of private members'

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Nuclear Power
business as listed on today's Order Paper, namely, public bills, notices of motions and private bills.


PRIVATE MEMBERS' PUBLIC BILLS
Mr. Deputy Speaker:: Shall all orders preceding No. 48 stand by unanimous consent?


Some hon. Members:: Agreed.


NATIONAL RESOURCES AND PUBLIC WORKS
Mr. Bill Blaikie (Winnipeg-Birds Hill) moved: that Bill C-248, to establish a moratorium on the continued development of nuclear power in Canada for the purposes of establishing a public inquiry into nuclear power that is followed by a national referendum, be read the second time and referred to the Standing Committee on National Resources and Public Works.
He said: Mr. Speaker, it is with a great deal of pleasure that I rise today to speak on Bill C-248, an act which (1) establish a moratorium on the continued development of nuclear power in Canada; (2) set up a public inquiry into the issues raised by nuclear power and (3) require that after this inquiry a national referendum be held to determine whether Canada should proceed with a nuclear future.
I should mention that this is my first private members' bill. I consider it providential in a way that it was selected for debate, even though the debate will be for one hour. The government will talk out the honour so that the bill cannot be voted on or sent to the appropriate standing committee.


Stanley Howard Knowles: Shame.


William Alexander (Bill) Blaikie: It is not possible in just 20 minutes to address the many issues in question which are and should be part of any discussion on nuclear power. Accordingly, I will try today to focus primarily on the process by which we are deciding, or appear to have decided already, that Canada is to proceed with the nuclear future planned for it for so long by the Liberal Party, Atomic Energy of Canada, Ontario Hydro and other long-established actors on the Canadian nuclear stage.
My basic contention is that the process by which we have come as far as we have already toward a nuclear future for Canada is undemocratic. Bureaucrats, technocrats and various other so-called experts from government and the nuclear industry have made decisions which will affect the lives of all
Canadians, decisions which in my view should be made openly, politically, after ample informed public discussion of, and reflection upon the implications of various options. This is not the kind of decision making we have had up until now.
The three parts of Bill C-248 are intended to deal with this tragic and perhaps fatal flaw in our collective decision-making process as a nation.
The moratorium is the necessary first step because, without a moratorium, it is difficult to believe any ensuing public debate will be taken seriously by the government or the nuclear industry. It also ensures that time limits for the debate will be taken seriously. The nuclear industry has a vested interest in talking about the issue, as long as it can proceed with its plans while talking. Indeed, it has professional talkers, public relations people who are paid to relate to critics while the industry proceeds as ever. A moratorium would give meaning to debate and represent a significant precedent in the location of burden of proof.
It is not the critics who should have to prove they are right, as long as there is reasonable doubt, as there is in this case. The critics can only be proved right or wrong by time and tragedy. It is the nuclear industry which should have to answer for its claims. The burden of proof should be on them. The situation we are in now is analagous to one in which the blindfolded driver of a car moving down a crowded street complains of unfounded criticism because he has managed not to hit anyone yet.
The public inquiry is a necessary second step because it is only through the instrument of such an inquiry that public consciousness about this issue can be sufficiently raised. My idea of this inquiry is similar to that which actually occurred around the issue of the Mackenzie Valley Pipe Line in 1977, under the auspices of Justice Thomas Berger. His held a travelling inquiry which listened to all sorts of people, raised public consciousness about native land rights and the environmental fragility of northern Canada. He made good recommendations which, unfortunately I must add, have not been respected by this government. But the understanding and perception of the issues which that inquiry facilitated for many Canadians have not disappeared. I want to underline this as we find ourselves debating Bill C-48 in committee, the Canada Lands Act, which will make a mockery of some of the rhetoric we have heard from the government lately about aboriginal rights.
As I was saying, the understanding and perception of the issues which the Mackenzie Valley Pipe Line inquiry facilitated for many Canadians have not disappeared. It exists in the seething anger and disappointment which is building in this country about the way this government is dealing with the North and its people, in spite of its recent abstract conversion to the concept of aboriginal rights, and in its formal but actually meaningless commitment to environmental assessment.
Nothing close to what I am suggesting in the way of a public inquiry into nuclear power has ever been remotely contemplated by recent governments. The federal Progressive
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Conservative Party would have set up only a parliamentary inquiry, likely force fed by AECL propaganda and not likely to have come up with truly independent conclusions.


Walter David Baker: On a point of order, Mr. Speaker. Surely the hon. member must be aware that such an inquiry would have Members of Parliament from his party, the Liberal Party and the Progressive Conservative Party, and have available all the expertise inside and outside of government. That was the intention. I thought I should clear that matter up for the hon. gentleman.


William Alexander (Bill) Blaikie: Mr. Speaker, I do not withdraw my contention that the decision to set up a parliamentary inquiry into nuclear power by the Progressive Conservative government in 1979 was a way of avoiding the kind of consciousness raising that the public inquiry that I am calling for would have more of a chance of creating.


Some hon. Members:: Oh, oh.


William Alexander (Bill) Blaikie: If the members of the Progressive party are feeling particularly sensitive this afternoon, I will acknowledge that at the very least they recognized that this was an issue the Canadian people wanted brought within the parameters of political discussion.
As I was saying before I was so rudely interrupted by members on both sides of the House, the Liberal Party of Canada, which is the nuclear party par excellence, is that party which has presided over the undemocratic and authoritarian imposition of nuclear power in Canada. It is the party of the technocracy, of those fascinated and captivated by the technological capacity of modern man, and who have forgotten that the goal of human life is not technological, but spiritual, in the sense that human life is to be lived in harmony with each other and with creation, first, and not in reckless, arrogant, and prideful disregard for the human future and/or nature.
Instead, all the Liberal government concedes in this matter is that there is an internal departmental inquiry which, as far as I can make out, never comes to any conclusions because it does not really exist. As the Prime Minister (Mr. Trudeau) said in answer to a question asked of him on May 1, 1980, a public inquiry would take too long. The viability of the Canadian nuclear industry cannot withstand scrutiny.
A national referendum on the subject is a necessary third step because we have learned only too well that inquiries by themselves can be interpreted away, or just plain ignored. A well and clearly asked set of questions put to Canadians about their energy future and the various options available, nuclear or non-nuclear, after a public process such as the inquiry I have talked about, would do much to clarify not just the nuclear issue but other issues as well. At the moment the parameters of political debate, and I have spoken about this in the House before, are too confined and too narrow.
Issues such as nuclear power have been seen to be technical, managerial or crudely economic, rather than political in the
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full sense of what it means to be political. This must change for two reasons.
It must change, of course, in order to improve the quality of the decisions made about these issues so they might become decisions taken in the total context. Second, such issues must become political in order to save politics, that eminently human activity without which we lapse into collective unconsciousness and the friendly fascism of a society in which all significant decisions are made by the executive and its managers, the kind of future the Liberal Party has in mind for Canadians.
Politics is the art-not the science, but the art-of building up the polis and of working together on deciding and constituting the good life for all. The health of our political process, the health of democracy and the relevance of our political process are threatened by the number of issues which the process is not allowed or able to address. We are just now on the verge of giving up much of what is left of the political process to the courts. This may be appropriate; I am not so sure. What I do know is that there will not be much left for politics as such because so much has already been unconsciously conceded to the technocrats and to the bureaucracy.
A referendum on nuclear power would be a step in the right direction. Some people are frightened by referendums. This is understandable. Referendums are not the answer to everything, but in my view something is necessary to break the creeping irrelevance of our political system.
I do not hide the fact that I already have a pretty clear position on nuclear power. I believe the risks associated with nuclear power, such as reactor accidents, the effects of low-level radiation, the perils of nuclear proliferation, the environmental and occupational dangers of uranium mining, the problems of long-term radioactive waste disposal and the longevity associated with all these risks, should lead us to regard nuclear power as a special and unique case, and for this reason we should not proceed with it unless we do so consciously and together after the kind of process I have described.
I would not be happy if Canadians chose a nuclear future, but I want them to be able to choose. The forms of energy which we choose to use involve moral choices now more than ever before. Our moral relationship with nature, with the people of the future, with those who presently live on or around energy resources and with those who will work in the energy-producing processes which we set up-all these relationships are at stake here.
There are difficult trade-offs ahead, but we are not at this time in the dilemma we think we are in and which many would have us believe we are in. Too often we operate on the false premise that we must continue to live the highly energy consumptive life we now live and that we can do this by entrusting our lives to the experts. This is both a false sense of what is important in life and a false faith in our ability to come

April 10, 1981
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up with a technological fix which does not do more harm than
good.
The truth is that we have not really tried conservation. The truth is that we have not really tried to develop renewable energy resources. The truth is that we have not really considered many of the options now before us, the soft energy paths, etc. We have not really tried individually or collectively to rethink our lives in the light of what we know about our ability to pollute and deplete a finite world. Thus, we are now taking many of the risks which we take as a society, not out of necessity and not because our backs are to the wall, but for no other reason than our own convenience and our own reluctance to drive smaller cars or to do whatever combination of things would be necessary to give, in a real way, the conserver society, as some people have called it, a try.
We are not faced with freezing in the dark. If we had tried all these other routes and still we faced energy shortages, then maybe we would need to contemplate nuclear power, but we have not done this.
I believe what we do about nuclear power will be powerfully symbolic for the western world. I speak here not just in the context of Canada but in the context of the western industrialized world. Not going ahead or stopping nuclear power at its present stage of growth will indicate that we are prepared, as a civilization, to repent of our headlong drive toward increasingly meaningless consumption-


Mr. Siddon:: Hands folded.


William Alexander (Bill) Blaikie: -at the expense of the future, nature, and those parts of the world which we keep as our economic hinterland at the point of a gun.


Thomas Edward Siddon: What are you going to burn, leaves?


William Alexander (Bill) Blaikie: I notice that the party which is so self-righteous and exuberant about getting God into the Constitution is becoming giddy at the language of repentance. I notice that the language of repentance bothers the same party which is concerned about God. Perhaps the people of Canada should take notice of that.
Going ahead with nuclear power will mean that we have given up on ourselves, given up on our ability to reshape the human community instead of continuing to bend heaven and earth to the false priorities of industrial civilization.


William James Kempling: Down on your knees.


William Alexander (Bill) Blaikie: Many in my party feel the same way as I do. Accordingly, we regret that the government of Saskatchewan has chosen to embrace so actively the mining of uranium in northern Saskatchewan. In the well-intentioned passion for creating wealth which may be used for the benefit of all the people of Saskatchewan they have made a Faustian bargain which, if it is not soon cancelled, will cost them their souls. But at least they have souls to lose. Others proceed with no pangs of conscience whatever. Nevertheless, I mentioned Saskatchewan so as not to appear naive or self-righteous in any partisan
sense. I do believe, however that it is only within a truly democratic socialist economy that the environment can be protected and people done justice. Because justice and survival, in the final analysis, can go together, we do not have to pick between justice and survival, and it is to the posing of these kinds of questions to an informed Canadian public that this bill is dedicated.


Some hon. Members:: Hear, hear!


Mr. Roy MacLaren (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, in the discussion today of nuclear matters I want to say a word first about the success of the development of the Candu reactor here in Canada. It has been a remarkable technological achievement on the part of Canadian scientists, engineers and industry. Indeed, by 1979, nuclear reactors were generating one-third of the electricity here in the Province of Ontario, with a total value of something over $1 billion. I cite that as an indication of the success of the Candu reactor, a largely indigenous system for generating electricity which makes use of abundant Canadian resources and is a unique Canadian technology.
Second, of course, the Candu reactor is economically competitive with coal-fired generation in large parts of the country, especially east of Manitoba.
Third, the technical performance of the Candu reactor has been outstanding. For example, statistics show that four Candu reactors were more reliable than any of the 110 large power reactors in the world today. In terms of lifetime gross operating factors, six of the world's top seven reactors in 1979 were Candu units operated by Ontario Hydro.
The bill before us today would eliminate exports of nuclear plants. If Canada were to adopt such a position and if other supplier countries were to follow our lead, we would be forcing on the rest of the world our judgment that they do not need nuclear technology. Many countries are facing rapidly worsening economic conditions because of the high cost of oil. Many of them simply do not have hydro electricity or coal as a viable option, and many of them are desperately short of the energy they need to raise their living standards to levels we would consider to be minimally acceptable.
It is true that many such countries have too small an electrical system to be able to use nuclear power, but if we refuse to sell to those who can use it we allow the world pressures on available oil supplies to increase and to make those supplies less available and more costly to countries with no other intermediate term energy options. Denying a country the energy sources it perceives it needs is not a step toward encouraging world peace. It is prudent to be careful in selecting which countries we shall sell to, assuring ourselves that they have only peaceful motives. It is not prudent to refuse to export one of the superior energy options in the world today to any foreign country under any conditions.
At home, export sales complement our domestic nuclear program. They permit economies of scale and the spreading of
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research and development and other overhead costs over a large number of units. They offer an opportunity to earn foreign exchange and make profits for our domestic firms. They also provide important experience in the management of international mega projects based on Canadian technology. Finally, of course, the demonstration effect from our Candu reactor sales can enhance Canada's broader ability to sell other high technology exports.
I am very pleased to have had the opportunity in recent months to participate in our sales efforts in both Yugoslavia and Mexico, two countries which are among those actively considering Candu reactors in their future energy programs. Korea is a satisfied customer already and is actively discussing with Atomic Energy of Canada the possibility of additional unit purchases. Romania has recently purchased a Candu reactor which is now under construction. During my recent visit to Romania, I found every indication that the Romanian government will pursue its intention to acquire a total of four Candu reactors in the time ahead.
The hon. member in raising the subject of nuclear energy today, and in proposing a moratorium on the further development of the industry, has referred in passing to concerns which he evidently has about certain aspects of safety and health regarding the generation of nuclear energy. He referred in particular to a question of uranium mining and the disposal of low level radioactive waste. In that regard and, indeed, with regard to other aspects of safety and health concerns, Canada's record is exemplary. I want to take a moment to touch on some aspects of those questions which are of some technical complexity but which are of great importance to the government of Canada and to provincial governments.
With reference to the disposal of low level radioactive waste, the bulk of the hundred million tonnes of uranium tailings disposed of today are safely isolated so that the environmental guidelines imposed by provincial governments and the Atomic Energy Control Board are met. The pollution abatement equipment installed in all operating mines prevents these systems from presenting any significant risk. The long-term problem is to replace the present control systems with passive systems or to dispose of the tailings safely.
In that connection, I am pleased to report that the Canada Centre for Mineral and Energy Technology has formed a group called the national technical planning group on uranium tailings research. The group includes representatives of the mining companies the federal and provincial government regulatory agencies, research groups, universities and consultants. This group is now in the final review stage of its report which will review present activities and sources of funding, propose a research program schedule, and propose a program management structure. The report is expected to provide the information necessary for the federal government to embark upon an expanded research and development program.
The hon. member opposite also referred in his statement to the question of reactor safety. 1 want to point out that the Candu reactor has an excellent safety record. It has less
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over-all impact on the environment than fossil-fuelled stations and hydro dams.
In that regard, I want to say a few words about nuclear reactors and safety. How safe is the Candu reactor is a question that is sometimes asked. The record of the Candu reactor has been, over all, one of outstanding achievement. In the 30 years since Canada's first major nuclear research reactor began operation, no member of the public has suffered any injury from a nuclear reactor accident, not one person has lost working time through radiation injury in our nuclear stations, a record which cannot be matched by those of other energy industries. This is not to say, of course, there are no risks associated with nuclear power. As with all other industrial processes, risks do exist but major efforts have been made to quantify and to ensure that appreciably lower risks than society accepts from other energy sources exist in the nuclear industry.
The greatest risk associated with nuclear plants is the uncontrolled release of radioactivity. The radiation from the normal operation of nuclear power plants is only a very small fraction of the natural and man made radiation to which we are continuously exposed from various sources, such as cosmic rays, medical and dental X-rays, jet flights, colour television, and fallout from atmospheric weapons testing. To prevent the release of radioactivity beyond acceptable levels is a major goal of reactor designers and operators. A series of barriers has been designed into the Candu reactor to prevent unplanned releases. These barriers range from the sheaths surrounding the fuel pellets to the massive airtight containment building around the reactor, which is surrounded in turn by an enclosure zone extending for one kilometre around the reactor. These barriers are in turn backed up by separate safety systems whose sole purpose is to handle accidents, such as shutdown systems and the emergency core cooling system.
Since the first nuclear reactors were designed, scientists and engineers have studied a wide range of hypothetical accidents so as to give increasing protection to the public. Indeed, the excellent safety record of Candu is both the result and testimony of the care with which these stations have been designed, licensed, constructed and operated. In all these areas, safety requirements are a dominant factor and the protection of the public from radiation hazards is a major consideration.
Another question which is sometimes asked, to which the hon. member referred today, is how we dispose of spent fuel. As members of the House may now be aware, Canada already has a well established research and development program regarding the technologies needed for the safe and permanent disposal of our nuclear fuel wastes. As has frequently been explained, underground disposal in stable geological formations will effectively isolate the fuel wastes. The initial stages of the program have been designed to test, through laboratory and field research, the viability of this concept.

April 10, 1981
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While Atomic Energy of Canada has prime responsibility for the program, several departments and agencies of the governments of Canada and of Ontario also participate, along with industry and the university community. The over-all objective of the Canadian program is to ensure that there will be no significant effect upon man and upon the environment at any time. The deep underground disposal method has been approved by many world scientists and engineers as the most suitable way to achieve our objective.
Therefore, work in Canada is concentrated on disposal in the stable, hard rock formations of the Canadian shield. The formations being investigated, known as plutons, are scattered across the Ontario portion of the shield. Studies of the geological characteristics and of the behaviour of immobilized wastes will contribute to a generic safety and environmental assessment of the disposal concept to be presented to regulatory authorities.
Only after this process has been completed will technically suitable sites be selected for disposal. The site selection phase will take account of economic factors, community impact, health and safety considerations, and environmental effects on each potential technically suitable site. The factors will be discussed with any communities near the sites and elected representatives of these communities.
There is no question that public knowledge, understanding and acceptance, are important to the success of this program. A full public information effort is now in effect over virtually all the Canadian shield region of Ontario and at the White-shell Nuclear Research Establishment in Manitoba, where an underground research laboratory is being built as part of the concept assessment stage. Exhibits, films, briefings for the media and for elected representatives of communities near which work is being done and mailings to householders, have all been planned or conducted to provide the general public with information.
Over the past year, scientists involved in the waste management program have made many in-depth presentations to municipal councils, associations and other groups. Accordingly, every effort is being made to reach out to the larger public, in an attempt to inform a wider range of people about the work which is being done in Canada, to answer the question of nuclear spent fuel disposal. The research can be pursued to the point where the basic concept is adequately assessed and justified and a long-range solution to the problem of nuclear waste disposal can be demonstrated as safe and permanent.
I think I have demonstrated, with respect to any concerns the hon. member may have regarding uranium mining, reactor safety and spent fuel disposal, that the federal government is moving vigorously to eliminate any potential risks. There will be no moratorium on our desire to maximize the benefits the CANDU reactor brings to our trading efforts, our industrial strategy, and our ability to provide Canadians with an assured and inexpensive energy source. There will be no moratorium on our desire, held with equal commitment, to protect Canadians from any health hazards.
The hon. member opposite proposed a three-year moratorium in the nuclear industry. He should realize that such a moratorium would kill the industry well before his public inquiry ever reported. Presumably he is advocating the closure of the uranium industry across Canada, including Saskatchewan, as well as the manufacturing industry which is currently at an important juncture in its development. If the industry were unable to survive a moratorium, the uranium industry and the Candu option would be lost just when we may need it most. Would the hon. member prefer the importation of inferior and less safe United States reactors? Would he prefer that we attempt to reassemble the industry when required to do so, at considerable expense and difficulty? If he is concerned about employment, innovative high technology industry and exports, I ask the hon. member to rconsider the wisdom of placing the Candu option in abeyance while our competitors are free to pursue sales worldwide.
A public inquiry may be an effective instrument of public information and may contribute to policy formation and decision making. However, public inquiries may also serve as delaying tactics for governments to avoid their responsibilities. There have been a large number of public inquiries into nuclear power in Canada in recent years. Their proceedings and reports have contributed to the information and analyses available to the public.
I should like to cite one or two examples. The Ontario Royal Commission on Electric Power Planning and the Porter commission actively considered many aspects of the nuclear industry. In Saskatchewan, the Bayda commission on Uranium Mining reported on the beneficial impact and assessed the opportunities for that industry in Saskatchewan. The Federal Environmental Assessment and Review Process reported on four different locations for a new uranium refinery. The Ontario Provincial Environmental Assessment Board reported on expansion of uranium mining at Elliot Lake. The Ontario Select Committee on Hydro Affairs investigated a number of aspects of the nuclear industry. In British Columbia, the Bates commission conducted an investigation of the implications of uranium mining in British Columbia. Its mandate was terminated some time ago by the British Columbia government.
At the federal level, a number of parliamentary committees have looked into different aspects of nuclear power and, no doubt, will continue to do so. Parliament devotes considerable time to nuclear issues.
The government takes the position that further formal public discussion of nuclear power issues is unlikely to improve the quality of decisions on this issue and that Parliament, with its committees, is a sufficient forum in which to discuss these issues at the federal level. The government will provide any additional fora in which to do so.
The government has been conducting a review of the nuclear industry in Canada, as the hon. member mentioned. A number of background papers on all aspects of the nuclear fuel cycle have been prepared and will soon be made available to the public on completion of their translations. We hope these will
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contribute substantially to a well-informed public discussion of all aspects of nuclear energy generations.
There are many important reasons to believe that nuclear power has an important role to play in Canada's future. This is not the time to restrict or limit our energy options.


Mr. Deputy Speaker:: I regret to interrupt the hon. member, but his allotted time has expired.


Mr. Dave Nickerson (Western Arctic):: Mr. Speaker, it is a pleasure to speak this afternoon in the few remaining minutes on the proposed moratorium, the proposed public inquiry, and the proposed referendum put forward by the hon. member for Winnipeg-Birds Hill (Mr. Blaikie).
I think Mr. Speaker will find some of my comments rather repetitive of those of the parliamentary secretary. It is not very often I agree with the hon. gentleman, but I think the force of his logic this afternoon has me convinced of the argument put forward by the government.
The views of the hon. member for Winnipeg-Birds Hill are demonstrative of what one might call the red flag mentality of the NDP. In the early part of this century when automobiles were first seen on the roads, it was prescribed that somebody should walk in front of automobiles with a red flag to warn people of what was coming. Automobiles were deemed to the very dangerous; in fact they are. Nobody would say they are not, but society has learned to live with them and with the new developments in transportation, as they will surely learn to live with new developments in the energy field. I would submit that the mentality displayed by my colleague to the left in respect of the energy field is just as outdated and belongs just as much to the horse and buggy days as the rest of his party's political philosophy.
Let us examine the Canadian nuclear industry. I think it is something we can be proud of in Canada. In this country we have all aspects of that industry, starting with the prospector looking for uranium in the field to the mining industry which started at the Port Radium mine in the constituency I am so proud to represent. We now have uranium mines in Ontario, in the Blind River area. There are new mines in Saskatchewan. This is a very healthy segment of the Canadian minerals industry. There is processing and upgrading in Canada, for example the Port Hope Uranium refinery. We have technical expertise in that particular field. Of course, we also have the construction field. Of course, we also have the construction and operation of nuclear power plants. I understand a trip has been arranged to visit the Chalk River plant on Monday next, to which I am sure the hon. member for Winnipeg-Birds Hill has been invited.


William James Kempling: He will not go.


Dave Nickerson: I do not think he will go I do not think he wants to know what the facts of the case are. Many of us who are interested in determining the facts and finding them out for ourselves will be availing ourselves of the opportunity to go
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and see these plants which have been safely in operation for many years.


William Alexander (Bill) Blaikie: I have been through Pinawa, Pickering, through them all.


Dave Nickerson: We also have expertise in the area of non-energy use of uranium in Canada. For instance, I understand that a good deal of our uranium is used in the aviation industry. Several hundred pounds of uranium is used as counterweight in large jets. Uranium is also used for shielding against radio-activity. This is another field in which we have developed technology in Canada.
Certain areas of this country, Ontario in particular, has bet its energy future on uranium and the nuclear generation of electricity. In provinces like Ontario, where there is limited coal, and even less oil and gas, where most of the hydro potential has been utilized, the uranium alternative must be used for a reasonably priced source of electricity. There are other places in the world, such as Scotland, which immediately comes to mind, where at the present time some 25 to 30 per cent of their electricity is generated by nuclear means.
The parliamentary secretary stressed the importance of the nuclear industry to Canada's exports. We can be proud of the Candu reactor which we market all over the world. In exporting that reactor and in guaranteeing sources of natural uranium for it, we are doing not only ourselves a benefit but the countries which buy from us this particular plant and the fuel needed to operate it.
Having said that, again in many ways I am reiterating what was said by the parliamentary secretary, there are obvious areas of research which should be undertaken and, in fact, are being undertaken. Mining techniques is one of those area. How do we make the mining of uranium as safe as possible? There are dangers associated with the emission of radon daughters in uranium mines and we want to, if not eliminate it completely, since mining will always be a hazardous occupation, at least reduce it as much as possible. In all probability we need more studies into the disposal of radioactive mine tailings.
As I understand the situation, the raw ore contains impurities which are more highly radioactive than the uranium mineral itself. When these are extracted they can be a source of trouble. We need to look into this problem more closely. This is being done. Most of the mining companies in the field take their responsibilities seriously. We need to look more efficient generation techniques and safer designs of nuclear reactors. Candu is a heavy water cooled plant which uses natural uranium. It seems to be one of the best plants available now. It is continuously being modified and upgraded. But the time will come when we might have to go to another system. Many years in the future the type of Candu reactor we have now might become completely obsolete and we will have to go to nuclear fusion techniques. I hope research into that field of endeavour is being undertaken in Canada as it is being undertaken in other countries in the world.

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We must look into the question of nuclear waste management, both the disposal of it and the reprocessing of it, to get the utmost value from the ores and metals produced in Canada. As I understand it, reprocessing is an expensive proposition and is not undertaken in this country at the present time. That does not mean to say we cannot look forward to the day when we will be able to undertake reprocessing in Canada.
The parliamentary secretary briefly addressed the question of nuclear waste disposal and the various methods which might be adopted to safely dispose of nuclear waste in the long term. He mentioned particularly underground burial in areas of stable rock and granitic plutons in the Canadian shield. He referred to the work that has been done close to Whiteshell in Manitoba in this respect. If I have any criticism it would probably be that insufficient finances have been made available to the underground laboratories in that area. If the Minister of State for Mines (Mrs. Erola) is listening perhaps she could put that on her list of priorities for additional funding. I know she has a great many areas which quite deservedly should be priorities on her list and it must be very difficult for her to priorize them.
The safety of the industry has been demonstrated. In his presentation the parliamentary secretary said he knew of no one who had ever been adversely affected by the operation of a nuclear power plant. If we look at the accident statistics in the nuclear industry, as compared with other forms of energy generating industries, we will find they are comparable and in a good many cases probably the number and severity of accidents are less in the nuclear industry for instance than in the generation of electricity by the use of coal.
In total, the generation of electricity by the use of uranium probably is safer than the generation of electricity by the use of coal. He referred to the general levels of radiation, the radiation to which all people are subject; natural radiation and cosmic radiation. One he did not mention was the application of fertilizers to farmers' field, potash, for instance, which to a limited extent is radio-active. It is spread over a large area and eventually finds its way into waterways. Radioactivity brought about by the application of fertilizers to the arable land of this country, in total, is much greater than radiation caused by the mining and utilization of uranium.
Finally, I want to look at the proposal for a moratorium which is before us-a public inquiry to be followed by a referendum. I wonder if the hon. member who proposed this has really thought about the effect a moratorium would have on the existing industry in Canada. What would it do to the people on the exploration side of the industry. What would it do to the people who work in the uranium mines in Saskatchewan, Ontario and in other provinces in Canada who would suddenly find themselves out of work? What would it do to the electricity supply? What would it do to our export markets? We would be making a dreadful mistake if we were to follow the recommendation of the hon. member for Winnipeg-Birds Hill. I think we have just about had a stomach full of public inquiries into the uranium industry. We have had them in Saskatchewan and we have had them in British Columbia. We
have had any amount of them. That is not to say that some good did not come out of them. There were some good recommendations made in Saskatchewan.
Only recently, the legislature of the Northwest Territories publicly debated this matter in Committee of the Whole. They heard various experts. They did not go so far as to suggest a moratorium, but the exercise was useful in that experts in the field were able to present their views, and members of the general public were able to find out the various viewpoints and come to their own conclusions. However, I think we have already had enough inquiries into this. We know what we must do. The matter has just about been studied to death.
In so doing we have found out the areas in which further research is required. These have been identified, and what we probably want now is both private funding-I am always in favour of private funding, because that does not cost the public purse anything-and maybe even some public funding into these areas of concern and research which have already been identified.
With respect to the proposed referendum, I do not really want to say anything more. Ideas of referendum have been debated ad infinitum. They have been debated to death in this House over the last few weeks. However, probably the most sensible ideas on referenda expressed recently in the last few weeks were those expressed only the other day by the hon. member for Sarnia-Lambton (Mr. Cullen). Instead of repeating what he said, I would advise hon. members who are interested to look at Hansard and find out what the hon. member for Sarnia-Lambton said on this matter.


Stanley Howard Knowles: He's our Edmund Burke.


Dave Nickerson: In conclusion, I would submit that the decision as to whether we are to proceed into the nuclear age has already been made.


An hon. Member:: That's the point.


Dave Nickerson: What the hon. member is trying to do now is engage in a last effort in futility. I think it would be wrong and disastrous to the Canadian economy and disastrous to the Canadian future.
What we should do, as Canadians, is go ahead to the nuclear age with confidence.


Some hon. Members:: Hear, hear!


Miss Aideen Nicholson (Trinity):: Mr. Speaker, I expect most people would agree that we should indeed go slow on nuclear until we have solved waste problems. The importance of dealing with management, storage and ultimate disposal of used nuclear fuel is an issue which concerns many thoughtful people, and this is recognized in the National Energy Program which includes a statement, and I quote:
If we make the right decisions today about all of our energy opportunities, we can move quickly off world oil, while still giving ourselves the time to analyse
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with care such issues as the technology needed to ensure the safe disposal of nuclear wastes, and the longer-term benefits and costs of the nuclear fuel cycle-
Against the risks of nuclear must also be balanced the risks in our time of not going nuclear, the risks of closing off our options prematurely. These risks are social, economic, health and environmental.
In 1976, when the United Nations held its conference on human settlements in Vancouver we saw, very dramatically, the two sides of this debate. There were calls for a moratorium on the spread of nuclear energy at a conference, where the main concerns were the starvation, death and the dreadful conditions of life in underdeveloped countries. No one can be unaware of what is involved in looking after the world's four billion people, a population which will escalate in three decades to eight billion. The struggle in the developing countries is harsh. Food shortages and higher prices for oil and commodities are presenting people with almost intolerable conditions of living.
Following Habitat, the Prime Minister (Mr. Trudeau) was asked what he thought about the calls for a moratorium on nuclear energy. I will read part of his reply:
We have this high technology in an era where many of the less developed countries are starved for energy, they need it not for explosive purposes; they need it in order to improve their standard of living; they need it for medical purposes, for agricultural purposes; they need it to reach some degree, some minimum degree of habitable environment, and we're sitting on this technology. We could say, well,... we don't share it because the dangers of proliferation are too great... It's too risky for you ... We can trust ourselves ... not to abuse this technology but we can't trust you so we won't teach you how to use it.
That is something for those who call for a moratorium to consider. The developed nations have a moral obligation to assist energy-poor nations to develop alternatives to oil. This conclusion was arrived at during the Venice Summit in June, 1980. I will quote from the declaration:
We underline the vital contribution of nuclear power to a more secure energy supply. The role of nuclear energy has to be increased if world energy needs are
Nuclear Power
to be met. We shall, therefore, have to expand our nuclear generating capacity. We will continue to give the highest priority to ensuring the health and safety of the public and to perfecting methods of dealing with spent fuels and disposal of nuclear waste. We reaffirm the importance of ensuring the reliable supply of nuclear fuel and minimizing the risk of nuclear proliferation.
That was from the declaration following the Venice Summit in June, 1980, a declaration which was arrived at following a very extensive discussion of the obligations of developed countries.
"The Health Hazards of Not Going Nuclear" is the title of an American publication which was borrowed by a Canadian scientist who, in an address last year, quoted some figures about the possibilities which would flow from our not going nuclear from, for example, an increased use of coal. Professor Yaffe pointed out that:
In the last 80 years 30,000 coal miners in Pennsylvania alone have been killed in coal mine accidents. In Appalachia 57,000 coal miners suffer from black-lung disease.
He also gave some figures about the effect on the environment and the possible increase in acid rain if we were to neglect our nuclear technology in favour of existing technology, such as more use of coal.
To a very large extent, the debate about nuclear power is a debate about the nature of risk, about how we evaluate risk, how open the discussion is and how best to make these decisions which will affect not only us, but also future generations.


Mr. Deputy Speaker:: The hour provided for the consideration of private members' business has now expired.
It being five o'clock, this House stands adjourned until Monday next at 2 p.m., pursuant to Standing Order 2(1).
At 5 p.m. the House adjourned, without question put, pursuant to Standing Order.

Monday, April 13, 1981