1982-05-13

ROUTINE PROCEEDINGS

[Stage Direction]
[English |

Mr. Gordon Taylor (Bow River):: Madam Speaker, I rise under the provisions of Standing Order 43. Federal government taxation is killing business and pounding the life out of the people. One utility company which paid a total federal tax of $8 million in 1980 was required to pay $64 million in 1981, or eight times as much, even though its revenue was only three quarters of the 1980 revenue. This increase was due to the excise tax and the Canadian ownership tax. These taxes are passed on to the people, including the aged, the poor and the crippled. Therefore I move, seconded by the hon. member for Peace River (Mr. Cooper):
That this House urge the government in the name of humanity and compassion to cut these taxes before we have a tax revolution in this country.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


HUMAN RIGHTS
Mr. David Smith (Don Valley East):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity to move a motion which I believe will obtain the consent of the House. Whereas Glendon College of York University, Toronto, will next month be honouring with the degree of Doctor of Laws, Anatoly Shcharansky, a man who has struggled to obtain his fundamental human rights, and whereas this Soviet dissident has involved himself fearlessly in mankind's struggle for freedom of thought, of expression and of movement, I move, seconded by the hon. member for Kingston and the Islands (Miss MacDonald) and the hon. member for Winnipeg North (Mr. Oriikow):
That this House urge the Soviet authorities to acknowledge Anatoly Shcharansky's courageous principles and allow for his release in order that he may accept in person an honorary degree of Doctor of Laws to be conferred by Glendon College of York University.


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


Some hon. Members:: Agreed.


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


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Mr. Vince Dantzer (Okanagan North):: Madam Speaker, the information branch of the Commissioner of Official Languages recently published a map supposedly depicting the languages of the world. The map is apparently intended as a teaching aid for students from the age of 13 to 17 years. The map pointedly omits any reference to the Ukrainian language. There are over 600,000 Canadians of Ukrainian descent in this country who have contributed their language and their traditions to enhance the cultural mosaic of Canada. The publication of this map by the government is an insult to each and every one of them. Therefore I move, seconded by the hon. member for Saskatoon West (Mr. Hnatyshyn):
That this House direct the Commissioner of Official Languages to withdraw this offensive map immediately and prepare a proper one which recognizes the Ukrainian language as one of the world's languages.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXPLORATION OF NEW BRUNSWICK'S OIL SHALE DEPOSITS- MOTION UNDER S.O. 43
Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, in view of the collapse of the Alsands project and the Prime Minister's statement in the maritimes that the government will be looking

May 13, 1982
for self-reliance in other areas, I move, seconded by the hon. member for Halifax West (Mr. Crosby):
That the government immediately commit itself to funding exploration of the oil shale in New Brunswick.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


STATUS OF WOMEN
Mrs. Margaret Mitchell (Vancouver East):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. I ask for support of this motion by all parties in the House. Yesterday many male members of the House laughed uproariously when they were told that one out of every ten men in Canada beat their wives repeatedly. As a result, there has been a public outcry against the appalling attitude expressed by these hon. members. Therefore I move, seconded by the hon. member for Beaches (Mr. Young):
That all members of this House apologize to the women of Canada for the shameful and disgusting display of discrimination and ignorance by members who degraded this House yesterday with their performance.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


AGRICULTURE
Mr. Charles Mayer (Portage-Marquette):: Madam Speaker, the Minister of Agriculture (Mr. Whelan) has been talking about a national beef program of one sort or another for over a year. In the meantime, because of the lack of any effective national program, every beef producing province has announced assistance to the beef industry which significantly varies from province to province. I therefore move, under the provisions of Standing Order 43, seconded by the hon. member for Saskatoon West (Mr. Hnatyshyn):
That the Minister of Agriculture stop accusing farm leaders of being gutless and show some leadership by calling a meeting of provincial agriculture ministers to work out a nationally co-ordinated and jointly funded beef stabilization program between the two levels of government and the producers.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


STATUS OF WOMEN
Mr. Marcel Roy (Laval):: Madam Speaker, under the provisions of Standing Order 43, I wish to remind hon. members of an incident that occurred in the House yesterday when a question was being put to the Minister responsible for the Status of Women, the Hon. Judy Erola, and some hon. members seemed to be unmindful of the situation concerning wife battering in Canada. I move, seconded by the member for Kingston and the Islands (Miss MacDonald):
That the House apologize for this attitude and shows that its members arc aware of the extent of the problem of violence done to women in Canada, and that it reiterate its support for the third report of the Standing Committee of the House and urge hon. members to support its main objectives, which are to gain a better understanding of the problem of violence and provide better protection for its victims.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ADMINISTRATION
Mr. Jack Shields (Athabasca):: Madam Speaker, more and more men and women across this great country are losing their jobs, causing real tragedy in the daily lives of ordinary Canadians. They depend on members of this House of Commons to show leadership in the direction of our economy. The absolute stupidity of the government is pushing Canada into a depression. The greatest resource of Canada is our young people who have spent years of effort to prepare themselves so that they may take part in the richness of our nation, but they are now finding no jobs and no hope of jobs. The stubborn jackass of a finance minister-[DOT]


Some hon. Members:: Order, order!


Jack Wendele Shields: -who knows full well that his policies are not working, that they only serve to make a disastrous situation worse, must now change his policies before it is too late. The

May 13, 1982

Minister of Energy, Mines and Resources (Mr. Lalonde) must throw out his national energy policy which has already wreaked havoc on the one industry which could have led the way to Canada's economic recovery.
I therefore move, seconded by the hon. member for Surrey-White Rock-North Delta (Mr. Friesen):
That this House do immediately receive the resignations of the members of this lunatic group called a government-


Some hon. Members:: Order.


Jack Wendele Shields: -whose disastrous, short-sighted and ignorant economic and energy policies are responsible for hurling our great country toward another depression.


Some hon. Members:: More, more!


Jack Wendele Shields: Madam Speaker, the people of Canada want to work, they do not want to-


Some hon. Members:: Order.


Madam Speaker:: Order.


Jack Wendele Shields: -they do not want welfare.


Madam Speaker:: Order. The hon. member for Humboldt-Lake Centre (Mr. Althouse).


AGRICULTURE
Mr. Vic Althouse (Humboldt-Lake Centre):: Madam Speaker, I rise under the provisions of Standing Order 43. Since the Minister of Agriculture (Mr. Whelan) is at least six weeks past his own deadline for a federal-provincial agreement on an improved stabilization program to assist in preventing further declines in Canadian net farm income, which has basically remained unchanged since 1974, at which time that income was close to parity with other sectors of Canadian society, I move, seconded by the hon. member for The Batt-lefords-Meadow Lake (Mr. Anguish):
That this House order the Minister of Agriculture to report to it the principles being proposed by himself and his department, as well as to report how many meetings he has initiated on this topic since June of 1981 when he set his deadline for the introduction of a new program.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
Oral Questions


NATIONAL ENERGY PROGRAM
Mr. Roger Simmons (Burin-St. George's):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Whereas my good friend, the illustrious hon. member for York-Peel (Mr. Stevens), has been one of the harshest and most severe critics of the National Energy Program, and whereas it was disclosed in the press today that he is chairman of the board of a company which is now a partner in the recently announced $600 million Beaufort Sea exploration project, I move, seconded by the hon. member for Lac-Saint-Jean (Mr. Gimaiel):
That this House invite the hon. member for York-Peel to prove that he is a man of conviction by asking him either to change his position on the National Energy Program and begin to support its excellent policies or to resign his corporate position.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Miss Pat Carney (Vancouver Centre):: Madam Speaker, my question is directed to the Prime Minister. Today the Canadian dollar fell to its lowest level since the depths of the depression 50 years ago, before the Bank of Canada stepped in to support it. This alarming drop reflects the conviction of investors that the government will again introduce the wrong economic policy at the wrong time and take steps to devalue the dollar or bring on exchange controls. Will the Prime Minister commit to this House, on the basis of whatever credibility his government still possesses, that the government is not planning to devalue the dollar or impose exchange controls, now or in the foreseeable future?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the hon. member is probably right in ascribing this drop in the dollar to an assumption that we are going to take the wrong policy. I can assure her that we are going to take the policy which she seems to prefer in her question, and which has been this government's policy, that of not devaluing the dollar and not imposing exchange controls.

May 13, 1982
Oral Questions BANK OF CANADA


POSITION OF GOVERNOR
Pat Carney: Madam Speaker, my second question is also directed to the Prime Minister. The panic selling of the dollar and the flight of money from the country reflects the fact that the whole world, not just Canadians, has lost confidence in the ability of this government to govern. After all, it is the government which brought in the national energy policy which cost us hundreds of thousands of jobs, and has even put our banking system at risk. Has it also lost confidence in the Governor of the Bank of Canada? Will the Prime Minister confirm whether the governor's resignation has been asked for or has been offered?


Pierre Elliott Trudeau: Madam Speaker, I can also say quite categorically that that is a completely unfounded rumour. The governor's resignation has not been offered, nor has it been asked for, nor has it been discussed in any way.


FINANCE
Pat Carney: Madam Speaker, my third question is also addressed to the Prime Minister. 1 am advised, by talking to people throughout the country, that the one positive step the Prime Minister could take to restore some degree of confidence would be to replace the finance minister and withdraw the budget. Is the Prime Minister prepared to take that step, or, having pulled the plug on the economy, is he prepared to let the country go down the drain?


Pierre Elliott Trudeau: Madam Speaker, I would inform the hon. member that the people who advised her of that seem to have a very simplistic view of the world economy and the Canadian economy if they think that one man in Ottawa can be responsible for the high unemployment in Germany, Britain, Italy and the United States.


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Madam Speaker, we again have the example of bellowing backbenchers who refuse-


Jack Wendele Shields: Go home and talk to the residents in your riding.


Madam Speaker:: Order. The hon. member on my left does not have the floor.


Pierre Elliott Trudeau: Madam Speaker, I apologize for the backbenchers to the hon. member for Vancouver Centre who should be as distressed as I am that they do not find her questions important.


THE ECONOMY
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, my question is to the Prime Minister who will know that today interest rates went up 25 bases points in Canada. This week interest rates on American T-bills went down about 40 bases points. Will the Prime Minister tell us how long he is going to force interest rates up in this country, now nearly three points above American rates expressed on T-bills, in order just to protect the market value of our dollar? What is he going to do to get interest rates down in Canada, and not keep blaming the Americans?


Pierre Elliott Trudeau: Madam Speaker, we have in these two questions an example of the confusion which is present in the opposition ranks. The hon. member is suggesting we should not do anything to protect the dollar. The previous questioner from the same party wanted to be assured that the Canadian dollar was not going to be devalued and, therefore, that it should be protected.


REQUEST THAT NEW BUDGET BE INTRODUCED
Donald Alex Blenkarn: Madam Speaker, the Prime Minister will know that we have advocated policy after policy to strengthen the exchange value of the dollar without resorting to ridiculous, high interest rates, which he seems to want to impose on the country.
One of the reasons the dollar is going down is the lack of confidence in the economy, the lack of confidence in his government. When is he going to bring in a new budget? When is he going to set the country on a new economic course? When is he going to change things so that Canadians will not take their money out of Canada and that foreigners will not take their money out of Canada? When will there be some confidence in Canada again so that we can build the country and make it go forward? When are we going to turn off the fiscal doomsday machine?


Some hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Amid all that shouting, Madam Speaker, I think the hon. member was asking me when we should be changing our economic policy. I would point out to him that a member of his own party, a couple of minutes ago, wanted to be reassured that we were not changing our policy in so far as devaluation of the dollar is concerned.


Robert Alfred Corbett: What devious hypocrisy!


Pierre Elliott Trudeau: There is hypocrisy over there, Madam Speaker. The problem could be solved if the Conservative Party were to get their act together and know what economic policy they are going to follow.
May 13, 1982


EXTERNAL AFFAIRS
Hon. Edward Broadbent (Oshawa):: Madam Speaker, 1 have a question for the Prime Minister. The internationally accepted role of an ambassador is that an envoy should not interfere in the host country's politics by speaking out publicly on matters which are to be resolved domestically. Considering that the United States ambassador to Canada has once again violated this principle, this time by asserting, on the one hand, that Canadians spend too much on social programs and, on the other hand, by asserting publicly that we should not strengthen our FIR A legislation, what action does the Government of Canada propose to take to ensure that this does not happen again?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: Madam Speaker, the hon. member has not stated the international rule exactly. It is that ambassadors are expected to represent their countries in another country and to speak on issues in that country which affect their own country's interests and policies. As I am sure all hon. members of the House would wish, we give a fairly wide latitude to that rule, just as we would expect other countries to do so in the case of our ambassadors.
I would admit what the hon. gentleman says, that there are some instances which, from time to time, could be considered borderline. In those cases, by and large, I think it is better that those be dealt with, as long as they are borderline, by the normal political and free speech process of this country, so that members like the Minister of National Defence or other members of this House can publicly answer things which are publicly said. It seems to me that that is in the best tradition of Canadian democracy.


Some hon. Members:: Hear, hear!


POSITION TAKEN BY FORMER UNITED STATES AMBASSADORS
John Edward Broadbent: Madam Speaker, I have rarely heard such a weaselly answer, even from the Secretary of State for External Affairs. I would like to direct a supplementary question to the Secretary of State for External Affairs, since the Prime Minister has decided that he is not going to get involved in this rather basic question which simply involves the principle that the American ambassador in Canada should act precisely according to the same rules as do all other ambassadors. That is really the point at stake here.
One predecessor of the current ambassador, namely, Adolph Schmidt, has said "I would never use a public forum to criticize Canadian policies." Another former American ambassador, Mr. Porter, has also agreed with this principle. Since I know of no person other than the Secretary of State for External Affairs who has said that ambassadors should be going around publicly engaging in domestic debate, does the minister not agree with the two former American ambassadors
Oral Questions
who said that an ambassador's role, when he has differences with the Government of Canada, is to express those differences with the Government of Canada, and otherwise keep his views to himself?


Mark R. MacGuigan: Madam Speaker, first of all, there is no difference in any rules or tolerances that we apply as between one ambassador and another in Canada. They are all treated exactly the same.
We must understand that an ambassador's role is not just to represent his government to the government of another country in the sense that he gives messages privately to that government; he is also entitled to speak out publicly-as our ambassador, for instance, in Washington does-on the issues of the day as they affect the interests of his country. It is only when an ambassador departs from that course that he is rightly subject to censure.


John Edward Broadbent: Madam Speaker, I would like the minister to be able to give to the House any comparable example of a Canadian ambassador going down to the United States and criticizing domestic U.S. policy. I suggest, with all respect, that the minister cannot give any such example.


UNITED STATES PRESSURE RESPECTING FOREIGN INVESTMENT REVIEW AGENCY
John Edward Broadbent: Madam Speaker, in the context of the present American ambassador's objectionable practices in this country, and considering that Mr. Robinson said, shortly before last fall's budget, that Canadians could anticipate an announcement that the Liberal commitment to strengthen FIRA would in fact be withdrawn shortly-and when we saw the budget we saw that his forecast was confirmed-does this acquiescent attitude of the Government of Canada to U.S. pressure really account for the minister's response to these questions today rather than the substance of the arguments he is presenting?


Mark R. MacGuigan: Do you want to take that, Prime Minister?


Some hon. Members:: Oh, oh!


Mr. Hnatyshyn:: Why don't you ask Pierre Bussieres? Get up, Pierre.


Donald Alex Blenkarn: He hasn't got any notes on that subject.


John Edward Broadbent: Ask your backbenchers.


Ramon John Hnatyshyn: Prime Minister, Bill Rompkey has his hand up.


Some hon. Members:: Oh, oh!


Mark R. MacGuigan: Madam Speaker-


Some hon. Members:: Oh, oh!

May 13, 1982
Presence in Gallery


Some hon. Members:: Hear, hear!


Madam Speaker:: Order.


Mark R. MacGuigan: Madam Speaker, I should not have to recall for the hon. member the cases in which our ambassador, our officials and our ministers speak openly and publicly in the United States against various aspects of American policy. Often at the instance of the hon. member's party they raise the question of the Garrison dam, for instance. We speak publicly. We lobby publicly in Washington on this issue-


John Edward Broadbent: That is an international question.


Mark R. MacGuigan: -because we believe it is in the interests of our country.
As I stated before, this is a question relating to a host country's policies and the effect they have on the policies of an ambassador's home country, in his view, and that is the rule which is internationally accepted as a valid one.
With respect to FIRA, I might say that our policy on FIRA has not changed. Our explanation of it in the United States has not changed.


John Edward Broadbent: Read the budget.


Mark R. MacGuigan: It is not for me to say what the product of the review of FIRA will be, but the fact is that this is not the highest profile issue we have in our relations with the United States, and the effect of the American pressure to which the hon. member refers is not a crucial factor in the formulation of our policies.


PRESENCE IN GALLERY OF MINISTER OF ENERGY OF THE PHILIPPINES
Madam Speaker:: I would like to draw the attention of the House to the presence in our gallery of Mr. Geronimo Velasco, the Minister of Energy of the Philippines.


Some hon. Members:: Hear, hear!


PRESENCE IN GALLERY OF MAYOR OF LA HR, GERMANY
Madam Speaker:: 1 would also like to draw the attention of the House to the presence of someone many members of this House have met, Mr. Dietz, the Mayor of Lahr, Germany.


Some hon. Members:: Hear, hear!


KENT ROYAL COMMISSION
Hon. Perrin Beatty (Wellington-Dufferin-Simcoe):: Madam Speaker, the last exchange of questions was like putting a
question to Edgar Bergen and getting the answer from Charlie McCarthy.


Some hon. Members:: Hear, hear!


Henry Perrin Beatty: Perhaps I can go directly to the ventriloquist. My question is directed to the Prime Minister. It arises from a cabinet document entitled "Response to the Royal Commission on Newspapers." Can the Prime Minister confirm that cabinet is currently considering a set of proposals dealing with the Kent commission which would substantially scrap its recommendations and result in a Canadian newspaper advisory council being set up, and in policies which would restrict Southam and Thomson to their present size, and which would result in the breakup of those two chains if they were to be sold?


Pierre Elliott Trudeau: Madam Speaker, the hon. member is asking to be informed of a discussion which has gone on in cabinet and which has not yet been the subject of a public announcement. I think that even Charlie McCarthy would know that the rules provide that a cabinet decision will not be announced until the minister responsible wants to make that announcement. The Minister of Multiculturism is at present travelling with the Governor General, and when he returns he may or may not want to deal with this question.


QUERY RESPECTING CABINET DOCUMENT
Henry Perrin Beatty: Madam Speaker, one of the recommendations is that in future nonmedia companies wanting to acquire newspaper holdings would first have to demonstrate to the Restrictive Trade Practices Commission that the purchase would be in the public interest. In view of the fact that the cabinet document itself says that even this review process may be struck down by the courts, can the Prime Minister give the House the assurance that, if this proposal is included in legislation presented to Parliament, before asking Parliament to pass it the government would first seek a reference to the courts?


Pierre Elliott Trudeau: Madam Speaker, I have to repeat to the hon. member that he is asking me to comment on a cabinet document-an alleged cabinet document. I can assure him that the rules of Parliament do not call for me to answer such a question and he, as a former cabinet minister, although admittedly an insignificant one, should not have to be told that.


Some hon. Members:: Oh, oh!
May 13, 1982


EXTERNAL AFFAIRS
Hon. John M. Reid (Kenora-Rainy River):: Madam Speaker, my question is directed to the Secretary of State for External Affairs and concerns a question I put to him on April 28. I am informed that the Canadian aerobatic team has received an offer from the Solidarity Union, of Poland, to help finance the movement of the Canadian aerobatic aircraft from Canada to Austria where the world championship competition will take place, in exchange for painting on the Solidarity logo on the aircraft. I understand those concerned have written to the Minister of National Defence and the Secretary of State for External Affairs asking for some assistance in getting their aircraft over to Europe. Has the minister responded to the Canadian Aerobatic Association and, second, has he responded to its request to use the Solidarity logo on its aircraft instead of the Maple Leaf?


Mark R. MacGuigan: Madam Speaker, the question that was addressed to me by this Canadian body was one asking for advice about the appropriateness of using the Solidarity logo. As hon. members know, many people in Canada wear Solidarity pins and are very proud to carry the Solidarity logo. That is a decision which, in a free country like this, Canadians are free to make, and they do so, showing their solidarity with the Polish organization. It is not for the government to advise a private organization whether it should adopt such a position. That is basically for it to decide, and that was the advice we provided.
Regarding the question of transportation, I think that might be more appropriately addressed to my colleague, the Minister of National Defence.


FISHERIES
Mr. Howard Crosby (Halifax West):: Madam Speaker, I have a question for the Minister of Fisheries and Oceans concerning employment in the fishing industry in Atlantic Canada. The minister knows that Atlantic Canada is experiencing record unemployment, and now the Fisheries Council of Canada has suggested reductions in the number of fishermen, vessels, and processing plants. The minister also knows that further fish plant closures would have drastic effects on unemployment in Nova Scotia and the Atlantic provinces.
Will the minister undertake to fight against further fish plant closures? Will he also make every effort not only to continue employment in the fishing industry at current levels but to reactivate closed plants, and will he work to create more
Oral Questions
job opportunities in the Atlantic fishery? Surely with millions starving in the world, we can catch, process, and sell this high protein food.


Hon. Romeo LeBlanc (Minister of Fisheries and Oceans):: Madam Speaker, I am afraid the hon. member's last question underlines exactly the problem we have had in the fishery, which is to try to load upon this industry all the other economic problems and all the problems of unemployment caused by closure of mines or whatever. For a good number of years I have advocated-and in this I have been supported by members on all sides of the House-that we should see the 200-mile limit not as an unlimited expansion but as a way go give the industry which existed some chance at stability. I am afraid that many people, including some of the large companies on the east coast, have expanded beyond anything that the oceans can provide.
On the question of disposing of surplus fish, I might say to the hon. member that if we had been able to convince the industry to co-operate, and if international markets had been better than they have been, we might have made more progress.


GOVERNMENT POLICY
Howard Edward Crosby: Madam Speaker, I have a supplementary question. I want to point out to my colleague from Atlantic Canada that, while I welcome his answer, he should remember that our colleagues in Ontario do not solve the problems in the auto industry in Oshawa by closing plants in Windsor. In Atlantic Canada we do not want this problem resolved by closing plants and getting rid of fishing vessels and fishermen because we are already faced with great unemployment. Does the minister have a plan for curing the difficulties in the fishing industry so that we can get on with developing this great resource industry and thus create more job opportunities? If he does not have a plan, can he assure us that the Kirby task force will come up with a plan to resolve these difficulties?


Roméo LeBlanc: Madam Speaker, it is exactly because we felt that putting money into the industry, as we did in 1974, would not give us a long-term solution to the problem that the Prime Minister appointed the task force which I recommended before Christmas.
I might say that the first part of the hon. member's question underlines the problem again. Some companies have made decisions against the advice of my department and against the advice of DREE and, in one case, against the advice of its usual banker. It went ahead and expanded, spending $7 million. I really do not think that in that situation the government should be expected to carry the responsibility.
17374

May 13, 1982
Oral Questions EMPLOYMENT


APPLICATION OF EMPLOYMENT BRIDGING ASSISTANCE PROGRAM IN BRITISH COLUMBIA
Mr. Ted Miller (Nanaimo-Alberni):: Madam Speaker, my question is directed to the Minister of Employment and Immigration. In Port Alberni alone 1,200 UIC claims will run out by the end of August. The only thing that the minister has announced that might give some aid to these people is the employment bridging assistance program, announced three weeks ago jointly by the province of British Columbia and the minister. That announcement was met with a lot of opposition from the union, and a lot of silence from the companies. Inquiries at the CEIC offices by people interested in the program are met with a big silence also. No details of the program have been announced and no one knows who can apply or who will benefit.
Has a final agreement been signed with the province of British Columbia and, if so, when will details be announced to CEIC offices? Will those people who are already off claim, or who will be coming off claim within the next couple of months in the forestry industry, be eligible for the program if it ever gets under way?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, in putting forward the program a very clear public announcement was made jointly with the province of British Columbia which is co-operating with us in this venture. The guidelines for the program were very clearly established. Officials of the Employment and Immigration Commission in B.C. were part of that announcement. The province and the federal government have a joint committee which administers the program, and it has undertaken discussions with the forestry industry and its unions.
I just do not believe that what the hon. member is saying is accurate. There has been a fair degree of consultation. Because of the affiliation of the hon. member's party with the unions, I would ask them to encourage the unions to be co-operative rather than standing completely opposed to this. They should give their members the opportunity to go to work in the very valuable area of forest management rather than simply standing on the principle that they will have nothing to do with a new employment program and will hold out for something different. This is an opportunity for their workers to go to work. I think if the hon. member worked with the unions in his own area he would find he could be of much better assistance to his constituents than by standing here asking these questions.


REQUEST FOR INVESTIGATION OF FOREST INDUSTRY LAY-OFFS
Edward Allan Miller: Madam Speaker, one of the difficulties unions have in accepting this program is there was no consultation with them in developing the project.


Madam Speaker:: Order. Members have to restrict themselves to questions. Every question is preceded by a commentary on the previous answer. This cannot go on because we will not have all the questions we want to have in question period.


Some hon. Members:: Hear, hear!


Edward Allan Miller: Madam Speaker, I am often the one who criticized-


Some hon. Members:: Order.


Edward Allan Miller: I shall ask the question, thank you. The purpose of the program is to establish better forest management. Just as the government is introducing this program, Noranda in Nanaimo recently laid off 35 people in their-


Madam Speaker:: Order. Unless the hon. member goes directly to his question I will have to recognize another member.


Edward Allan Miller: Will the minister investigate the charge that they are laying off people directly involved in improving forest management, and take some action against companies which are laying off people doing work which this program is supposed to cover?


Lloyd Axworthy: Madam Speaker, we are always pleased to look into any representation made by Members of Parliament, and we will certainly look into that one. 1 would assure the hon. member that in the Vancouver Island area we are already committed to establishing special response employment programs so that workers who do come off their entitlements will be able to re-establish their eligibility. He can take that particular word of comfort back to his riding.

[ Translation]


UNEMPLOYMENT
Hon. Roch La Salle (Joliette):: Madam Speaker, my question is directed to the Right Hon. Prime Minister. As you know, Madam Speaker, 50 per cent of the members on the government side and 33 per cent of the government's cabinet ministers are from Quebec, and this government is nevertheless responsible for the fact that 43 per cent of bankruptcy cases in Canada occur in Quebec. In the circumstances and since he has such a formidable team, does the Prime Minister intend to call a meeting of Quebec members, both ministers and other members, and propose a special strategy to deal with the fact that 400,000 workers are unemployed in his own province?


Pierre Elliott Trudeau: Madam Speaker, I am not sure whether the hon. member wanted me to call a meeting of ministers of the Quebec government or the federal government. I can assure him that the latter regularly,
May 13, 1982

that is several times a week, attend meetings of parliamentary committees, where these very important issues are discussed. I do not know what the procedure was when the hon. member opposite was a minister, but I trust that he too was consulted, and on this side, consultation is alive and well.


INDUSTRY
Roch La Salle: Madam Speaker, I have a supplementary. The Prime Minister misunderstood my question. I was, of course, referring to the federal, not the Quebec government. However, I repeat that although the Prime Minister is proud that 50 per cent of the members on the government side and 33 per cent of his cabinet are from Quebec, they are nevertheless responsible for the fact that Quebec has 43 per cent of the bankruptcy cases in Canada. In the circumstances, does the Prime Minister intend, in the short term-I suppose he does sympathize with Quebec's 400,000 unemployed workers-does he intend to present a specific industrial strategy, because 400,000 Quebecers are waiting for these exceptional measures that were promised by the Prime Minister?


Hon. Charles Lapointe (Minister of State (Small Businesses and Tourism)):: Madam Speaker, the member for Joliette made several mistakes in his statement. When he referred to the fact that 43 per cent of Canadian bankruptcies occur in Quebec, perhaps the hon. member should realize that during the past ten years, Quebec's share of bankruptcies in Canada varied between 39 and 43 per cent. This is simply because Quebec has far more small and medium-size businesses than other Canadian regions. Quebec has more restaurants and retail and wholesale merchants, and that is why the percentage of bankruptcies is higher in Quebec. The hon. member is asking what measures have been taken to bring relief in this difficult situation. The hon. member should know that during the past year, we have provided loan guarantees, through existing programs under the Small Businesses Loans Act, to 5,000 small businesses in Quebec. If we consider the past five years, Madam Speaker, 29,000 small businesses in Quebec have received direct assistance through federal programs. That is what we are doing, Madam Speaker.



Mr. Otto Jelinek (Halton):: Madam Speaker, my question is directed to the Minister of Industry, Trade and Commerce. Over 6,000 jobs have been lost in the Canadian footwear
Oral Questions
industry since last November when the Liberal government lifted its quotas on leather shoe imports despite Anti-Dumping Tribunal recommendations to the contrary. Notwithstanding the insensitive attitude of the minister and his cabinet colleagues toward the growing number of unemployed Canadians, can the minister either justify his action of last November- which was totally contrary to the recommendations of the Anti-Dumping Tribunal-or indeed justify the continuing existence of the tribunal itself, the advice of which the government does not heed? Who is right, the minister or the tribunal?


Hon. Herb Gray (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: Madam Speaker, I advise the hon. member to take another look at the report of the Anti-Dumping Tribunal. We have not disregarded its advice. We have acted in a way we believe is totally consistent with its findings, which said that our industry is in the position to meet competition from developed countries, the main source of imported leather footwear. That is why we decided not only to maintain the existing quota on non-leather footwear, but extend it to canvas footwear, while taking into account that conclusion of the tribunal. This was in addition to creating a special fund of $17 million to aid our industry in modernizing and becoming more efficient and competitive. We are not insensitive to the industry; we consider it and its workers very important, and I think we have read the report of the Anti-Dumping Tribunal a lot more carefully than did my hon. friend.


GLOBAL QUOTA ANNOUNCEMENT
Otto John Jelinek: Madam Speaker, according to the president of the Canadian Shoe Manufacturers' Association, unless leather shoes are reinstated in the global quota at once, a further 10,000 Canadians will lose their jobs within four months. Two months ago the minister gave an undertaking in this House that he would make a decision in that regard within 30 days. He is now one month behind schedule, and I ask the minister to stand up in this House and tell us if a decision has been made. If so, what is it? If not, when can we, and in particular the shoe industry which is functioning in a void out there, know when the decision will be made by this cabinet minister who has promised it?


Herbert Eser (Herb) Gray: Madam Speaker, the decision in question is that of cabinet.


Otto John Jelinek: You promised it two months ago.


Herbert Eser (Herb) Gray: We will be in a position to state very soon the results of our review of information provided to us by the industry and other elements interested in the Canadian footwear sector. I think we will be able to state the conclusions of our review before too long.

May 13, 1982
Oral Questions


REGIONAL DEVELOPMENT
Hon. George Hees (Northumberland):: Madam Speaker, my question is for the Minister of Industry, Trade and Commerce in his role as minister responsible for DREE. Can he report to the House what progress he is making in including the County of Northumberland in the eastern Ontario subsidiary agreement, a project on which I had been working for many months with his predecessor, and about which his predecessor wrote me last December 17 as follows:
I feel that federal and provincial officials are making real progress in the development of the agreement format. It is hoped that the matter will be put forward for governmental decision early in 1982.
In answer to a question I put to him in the House on February 3, 1982, he said:
-I am very happy to remind the hon. member that one of my last acts as minister responsible for DREE was to deliver a letter to his office by hand, stating that the draft of that agreement would be ready very soon. I also remind him that at my first meeting with the provincial government of Ontario, with his support, I stated my initiative to do something for the county of Northumberland. I hope that in the very near future that initiative will reach its final conclusion.
Can the minister advise when he expects to announce the entry of the county of Northumberland into the eastern Ontario subsidiary agreement?


Herbert Eser (Herb) Gray: Madam Speaker, I am happy to confirm my hon. friend's great interest in this subject. This matter is being actively worked on in connection with the review of departmental programs that has to be carried out because of something which intervened since the letter that my hon. friend read, that is, the announcement of the Prime Minister of the eventual integration of the Department of Regional Economic Expansion with the Department of Industry, Trade and Commerce. This is a subject which I know is of great importance to a number of people on both sides of the House, and I am working on it very actively.


George Harris Hees: Madam Speaker, I am glad to hear that. I would just like the minister to know that his predecessor also said to me that in his first meeting with-


Madam Speaker:: Order. I am sorry, we have to stick to questions. If the hon. member has a question, I can recognize him.


George Harris Hees: Madam Speaker, I will certainly ask the minister a supplementary question.


INQUIRY RESPECTING DATE OF DECISION
George Harris Hees: Could the minister give the House some indication of just when he expects to
come to a conclusion on this matter? I have written to him several times. I have had great difficulty in obtaining answers. His predecessor told me that he expected to bring the matter to a conclusion very, very soon. He had an agreement with the provincial government. Everything was done, except actually announcing that Nothumberland was to be included in the eastern Ontario subsidiary agreement. I can see no justification for the minister holding up this decision any further. His predecessor had the whole thing done.


Madam Speaker:: Order. The hon. member for Winnipeg-St. James.


HOUSING
Mr. Cyril Keeper (Winnipeg-St. James):: Madam Speaker, my question is for the minister responsible for housing. HUDAC has indicated that the housing construction industry is in a real crisis today. Predictions for housing starts are down to 145,000, that is, down some 18.5 per cent. Yesterday the minister seemed to express some skepticism about his own program when he said:
-we are now in the process of dealing with individual applicants to see if some of those projects will get started.
Is the minister satisfied that the meagre program for housing starts approved by cabinet is sufficient to help the industry survive in present conditions?


Hon. Paul J. Cosgrove (Minister of Public Works):: Madam Speaker, I am quite satisfied that the S350 million allocated in the budget of November last year will go a long way toward assisting the industry in adding to the number of starts this year, notwithstanding the fact that the New Democratic Party voted against 30,000 units and 60,000 jobs in that industry.


Some hon. Members:: Shame!


Cyril Keeper: Madam Speaker, the minister should know that 60,000, at a time when we have nearly two million real unemployed, is pretty insignificant. He should take note of the fact-


Some hon. Members:: Order.


Madam Speaker:: Proceed to the question, please.


EFFECT OF INTEREST RATES
Cyril Keeper: Madam Speaker, given the fact that interest rates have gone up today and that building permits are down by 22.2 per cent, is the minister prepared to recognize that the housing industry is in a real crisis and that he should go to his cabinet colleagues and convince them to bring down the general interest rate policy in the country?
May 13, 1982


Paul James Cosgrove: Madam Speaker, the government realized that the industry would need support and that is why in November of last year these moneys were allocated in the budget for that assistance, and that is why in December of last year I introduced legislation in the House and sought the support of all hon. members for that legislation. It is unfortunate that that legislation was delayed unnecessarily for three months and was eventually voted against. I hope the 60,000 people who find employment under that program and the 30,000 families who will enjoy that program know that the NDP voted against it.


CANADA PENSION PLAN
Vincent Martin Dantzer: Madam Speaker, my question is directed to the Minister of National Health and Welfare. The minister may or may not know that at the recent Canadian pension conference held in Ottawa, the Quebec minister of social development said that he had been working with federal officials on pensions and that for the first time Quebec officials and federal officials were on the same wavelength. Then he proceeded to say that he favoured and would institute benefits under the Quebec Pension Plan to equal 37.5 per cent of pensionable earnings. Does the minister favour expanding benefits under the Canada Pension Plan, thereby following the Quebec scheme or alternatively does she favour expanding benefits under pensions in the private sector?


Hon. Monique Begin (Minister of National Health and Welfare):: Neither, Madam Speaker, because there are other avenues that are perhaps just as interesting and would be worth exploring. I am glad to hear questions by members of the opposition, but I would like to know what kind of reforms they would like to see in private sector pensions. The fact is that Dr. Denis Lazure has finally, if I may say so, announced the position of the Quebec government, which is in need of money and, if I understood correctly, is going to replenish the funds of the Quebec Pension Plan. That is one negotiating position, and I hope that all provinces will be able to make their positions known in this national debate as soon as possible, so that Canadians, namely all employees and part-time workers, can be covered by private sector pensions in the future.


Vincent Martin Dantzer: Madam Speaker, the minister did not answer the question and I understand why. I gather she is having some difficulty with cabinet.


TERMS OF REFERENCE FOR PROPOSED ALL-PARTY COMMITTEE
Vincent Martin Dantzer: Madam Speaker, I will ask the minister a less contentious question. She was reported as saying in that conference that the government
Oral Questions
would establish an all-party committee to study the whole question of pensions and the long-awaited green paper. Has the minister set the terms for that committee?


Monique Bégin: Madam Speaker, I think the hon. member did not properly read the text of my speech to the Canadian Pensions Conference last Tuesday. There will be consultation with the persons concerned, and therefore I feel we would be lacking in respect for the opinion of Canadians if we immediately announced our position. Unlike Quebec, we want to hear what the main economic partners and what the employees themselves want in the way of reform and we want to know who has the best plan for investing these vast sums of money at this stage. These are fundamental issues, and we are therefore considering the possibility of setting up a parliamentary committee on this question, to seek out the views of Canadians across Canada. I feel very strongly that before we commit ourselves, we should find out how anxious Canadians are to contribute to a pension plan and how such funds can best be invested for the wellbeing of all Canadians.


INDIAN AFFAIRS
Mr. F. Oberle (Prince George-Peace River):: Madam Speaker, my question is directed to the Minister of Indian Affairs and Northern Development. I would like him to direct his mind to the long-standing dispute between himself and his department and the Musqueam Indian Band in Vancouver. As the minister knows, the matter was adjudicated in court and Justice Collier of the federal court of British Columbia found the minister and his department fraudulently negligent in the discharge of his trust responsibility to these native people. The minister has now launched an appeal against this judgment which awarded the Indians $10 million. Why has the minister launched this appeal after this lengthy court hearing? Why is he not withdrawing this appeal and paying this money which belongs to the Indians, forthwith?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, I am sure the hon. member is aware-at least I think many of his colleagues who were in cabinet in the previous government would soon tell him if he is unaware-that most ministers accept the independent legal advice of law officers of the Crown. In fact I think there is a primary duty on the part of ministers of the Crown to do so. Of course I took a legal opinion with respect to whether an appeal was the appropriate thing to do in this particular case, and they felt that an appeal was warranted. I do not think I should substitute my legal views for those of the law officers of

May 13, 1982
Petitions
the Crown who presumably are unbiased and non-partisan, and who would be far more acceptable in terms of credibility to the opposition than one of the ministers.


Mr. Baker (Nepean-Carleton):: Oh, oh!


John Carr Munro: I was assuming that they would endorse that procedure and agree that I did the right thing in this particular case.


COSTS OF APPEAL
Frank Oberle: Madam Speaker, the appeal will be fought on the backs of Canadian taxpayers. The Indians have already spent $250,000 in court and the appeal will cost them $1 million. How long will the minister ride on the backs of these people, knowing full well that he is responsible? It would not be the first time that ministers have not accepted the advice of legal officers of the Crown.
If the minister insists on taking this matter to court for another two or three years, will he assist the Indians in paying for the legal costs? Furthermore, since he has the jurisdiction and the responsibility, will he pay interest on the money which is sitting somewhere following the judgment of Judge Collier?


John Carr Munro: Madam Speaker, as the hon. member is also aware, in many criminal proceedings where an Indian has pleaded not guilty in the court of first instance, we do pay the costs of appeal. If the circumstances warrant it, in some cases we are prepared to enter into arrangments of that kind and, yes, I would be prepared to look at it.
As well, there is another question here of which I think the hon. member is aware. It is the fundamental principle of whether the minister has a trust responsibility, which is a key question to the Indian community in Canada. That is what is involved in this particular case. I think some Indian leaders, to whom I have talked, realize that this fundamental question which has been a source of frustration to everyone concerned for so many years will have to be determined. It will not satisfy anyone to have a lower court decision on it, and since it is so fundamental it will probably have to go to the Supreme Court of Canada. The Musqueam case does serve that particular purpose, not only for the Indian people but for all of us who are concerned about this principle.


PETITION
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the two hundred and thirty-eighth report of the Clerk of Petitions, stating that he has examined the petition presented by the hon.
member for Spadina (Mr. Heap) on Wednesday, May 12, 1982, and finds that the petition meets the requirements of the Standing Orders as to form.


BUSINESS OF THE HOUSE
Mr. Lewis:: Madam Speaker, this being Thursday, I ask the government House leader whether he could give the House some idea as to the business for the remainder of this week and as far into next week as he can take us.


Mr. Pinard:: Madam Speaker, first of all, we will complete debate on second reading of Bill C-l 12. After consultation, we made an agreement this morning, and I would ask you to seek unanimous consent to the following motion:
That notwithstanding any Standing or Special Order, if a recorded division has been requested previously on either Bill C-l 12 or on Bill C-61, the said division or divisions shall be deferred until 3 p.m. on Tuesday, May 18, 1982.


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


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
Yvon Pinard: Following this agreement, tomorrow will be an opposition day.
[ Translation]
As far as next week is concerned, for Monday we have also made an agreement to deal with third reading of Bill C-61 concerning young offenders. By order of the House, as agreed just now, if a recorded division is required, it will automatically be deferred until 3:00 p.m. on Tuesday. After Bill C-61, and before ten o'clock on Monday, we shall, if possible, start consideration on second reading of Bill C-l 10, which deals with export development. On Tuesday and Wednesday, we shall proceed with consideration at the report stage and third reading of the energy bills, which are to be referred back to the House, by the Special Committee on Energy Legislation, in the following order: C-l01, C-l06, C-l05, C-l02, C-l07 and C-l04. Finally, Thursday will be an opposition day.


Walter David Baker: Madam Speaker, I wonder if I could ask the government House Leader whether or not there has been a decision by the government to advance Bill C-43, the freedom of information bill, or is it the position of the government that it will lay quiet and allow the bill to die before the end of this session? What is the intention of the government with respect to this bill?


Yvon Pinard: Madam Speaker, I hope to be in a better position to answer that question next week. However, I can assure the hon. member that we have taken good note of his offer to allow this bill to be dealt with in a future session at the same stage as it would be if we were to prorogue.
May 13, 1982

This is not to say that we would not want to conclude debate on that bill through all stages before the summer.That is why I would prefer to be more specific next week after consultations with the hon. Minister of Communications.



ROUTINE PROCEEDINGS


Mr. D. M. Collenette (York East):: Madam Speaker, I have the honour of tabling, in both official languages, the fifth report of the Standing Committee on Energy Legislation.
[Editor's Note: For above report, see today's Votes and Proceedings.]


PETITIONS
Hon. John Wise (Elgin):: Madam Speaker, I have the responsibility today to present a petition signed by some 994 residents of my constituency of Elgin. These citizens, by way of this petition, are vigorously demonstrating their strong and united opposition to the private member's bill, C-451, and consider its purpose to be a serious infringement on their rights as law-abiding Canadian gun owners.
I believe the record should show that Bill C-451 is not a government bill and has not received second reading, in spite of what the petition indicates.
I fully support the views of the petitioners and indeed, judging from the conversations and correspondence that I have had with the Solicitor General (Mr. Kaplan), the changes sought in Bill C-451 will indeed not become law.


Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, I too wish to present a petition from the undersigned residents of the towns of Gravenhurst, Bracebridge and many other municipalities of Parry Sound-Muskoka. This petition also deals with the private member's Bill C-451.
These petitioners humbly sheweth that the private member's Bill C-451 regarding gun control legislation deals with the number of firearms in circulation in this country and the control of the number of firearms in Canada, and the undersigned, your petitioners, humbly pray and call upon Parliament to oppose this legislation and deal directly with the present gun laws which are cumbersome, expensive to administer and ineffective except to harass law-abiding people. As in duty bound, your petitioners will ever pray.
Order Paper Questions QUESTIONS ON THE ORDER PAPER
(Questions answered orally are indicated by an asterisk.)


David P. Smith: Madam Speaker, the following questions will be answered today: Nos. 2,822, 2,823, 2,835, 2,843, 2,848, 2,861, 2,888, 2,890, 2,901, 2,950, 3,133, 3,495, 3,736, 3,737, 3,895, 4,121 and 4,224.


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Department of Industry, Trade and Commerce at page 13.6, volume I of the 1979-80 Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $8,302 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the public service?


Herbert Eser (Herb) Gray: 1. (a)
and (b) Treasury Board Policy; chapter 110 sub-chapter 5 of the Personnel Management Manual-Conditions governing education, training and development, including subsidization.
2,	3 and 4. Nil.


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Department of Justice for the Supreme Court of Canada at page 13.6, volume I of the 1979-80 Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $8,969 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the public service?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: 1. Please refer to Treasury

May 13, 1982
Order Paper Questions
Board Policy, Personnel Management Manual, chapter 110-5, "Conditions governing education, training and development, including subsidization".
2.	Nil.
3.	(a)(b) and (c) Nil.
4.	Nil.


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Department of the Secretary of State for the Public Archives at page 13.6, volume I of the 197980 Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $15,932 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the public service?


Mr. Jack Masters (Parliamentary Secretary to Minister of Communications):: I am informed by the Public Archives as follows: 1. (a) and (b) Departmental policy sub-section 5.1.10 derived from Treasury Board policy: Chapter 110 sub-chapter 5 of the Personnel Management Manual-Conditions governing education, training and development, including Subsidization.
2.	Nil.
3.	Nil.
4.	Twenty-five per cent left the public service. (One of four).


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Treasury Board, Secretariat at page 13.6, volume I of the 1979-80 Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $6,042 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the Public Service?


Hon. Donald J. Johnston (President of the Treasury Board):: I. (a)(i), (ii), (iii) Chapter 110 sub-chapter 5 of the Personnel Management	Manual-Conditions	governing
education, training and development, including Subsidization,
(b)	Same as (a) above.
2.	Nil.
3.	(a) and (b) Nil.
(c)	One hundred per cent.
4.	One of two, or 50 per cent.


Mr. Clarke: With reference to the professional and special services recorded by the Privy Council Office for the Northern Pipeline Agency at page 32.26, volume II of the 1979-80 Public Accounts of Canada, with particular reference to hospitality services (a) how does the department account for the 86 per cent increase in expenditure for the item over that for 1978-79 (b) what is a list of each contract of a value more than $2,000 (c) are guidelines used to determine when the department will pay for hospitality and, if so, what are they (d) of the $14,786 paid for hospitality, what percentage was principally used to entertain (i) foreign visitors (ii) Canadian businessmen (iii) provincial public servants (iv) federal public servants (v) ministerial exempt staff (vi) Members of Parliament (vii) Members of Provincial Parliaments, Legislative Assemblies and the National Assembly (viii) Canadian dignitaries, such as the Governor General and Lieutenant Governors General (ix) federal Crown corporation executives (x) provincial Crown corporation executives (xi) members of federal commissions, boards and councils (xii) any other categories?


Hon. Marc Lalonde (Minister of Energy, Mines and Resources):: (a) The increase of 86 per cent in expenditure in hospitality services over that for 1978-79 is the result of:
(i)	Accelerated activity in 1979-80 which was really the first full year of activity at the operational level;
(ii)	The role of the agency in ensuring that maximum economic energy and industrial benefits for Canada are achieved.
(iii)	The 'single window' role that the agency performs which requires frequent liaison meetings with departments and agencies of the Government of Canada, most of which are held at the Calgary operational office of the agency.
(b)	"List of each contract of a value more than $2,000"-[DOT] none.
(c)	Guidelines are used to determine when the Northern Pipeline Agency will pay for hospitality. These guidelines are in strict accordance with those issued by the Treasury Board which are common to all government departments.
(d)	Of the $14,786 paid for hospitality in 1979-80, the following percentages were used to entertain:
(i) Foreign visitors (includes U.S. and others), 6 per cent; (ii) Canadian businessmen (includes community and native representatives), 41 per cent; (iii) Provincial public servants, 5.8 per cent; (iv) Federal public servants, 41.2 per cent; (v) Ministerial exempt staff, nil; (vi) Members of Parliament, nil; (vii) Members of Provincial Parliaments, Assemblies, etc., .6 per cent; (viii) Canadian dignitaries, Governor General, Lieutenant Governors, etc., nil; (ix) Federal Crown Corporation executives, .5 per cent; (x) Provincial Crown Corporation executives, nil; (xi) Members of federal commissions, boards and councils (includes advisory councils), 1.5 per cent; (xii) Other (Yukon Government)-contractors, 3.4 per cent.
May 13, 1982


Mr. Clarke: With reference to the professional and special services recorded by the Department of the Solicitor General under the Royal Canadian Mounted Police at page 32.36, volume II of the 1979-80 Public Accounts of Canada, with particular reference to hospitality (a) what is a list of each contract of a value of more than $2,000 (b) are guidelines used to determine when the department will pay for hospitality and, if so, what are they (c) of the $83,671 paid for hospitality, what percentage was principally used to entertain (i) foreign visitors (ii) Canadian businessmen (iii) provincial public servants (iv) federal public servants (v) ministerial exempt staff (vi) Members of Parliament (vii) Members of Provincial Parliaments, Legislative Assemblies and the National Assembly (viii) Canadian dignitaries, such as the Governor General and Lieutenant-Governors General (ix) federal Crown corporation executives (x) provincial Crown corporation executives (xi) members of federal commissions, boards and councils (xii) any other categories?


Hon. Bob Kaplan (Solicitor General):: (a) Nil. (b) Treasury Board Administrative Policy Manual, Chapter 360-Hospitality. (c) Percentage (i), 79; (ii), 0; (iii), 0; (iv), 7; (v), .02; (vi), 0; (vii), .3; (viii), .09; (ix), .13; (x), 0; (xi), .06; (xii), 13.4.


Mr. Clarke: With reference to the professional and special services recorded by the Department of Public Works under the administration program at page 32.26, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) how does the department explain the 2,354 per cent increase in expenditure for the item over that for 1978-79 (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid?


Paul James Cosgrove: (a) and
(b) The increase in other types of services in 1979-80 is a result of not reporting expenditures in as great a detail as in 1978-79.
Reported in Public Accounts	1978-79	1979-80Other Types of Services	$ 1,048	$25,726Official Hospitality	16,972	11,127*Other Business Services Membership Fees	5,837	7,392*Conference Fees	5,477	3,910*Sundries	1,048*	3,297*29,334	25,726
* Included above in other types of services.
The comparable figure for 1978-79 is $29,334 as compared to $25,726 in 1979-80 which reflects a decrease of $3,608 in 1979-80.
(c) There were no contracts over $2,000, but a total of $2,539 was spent at the Canadian Government Conference Centre on official hospitality and is included in the amount of $11,127 as shown above.
Order Paper Questions


Mr. Clarke: With reference to the professional and special services recorded by the Department of Public Works under the land management and development program at page 32.29, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) how does the department explain the 4,682 per cent increase in expenditure for the item over that for 1978-79 (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid?


Paul James Cosgrove: (a) and
(b) The increase in other types of services in 1979-80 is a result of not reporting expenditures in as great a detail as in 1978-79.
Reported in Public Accounts	1978-79	1979-80
Other types of services		
Vote 40	$ 869	$41,563Vote 45	134	-1,003	41,563Garbage Removal	Vole 40	2.394	5,512*Photographic Services	Vote 40	2,882	6,190*Vote 45	16,060 18,942	Snow Removal Services	Vote 40	23,237	18.270*Training Educational Services	Vote 40	7,919	10,847*Sundries	1,003*	744*$53,495	$41,563
* Included above in other types of services.
The comparable figure for 1978-79 is $53,495 as compared to $41,563 in 1979-80 which reflects a decrease of $11,932 in 1979-80.
(c) Individual payments over $2,000 were as follows: Government of Canada-Public Service Commission, Ottawa, Ontario-Training and Education Services, $2,902; Arthur Richer and Fils, Ste Sophie, Quebec-Garbage Removal, $3,134; Releves Aeriens Gar-X Ltee, Montreal, Quebec- Photographic Services, $3,133; D'Alesio Contracting Ltd., Montreal, Quebec-Snow Removal, $3,300; Real and Gilles Laurin, St. Colombian, Quebec-Snow Removal, $6,680.


Mr. Clarke: With reference to the professional and special services recorded by the Department of the Secretary of State under the official languages program at page 32.32, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) how does the department explain the increase in expenditure for the item over that for 1978-79 (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid?


Hon. Gerald Regan (Secretary of State):: (a) There was in fact a decrease in expenditures for other types of services, in

May 13, 1982
Order Paper Questions
1979-80 compared to the amount for 1978-79. Expenditures for 1979-80 totalled $8,958, compared to $38,211 in 1978-79.
(b)	(i) training of public servants; (ii) non-departmental conferences; (iii) hospitality; (iv) miscellaneous services.
(c)	(i) $3,536 (no contracts over $2,000); (ii) $248; (iii) $1,047; (iv) $4,127 (no contracts over $2,000).


Mr. Clarke: With reference to the professional and special services recorded by the Department of Labour under the fitness and amateur sport program at page 32.18, volume II of the 1979-80 Public Accounts of Canada, with particular reference to education and information services (a) what services did the National Film Board provide for $242,260 (b) what is a list of each contract of a value more than $2,000?


Gerald Augustine Regan: Education and information services provided by National Film Board-1979-80
Production of a filmed television sport announcement	$	4,500
promoting skiing.
Production of a one hour filmed TV special on the Canadian	15,000
National Ski Team.
English and French prints of "Nelli Kim" Film.	3,150
Production of a 30-minute film on cycling, English version.	30,000
Copies of the set "You've got the Power" clips.	1,967
Purchase of 20 prints of "Runner" English version.	20,000
Canadian-non-theatrical booking programs.	17,643
Production of the 1978 Commonwealth Games film.	150,000


Mr. Clarke: 1.	With reference to the notes to financial statements of Atomic Energy of Canada Limited for the year ended March 31, 1980 at pages 13-19, volume III of the 1979-80 Public Accounts of Canada, which notes that the company has listed "remuneration and expenses paid to sales agents and representatives" (a) what amount was disbursed for sales of (i) Candu reactors (ii) uranium (iii) medical equipment (b) what amount was disbursed for all other types of sales and, in each case, what was the type of sale?
2.	Does the company have a policy concerning the payment of fees to agents for transfer to officials in prospective client governments with reference to the sale of nuclear Candu reactors and (a) if so. what is it (b) if not, for what reason?


Marc Lalonde: Atomic Energy of Canada Limited reports as follows: 1. (a)(i) Remuneration and expenses paid to agents for Candu sales support-$86,000. (ii) Nil. (iii) Remuneration and expenses paid to agents in support of sale of medical equipment and industrial irradiators by the Radiochemical Company (Commercial Products)-$746,000.
(b) Nil.
2.	(a) AECL complies with "Government Policy and Guidelines Concerning the Commercial Practices of Crown Corporations" established by Treasury Board on December 16, 1976.
(b) Not applicable.


Mr. Cossitt: 1.	How many members of the Royal Canadian Mounted Police were stationed within the buildings on Parliament Hill on November 21, 1981 or thereabouts and what was the breakdown of the total for each building?
2.	Did the RCMP request permission to enter the Parliament Buildings and, if so, to whom did they make such a request?
3.	Was the request granted and, if so, by whom?
4.	Did the RCMP in each occupied building remain at one central location or did they wander anywhere they wished in the buildings and, if so. for what reason?


Robert Phillip Kaplan: 1. No members were stationed within the buildings on Parliament Hill, however, accommodation was provided in Centre, East and West Blocks for members on rest periods when not deployed.
2.	Yes, the Sergeant-at-Arms.
3.	Yes, the Sergeant-at-Arms.
4.	Members were assigned specific rooms and requested to remain in same except when moving to duty posts outside or washrooms.


Mr. Lawrence: What amount was paid to or at the request of Mr. Clifford Olson of Vancouver, British Columbia or what was the value of any benefits or consideration given to him or at his request by the RCMP or by any other police force, to the knowledge of the RCMP, for each taxation year 1976 to 1981?


Robert Phillip Kaplan: A payment of $90,000 was made at the request of Mr. Clifford Olson of Vancouver, British Columbia into a trust fund for the use of his wife and child. This payment was made in 1981 and was the only one for the taxation years 1976-1981. There were no benefits attached to the payment.
The RCMP have no knowledge of information relative to payments by other police forces to their informants.


Mr. Malone: 1.	Did a grain boxcar No. CN-422258 leave Rosalind, Alberta on November 19, 1981 filled with select grade oats and, if so (a) was the destination for the oats Thunder Bay, Ontario and did they first travel to Vancouver before reaching their final destination (b) did the car travel from Vancouver to Peace River before leaving for Thunder Bay?
2.	Do grain box cars or grain hopper cars on CN rail lines travel to Thunder Bay via Vancouver and Peace River and, if so (a) how frequently and what is the reason for the error (b) is the cost absorbed by the railway company or by the farmers directly (c) is CNR taking measures to alleviate the problem and, if so, what measures?
3.	What methods, if any, does the government have to control such inefficient transportation routes?
May 13, 1982


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: The management of the Canadian National Railways and Transport Canada advise as follows:
1.	On November 20, 1981, the Alberta Wheat Pool agent at Rosalind, Alberta, gave "telephone release" to CN's Edmonton Carload Centre for three carloads, including CN-422258, loaded with oats, (a) Yes. (b) The carload travelled from Vancouver to Athabasca and then to Thunder Bay.
2.	(a) Rarely. In this instance an error was made in recording the information given by the pool agent in the "telephone release", and as a result, the billing details fed into CN's computer system recorded the destination for CN-422258 as Vancouver. Upon arrival there, it was sent to the Lynn Creek Yard to await placement to a terminal elevator; subsequently, the loaded car was diverted to Vancouver's Thornton Yard and returned to Edmonton's Calder Yard where the staff, being unaware the car had not been unloaded, sent it to Athabasca, Alberta. At that point it was found to be still under load and was returned to Edmonton. Identification and destination were established and the car was forwarded to Thunder Bay.
(b)	The cost of the extra transportation was absorbed by Canadian National in this case.
(c)	Canadian National is continually striving for the elimination of this type of error.
3.	The Canadian Wheat Board has access to the railway car training computers and the Grain Transportation Authority also keeps a close watch on car movements. It should not be forgotten that last crop year 233,686 cars were unloaded at Thunder Bay while 150,059 were unloaded on the west coast. The vast majority of these cars were moved to terminal position with dispatch.


Mr. Miller: 1.	Did the Nuu-chah-nulth submit a comprehensive land and sea claim to the Department of Indian Affairs and Northern Development and, if so, on what date?
2.	What was the procedure and criteria used by the Office of Native Claims to analyse the claim for historic accuracy and what were the results of the analysis?
3.	To date, since the claim was submitted by the Nuu-chah-nulth, what information and documentation was the claimant group required to provide to the Office of Native Claims in support of the claim?
4.	Were meetings held concerning clarification of points that seemed subject to misinterpretation in the claim and, if so, in each case (a) what was the date (b) who attended and what was his/her affiliation (c) what were the results?


John Carr Munro: 1. Yes, October 1980.
2.	A review of the claim was undertaken under the provisions of the 1973 policy on comprehensive claims. No decision has yet been made.
3.	None.
Order Paper Questions
4.	No. (a), (b) and (c) not applicable.


Mr. Cossitt: Did the National Capital Commission or any division thereof contemplate, consider, or authorize the erection of a sculpture, statue or monument in the area of the former Rideau Club at Metcalfe and Wellington Streets, Ottawa and, if so (a) was the estimated cost approximately $300,000 (b) what was the name and job designation of the highest-ranking official dealing with the matter at the commission (c) was the decision vetoed and, if so, what was the name and job designation of the person who vetoed it (d) did Mr. Michael Pitfield, Secretary to the Cabinet and Clerk of the Privy Council, oppose the erection of the sculpture on the grounds that he did not want to look at it out of his office window (e) what was its purpose in the first place and how could it be justified in view of the government's restraint policy (0 was it to be a monument to the Prime Minister; the Hon. Bud Drury, chairman of the National Capital Commission; the Minister of Energy, Mines and Resources; or the hon. member for Edmonton East?


Paul James Cosgrove: Yes. (a) No. (b) NCC executive committee chaired by Mr. C. M. Drury, (c) No. Project was cancelled after consultation with the Offices of the Prime Minister and the Minister of Public Works, (d) No. (e) To instal an interesting work of art as a centre of attraction and to facilitate future animation activities on the site, (f) No.


Mr. MacKay: 1.	Did the government issue work permits to any of the directors of a corporation named Omnitrade Ltd. at 750 McArthur, Montreal who are not residents of Canada and, if so (a) what was his/her name and address (b) on what date and for what reason was the permit issued?
2.	What is the residence status in Canada of each director and is he/she a Canadian citizen or a landed immigrant?
3.	Are any of the directors residents of the Czechoslovak Socialist Republic and, if so, which ones?


Lloyd Axworthy: 1 to 3. Yes. As of the date of the question, there were four non-residents working at Omnitrade Limited of Montreal with work permits. In so far as the remainder of the question is concerned, personal information or information concerning a person's employment in Canada is considered by the Canada Employment and Immigration Commission as personal and confidential.


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


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


Some hon. Members:: Agreed.

May 13, 1982
Taxation



GOVERNMENT ORDERS


Hon. Pierre Bussieres (Minister of State (Finance)) moved: that Bill C-112, to amend the statute law relating to certain taxes, be read the second time and referred to a Committee of the Whole.
He said: Madam Speaker, yesterday hon. members had an opportunity to discuss a borrowing authority bill, and on that occasion I explained that we were resuming second reading on the same subject because the previous borrowing authority bill, which also covered, in its second part, a number of amendments to the Excise Tax Act and in its third part, the legislation on natural gas and oil revenue taxes, had been split, following discussions between the government, opposition and New Democratic House leaders and the finance and energy critics, to provide a format for debate on borrowing authority and fiscal measures that was more appropriate in the opinion of hon. members. I also explained that, in addition to splitting the bill in two and thus providing for separate debates, this agreement also provided a time limit for debate in the House, in Committee of the Whole or in the standing committee, depending on the bill. I explained to the House that I would restrict my comments so as to enable the largest possible number of members with an interest in this issue, both on this side and on the other side of the House, to speak to this bill.
During the debate on the previous bill, which in its second and third parts covered the subject of the present bill, hon. members complained that the government had failed to explain why the bill raised the ceiling on the natural gas tax from 70 cents to $4.00 per gigajoule. I shall briefly give some of our reasons for wanting to regulate the tax in this way.
At the present time, the Excise Tax Act provides for a set schedule of tax increases, according to which the tax increased from 28 cents on November 1, 1980, to 56 cents on January 1, 1982, and will increase to 70 cents on January 1, 1983. The schedule was established on the basis of assumptions relating to the policies and prices set in the National Energy Program which, the House will recall, was announced in October, 1980. According to this policy, the tax will apply to both domestic and export sales, according to a proposal in the National Energy Program published in October, 1980. Hon. members will recall that the province of Alberta objected to the price schedule set in the National Energy Program and objected very strenuously to the tax on natural gas exports. Following negotiations, it was agreed to increase domestic oil prices beyond the prices provided in the National Energy Program, and following this increase, to abolish the natural gas export
tax. Thus, a new mechanism had to be established for determining what the natural gas tax rate would be. The House will recall that the tax rate must be set in such a way that the ratio thus established between the price of natural gas and the price of oil in eastern Canada will promote the use of natural gas in eastern markets. This ratio is determined by the natural gas tax rate, the price and quantity of imported oil, the price paid to producers for domestic oil and natural gas, the Canadian ownership tax rate and the cost of transporting natural gas from Alberta to the eastern provinces.
Thus, we have a complex formula with a large number of variables. If the use of a specific formula of this kind were prescribed by law, the result would have been frequent rate variations, perhaps every two months or even more often. The companies that distribute natural gas to consumers raised the point that the time and money involved in implementing the rate changes, including the submission of applications to regulatory commissions, could, and certainly would create a number of problems. Therefore they requested a procedure for minimizing the administrative costs resulting from too frequent changes in this tax. By prescribing the rate of the tax through regulations, we shall have some flexibility and the margin of autonomy required to reduce the effect of shortterm mistakes in the variables underlying this complex formula which I described earlier.
A ceiling of $4 had been chosen as the maximum amount in a possible range of rates which would apply during the life of the energy agreement between Canada and Alberta. In view of the forecast increases in world oil prices and the expected reduction in natural gas transportation costs, it is possible, while not probable, that the tax could reach $4 per gigajoule by 1987. However, to meet the representations and the requests of certain hon. members, I undertake to introduce in committee of the whole an amendment to lower the ceiling from $4 to $3 per gigajoule. Moreover, I shall propose in the same amendment that this ceiling of $3 be phased in over a number of years for the period of the agreement. I believe that this amendment will meet the requests and the representations made during the debate on second reading. Of course, this does not meet all the representations made at that time, but it responds to a basic concern reflected by these representations.
The rate of tax proposed in this bill for the year 1982 is not much higher than the rate provided by existing legislation. In 1982, the tax will amount to 42 cents for January and 63 cents for the rest of the year, which gives an average of 61 cents over a 12-month period. This rate is only five cents higher than that prescribed by the existing legislation. I would also like to emphasize that the removal of the tax on natural gas exported from Alberta and British Columbia reflects the wish of this government to take into account the representations made by the producing provinces. Moreover, the fact that the Minister of Energy, Mines and Resources (Mr. Lalonde) has been able
May 13, 1982

to reach an agreement on so critical a subject as oil and gas prices demonstrates that the government, and particularly the Minister of Energy, Mines and Resources on behalf of the government, has shown a lot of flexibility and skill in his negotiations with the producing provinces.
In view of the objective which is to increase the share of the Canadian government in the revenues generated by oil and gas production, and especially of the emphasis placed on the need to obtain this increase by other means than an export tax, it has been necessary to increase other taxes collected from the industry, such as the oil and gas revenue tax. I would like to remind hon. members once again that the bill now under consideration simply implements the arrangements arrived at after months of intensive and skilful negotiations between the Government of Canada and the provinces, and which were finalized and officially endorsed in the agreements signed with the Premiers of Alberta, Saskatchewan and British Columbia. Mr. Speaker, through this bill, the House is asked to approve the agreements signed between the Government of Canada and those of the producing provinces.
Concerning the provisions for levying special taxes on profits derived from crude oil production, I would remind the House that all other producing countries insist that their government get a significant part of oil revenues. Britain, Norway, Mexico, the OPEC countries all levy heavy taxes on production. The United States are already levying a tax on windfall profits from old oil operations in order to tax extra profits on the production of oil that has long been discovered. This bill provides for the implementing of a tax on incremental oil revenues, in respect of revenues derived from the production of old oil. That tax is meant to achieve exactly the same purpose as the American tax I have just described.
I would remind the House that the financial situation of oil companies in Canada compares favourably with that of companies in most other oil-producting countries. Although a number of Canadian companies thought they would be better off if they invested money in oil operations in the United States, they now realize that involvement in the United States is not without any risks. The Canadian government here is generously encouraging Canadian corporations into finding new oil, through the many incentives to be found in the Canadian Energy Program. Sure enough, Mr. Speaker, the government is not unaware of the indebtedness of some companies, of the decline in world oil prices, and of the impact which capped oil and gas wells may have on the industry. 1 want to assure hon. members that the government and the Minister of Energy, Mines and Resources (Mr. Lalonde) are closely monitoring that situation.
This bill introduces a resource deduction from the oil and natural gas revenue tax. As of January 1st, 1982, there is a 25 per cent deduction on production revenues, before deduction of any resource royalty payment. Such a provision was requested by the province of Alberta in order that the oil and gas revenue tax be levied at a later stage after extraction. The deduction structure was also designed to grant an extra incentive to
Taxation
operators who pay Crown royalties and transfer part of their production revenues to other persons in the form of royalties. Those royalties are not deducted from revenues on which the 25 per cent resource deduction will be based. Details of the resource deduction will be introduced in the oil and gas revenue tax regulations. Legislative authority to proceed this way is provided under Clause 19 of the legislation now before us.
Mr. Speaker, the bill also includes a number of lesser provisions that relate to the federal sales tax. I do not wish to take time to outline these provisions, since the hon. members who referred to them admitted that the amendments are of a rather technical nature. As I said in my opening remarks, an agreement was reached to expedite the legislation, and I hope that all the hon. members who wish to contribute to this debate will have an opportunity to do so. For that reason, Mr. Speaker, I am limiting my remarks to the few minutes I have used up to outline the main aspects of the legislation and to confirm to the House the commitment to change both the ceiling and the implementation of national gas taxes and savings.


Mr. Harvie Andre (Calgary Centre):: Mr. Speaker, I must say I was a little bit surprised to see the Minister of State for Finance (Mr. Bussieres) as opening speaker for the government on this legislation, given that the taxes imposed and legalized by this legislation represent the very heart of the National Energy Program in terms of the devastation it has wreaked upon this country.
Bill C-112 introduces three new monstrously huge federal taxes extracted from the oil industry and the consumers of this country. They are monstrous taxes; not minor, not insignificant, but monstrous. They are so monstrous as to have caused the decimation of the oil and gas industry in this country. Prior to the introduction of the National Energy Program, that industry was one of the most vital and healthy in this country. It provided hundreds of thousands of jobs and earned the country enormous amounts of income. In general, it provided an engine for growth in the economy from coast to coast.
Prior to the National Energy Program and these taxes being introduced, the energy industries in Canada were looked upon with envy by other countries. They were looked upon by economic groups such as the Economic Council of Canada as our ace in the hole, the one thing Canada had going for it that would give us a chance in the eighties. It was to make this country purr in the eighties. It could have generated the hundreds of thousands of jobs that are necessary for our population. This is what the energy industry could have been, would have been and was predicted to be in the eighties.
If it had not been for the National Energy Program as exemplified by these taxes, we would not be facing the interest

May 13, 1982
Taxation
rates we face today; they would be two or three points less. We would not be facing nearly the number of unemployed we now have. At least 100,000 more Canadians would be employed. Instead of looking at a depression which more and more people are seeing for the future, we would be looking at a rosy future indeed.
That is what this bill exemplifies-taking away the future of Canada as we go into the eighties. It is a massive, horrendous tax grab that has devastated the industry. It has driven many into bankruptcy, driven many out of the country, driven a lot to the brink of bankruptcy and caused havoc. That is the consequence of the taxes levied by this bill which are part of a so-called National Energy Program. There is nothing national about it if one considers the energy sectors of this country, the oil and gas producing sectors in western Canada, as being a part of this nation.
This bill is a massive tax grab as a result of analysis done by brilliant people working for the minister at Tunney's Pasture. They prepared for him and a new cabinet an analysis of the energy sector in Canada. I saw that analysis. They projected what was going to happen. They projected what was happening in terms of ownership, what was happening in terms of activity. They projected an absolutely devastating scenario unless the government acted. They projected huge revenue flows into the oil and gas sector in western Canada. Their projects were such that, if they were right, something would indeed have to be done because the country would have been destabilized as a result of this massive transfer of wealth into a very small area, namely, the province of Alberta.
Based on these projections by those geniuses in Tunney's Pasture, they produced the National Energy Program. It was the answer to a hypothetical, totally false, totally inaccurate description of the future. It makes one wonder when there will be a recognition of all of this cabinet secrecy, all of this notion that no one should know what the government is doing until it is finally announced, and when we are going to address that problem. Anyone who had any knowledge whatsoever of the energy sector could have destroyed those analyses which were prepared by the officials for the minister. You did not have to be particularly brilliant. All you had to have was a little bit of knowledge of the real world, in terms of the energy industry, to know that the projections made by those officials were wholly inaccurate.
Of course, the system which is designed by the bureaucrats for the protection of the bureaucrats does not allow that. So they sit there, they put together a scenario, and they convince the minister, who knows no more than they about what is going on in that part of the country. That is not intended to be demeaning in any way, that is the reality. He would not know any more about energy than I know about fishing. I do not happen to live in a fishing area and so have not been exposed to the fishing industry. So the minister did not know the energy industry, he is advised by officials who do not know the energy industry, on an analysis that is totally out of whack
with reality, and the consequences of that are the National Energy Program, which destroys the industry.


Mr. Thacker:: Ask him what Dome has got for the workers. No jobs this year? And children on welfare?


Harvie Andre: I want to deal with the natural gas and gas liquids tax. Mr. Speaker, there is another technique that governments use for disguishing what they are really doing. When you talk about taxes to the ordinary citizen, the citizen assumes that you are talking about income tax and says that everyone should pay income tax and contribute to the upkeep of the government. He looks at analyses of income tax paid by Canadian industry and says they are not paying very much tax, that they can afford to pay more. But what the citizens fail to realize is how many new taxes the government has invented. Those new taxes do not mean very much to the public; they cannot be concerned about them when they do not know about them. We have the natural gas and gas liquids tax, the NGGLT, the PGRT, the petroleum gas revenue tax, the oil warranty, the incremental oil revenue tax, the COC, the Canadian ownership charge, the PCC, the petroleum compensation charge and, of course, there is excise tax and sales tax on top of that. There are about seven or eight different taxes, the sum total of which is a horrendous tax load on one sector. How come? That sector happens to be in an area of the country which does not have that much population; therefore they are not able to express through the ballot box their indignation in a way to cause the government and the bureaucrats harm.
Yesterday in committee the member for Pontiac-Gatineau-Labelle (Mr. Lefebvre) said he wished he had some oil wells in his riding, and I had to say "Amen, me too!" Boy, I wish there were some oil wells in Pontiac, in Montreal and in Quebec and Toronto. I wish there were oil wells all over central Canada, because that is the only way we would ever get a national Canadian energy policy. That is the only way we will get one until the system is changed.
In regard to this natural gas and gas liquids tax, there is an interesting little history on how that one came about. Just prior to introducing the national energy policy, which was part of the budget of the Minister of Finance (Mr. MacEachen) in October, 1980, the government were threatening to put an export tax on natural gas. That was objected to quite strenuously by the province of British Columbia in particular and also by the province of Alberta. There was a lot of lobbying and agitation on that matter, so the government was feeling the heat. When the Minister of Finance read his budget speech, he said, right in the budget speech: "In response to the representations, there will be no export tax on gas". And because they had a lock up and were able to control the media, that is what went out on national television-"No export tax on natural gas". That is what the propaganda masters had told the television and radio people who were at the lock up. The very next line in the speech said: "There will be a charge on gas sold to United States customers." That was the very next
May 13, 1982

line-a charge on gas sold to U.S. customers. If that is not an export tax, what is it?
Mr. Speaker, I am not allowed to say that is a lie; I am not allowed to say the author of that is a liar. But what is it, Mr. Speaker? It certainly is not true?
Then the province of Alberta took the federal government to court and said this charge on gas sold to U.S. customers is in violation of the Constitution of Canada. The lawyer representing the federal government, Mr. William Code, said the federal government had the authority to put on an export tax. The judges said: "Well, the Minister of Finance said it is not an export tax." Mr. Code replied: "Well, in reality it is an export tax." So the government had to admit in court that what the Minister of Finance had said to this, the highest court in the land, was not true. The Minister of Finance who said there would be no export tax was deceiving this House and the country when he made that statement, and that is what the lawyer for the government had to admit in a courthouse in Alberta. The court ruled, five to nothing, that that export tax was unconstitutional.
So the negotiations carry on. The federal government now has to negotiate. They lost in court so they have to negotiate. They negotiated with the province of Alberta and in the negotiations said: "Yes, we are going to have an export tax on natural gas, but the export tax will be zero rated."


Mr. Deputy Speaker:: Order, please. The hon. Minister of Energy, Mines and Resources is rising on a point of order.


Marc Lalonde: Mr. Speaker, on a point of order, I would just like to remind my hon. friend that the case he referred to is now before the Supreme Court. I would invite him to exercise care in his comments about a matter that is before the Supreme Court of Canada and upon which the court has not yet rendered judgment. The premier of one province got himself into trouble recently as a result of comments about things going on before the courts, so I would just draw his attention to that.


Mr. Deputy Speaker:: The hon. minister's point appears to be well taken. Will the hon. member for Calgary Centre please take note of it.


Harvie Andre: I recognize that, Mr. Speaker, and my next comment was to be that that case has been appealed to the Supreme Court of Canada. Argument has been heard by the justices. I am told the court has indicated that it has made a decision and that it is preparing it for presentation.


Marc Lalonde: An additional reason to be careful.


Harvie Andre: I am not commenting on the merits of the argument or the lack of them, other than to state the fact that the Supreme Court of Alberta ruled, five to nothing, against the federal government.
Taxation
What we have in this bill is an export tax, zero rated. There is no export tax; there is a charge on gas sold to U.S. consumers. There is an export tax but it is zero rated. If that is not Orwellian 1984 double-speak, I do not know what is. It is no wonder the public does not know what is going on when that kind of language is used.
How much is involved for this fiscal year? In this current fiscal year that tax will bring in $1,505 billion, a very large amount. I do not want to prejudice court cases, but it seems that the only way to get things done in this country nowadays is to go to court because this institution, the highest court in the land, does not work.
There is another case going on respecting the NGGLT between the federal government and the city of Medicine Hat. The city of Medicine Hat is suing the federal government because this natural gas and gas liquids tax has caused utility bills in the city of Medicine Hat to double. The cost of heating a home in Medicine Hat has doubled as a result of this tax. Rudyard Kipling said, "They have all hell for a basement." In Medicine Hat natural gas is literally underneath the people's houses. It is just a few feet below. It is available everywhere in the vicinity of Medicine Hat. For 100 years people there have heated their homes with natural gas literally taken right out of their basements, and now they are facing horrendous increased costs.
What is really ridiculous is that it is now more expensive to use natural gas for various agriculture purposes-operating sprinkler systems in irrigation areas and so forth-than it is to use diesel fuel. Diesel fuel is refined. In the case of Medicine Hat I think it has to be trucked all the way from Edmonton. People in Medicine Hat have natural gas in their basements, but because of this additional horrendous tax increase, their utility bills are twice the level they were just a year ago.


Blaine Allen Thacker: I wonder if they tax Quebec electricity.


Harvie Andre: It is natural gas that is taxed. Electricity is produced in central Canada and, of course, there are too many voters there, so electricity is not taxed.


Mr. Waddell:: They took off the export tax.


Harvie Andre: But it is all right to tax natural gas because there are not many Liberal voters in Medicine Hat anyway.
I read in the newspaper yesterday or today that the beavers in the Department of Energy, Mines and Resources are working on the so-called son of the National Energy Program. They are going to produce some documents. They are worried about criticism and the obvious fact that the National Energy Program is a disaster. They are worried about the observations being made by everyone that the National Energy Program is a disaster. Those observations are not being made just by politicians but by literally everyone in the country involved in business in any way, shape or form. They are going to produce a new paper called "The son of the National Energy Program" which apparently will say that the National Energy Program is alive and well and on schedule. The National Energy Program might be alive and well, but the country is dying of it. If we

May 13, 1982
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want to revive the economy and the country, the best way to do it is to kill the National Energy Program.
The government told us the three goals of the National Energy Program were self-sufficiency, Canadianization and fair revenue sharing. Everyone supports those goals. The problem is that the National Energy Program is working against the achievement of every one of them. It is working against self-sufficiency. Self-sufficiency is out the window. We will not have it in this generation or in this century. We will not come anywhere near self-sufficiency. That is the conclusion of the National Energy Board and everyone else who has looked at the energy situation.
With respect to Canadianization, between 1975 and 1980 the degree of Canadian ownership of the oil and gas industry increased very substantially. That was before the National Energy Program. All that happened in 1975 was that the tax law was changed to put Canadians on a par with foreigners for the first time in history with respect to investment in Canada. That was all. The tax law just put Canadians on a par, and the degree of Canadianization or growth in the Canadian-owned sector of the industry grew spectacularly. The National Energy Program finished that. It drove Canadians out of Canada. There are more Canadian companies with offices in Denver than there were Canadian offices in Calgary ten years ago. Downtown Denver looks like Calgary did four or five years ago. Buildings are being put up by Canadians and filled by Canadian oil companies.
In order to Canadianize the Canadian oil and gas industry, the minister's officials telephoned companies in 1981 and said: "We want to encourage Canadianization; we would like you to look into acquiring some American-owned oil and gas companies." The banks were telephoned and told this was government policy and that the government wanted them to cooperate. Many companies accepted those blandishments. Such companies were Dome, Sulpetro, Turbo, Drummond and Husky. They said, "Hey, this is a good idea. The banks want to give us money, and the government thinks it is a good idea. We are being encouraged and applauded."
Seven and a half billion dollars left the country. Not one new job was created. Not one new barrel of oil was added. There has not been a single benefit to the country in terms of achieving real goals. Foreign-owned companies have become for the most part Canadian owned, but every single one of those companies today has regret because they are all in deep trouble. They are in such deep trouble that the bankers who lent them money are in trouble. The latest estimate is that there might be as much as $5 billion in uncollectable bank loans outstanding in Canada. That is just absolute insanity. Why would the country spend $7.5 billion and not get a single job out of it? We did not get a single extra barrel of oil out of it. We did not get a single extra cubic foot of gas out of it. There has been absolutely no benefit. We have crippled the companies which were enticed by the blandishments of the minister and his officials. What incredible stupidity!
In the meantime, that $7.5 billion was joined by about $10 billion of capital. Investors said: "I guess we are not welcome in this country," and they left. Canadian and foreign money
totalling about $17.5 billion also left. When that happened, the dollar was put under pressure. To keep the dollar from falling through the floor, we have to keep interest rates high. The interest rates we have are much higher than necessary because of the stupid National Energy Program. It is supposed to Canadianize. What has happened is just incredible.
Then there is the claim of fair revenue sharing. From each barrel of oil produced the federal government collects 44 per cent of the revenue. The people who go out to find the oil, the people who take the risk of acquiring the land, the people who take the risk in doing the geophysical work, the people who take the risk in drilling the oil, the people who take the risk putting the system in place, the people who take the risk building the pipelines and who do everything else, get 7 per cent of the revenue while the others get 44 per cent. Is that fair revenue sharing? It has resulted in fewer companies searching for oil; it has caused lay-offs; it has caused companies to go bankrupt; it has caused companies to leave the country; it has caused carnage in what previously was a buoyant and growing industry which generated jobs all across the country. That is what "fair revenue sharing" has done, Mr. Speaker.
Some weeks ago the province of Alberta reacted to the devastation and carnage by adjusting its royalty rates. I do not know of anyone who criticized that move. The federal government needs to show that it is equally concerned by making the same move and I am pleased to note that the minister has not rejected that notion. He has kept the door open. If the gossip columnists in the newspapers are right, he is engaged in a debate with the Department of Finance. Apparently that department wants the money and is not willing to give it up. If that argument really is going on, I would be on the minister's side.
I am absolutely convinced and 1 think it can be demonstrated that if the federal government would back off some of these taxes, the resulting stimulus to the economy would generate more revenue to the government than it would lose. People would be put back to work and would pay taxes rather than receive unemployment insurance benefits. Perhaps some Canadian companies who deserted the country as a result of the National Energy Program in 1981 would be encouraged to return and devote their energies and skills, which we certainly need, to activities in this country.
There does not seem to be much that we can do about this Mr. Speaker. I have been objecting for a long time and mine is not a voice in the wilderness. There is a veritable Mormon Tabernacle Choir out there which has been objecting for a year and a half.
I wonder if it was necessary to go through the pain of this carnage or if we could not have had a different system, Mr. Speaker. Perhaps in the first instance we could have avoided the mistake that is the National Energy Program if we had opened up the policy-making process, as the Minister of Finance is now talking about opening up the budgetary
May 13, 1982

process. Perhaps all of government should be opened up. There should be some scrutiny of the advice given to the minister by his officials on the energy policy process. We should be able to make an analysis of the data that are given to him as facts. I know they were not facts. The information could have been the result of error or it could have been cooked, but it certainly was not factual.
I wonder if things would have been different if the minister had listened to the Independent Petroleum Association of Canada. After the National Energy Program was introduced, it asked him to refer the matter to a standing committee of the House or to a joint committee of the Senate and the House for study. If the minister had agreed and there had been an opportunity for full discussion and analysis of that program 15 months ago, then perhaps we could have foreseen the consequences for Canada. Perhaps we could have avoided some of the worst consequences if the matter had been fully aired. How many billions of dollars or hundreds of thousands of jobs could have been saved? How many companies could have avoided bankruptcy if there had been fair and open and honest debate among parliamentarians?
When the Independent Petroleum Association said that the national energy policy was going to be a disaster for the country, the minister said that the association had no credibility. As a result, the head of Petro-Canada quit the association because it did not have nice things to say about the government. I wonder if things would have been different if the minister had listened, instead of discounting the credibility of the association. Would they have been different if the head of Petro-Canada had listened to the association instead of quitting? If the matter had been referred to a committee for study, I wonder how many people would be working today who are presently unemployed, wondering how they are going to maintain their standard of living and keep a roof over their head.
Is it not time that we demanded that the bureaucrats who actually run the government come out into the light? It is time we had an open democracy so that we can see what they are doing and perhaps prevent the terrible mistakes that are destroying the country.
I had hoped that the minister would announce some changes in the incremental oil revenue tax and the petroleum and gas revenue tax. The small producers have been lobbying the minister for over a year and I had hoped that he would do something for them along the lines of their suggestions. It appears that my hopes were in vain, Mr. Speaker, although there is still time left in the debate and committee stage is still to come. Perhaps the minister can bring himself to admit that his advisers are not doing well by him. I hope that he will admit that it is time to stop devastating the oil and gas industry. It is time we got back to the position we were in before the National Energy Program was introduced. We must be able to pursue self-sufficiency, Canadianization, and growth. We must be able to adopt a positive outlook and direct our efforts to making this country work. We continue to hope for all that, Mr. Speaker, although only a fool would hold his breath waiting for it.
Taxation


Ian Gardiner Waddell: Mr. Speaker, Bill C-112 is the new version of the former Bill C-93 which dealt with the energy taxes, namely, the tax on industrial gas only consumed domestically, changes to the petroleum and gas revenue tax or PGRT, and implementation of the oil revenue tax, the IORT.
The hon. member who has just spoken was talking about taxes. No one likes to pay taxes, Mr. Speaker, least of all the oil industry. At the committee hearings which are presently continuing, the president of Dome Petroleum, Mr. Richards, answered a few questions that I put to him about the taxes that the company paid. Dome Petroleum is the largest Canadian-owned oil company in Canada today. It is not Petro-Canada but Dome Petroleum that is the largest. Dome Petroleum was going to receive from the government about S640 million in grants over the next three years. Mr. Richards himself is reputed to be making in the neighbourhood of $600,000 a year, according to the book "The Blue-Eyed Sheiks". Dome Petroleum does not pay taxes. Some oil companies do not like paying taxes; Dome is one.
This is simply an incredible thing to have to explain to your constituents. I represent a working class riding in the east end of Vancouver. My constituents work hard and their income tax is taken right off the top of their cheques, yet here is an outfit like Dome which pays no taxes.
I know the last speaker is a spokesman for the oil industry, and I know people in the industry wonder why the public is not sympathetic to them. Well, when you go around like the hon. member calling everyone stupid, strutting and fretting, ranting and raving, it is sometimes hard to get people to listen to you.
I am going to refer to this later on because I think small oil and gas producers in Canada have some case to take to the government about changes in taxation. However, what I hope to do in my speech today is to tackle this Liberal government and make some criticisms in areas I think are solid. If the members to my right would listen for a change instead of ranting and raving, they might learn something.
I am a western Canadian MP from a consumer area of the country, but I have also spent a lot of time in a producing area. I am going to make some detailed and solid suggestions which the government might consider. I think that is the way to approach things because Canadians are tired of federal-provincial and Liberal-Conservative bickering. They want some suggestions for solutions to the problems. I may be wrong, Mr. Speaker, but I think that is what Canadians want and I propose to make a few today.
I am going to deal with three areas on behalf of the New Democratic Party, Mr. Speaker. One area is the taxation itself, the PGRT and the IORT, and what they mean. I am also going to deal with the natural gas and gas liquids tax which is levied after the gas reaches the city gate and which represents about 65 per cent of the burner-tip price of $5.51 per mcf.

May 13, 1982
Taxation
What happened was that the government was going to bring in a tax on the export of gas. We pressed them in this House not to do that because it would really cripple some of the western provinces. The government backed off after some strong opposition. But what it did was to bring in a general tax on all gas, and that tax is really hurting consumers. Last winter in Ontario that tax added $848 to the heating bill of consumers, $544 in Alberta, and $708 in British Columbia.
Incidentally, Mr. Speaker, I would be remiss if I did not mention that we are having an historic event tonight in my city of Vancouver; that is, the first Stanley Cup final in 50 years. I am sure all members of this House will show some support for the Canadian team.


Some hon. Members:: Hear, hear!


Ian Gardiner Waddell: Getting back to the more mundane matter of my speech on taxes, the third area I want to deal with is the agreement with Alberta and what it means to the Canadian consumer. During the period 1973-80 the Canadian public became largely disillusioned with the oil industry for several legitimate reasons. I hope the oil industry will listen to this. I have noted some industry people are writing in Oilweek and other energy magazines who have started to look at the issue as dispassionately as they can. If they do, they can make a solid case where they have one. In my view, the Canadian public saw first of all that the price paid for domestic oil was no longer related to the cost of production, but was being legislated in response to the arbitrary prices set by OPEC. We call them the Arabs, but they are not all Arabs. It was seen that this cartel was really determining prices in Canada.
Second, Mr. Speaker, the price increases were, by and large, not benefiting the Canadian public or the Canadian-owned portion of the oil and gas industry. Instead, the increases were contributing billions of dollars to the assets of the large foreign-owned corporations which had established reserves. For example, for every $1 increase in the price of conventional oil, it is estimated that the value of the reserves of Imperial, Amoco, Texaco, Shell and Gulf rises by more than $4 billion. We have to remember that this is a country which allowed as much as 75 per cent of its oil industry to be dominated by foreign-owned oil companies. It is really shameful that we did that. So every time we increased the price of oil, we gave these people more money. It is a wonderful scheme if you are a large, multinational oil company.
The assets of the industry as a whole increased by 260 per cent between 1973 and 1980. I understand that now industry profits have gone down and they have cash flow problems, but between 1973 and 1980 they made a heck of a lot of money. These gains seem particularly unfair to the Canadian public which had subsidized through taxation and super-depletion allowances the discovery of these reserves. So the consumer is paying once with the subsidies, paying again at the pump, and now they are going to be asked to pay a third time with increased taxes; but I will come to that in a minute.
Another reason the Canadian public was suspicious is that although the industry and governments had assured the public there was no shortage of crude oil and subsequently promoted
large exports to the United States, by 1974 the reserve figures had been altered so dramatically that it was forecast that Canada would be a net importer of crude oil by the end of the decade. Understandably the public was shocked and appalled by this turn of events and demanded that the government start collecting and distributing accurate information on Canada's energy future.
Everyone knows that the Minister of Energy, Mines and Resources (Mr. Lalonde) once said in this House that we have enough conventional oil reserves for 300 years. Now it is about nine to 11 years. On the basis of what that minister said, we exported one-half our daily production, and that is why this government has all the problems it has today, because we are self-sufficient in all forms of energy except oil. We are going to do the same thing with our natural gas. We are on the point of exporting that as well, and in a few years we may have the same problem with natural gas.
Our party, Mr. Speaker, sharing these concerns, forced the minority Liberal government to form a public energy corporation which could provide accurate technical information on the oil and gas industry to the government, which in turn would earn profits for the Canadian people from the development of Canadian resources. That company is PetroCan. It belongs to us. For the same reasons there was a limited movement towards this end in Alberta when that province formed the Alberta Energy Company, which was involved in Syncrude. By 1980, Mr. Speaker, the oil and gas industry was by far the most profitable industrial sector of the Canadian economy. In fact, in Alberta it became almost impossible to raise investment capital, I am told, for anything but oil and gas exploration.
This sets the background to why the government would come in with some taxes to tax away these windfall revenues. It was to be expected, but the problem is that it may be killing the goose by the manner in which it levied the taxes.
The Liberal government's answer to the growing problem was the National Energy Program. I agree with the hon. member for Calgary Centre (Mr. Andre) in the sense that perhaps there was not a problem, but it was a rich industry and the money was flowing to few individuals and to many multinational oil companies, and this was money from Canadian consumers, so the government was bound to take some of that windfall back in the form of taxes. This was done in the United States. It enacted a windfall profits tax after the OPEC oil increases. It was perfectly in keeping with what had happened in other areas. The American ambassador may be surprised to learn that the United States did exactly the same thing.
While the thrust of the National Energy Program to Canadianize is correct and while its thrust to obtain a larger share of revenues from the industry is correct, the problem is that it is hurting independent Canadian companies by imposing a more complicated tax environment and by emphasizing
May 13, 1982

development of frontier areas which are in the control of the oil giants. These submissions were given to the committee. We sent an economics committee from our caucus across the country. We went to Alberta and listened to the Alberta Energy Services Association, to some oil companies and oil groups, and to some servicing groups. If we could take away the Canadian Petroleum Association and if we could cut through all the guff, we would see that there was a problem for small companies because of the complicated tax environment. Also we would see that the NEP was taking the action out of Alberta and moving it to frontier areas. Of course, that was part of the war between federal and provincial governments. It was hurting small Canadian companies and was helping the oil giants which the National Energy Program was supposed to curb in the first place. This is the real critique of the National Energy Program.
Moreover, the federal government unilaterally increased its share of the the energy resource revenue pie without making any significant commitment to encourage domestic conservation, alternate fuels, or expansion of domestic use of our relatively abundant supplies of natural gas and heavy oil. I know that there are provisions in the National Energy Program for alternatives and conservation, but they are far outweighed by the emphasis upon supply and upon going to the Beaufort Sea and Hibernia to find new oil. I think we must find new oil and we have to develop Hibernia, for example. We need oil in Canada. We cannot be ostrichlike in our critique of the government. But more could have been done in the area of conservation.
Last week I saw an advertisement in the magazine Oilweek in which a company was advertising a heat pump. It claimed that if heat pumps were installed in houses it would save something like 80 per cent of energy used. It was broken down per barrel, but unfortunately I did not bring the article with me. However, I will raise this matter again in committee debate on the bill. If I read the advertisement correctly, it seemed to indicate that we could save two, three or four oil sands plants by simply bringing heat pumps to all homes in Canada. This would provide employment. It is the kind of thing we should be doing instead of megaprojects. But that is another subject; I was discussing the National Energy Program.
Then there was an agreement between the federal government and Alberta which was signed on September 1, 1981. The agreement was premised upon rapidly rising world prices for crude oil throughout the decade. That premise has been shown to be wrong. In all my reading, I see a stable environment or a stable price for OPEC oil in the next decade. This makes sense for OPEC; if one thinks about it, one will realize that it is in the interests of OPEC. I see a stable price, not a rapidly rising one. The problem is that the National Energy Program and the agreement with Alberta were designed on a false premise, namely, simply to stuff more petrodollars into the federal deficit and the heritage fund without regard to either domestic producers or consumers.
Taxation
I hesitate to mention this, but if there is a lesson one must learn from the Saskatchewan election, perhaps it is that a government with lots of money in its heritage fund and in its provincial coffers does not necessarily mean that the average grassroots person thinks he or she is receiving benefits. That was the problem in the agreement with Alberta. There was lots of money brought into the coffers of the federal government and into the Alberta heritage fund, but it does not help the man and woman in Vancouver-Kingsway, the man and woman in Spadina, or the farmers in the various ridings which my colleagues represent.
After ten years of acrimonious debate between the federal government and the government of Alberta, we have the worst of all possible worlds. We have high consumer prices and therefore increased tension between the producing and consuming provinces. We have a domestic industry which is in serious trouble. We have a deteriorating domestic supply of crude oil.
For the benefit of my friends on my right who are fond of heckling me, let me repeat that we have the worst of all possible worlds with the Liberal energy policy. We have high consumer prices when we were promised low prices; we have a domestic industry which is in serious trouble when we were promised a program to help small Canadian producers; and we have a deteriorating domestic supply of crude oil when we were promised energy self-sufficiency. Is that not the situation today?
Are there any solutions to these problems? Let me suggest some solutions, some of which are new ideas. It seems to me that one problem faced by small companies in western Canada is shut-in natural gas. They have trouble selling natural gas. The government should look at the possibility of a public natural gas bank, consisting of gas received instead of some provincial royalties. Of course, there would have to be an agreement with the producing provinces. If Alberta did this, in lieu of 20 per cent in natural gas royalties, it would increase the market for natural gas by some 10 per cent.
We could aid the provinces in the construction of facilities for the production of high quality gasoline from natural gas feed stocks, following the process developed by Mobil and currently underway in Germany and New Zealand. This facility would create an additional local market in Alberta alone of 5 per cent.
We could bring in a program to encourage maximum substitution of natural gas for heating oil and gasoline. I know there is a program in place, but we have done very little with our automobile and truck fleets. Most hon. members with offices in the Confederation Building come to the House on a bus. That bus is one of a fleet of buses. By what is it propelled? Is it propelled by natural gas? No, it is propelled by scarce gasoline. We could do much more here.
Another area in which we could become involved is the expansion of heavy oil in the west. The federal government, should immediately construct, in co-operation with the provinces of Saskatchewan and Alberta, one or more heavy-oil upgraders which would provide necessary facilities to expand

May 13, 1982
Taxation
the Lloydminster, Wainwright and Cold Lake heavy oil fields. Such development should emphasize small-scale modules, and in situ miniprojects which would provide a much needed shot in the arm to both the drilling and service industry and smaller, independent, Canadian-controlled companies.
As much as we talk about Alsands, that kind of project would not have helped small drillers in Alberta. There is no doubt that the spin-offs will help some of the industry. If you really want to help the small, independent companies they would be better served in the areas of heavy oil and small drilling projects, not in mining, which is what Alsands was. This provides an economic alternative to the uneconomic Alsands megaproject route.
Second, the federal government could improve prices for heavy oil to bring on stream otherwise semi-marginal deposits.
Third, we could have a public heavy-oil bank, assisted in the process by a deferred royalty on heavy-oil payments. This would allow a shorter pay-out period while protecting the royalty share in Alberta, for example. There could be public participation with Petro-Canada, the Alberta Energy Company or Saskoil, or other miniprojects at manageable levels and economic prices.
What we could do for the Canadian industry is to replace the unfair and overly complex tax regime, the PGRT and the IORT that we are debating in this bill, with a simple federal and provincial royalty sharing agreement, analogous to the tax rental agreement.
I would like to expand on that particular matter. It may be the crux of the problem with this bill. Rather than face the problem of revenue sharing in a straightforward and rational way, the federal and provincial governments have engaged in a series of tax wars which have continued to the present time. They have burdened the oil and gas industry with one of the most complicated and consequently unfair tax regimes in Canada. This regime must be changed. Overly complex taxes are unfair taxes. To the largest corporations, these taxes become fine instruments to be tuned and played by well-paid accounting staffs for the benefit of corporate interests. On the other hand, for the small, independent Canadian producer, they represent a mountain of paperwork and added expense.
What we need is further price negotiations between Ottawa and Edmonton. The provincial government should consider voluntarily sharing a portion of its provincial royalties with the federal government. This would eliminate any justification for the PGRT, the IORT and excise taxes and would hopefully give the provincial government more say in what the surrendered revenues would be used for.
This is a novel suggestion. Some people may say it is naive or wishful thinking, but I believe there is a political will within the country for the producing provinces like Alberta, Saskatchewan and British Columbia to arrive at better agreements with the federal government. The oil agreement that the Premier of Alberta and the Prime Minister (Mr. Trudeau) toasted on September 1, 1981, is gone. It has become redundant because the price of oil on the world market is not going
up. The tax regime so instituted is too complicated for Canadian industry, especially small industry. If it is redundant, let us change it.
There is another approach I would like to put forward on behalf of our party. We do not support the concept of giving tax incentives or bonuses without earning an interest in the particular venture. Therefore, if there are to be grants by either the federal or provincial government of up to 80 per cent of the cost of a well, we say that either the provincial or the federal government should get that share of equity in the well. We believe that there have been vast giveaways in that area.
The introduction of equity incentives, federal-provincial royalty sharing and the elimination of complex federal taxes would require a careful review of the existing royalty structures. This has to be done at the provincial level and done with federal-provincial co-operation. The object would be to simplify the taxation regime of the industry and not to fatten the coffers of the provincial governments.
I think I have made some positive suggestions about how to deal with an industry which appears to be ailing. I do not think I have strutted or fretted or called everyone stupid. I believe that my criticisms of this government have been just as effective as the criticisms of my friends to my right. They have made some changes and they will have to continue to do so.
I mentioned the tax on domestically consumed natural gas. That affects every member opposite because I suspect that most of them have people in their ridings who use natural gas. The tax on that natural gas is unfair and regressive. It affects senior citizens, people on fixed incomes and poor people just as much as, or perhaps more so than, the rich person because they spend a greater proportion of their income on such things as energy, food and housing. I believe that this tax is a regressive one and should be removed.
Total energy costs, as measured by a component of the consumer price index, have gone up 46 per cent since 1980 under the Liberals. Natural gas prices rose 28 per cent in 1981. The present cost to consumers for oil and gas will double by 1986. I am already receiving complaints from constituents in my riding who tell me that while their salary went up 8 per cent or 9 per cent, their energy costs are going up 28 per cent. They ask me what is going on. It cannot be explained. It is a regressive tax which should be removed.
I have already spoken about the PGRT. It is a very complicated matter. This royalty has certain advantages because it is put on at the wellhead, which makes it difficult to manipulate in order to deduct expenses at that stage. As I said, though, the problem is that it will hurt the small producers. I have suggested some ways to replace that tax with a method of sharing provincial royalties with the federal government, which may work.
During the committee hearing I would like to raise the matter of oil companies which have received a windfall gain from the Minister of Finance (Mr. MacEachen) for one quarter in 1981 in which no higher taxes were levied. What
May 13, 1982

happened at that time was that the government boosted the price of oil by $2.50 a gallon for three months, from October 1 to December 31, 1981. However, the taxes did not come in until January 1. Therefore, the government may talk tough with the oil companies but they gave them a windfall profit for those three months. I want to press the government on that matter during the committee hearing and perhaps introduce an amendment to the bill which would provide that this money be paid back to the Canadian consumer.
I would like to conclude by saying that the Canadian consumer is getting hosed by a Liberal government that promised during the election campaign that it would bring in lower energy costs. The official opposition have been roaming around the country, including Saskatchewan, saying that they are a party of low energy prices. Do not believe it. In the budget of the hon. member for St. John's West (Mr. Crosbie) when he was Minister of Finance, there as an initial 18-cent per gallon levy and it was going to rise further. People forget that fact. Let us not make any mistake about it: the Conservatives are the high energy cost party and they are being followed by the Liberal Party. I suggest to hon. members to my right that they review the budget of the hon. member for St. John's West and cut out the malarkey in the House of Commons.


An hon. Member:: It was 18 cents. How much is it now?


Ian Gardiner Waddell: It was 18 cents immediately, then $4, then another $4, and so on. The price was going to be high and we voted against it. When the Liberal Party returned to power they proposed a similar regime and we voted against that as well. That is the point I am making. There are no members in the House who are prepared to get up and take the position of the consumer. They are always bleating about the oil industry, but we hear very little about the small oil industry and very little about the consumers of Canada.
Let me tell my friend that our proposal with reference to taxes would be the lowest priced energy proposal put forward by the two parties in Canada. I make that quite clear.


Mr. Jarvis:: You sold them down the river in 1979. You are a hypocrite!


Ian Gardiner Waddell: There is another problem. I detect a little consternation on the faces of the members to my right, but I simply offer them the simple facts.


William Herbert Jarvis: How many taxes do you propose, Ian?


Ian Gardiner Waddell: I simply ask them to read John Crosbie's budget and to look at the figures for future increases. I ask them to look at the agreement between Alberta and Ottawa, and they would then see that the figures are not that much different. They are just a little lower. I again ask, who represented the consumer-
Adjournment Motion


William Herbert Jarvis: Certainly not the NDP!


Ian Gardiner Waddell: -and who represented the small oil and gas companies? Premier Lougheed, the Conservative-


William Herbert Jarvis: The Chamber of Commerce represents them better than the NDP!


Ian Gardiner Waddell: -is the great chief in hiding of the Conservative Party. What happened to the chief in waiting when he made the deal with Pierre Trudeau, the present Prime Minister, and they raised their glasses-


Mr. Deputy Speaker:: Order, please. The hon. member should refer to hon. members of the House by their functions or constituencies.


William Herbert Jarvis: He is too new, Mr. Speaker.


Ian Gardiner Waddell: When Premier Lougheed and the right hon. member for Mount Royal (Mr. Trudeau) raised their glasses, where was the consumer represented there? Who was representing the consumer? No one. Certainly, no one. When that agreement was made between Alberta and Ottawa, did we ever really think that we would get the worst of all possible worlds from a Liberal Prime Minister and a Conservative provincial Premier?


Some hon. Members:: Shame!


Ian Gardiner Waddell: What we have is the worst of all worlds. We have high consumer prices, we have a domestic industry which is in serious trouble, and we have a deteriorating domestic supply of crude oil. Hon. members, ask what the NDP would do. Put us in government, gentlemen, and we will show you what we can do! This country has every energy resource known to mankind.


William Herbert Jarvis: And you voted against every one of them!


Ian Gardiner Waddell: Only a succession of Liberal and Conservative governments could literally turn the situation on its end and get us into a position where we are short of oil and we have these high prices. And they criticize the NDP! That is ridiculous.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Surrey-White Rock-North Delta (Mr. Friesen)- Emergency Measures-Order in council provisions affecting manpower, (b) Effect on unions; the hon. member for

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Taxation
Chateauguay (Mr, Watson)- Airports-Possible change in status of Dorval and Mirabel airports-Request for independent examination; the hon. member for Portage-Marquette (Mr. Mayer)-Finance-Request for increased tax rebate on farm fuel.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Bussieres that Bill C-l 12, to amend the statute law relating to certain taxes, be read the second time and referred to a Committee of the Whole.
Mr. Paul E. McRae (Thunder Bay-Atikokan):: Mr. Speaker, I was very interested in the statement of the hon. member for Calgary Centre (Mr. Andre) that we should have a chance to debate this subject and to kick it around. He felt we should have a parliamentary committee and that we should have a chance to go over it really thoroughly. This is the fourth time I have had a chance to speak on this subject. It is also the fourth time in the last seven days that I have had a chance to speak on subjects surrounding this issue.


Gordon Edward Taylor: Nothing has been changed.


Paul Edmund McRae: I recall that we spent 82 days on the first major bill and 35 days on this bill. I do not know what we mean when we speak about not having debate.


Gordon Edward Taylor: Nothing has been changed.


Paul Edmund McRae: I do not suppose there is any other jurisdiction or any other Parliament in the world where this kind of subject would be debated for 125 or 150 days, because in that list I did not include all of the opposition days and so on and the emergency debate we had last week. It seems to me that there has been a tremendous amount of debate around this particular subject or subjects related to the economy. I simply cannot believe that this Parliament has not aired its views very fully by now concerning this area.
In the last few days I was very interested to hear some of the comments coming from the opposition, particularly from the Tory opposition. The hon. member for Fraser Valley West (Mr. Wenman) made a very interesting series of statements about how his party sees this problem and our economic problems. Certainly one cannot separate them. He sees all of the solutions in terms of following Reaganomics, following President Reagan's economic and energy policies, and believes that if we follow those we will all arrive at the point where everyone will be healthy, wealthy and very wise.


William Herbert Jarvis: That is yesterday's speech, Paul. Come on, give us today's speech.


Paul Edmund McRae: That is not yesterday's speech. It has been the whole debate all along.


William Herbert Jarvis: Oh, come on! It is a different bill today.


Paul Edmund McRae: I was fascinated by some of the comments which were made along this line, that if we were to simply follow President Reagan and free up the economy, our energy economy and everything else, everything would be hunky-dory and we would have no problems.


Gordon Edward Taylor: Could not be a bigger mess than you have made of it.


Paul Edmund McRae: Members opposite say that if they were in power, this is exactly what they would do.
I was also interested in some of the comments of the hon. member for Vancouver-Kingsway (Mr. Waddell), who spoke just before me, in his discussion of the whole energy program and the energy bills. I think I support a good many of the things he has said; but, concerning the energy program, I find it very difficult in not understanding the position of that party, considering the positions it has taken in the past concerning its approach to energy.
In early 1973 I was in the House and really had the first inkling that we would have some real difficulty in terms of oil supply. That is when we had the first sense that we could not simply sell all of the oil we had as fast as we could get it out of the ground. I remember sitting in committee, I suppose it was in January or March of 1973, when Donald Macdonald, who was the then minister of energy, mines and resources, suggested that we would have to put on an embargo, a limit, on the amount of oil that we were exporting to the United States. I remember the absolute horror with which this comment was greeted by the hon. members of the Tory opposition. They grumbled and said: "This is ridiculous; we have unlimited quantities of oil. There is no limit to what we have; the only limit is how fast we can take it out of the ground." For about two years they took the attitude that it was an absolutely ridiculous policy that we should not keep pumping that oil out of the ground and exporting it.
Then I recall a change a little later on when we heard that there was a shortage. Because we had a shortage, the price had to go up along with the OPEC prices. This was in late 1973 and 1974. I recall a statement by one of the majors who told us that if the price of oil went up to $8 a barrel, we could expect an 800 per cent increase in the discoveries in this country. There would be no less than an 800 per cent increase. Actually, I think we had something like a 30 per cent increase in discoveries in that period, but we did not go to $8 a barrel; rather, we went to about $20 a barrel or a little more than that.
I have listened to this argument going on for a long time in this House, and I find that there have been two very interesting arguments, especially of late. One of them is that a terrible
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tragedy has been brought on by this government's National Energy Program and its policies because we are not taking that oil and gas out of the ground fast enough. The argument is that we have to get it out of the ground, we have to continue to explore and we have to sell that oil. There is a kind of inference there that there must be a hole or something beneath the earth's crust and that all the oil will disappear into the hole, that it will run away if we do not get it out fast!
No one in this House has told me that in the long run we are not going to run out of conventional crude oil. We talk about cutting back to about 10 per cent of supplies in the 1980s by the early 1990s. Because of new discoveries, certainly the Hibernia, the north and other factors I will come to in a minute, we will probably not be down to that point so early. We may get a couple of years' grace.
We keep hearing that if we do not explore, drill and pump the oil and gas out immediately, it will not be there. Somehow it will disappear and be lost to us. We hear that it is a terrible crime not to take out the oil at this point. Future generations will want that opportunity in the next 10 or 20 years, but we do not hear about that. The exploration does not have to be done tomorrow, next year or ten years down the line. The oil is not going to disappear. There are no perforations in the caps on the national gas wells which will allow the gas to leak away.
There are over a thousand wells that have been drilled and capped. We are told it is a terrible thing that the gas was not taken out right away. 1 have great difficulty understanding that kind of mentality. We were told by the minister of energy, mines and resources in the Clark government that the crossover time between the supply and demand for natural gas and western reserves would be 1997. It may have been extended a bit, but it is still there. It will still be a resource that our children and our children's children will have a hard time finding.
The fact that we are not selling or exporting this gas immediately is not a tragedy for Canadians, it is a good thing. It is and will remain a valuable resource even though it is not being pumped out now. That is a myth that must be dispelled immediately.
There is another myth we constantly hear from the Tory opposition. If a company buys a property or the controlling interest in another company, that is considered an investment. That investment is made in the expectation that there will be some profit. That is the way business works. It is a legitimate function.
However, if the government should buy Petrofina, Phillips Petroleum or Atlantic Richfield, that is an expenditure and the money is wasted. They say that money is being thrown away by purchasing such a company. That is what we hear. They believe that if the government buys it, it is not an investment, not profitable and will not yield a return. I have difficulty with this kind of mythology that says that Canadians have no business investing Canadian dollars through the Government
Taxation
of Canada and owning a national oil company. It is something I do not understand.
These two mythologies leave me cold. I am prompted to speak time and time again because they keep coming up. Those opposite always say that we are losing tremendous opportunities by not pumping the oil and gas out of the ground. They say we should be exporting it. They also say the government has no business buying a company because that is an expenditure and a waste of government funds.
The Tories talk about when they were in government. One reason they are no longer in power is that they do not understand the Canadian public. Canadians respected the notion of this government forming Petro-Canada. They liked that idea. Canadians, through their government, want to own a strong, powerful, active company, one involved in exploration and the sale of gas at the pumps.
When I drive around this city or Thunder Bay, I am pleased to see the Canadian flags and the name Petro-Canada. I feel good about that. We in Thunder Bay were very happy to see the Petro-Canada sign go up. At that point we were the most easterly region where Petro-Canada stations existed. In eastern Canada we now see the sign at stations that were formerly Petrofina.
This is the way Canadians want it to be. It gives them a sense of owning something, of owning part of their own resources. I am proud to be part of the government which brought that about. I know I will hear the argument from the New Democratic Party that they were responsible for Petro-Canada. However, I was at the caucus meeting where this idea was presented. We were a part of selling that idea. The minister talked about it long before it became an issue, long before the so-called "forced" vote. It was eight or ten months before that happened.
Six or eight months before the debate in this House, I attended a convention of our party where this idea was strongly suggested. There is no question that the NDP were very interested and wanted the same thing, but to say they brought it about is not true. The truth is that it came out of this government. There was a lot of work done by many of us in this party, and I resent being told that somebody else do it. When we were in power in 1974, we were not under the gun. It was not a minority situation at that time. That is when this proposal was brought in. Nobody forced us to do it.
It is interesting to note that the Petro-Canada bill was one of five bills brought in at that time. The NDP energy critic, Tommy Douglas, a long-term member of this House and a great Canadian, attended the committee meetings on that bill and supported this government in every respect. He supported second reading in principle, supported the bill in committee, introduced amendments that were accepted and supported the bill all the way through. Other members of his party did the same. He did the same with regard to the emergency supplies allocation bill, the monitoring bill, the Petroleum Administration Act, in fact, all five bills. They were supported by the NDP and filibustered by the Tories.

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Taxation
Now here we have the granddaddy of them all, the bill that says to the people of this country, in fact throughout the world, that we are determined to get control of a resource that should be Canadian. We are determined that we are going to be owners of our own natural resources. This is the bill that says we are going to do it. This is the bill that the people on the left are with. It is the one bill that Mr. Douglas came to speak to our Prime Minister (Mr. Trudeau) about, and I am very pleased that he did, to give him support, he and a bunch of other Canadians, good Canadians from all over the country. They came down to see our Prime Minister and said they support what we are doing in this bill. But not that other party. I am very disappointed that when we get to the crux of the debate-the bill that Mr. Douglas said he would like to have had ten years ago-that support is not there.
That is why I am proud to be on this side of the House as a Liberal, speaking about our energy policy. I admit that it is not easy right now, that these are difficult times for the National Energy Program and that things may look tough in these difficult times; but in the long run there will be hundreds of billions of dollars for Canadians when we hold and develop our own resources.
In the last few weeks I keep hearing people on the other side and even some on this side being called socialists. There is that kind of talk. The word "socialism" is some kind of word that condemns you, saying you are stupid and do not know what is going on, that you are destructive. It is a word I find used with much disdain by many people on the other side. Certainly on this side of the House there is no one who is a pure socialist, a socialist per se. We as Canadians are a people who believe in a mixed economy. I do not know that there are many people on the other side who would say that we should sell Ontario Hydro back to a private corporation. I do not know how many would sell OC Transpo or the Toronto transportation system or the Thunder Bay transportation system back to the private sector. It makes sense to run them as public enterprises. I suppose you could call that socialism. If Ontario Hydro is called socialism, it was probably put into effect by a Conservative government. You could call the CBC, the Canadian Broadcasting Corporation, socialist. Pacific Western Airlines was purchased as a private company by the government of Alberta and made into a socialist enterprise, but I do not call Mr. Lougheed a socialist. I do not call the Premier of Ontario at the time who bought Ontario Hydro and made it into a public corporation a socialist. Because I am proud to be part of the formation of Petro-Canada, I do not call myself a socialist.
I believe there is a decent, intelligent mix between the private and public sectors in a democratic country like ours. Some may say we should lean a little more this way, others may say we should lean a little more the other way; but basically speaking, that mix is a decent mix.
I do not believe that the kind of mix that President Reagan would have in the United States is the kind I would like. I think there are more valuable things being done in the public sector than he believes in. For instance, I believe strongly that our medical and health care system in Canada is better than
any in the world. I would not want that to be turned back to some kind of private insurance company to operate. I do not know how many on the other side would want that to happen. But because I say it, I am called a socialist. The word does not mean anything. It is a word that deals with the extent to which people organize their affairs either in the private sector or in the public sector, and that mix is always there. To say this group is socialist and that the others are free enterprisers is just using two blurred terms.
With Canadian ownership of, first, the oil and gas industry, these particular enterprises, we are not saying the Canadian government is going to buy up all of the multinational controlled companies. We are going to buy up some of them and we are making it possible for other parts of the industry to fall into the hands of Canadian companies.
When Nova Corporation-it was not Nova Corporation at the time, it was Alberta Gas-purchased Husky, almost simultaneously we bought Phillips Petroleum. I thought this was a great combination. I was quite pleased in many ways that Petro-Canada did not get Husky. At the time I felt rather badly about it, but I thought better about it afterwards. What happened was that we did not spend our money on Husky but we got Phillips, and Alberta Gas, or the Nova Corporation, bought Husky. In those particular deals we ended up with two good American companies that had become part of Canada. Was that not a sound proposition? It seems to me it was not a socialist proposition. It was a proposition where we as Canadians worked out a mix between the private sector and the public sector which was a very valuable and very good mix.
So, Mr. Speaker, I welcome this particular program because it enables us to put control back into the hands of Canadians, whether it be through the public sector or through the private sector, and more can be done through the private sector than through the public sector. We get it back into our hands so that we can control those resources. We will be able to control the kind of development we want from those resources. We can decide whether we want to develop those resources instantly or leave them there, knowing full well that there is no hole in the ground that they are going to disappear into or that the caps are not perforated, that they will be there for a long time.
Even though it is a difficult time, Mr. Speaker, and even though it is not easy sitting on this side to be buffeted constantly, I really feel proud to be able to say that we believe in something and we stand up for it. I believe in the National Energy Program. In the long run, in the history of Canada it will prove to be a very important development and I am proud to have been here in the last ten years to be part of that development.


Mr. Gordon Towers (Red Deer):: Mr. Speaker, it is a real opportunity to follow the hon. member for Thunder Bay-Atikokan (Mr. McRae), because I have never in my life seen such a display of ignorance of a subject from a man who was educated, a former principal in our schools. He does not have an inkling of what happens in the oil industry. A person asked
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me the other day what has happened. Is it because the government has a design to destroy the system? Surely no one could be that incompetent. But then, having listened to the previous speaker, I am beginning to wonder; perhaps it was a combination of both. The situation we are in now is totally unnecessary.
I wonder, Mr. Speaker, if I could call it five o'clock?


The Acting Speaker (Mr. Ethier):: It being five o'clock p.m., the House will now proceed to the consideration of private members' business as listed on today's Order Paper, namely, private bills, notices of motions (papers).
There being no items on the Order Paper under the heading of private bills, the House will proceed to notices of motions, production of papers.


PRIVATE MEMBERS' MOTIONS FOR PAPERS
[Stage Direction]
Motions Nos. 22, 35, 1, 48, 28, 43, 5, 54, 34, 83, 71, 89, 36, 94, 84, 88, 49, 76 and 95 allowed to stand by unanimous consent.

Mr. Hal Herbert (Vaudreuil) moved:: That an humble Address be presented to His Excellency praying that he will cause to be laid before this House copies of all minutes of meetings, letters and other communications during the last year between the government and the representatives of airline companies in connection with the division of landing rights and other services between Dorval and Mirabel airports in Quebec.
He said: Mr. Speaker, the motion is certainly appropriate at this time when we anticipate that within the next week or two we shall hear some announcement from the government about its intentions with regard to these two airports, Dorval and Mirabel.
To put the subject in the proper context, I would like to go back over the history of the past three decades. When I came here from Scotland after the war, I came over on a Northstar into Dorval airport. I remember well that I was so happy to get off that aircraft that it would not have mattered what kind of airport I was landing at. In fact, I disliked the flight on that Northstar from Scotland to Dorval so much that I would not travel in an aircraft for the next 15 years.
Be that as it may, it was interesting to watch the development of Dorval. In those days it was obviously not intended for use as a major international North American airport. Dorval was the first airport to undergo extensive renovations, alterations and additions, and in those days the work that was being done in Dorval was a great assist to my own industry, the construction industry. Plans were developed and the building got underway.
I recall that at that time many criticisms were made of the design of Dorval and that, when the airport at Toronto was to
Airport Services
be built-or rebuilt-that particular design would certainly not be used. The concept at Dorval at that time was an open one, and even today the availability of space is such that there is really no difficulty whatsoever in providing the accommodation needed for automobiles and other forms of traffic going into and out of Dorval. Access is easy and fast.
When the Toronto airport was built in its present form, it was decided that it would be a more modern airport, so it was built, as everyone knows, in an entirely different form and concept. I know this too well because I had what I suppose I could call the misfortune of having to go through that airport once a week, as I had an office in Toronto, and many was the time I was stuck in a taxi approaching the airport and watching my plane take off because I could not get into that airport.
Being proud of Montreal and always somewhat jealous of Toronto construction, I obviously felt we had made the right decision at that time. However, the years went by and it again became obvious that additional work had to be done at Dorval. In the mid-sixties when I was president of the Montreal Construction Association we were making representations to senior cabinet ministers at that time, and plans had been made both to extend and to widen the runways. The intention was to turn Dorval into an airport which would be good for the next 20 or 30 years. Rather strangely, the local mayors resisted any further expansion at Dorval. What had happened was that there had been considerable house building in the vicinity of the airport. People had even built houses in line with the runways, and suddenly they were objecting to the fact that planes were going overhead, despite the fact that the airport was there first and they built their houses later. They objected to the airplanes and made representations through their elected representatives at the municipal level that the amount of traffic at Dorval should be cut down, to the point that night traffic at Dorval was not allowed, and it is still not allowed.
This obviously took away the effectiveness of Dorval as an international airport, to the point where the government had little choice but to decide to build a second airport, leaving at that time Dorval to service the continental traffic, with Mirabel obviously to become the international centre. I say Mirabel because prior to deciding on that region a study was undertaken, and the area which was chosen for this new international airport was my own constituency of Vaudreuil. That was vigorously opposed by the Quebec provincial government because of its proximity to the Ontario border. The provincial government refused to give its approval of the site on the basis that some of the benefits from this development in the constituency of Vaudreuil would accrue to the province of Ontario. The choice of the provincial government, as we well know, was the south shore. The eventual compromise site was Ste. Scholastique, which is now Mirabel, and construction got underway. Surrounding land was expropriated. It is rather interesting now that there are complaints from the people whose land was expropriated that an attempt was made at that time by the government to expropriate land to make sure

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Airport Services
Mirabel would never be in the position in which Dorval found itself when it was not able to expand its runways as it would have liked.
The airport at Mirabel was eventually opened, at a cost of some $1 billion, in 1975 and, according to the projections made prior to the decision to build the airport, there was to be an annual increase in passenger traffic which warranted the construction of that second airport.
However, there were two subsequent events which changed that projected increase in passenger traffic. The very first one was the decision of the government to allow foreign airlines to enter Canada at Toronto rather than Montreal. Of course, the foreign airlines immediately took advantage of that permission and, as a result, the Montreal area was no longer the point of entry for many of those foreign airlines. The second event was the economic downturn which resulted in less use of airlines.
The decision to construct Mirabel, the second airport in the Montreal area and a truly international airport from the point of view of its size, its quality and its capability of handling all kinds of aircraft, including the largest aircraft presently flying, cargo planes and so forth, was a wise one based on the conditions which existed at that time.
And, as everyone knows, subsequently the same logic was applied to the construction of a second airport at Toronto. However, the people of Toronto resisted the construction of the Pickering airport and, as a result, a move was made to expand the existing Toronto airport. For those of us who use the Toronto airport it possibly was a reasonable compromise, but of one thing 1 am absolutely convinced: ten years from now we in Montreal will be very pleased that we have two airports.
To return to the immediate problem, the Dorval airport cannot handle 24 hour per day traffic. Second, because of the length and width of its runways Dorval would be in a very difficult position if it had to handle all the additional traffic from Mirabel.
I put this on the record because I am going to argue that we should still mothball Mirabel. The problem with transferring any traffic to Mirabel is that some of the passengers who presently fly out of Dorval would not go via Mirabel but instead would go by shuttle service to Toronto, thus increasing the traffic in Toronto and defeating the purpose of the move. At the present time Air Canada runs some of its Caribbean flights via Toronto; the reason for this is that it wants to avoid using Mirabel. The Montreal chamber of commerce believes that any change to Mirabel would result in many airlines leaving Montreal altogether.
We have what is, in my opinion, an even more serious problem, however. At the present time the Dorval airport is the hub of the West Island/Montreal activity. The maintenance facilities are there and one must admit that the language of a large number of the workers at Dorval airport at the present time is English. If any attempt is made to move services to Mirabel, it is unlikely that the present employees at Dorval will be willing to move. They will do what many Anglophones have already done-move out of the province. The result will
be a further decrease in the proportion of Anglophones in Quebec and the reason for that will be the decision of the federal government.
I note from the statistics that whereas the traffic growth in Montreal has been just over 4 per cent per annum, the traffic growth in Toronto has been almost double that. Any attempt to move flights out of Dorval into Mirabel will inevitably increase the amount of traffic in Toronto for the reasons that I have stated.
The airlines themselves have come up with a simple solution-mothball Mirabel. It is understood that the loss at Mirabel is in the order of $1 million per week. The profits at Dorval are probably about $1 million per month. The cost of moving from Dorval to Mirabel is estimated to be in the order of half a billion dollars. This is without taking into consideration the disruption of employees who may or may not decide to make the move when the transfer is made. I do not think the transfer is going to be made for the simple reason that the federal government has a commitment to the West Island community.
In any other province it is possible that persons might be willing to move a distance of 30 or 40 miles from one location to another, but the very sensitive language problem in the province of Quebec means that it is not quite that simple. The probability is that the employees at Dorval will be unwilling to make that move.
It is realized that if Mirabel were mothballed it might be impossible to get all the flights into Dorval. That may be so, but I suggest the consequences would be far less severe than if an attempt were made to take flights out of Dorval and put them into Mirabel.
If one looks at the price tag for the move and compares it with the present $50 million per year loss, it will be seen that if the shift is to cost half a billion dollars and the interest on that amount alone is almost twice the total annual loss, economically it would not make any sense either.
When an international airport is constructed it is essential that there be easy access. Because the government of the province of Quebec was annoyed that it did not get its own way and because the present provincial government has no intention of co-operating with the federal government, there has been a refusal to construct a main highway linking Montreal to Mirabel despite the fact the federal government has offered the financing. It makes absolutely no sense, when the provincial government refuses to construct a high-speed highway linking Montreal to Mirabel, to give any consideration to transferring flights from Dorval to Mirabel which businessmen would refuse to take because of the additional time factor and the additional inconvenience involved. We cannot force people to use a different location if they are not so inclined. Unless all flights were taken out of Dorval, businessmen would still use that airport and travel by the alternative routes I have suggested, such as going via Toronto.
For these reasons, I suggest that any move by the federal government to make any transfer whatsoever of flights from
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Dorval to Mirabel at the present time would be uneconomical, contrary to the interests of the residents of the West Island of Montreal, would be a very damaging blow to the anglophone community that remains in the province of Quebec, and would be foolhardy in the extreme.
Whether in its wisdom the federal government decides to retain Mirabel for its present international and cargo flights, it must swallow its pride, accept the fact that the decision to construct originally was correct-and as I have said, I fully support the original decision-absorb the inevitable losses and be patient for another five, six or seven years when the people in Montreal and the province of Quebec will be very proud that they have access to two airports in Montreal, Dorval and Mirabel.


Henry Perrin Beatty: Mr. Speaker, I can assure the hon. member for Vaudreuil (Mr. Herbert) that he will have the full support of hon. members in this party for his Notice of Motion for Production of Papers. I think the hon. member showed considerable courage in making the statement he did about Mirabel today. It is regrettable that the Minister of Transport (Mr. Pepin) is not here to listen to that statement.
On two successive days, yesterday and today, members of the Liberal caucus from Montreal have raised the concerns of their constituents about the fact that the government is considering actions which would be to their detriment by considering the possibility of transferring a large number of domestic flights from Dorval to Mirabel. That is not in the best interest of the west end of Montreal. The decision clearly would not be in the best interests of the airline industry, which does not want it. Travellers do not want it either and it would be a very regressive step.
From the time the decision was first made to build Mirabel it should have been apparent to the government that it would be a white elephant, extremely costly, underutilized and would cause very serious problems for the future. We have seen those problems manifested in the massive deficit run up by Mirabel, in the treatment of landowners on the site whose farms and homes were taken away from them and who found that their treatment by the government was totally unfair.
We have seen Dorval's competitors advertising for some time to encourage people to route themselves through competing airports. One example is that of a few years ago when people were encouraged to route themselves through Logan instead of Mirabel because it is more convenient. We have seen that the reaction of the travelling public is that they find Mirabel extremely inconvenient and very costly to get to.
Anyone who has gone through Mirabel, Mr. Speaker, recognizes that it is very severely underutilized at the present time. The government's investment there was a mistake in the first place, and it is continuing to cost Canadian taxpayers over the course of time. It would be useful for members to have the opportunity of trying to find public transportation from
Airport Services
downtown Montreal to Mirabel, or to take a cab and pay for the expense of travelling to such a remote location. If they do, they will discover something about the inconvenience that airport has caused for so many of the travelling public. For the government now to be talking about depriving air travellers of services they now have in Dorval and requiring them to use Mirabel is, I feel, a very serious and regressive step.
The real question, Mr. Speaker, is to what extent members of the Quebec Liberal caucus are prepared to speak out against this policy currently under consideration. To what extent are they prepared to put their constituents' interests first and give consideration to the concerns of the travelling public, the airlines, and the people of Montreal. Surely it is time that other members of the Liberal caucus showed the courage shown yesterday by the hon. member for Chateauguay (Mr. Watson) and today by the hon. member for Vaudreuil, and speak out to make it known that the decision under consideration is very regressive.
One need look no further than page 4 of today's Globe and Mail to see that concern is running very deep in that part of Montreal. It quotes the hon. member for Chateauguay as follows:
He said in an interview later that the issue is shaping up into "the biggest political problem in the Montreal area. We'll lose two seats for sure" in that area in the next election if the government's plan goes ahead.


Mr. Bujold:: Nonsense.


Henry Perrin Beatty: The hon. member opposite says "nonsense". He is saying nonsense to his own colleague. It was the hon. member for Chateauguay who is quoted in today's Globe and Mail as saying that. Perhaps the hon. member wants to get up and attack his friend, the hon. member for Chateauguay. Perhaps he wants to say that the comments of the hon. member for Vaudreuil, who spoke a few minutes ago, were nonsense. We on this side do not believe they are nonsense. We believe there is a very deep-seated concern among the people of Montreal about this waste and inconvenience. We believe for the government to simply bull ahead and ignore this problem is to do a disservice to all Canadians, in particular the people of Montreal.
We should put on record, Mr. Speaker, that members of the Progressive Conservative Party are prepared to fight for the people of Dorval and west end Montreal. If voices on the other side are silenced, if members of the Quebec Liberal caucus are not prepared to stand up for those people, then members on this side will.
We believe Mirabel was a very serious mistake and it is being compounded today by the consideration of shifting domestic traffic from Dorval to Mirabel which would be very unfair to everyone concerned. The taxpayers of Canada have been forced to subsidize a very costly and unnecessary airport at Mirabel. In that regard 1 disagree with my friend, the hon. member for Vaudreuil. It was a mistake in the first place to have built Mirabel, an airport which served only to take prime farm land out of production and deprive farmers of the opportunity of growing and supplying food to the people of that

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Airport Services
area. It was a mistake, Mr. Speaker, but let us not compound the mistake today by allowing the Minister of Transport to go ahead and transfer domestic routes from Dorval to Mirabel.
Again, Mr. Speaker, I would underline that the hon. member for Vaudreuil has the full support of members on this side of the House for his motion for the production of papers. If it comes to a vote we are prepared to support him. If it does not come to a vote, it will not be because members on this side have talked it out, thereby preventing members of the House of Commons from expressing themselves in a free vote on this issue. It will be because members on the government side have decided to talk it out and deprive the hon. member for Vaudreuil of the opportunity of having a vote on this motion. The people of Dorval have our support and the hon. member has our support. I hope all members of the House will recognize their responsibility and allow this motion to come to a vote today. I hope members on all sides will support this very reasonable motion.


Mr. Les Benjamin (Regina West):: Mr. Speaker, I will be brief because I agree with the hon. member who has just spoken. We will not contribute to this motion being talked out because we support it. I merely want to say that it is hard to hide an elephant. In fact, you can ask any undertaker-it is even harder to bury one, whether it is white or any other colour.
However, the Liberal government deserves an "E" for effort on Mirabel, because after that fiasco they shuffled much of the expropriated land and much of the costs over to the Department of Public Works accounts from the Ministry of Transport accounts. They wiped out the interest payments on Mirabel and tried to shut the closet door on that. Now the government wants to force passengers and airlines to abandon Dorval in order to try and justify the existence of Mirabel.
The simple fact is that Mirabel covers only 14 per cent of its costs. If one uses the same formula for grain that the Minister of Transport (Mr. Pepin) is relying on arrived at by one Mr. Snavely, farmers should get $12.90 a bushel for grain. If the minister used the Snavely formula on Mirabel, we would recover 14 per cent of the cost.
The government proposes to transfer long-haul domestic flights from Dorval to Mirabel. That is an expensive proposition at a time when the government says there is no money for other things. First of all it will cost about $400 million to build new hangars, terminals and other facilities at Mirabel, duplicating what we now have at Dorval. As Dorval starts to lose traffic it will start to lose money, and we are back into a different rut.
Mirabel is a one-hour and $40 taxi ride from Montreal, so it is no wonder people do not want to use it. If Mirabel were set up in the same way as Gatwick in England, or Frankfurt in Germany, that might make some sense. Gatwick has a highspeed electric train for the transportation of passengers some 40 miles to London at a cost of $6 or $7, and that might make some sense at Mirabel. Of course passengers are reluctant to use Mirabel and you can hardly blame them. CP Air has
threatened to discontinue non-stop flights from Mirabel to western Canada. Air Canada and CP Air passengers will of course avoid Mirabel. As the hon. member who sponsored this motion has said, they will go via Toronto instead, which not only avoids Mirabel but hurts Dorval as well. Malton airport will be under pressure to handle more traffic as airlines and passengers avoid Mirabel. The department will then use this new problem to justify a new airport at Pickering for which it has already thrown $187 million down the drain.
The need for mega-airports such as Mirabel and Pickering died with the death of the supersonic transport. This is what they were designed for. The visions of the mid and late-1960s was that an airport like Mirabel would be the greatest supersonic transportation airport in the whole world. It was to be the first one as well as the greatest one. This has gone down the drain. I agree with the hon. member that it needs mothballing.
Airport congestion at Malton and Dorval can be solved by improving ground transportation on routes up to 500 to 600 miles. I am referring to bus and rail. This will take some money but not as much as the $ 1 billion which the government has already thrown into Mirabel or the $1.5 billion the government will throw into these projects if it gets away with its plan to shift traffic from Dorval to Mirabel.
In supporting this motion, let me indicate that I have a final solution for Mirabel. The government of the United States purchased some property in Ottawa in order to build a new embassy; the Government of Canada will build a new embassy in Washington. I suggest that if we saw the Mirabel terminal building in half, we could give half of it to the U.S. government for its embassy. It could pay for the bill to move that half to Ottawa. We could transport the other half down to Washington. I suspect that the architect's fees for the new embassy in Washington would cover much of the cost of moving the other half of that terminal building to Washington. Then we would have two embassies. We are good, co-operative international neighbours, and we would not have to put mothballs in the buildings. We could saw the terminal in half, have two embassies, and let farmers return to growing food on the land which the runways occupy.


Jesse Philip Flis: Mr. Speaker, I am pleased to take part in this private members' debate provided by Standing Order 48(2), and specifically to debate Motion No. 96 in the name of the hon. member for Vaudreuil (Mr. Herbert), a motion for the production of all communications between the government and the representatives of airline companies in connection with the division of landing rights and other services between Dorval and Mirabel airports in Quebec.
As we are well aware, the issue of the assignment of traffic between Mirabel and Dorval airports has been with us for a long time. Virtually from the opening of Mirabel, it has been reviewed by successive ministers of transport. The issue is an
May 13, 1982

extremely complex one which has many different technical and economic aspects and is one which affects people from many different sectors of society. For example, it affects business travellers and leisure travellers; people living in the vicinity of Mirabel and people living in the vicinity of Dorval; travellers from other parts of Canada, from the United States, from Europe and from all corners of the world; employees at Mirabel and employees at Dorval.
Clearly each of these sectors will see the issue from their own perspective, as did the three hon. members who have participated thus far in the debate. In addition, the view of different people in these sectors will vary to some considerable extent as a result of personal experience and personal involvement. The situation has been exacerbated by further complexities such as Montreal origin-destination passenger traffic which has not grown as anticipated mainly because of the economic downturn, as mentioned by the hon. member for Vaudreuil. It is not only a Canadian economic downturn but a worldwide one. Another complexity is the increased cost of aviation fuel, which no one mentioned, and the resulting raising of fares. Since Mirabel basically serves international traffic, excluding the United States, passenger traffic growth has been reduced even further by the introduction of more direct flights by domestic and foreign European carriers, to other Canadian cities, thereby reducing the number of connecting passengers at Montreal. This development has taken place despite the moratorium on new foreign carriers at Toronto International Airport since 1976 and considerable efforts in bilateral negotiations to encourage the use of Mirabel.
The present Minister of Transport (Mr. Pepin) is vigorously attempting to resolve the Montreal airports issue, and fully intends to be the minister who obtains a government decision on the issue. He is a minister who is not afraid to make tough, unpopular decisions. He is one who makes decisions, keeping in mind what is best for the country in the long term.
I know he will appreciate the debate which is taking place this afternoon because it will certainly help him to come up with a solution that will benefit Canada in the long term. As all hon. members are well aware, on February 12, 1981, the same minister released a report entitled, "An Interim Report On Airport Role Options". This report was the culmination of the first phase of a study which had been undertaken by the Department of Transport, assessing a range of possible traffic assignments for the Montreal airports system. With the release of this interim report, all interested parties were invited to submit comments and concerns on the analysis done to date, with a view to providing a broader input base for the analysis in the second phase of the study.
In total, some 92 interested parties submitted their viewpoints and concerns, with the greatest response being from municipal governments and local chambers of commerce. As well, ten air carrier companies submitted detailed information on the potential cost-revenue implications of transferring additional traffic to Mirabel.
Airport Services
Let me reflect for a moment upon the findings of the first phase of the analysis which are documented in the interim report. The analysis indicated the following:
That the original long-range plan to consolidate most of the commercial air traffic at Mirabel is still the best solution.
I emphasize the words "long-range plan". It continued:
That the timing of any such transfer must be carefully assessed taking into account the anticipated demand; the residual economic life of existing facilities at Dorval; the current availability of under-utilized new facilities at Mirabel; and the impact of substantial traffic reassignment on the social and economic wellbeing of the communities adjacent to the two airports.
It went on to indicate:
-that the focus of the second phase of the study must be on not only the costs and benefits of transferring traffic to Mirabel but also on the optimum timing for any such transfer.
1 also emphasize the word "timing". Many of the submissions made in response to the minister's request for comments attempted to identify the costs which would be incurred by the respective party or interest group as a result of any transfer of traffic to Mirabel.
Needless to say, rarely does the summation of the individual aspects of any transportation issue portray the total effect upon the system. The detailed cost benefit analysis which was undertaken in the second phase of the Montreal study, while taking into consideration the information and concerns contained in the individual submissions, at the same time addressed the question of the total impact on the Montreal airports system. This detailed cost benefit analysis is now being finalized. Regardless of what conclusions the analysis indicates, it is inevitable that the proposed solution, whatever it is, will not fully satisfy all parties. It will not satisfy the parties which I mentioned earlier. I could add others. Whatever solution the minister comes up with, it will not satisfy the mayor of Dorval and the mayor at Mirabel Members of Parliament whose ridings are around Mirabel and Members of Parliament whose ridings are around Dorval, MLAs whose constituencies are around Mirabel and MLAs whose constituencies are around Dorval. His solutions will not satisfy local businesses, because whatever move the minister makes, some businesses will be affected.
I was hoping that I would have heard more alternatives from the hon. members who spoke in this debate. They gave one alternative, namely, to mothball. Is that the way to run the country? If you have alternatives that will benefit the country, give them. Give some alternatives which will help the minister make a good decision. Do not come up with just one alternative solution, such as to mothball the project. If we ran the country in that manner we would really be in a mess.


Gordon Edward Taylor: You are.


Jesse Philip Flis: I would like to inform the hon. member for Vaudreuil that when the original motion was transferred for debate, officials within the Department of Transport were already in the process of readying the documentation requested for tabling in the House.

May 13, 1982
Airport Services
In conclusion, I would like to stress upon the hon. members that most of the information compiled as a result of this study is already public knowledge. The positions of the air carriers with respect to any transfer of traffic to Mirabel have been made public in a news release by the Air Transport Association of Canada. I have a copy of it here. It was released as far back as April 22, 1981, under the heading, "ATAC statement on Pepin's Dorval Mirabel options". It says:
ATAC believes that one of the two options, i.e., the transfer of all air traffic, except short-haul domestic flights, from Dorval to Mirabel, would result in higher costs and great inconvenience to travellers; would impose serious new financial burdens on financially fragile airlines, and would require unwarranted major expenditures of public money that should not be countenanced by any prudent government or responsible M.P.


Henry Perrin Beatty: Do you agree?


Jesse Philip Flis: The hon. member asks if I agree. I do not think the minister has, at this point, taken one side or the other. That is why I was hoping this debate would have produced various alternatives, which I could have taken to him.
Individual air carriers have, on several occasions, stated their position with respect to any changes in the assignment of traffic at Montreal. One needs only to pick up any newspaper, such as the The Gazette dated April 28, which has the headline "Air giants face new pressure to move to Mirabel". Another article is headed, "Mirabel shift would raise air fares". Mr. Taylor, in a speech to the Montreal Chamber of Commerce, said that while Mirabel has the potential to become one of the world's great airports, any further transfers of traffic from Dorval to Mirabel would be economically unsound at this time for both airlines and travellers.
I do not know what the intent of the member for Vaudreuil was in making a motion for the production of papers. Really, people's positions are quite well known. All you have to do is to read the newspapers.
Furthermore, one needs only to pick up any issue of a Montreal daily newspaper to read about some particular group being either in favour of or opposed to a particular scenario for allocating traffic between the two airports.
As I have stated previously in the House, the Mirabel-Dorval solution must be one that recognizes the long-term socio-economic development of the Montreal area. There can be no doubt about the importance of proper airport facilities to the economic wellbeing of a community. Such a solution can only be found, however, after all the facts have been thoroughly assessed.
Given the rapidly changing times and the unstable world economic situation, such an assessment is not easily made, and consequently a decision on this issue will only be forthcoming at such time as the minister is confident that the best solution has been determined and that he has been able to convince his cabinet colleagues accordingly.
I would like to take this opportunity to thank the hon. member for Vaudreuil for raising this topic because it gave hon. members who were interested in it the opportunity to give
their views and state alternative solutions. My only disappointment was that I wish I had heard more alternatives and possible solutions which I could have taken to my minister.


Mr. Marcel Dionne (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, I have a few comments to make on the construction of Mirabel Airport. There was, of course, the initial decision to build this airport. I also want to comment on the positive impact of the airport and also on the less favourable effect it has had on the airport facilities at Dorval. During the 1960s, the growth of air transportation in Canada was tremendous, especially in flights to Europe and North America. Air transportation progressed annually at rates varying from 8 per cent to 15 per cent, and as a result, it was necessary to expand all our major airports. Increased air traffic at Dorval, and especially the advent of jet planes for long-haul flights, created a serious conflict between the need to expand operations and the fact that people in the surrounding areas were suffering increasing exposure to the noise connected with airport operations so that it became necessary to restrict-operating hours. Towards the end of the 1960s, the alternative was to either acquire new property and expand Dorval or select another site that would eventually replace Dorval.
It was thought at the time that the first solution would permanently add to the problems of surrounding communities, because the noise factor could only be expected to increase. It seemed more sensible to opt for the second alternative, namely to develop a new site that would minimize the environmental impact. The share of air traffic originally proposed in 1975 for Mirabel consisted of international flights other than those to the United States, while long-haul flights to western Canada would necessarily be directed to Mirabel.
Now to the present situation. Following consultations with Canadian carriers, only international flights have been transferred, because the airlines maintain it is impractical to fragment domestic traffic. Here I would like to mention the positive impact of Mirabel. It was supposed to eliminate congestion at Dorval in the air terminal, on the runways and the roads to and from the airport. There would also be a substantial reduction in noise near Dorval, and more than 2,500 jobs would be created in the area north of Montreal. The road network would be considerably improved as a result of the construction of the longest section of Highway 13, installation of street lighting along Highway 15 and improvement of regional and local roads. There would be no restriction on air operations at Mirabel.
Hon. members will agree that there was a great deal to be said in favour of opening a new airport at Mirabel. Obviously, there is also a negative side which concerns the airport facilities in Montreal and the decline in the level of service provided to passengers in transit in Montreal, who often have to travel between Dorval and Mirabel. This may be resulting in a loss of traffic. There is also the fact that more time and increased costs are involved for passengers who have to use Mirabel.
May 13, 1982

Obviously, the problems encountered by air carriers who had to use both airports led to other decisions, and most of the negative effects would be relatively short-lived, since the original traffic transfer plan provided that in 1975 Mirabel would be taking over the majority of Montreal's flights, except for short-haul flights. However, slow growth of air traffic owing to various economic and social problems, the financial situation of the airlines and the opposition of some groups in the Montreal Urban Community have all in some respect contributed to the postponing of a decision in this respect. The issue has been studied thoroughly for several years. There is, however, a risk of promoting solutions that would merely reinforce the negative aspects of the traffic split.
Several scenarios for traffic sharing have been considered, but there are only one or two that would meet the main objective which is to give Montreal efficient airport facilities while helping to develop transportation, supporting the economic viability of carriers and providing a comprehensive and efficient service to the travelling public. One of the most controversial aspects of increased utilization of Mirabel is surface transportation, in terms of access time, additional costs and road congestion. A number of experts have examined these factors, especially road congestion, and since some conclusions have been received, I shall mention the main ones. It is true that for many travellers it takes longer and is more expensive to go to Mirabel than to Dorval. However, the travelling time to Mirabel compares favourably with the situation in other major air traffic centres such as New York, Paris, Rome or London, to name a few. Actually, the express bus service provided by the MUCTC from downtown Montreal is fast- about fifty minutes-and very comfortable.
Other options were considered, including railway transportation that could provide a better service, and the conclusions of these studies were that a high-speed train that would make the trip from Mirabel to Montreal in thirty-five minutes would require the construction of a new tunnel under Montreal at a cost of several hundred million dollars. This option was therefore rejected. The second option, a semi-high-speed train, which would take forty to forty-five minutes and use the present tunnel under Mount Royal and existing railway tracks, would still cost more than $100 million in 1980 dollars. The possibility of a semi-high-speed train is still being considered, but it is a fact that the infrastructure costs are relatively high compared to that of a bus line. Also, the service is not that much quicker that the present bus service. According to the experience at a number of other airports, there is no marked preference for trains and the majority of travellers still prefer to go by car.
Actually, the road system from downtown to Mirabel and the restricted-access roads from Mirabel to downtown Montreal are fairly good. Once Highway 13 is completed, this will cut down even more on travelling time. Of course, completion of this highway was promised by other levels of government, and it seems that it has not been completed as planned. Mr. Airport Services
Speaker, in concluding, I wish to say that construction of a railway line would require a high passenger volume to be profitable, and would not be justified unless the volume of passenger traffic increases very substantially over the one existing at the present time. The train as such will not generate additional traffic. The surface aspect is only one of the factors that adds to the complexity of the analysis. Clearly, any decision will have to make a thorough assessment of all these factors. I shall conclude with the comment that there are not many alternatives, and I feel that in the House, most of the options-if there were any and I do not see very many, Mr. Speaker-were often presented in a very partisan spirit and often failed to consider the interests of the majority of our fellow citizens.


Mr. J.-Roland Comtois (Terrebonne):: Mr. Speaker, I listened with great interest to what my colleagues had to say about Mirabel Airport, but none of the hon. members who spoke to this subject this afternoon were here when the decision was announced in 1969. I was one of the members in this House at that time, and I must say that the decision, and it was a long-term decision, was made after lengthy consideration and many in-depth studies. When I hear my colleagues opposite saying that the airport should be mothballed or should be split in two to send some of it to Ottawa and Washington, I must say there is only one step from the sublime to the ridiculous. Usually, people who take the shorter view of things are on the opposite side of the House, and in fact that is why they are in the opposition. People with a more realistic view of the future are usually on the government side. And when a government becomes a shortsighted government, it does not take long for it to land in the opposition. In the case of Mirabel, Mr. Speaker, 1 feel this was one of the best decisions ever made by a federal government since Confederation. It is certainly the best decision ever made for Quebec.
As a parliamentarian, I have had an opportunity to visit a number of countries and I have travelled to several airports throughout the world. I must say that Mirabel compares very favourably with any of these. In Toronto, for instance, if you have to change planes, very often you have to take a minibus and transfer to another air terminal, which may take half an hour or an hour. This is never mentioned. If you go to Paris, you have to change airports. If you go to New York, you have to change airports and it takes hours, and hundreds of millions of dollars just go down the drain. If you go to Mirabel, you do not have to change air terminals. You do not even have to walk to the plane. So there are very real advantages, and all foreigners arriving at Mirabel are amazed at the size of the airport and the surrounding area. It has been much criticized, but I still think this was one of the wisest decisions ever made. I know that some parliamentarians are talking about giving back part of the land. I think that would be a serious mistake.

May 13, 1982
Taxation
Once more, I believe these people take the shorter view and have an entirely mistaken concept of the future. I think that people who talk about mothballing Mirabel are talking through their hats. I heard one of my colleagues from the Progressive Conservative Party say that the best farmland in Quebec was used for this airport, although it is widely known that most of the land, although excellent farmland, was not under cultivation, and that today, farm production, despite the construction of Mirabel Airport, has increased over what it was in 1969. These things are forgotten because there is no knowledge of the real situation. Mr. Speaker, I could go on for two hours about Mirabel. When they talk about it, all they can say is that you need a taxi and it costs $40 to get there. As my colleague said, Highway 13 has not been completed. Three years ago, the federal government signed an agreement with Quebec for the completion of this highway.


The Acting Speaker (Mr. Ethier):: Order, please. It being six
o'clock, 1 do now leave the chair until eight o'clock.
At 6 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.


[Stage Direction]
The House resumed consideration of the motion of Mr. Bussieres that Bill C-l 12, to amend the statute law relating to certain taxes, be read the second time and referred to a Committee of the Whole.
Mr. Deputy Speaker:: When the debate was interrupted at five o'clock this afternoon, the hon. member for Red Deer (Mr. Towers) had the floor.


Thomas Gordon Towers: Mr. Speaker, at least-


Mr. Deputy Speaker:: Let me point out, with all due respect to the hon. member for Surrey-White Rock-North Delta (Mr. Friesen), that the customs and practices in the House are well known to him.


Thomas Gordon Towers: I guess the Vancouver Canucks are going to be playing hockey tonight. I surmise that is the reason for the waving of one of their sweaters.
Prior to private members' hour, I was expressing the thought that it was unbelievable that a cabinet or a government could be as incompetent as the one which brought in the National Energy Program which is causing destruction of the economic wellbeing of this country. There is no doubt about it. We have
never had a program which has done as much damage to this country as has the National Energy Program. The people who perpetrated it will not listen.
I should state tonight that it is a pleasure not only to speak on behalf of my constituents, but to do so also on behalf of those of the hon. member for Medicine Hat (Mr. Hargrave) who is looking after the people's interest in another part of the country. Our problems are pretty much the same. 1 am sure he would support anything that I say in trying to bring the attention of this government to the serious problems it is creating for Canadians.
The heavy hand of government is taking more and more of the gross national product in taxes. The figure is creeping up each year. Unfortunately, the government does not seem prepared to cut the pattern to fit the cloth. On a national accounts basis, expenditures for all levels of government which far exceed receipts of most years, are inching up to almost one half the GNP. In 1977, government expenditures accounted for 41.4 per cent of the GNP. In 1978, the last complete year for which the Canadian Tax Foundation has provided information, government spending accounted for 42 per cent of GNP. This year the percentage will be that much worse because the GNP is growing much more slowly and government expenditures are escalating more rapidly.
As the Canadian Tax Foundation notes, such payments, which include pensions, family allowances, unemployment insurance railway subsidies and interest on the public debt, redistribute income within the economy but do not increase the government's claim on the goods and services produced. That is a gentle way of saying that government is passing out dollars it has not produced, and the net result is that no new wealth or productivity is created.
Government taxes take about 38 per cent of the gross national product, that is government at ail levels, and the federal government takes the lion's share, a share almost equal to the combined share taken by the two other levels of government.
Federal tax collections amounted to only 7 per cent of GNP in 1926. They peaked at 21 per cent in 1946 and then rose to 30.5 per cent in 1978. Together with revenue from other sources, capital cost allowances, investment income and other minor items totalling 7.7 per cent, a hefty 38.1 per cent was taken out of the gross national product.
My own province of Alberta shells out $5,028 billion in all forms of taxes to Ottawa and gets back $3,490 billion. That means we are a net loser to the tune of $1,538 billion. I guess that is the price of being a have province. However, this year there will not be the income tax coming from that province because of so many workers departing from the oil industry in Alberta. They have gone to the United States where they will be paying income tax.
May 13, 1982

I wonder how long we will continue to be a have province with this federal government's insatiable appetite for new and higher taxes. The federal government's disastrous national energy policy has wrecked the oil and gas industry in Alberta. The boom is over in Alberta thanks to the Minister of Energy, Mines and Resources (Mr. Lalonde), the Minister of Finance (Mr. MacEachen) and the Prime Minister (Mr. Trudeau) together with their tax policy. They are the great destroyers. Their clumsy attempts to Canadianize the oil and gas industry have resulted in Americanizing it. That is where all our jobs, risk capital, drilling rigs, expertise and technology have fled. The New York Times of May 9, 1982 reported on the price of the national energy policy as follows:
Oil exploration, drilling and production plunged, prices soared and consumption fell.
New oil wells completed in 1981 were down from 8,865 the previous year to 7,165-a loss of 1,800 wells. Oil rigs in use dropped from 446 to 303-a loss of 143 rigs. Petroleum output fell from 1.76 million barrels a day to 1.61 million barrels a day. Gas prices at the pumps soared from an average of 0.61 cents a gallon in 1980 to an average of $1.21 a gallon in 1981, and up to $1.75 in 1982. Do hon. members opposite think this makes sense, when 400,000 barrels a day from Alberta is locked in?
The New York Times says that the fact is that Canada's energy policy will cut off the competitive edge in new technology just when it is most needed. What has happened since the national energy policy in Canada and Reagan decontrol in the United States? For the first time in a decade production of crude oil within the continental United States rose. Drilling of new wells increased 40 per cent and the number of operating rigs hit a record high. Matching this increase, continued decreases in per capita consumption caused crude imports to decline by as much as half a million barrels a day.
The New York Times went on to say that in Canada, on the other hand, 1981 production of crude oil and natural gas fell 10 per cent and 4 per cent respectively. Exploratory activities declined by 20 per cent in western Canada as companies moved to the north to obtain production incentive payments or left the country entirely.
The article in The New York Times said that while $4 billion to $5 billion was spent on drilling, $7 billion left Canada as Canadian companies bought out foreign interests. The outlook is for another 25 per cent reduction in well completions this year. Thus, more than half the rigs in the country during 1980 will have left by the end of 1982, principally for the United States.
So much for the Canadianization of our industry. And The New York Times concluded:
If the northern projects fail, as the $13 billion Alsands heavy-oil project did, then Canada will be importing half of its crude oil by the end of the decade. Since the United States should only be importing 10 per cent of its crude by that time, the Canadians will likely come to us for help in the next embargo. Let us not be of assistance, given that they've wrecked their markets and expelled efficient United States companies. Let them freeze in the dark.
Taxation
That is a sad commentary the United States has made about the activities of this government. There is no remorse among members opposite, and there does not seem to be any understanding.
So much for our goal of energy self-sufficiency by the end of this decade. If Sir Wilfrid Laurier were alive, do you think he might say that the twenty-first century will belong to Canada, and the twenty-second? Canadian individuals and industries are being buried by taxation, they are being frustrated by new and revised levies. The Fraser Institute on the west coast said, in a recent report:
In 1961, for example, the average family had an income of $5,000 and faced a total tax bill of $1,675.00; by 1980, the average family was earning $22,500 but of that $10,306 went to the tax collectors at the federal and provincial municipal levels in the form of hidden and direct taxes. The Institute's tax index shows that the tax bill of the average family has increased by 515 per cent since 1961.
In fact, it has increased even more in recent years because of the increasing extent to which governments, especially the federal government, have engaged in deficit financing. The bonds that governments issue to cover these deficits are, in effect, deferred taxation, since tax revenue must ultimately be raised to pay the interest and redeem the bonds. Including this deferred taxation, the Fraser Institute estimates that taxes between 1961 and 1980 have gone up 619 per cent. I wonder if in this reconciliation of net debt, this so-called deferred taxation, the Fraser Institute has taken into consideration the billions and billions of dollars the government owes for Crown corporation debts and the pension and superannuation funds.
And then, of course, we heard the member for Thunder Bay-Atikokan (Mr. McRae) saying today that he did not mind the government buying oil companies, companies that do not produce another barrel of oil, and the money leaving Canada in large amounts.
The last public accounts of 1980-81 show that the government has to account for $18.9 billion in Canada pension at 10.59 per cent. Does the government have that money? The accounts also show $22.3 billion in public service pension contributions at 8.2 per cent, $8.7 billion in the Canadian Armed Forces superannuation fund, which it does not have, and almost $1 billion in the RCMP retirement fund.
Now, Mr. Speaker, I know that this is of concern to you, because we have sat on many committees and discussed this. I was absolutely flabbergasted, when I was elected as a Member of Parliament, to find that these funds did not exist. It actually is a paper debt that the federal government owes to all these people. No other business in the world would be allowed to do this. If that money existed in those funds, it would be different, but it does not. It is a debt the government owes to the Canadian people.
Those are liabilities of the government, which simply show up in the public accounts as specified purpose accounts. As I said earlier, Mr. Speaker, this adds up to almost $51 billion, just in those three or four accounts alone. Then, of course, we have people on the other side-elected representatives of the people, saying it is okay to go on buying oil companies.
80114 31

May 13, 1982
Taxation
Taxes today account for a more significant chunk of the consumer budget than shelter and food combined. The average family with a $22,500 income paid $10,305 in all taxes and had average shelter costs of $4,239 and average food costs of $4,631, for a total of $8,870.
The Fraser Institute said: "In other words, taxes other than incomes taxes accounted for nearly 70 per cent of the total tax bill of the average Canadian family." And many of these taxes were hidden taxes. Commenting on the Fraser Institute report, the St. John's Evening Telegram editorialized:
Most Canadians, unfortunately, won't see a copy of this Fraser Institute document, and they will scarcely get such information from their taxman or their political representatives. But, until they "wise up" to the fact that governments cannot spend the people's money better than the people themselves, we will continue on the long slide to total dependency on the state and its expensive bureaucracy.
The Calgary Herald said in an editorial:
Nevertheless, there is a point at which any further increase in the proportion of total income taken through taxes is held to be intolerable. That point may vary from time to time according to the perceived worthiness of governmental programs and performance, but it is out there somewhere and governments dare not ignore it.
If they do so, they do so at their own peril.
The message of the Fraser Institute's report is that the point of intolerance is substantially closer today than it was in 1961 and that further appreciable increases in taxation, relative to real wealth, may be at the risk of economic wellbeing and political stability.
The escalation in energy prices has had a drastic effect on the food chain. I must impress upon this House, Mr. Speaker, that it is not necessarily the escalation in the price of energy that is creating the problems, but, rather, it is the taxation of the energy. Farmers must pay higher prices for their energy and for their products which have a high energy concentration, such as, for example, fertilizer. These costs must be passed on, and eventually they come to roost at the checkout counters in the supermarkets.
I have here a document from one of my constituents which shows that the tax on natural gas alone is creating real hardships for many people. One fairly large hog operation in my constituency had a tax bill of $725.95 for the month of March alone. That was just excise tax on natural gas alone. That is more than the total cost at the original installation, so we can see the devastating effect of this excise tax on natural gas. This has to be added to the cost of the operation, and that cost is reflected right through to the grocery counter. The consumer will have to pay. We should not be taxing fuel for home heating or fuel used in production because that is where Canada is falling down.
I also have a letter from Mr. Gerald Kemp, who is a director of the Federated Co-operatives Limited. He is also the vicepresident in the Calgary region. This is what he wrote to me:
The following is an excerpt from a directive sent through Federated Cooperatives Limited-
"There is concern among agricultural producers over the effect that scheduled increases in energy costs, as negotiated in the Canada-Alberta energy agreement, will have on farm production costs. While we are sympathetic to the need for higher energy costs, we share the concern of producers. Based on the projected
increases to the cost of crude oil and natural gas, we have calculated the effect these will have on a farm with 1,000 acres under cultivation. The cost of motor fuel, heating fuel, and fertilizer for such an operation was about $11,820 in 1980, and increased to $16,573 in 1981. Our calculations indicate that by 1986, costs will increase to about $42,536, an increase of 280 per cent over the 1980 level. The predictable result is that as well as eroding farm income, the increased costs will be reflected in the food bill for all families".
He included working papers. Motor fuel for that farm with
1,000	acres under cultivation in 1980 cost $4,540; heating fuel cost $810; fertilizer cost $6,470, for a total of $ 11,820. Then in 1981 the motor fuel cost $6,860; heating fuel cost $1,223; and fertilizer cost $8,670. The total was up to $16,753. In 1986 we will find that from $16,753 the cost will go up to $42,536.
How in the world are these people going to survive and keep producing if the government continues to impose taxes like these on the industry? It just cannot be done. There is absolutely no way those people can survive. The government must realize that one third of the cost of natural gas is federal tax. In addition to that, the federal government will not wait for the tax to be collected by the co-operatives. No, it has to have it within 30 days. There is absolutely no way co-operatives can collect the tax and pay it to the federal treasury in 30 days. They need 90 days. But no, the government will not listen. Not only does the federal government take approximately one third of the cost of natural gas in tax, but there is also a top loading because the tax must be financed for 60 days. A co-operative has to have about $100,000 at any one given period, and that is borrowed from the bank. These co-operatives have to pay ordinary interest, so hon. members can imagine the extra cost involved. It is absolutely senseless that we have allowed ourselves to get into that kind of situation.
The escalation in energy prices has had drastic effects on the food chain, and it will have a much worse effect in the future.
The cost of air travel is becoming prohibitive. Because of the massive VIA Rail cuts, that is the only option left to some communities. Last May the government introduced the transportation fuel compensation recovery charge to force air carriers to pay world prices for fuel used in international flights. The initial levy was about 11 cents a litre. The government used this dodge because it claimed that foreign carriers were taking advantage of cheap Canadian gas prices to tanker fuel from this country. The airlines, through the Air Transport Association of Canada, fought this measure, claiming it was simply an illegal export tax on fuel. They said it was discriminatory because it applied only to aviation jet and marine fuel. They said it contravened bilateral air agreements and that it was never made into law. Air Canada, Nordair and a couple of other airlines paid, but other Canadian carriers withheld their payments pending the outcome of protests. Foreign carriers all paid the illegal levy. Canada caved in when the United States got tough and threatened to take the levy to international arbitration. The recovery charge ended on January 31. The foreign carriers, who paid a total of $46.5 million, can apply for a rebate. The $50 million paid or owed by Canadian carriers will not be rebated, and the Canadian consumer does not get a rebate either.
May 13, 1982

Foreign carriers will get a break. British Airways will get back $4.5 million. Canadian Pacific owes $11.5 million. The new scheme to get around the recovery charge boggles the mind, but it amounts to the same thing. Canadian carriers have to keep separate accounts for fuel used on domestic and international flights. The Air Transport Association of Canada believes that this sneaky scheme is also illegal, and it is deciding whether to challenge it in court. It is a monumental rip-off of the domestic airlines and is resulting in higher costs in fares for travellers. Canada must surely be the only country in the world where domestic carriers are singled out for special punishment in the form of irregular and doubtful energy levies.
In the end who pays? It is the Canadian consumer who pays, and no one else. It is terribly difficult to understand why the elected officials of the people on the side of the House opposite me would stand idly by and let three people, the Minister of Energy, Mines and Resources, the Minister of Finance and the Prime Minister get away with it.
The late John Diefenbaker had a phrase for this. He used to call the rare affliction most Liberals have the "Otto Lang syndrome." Mr Diefenbaker used to say in the House that if Otto Lang was walking across a cow pasture with four cow pies in it, he would walk in all four. The Minister of Finance and the Minister of Energy, Mines and Resources appear to have terminal cases of the disease, and the Prime Minister should put them out of their misery. I challenge hon. members across the aisle to tell me one positive benefit they have brought to Canada and Canadians in the two years plus since they were elected to office. They have brought Canada and Canadians nothing but misery. The Prime Minister shrugs and says that our economic climate is but a spin-off of worldwide recession. Nothing could be further from the truth, Mr. Speaker. As I said earlier this week in the House, he has left the Governor of the Bank of Canada hanging out to dry, trying to protect the Canadian dollar with high interest rates. He forgets that the gross national product and the fiscal responsibility of the government adds more to the protection of the Canadian dollar than interest rates ever could.
The statements of the Prime Minister, the Minister of Energy, Mines and Resources and the Minister of Finance are just baloney. We are in poor shape because the economy is being mismanaged. Every major economic indicator is in disarray. The Liberals achieved office through stealth and guile. They lied to the Canadian people when they said that they would keep the increase in the price of gasoline below 18 cents per gallon and probably at around 14 cents, to quote the Prime Minister. There have been about 15 gas and oil price increases since the Liberals were returned to office, but some of these were due to the extra taxes that were levied. How can they justify this when they were returned to office on a promise of keeping prices down?
In 1981 a typical Canadian family driving one car and heating their home with oil paid about $550 more per year
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than in late 1980. Of this, $409 was paid indirectly to the federal government.
Since the Liberals assumed office in 1980 the cost of heating a home has just about doubled. Where the average annual cost was about $560 in 1979, the cost in the winter of 1981-82 was just about double that. I have never had so many complaints from people about the cost of heating their homes. Senior citizens have to pay $100 to $125 more to heat their homes. They used to be able to heat them for $25 or $30.
The price of natural gas for home heating was driven up by excessive federal taxation. One third of that cost is federal tax and goes directly into federal revenues. Two years ago there was no excise tax on natural gas for home heating. Now the consumer pays about 32 per cent of the total cost in the form of excise taxes to the federal government.
Not content with avoiding cow flaps, this accident prone government is spending its spare time creating new cow flaps to walk in. We wasted a year and a half on the Constitution, a pet project of the Prime Minister. The debate was counterproductive and divisive and did nothing to draw this nation closer together or to increase productivity and real growth. We ended up with a flawed document, which will be a judicial nightmare and a bonanza only for lawyers.
We could have used all that time to ensure that proper procedures were developed for the tarsands. Cancellation of the megaprojects is a body blow to the Canadian economy, and in particular to the province of Alberta. At a time when we need productivity and jobs, we are being forced deeper and deeper into the morass of recession and despair. I have never seen the morale of the Canadian people as low as it is today.
Canadians have been browbeaten and put down for too long. They need hope, they need optimism and they need confidence in their elected officers and their elected leaders. They need a government which, first of all, understands what makes our marketplace economy tick.
The government says it wants to nationalize the Canadian energy industry. I say that for the word "nationalize" it should substitute the word "socialize" because that is what it is trying to do. Its clumsy attempts to Canadianize the industry have resulted in an Americanization of the industry. That is where all our drilling rigs are-in the United States. That is where about $17 billion in risk capital, equipment and payroll has fled. Mr. Bouey is left trying to protect the outflow of the Canadian dollar with high interest rates, when it is being shovelled out the back door faster than it is coming in the front.
The little independent businessman, the service and supply small businessman, is feeling the squeeze most in Alberta. Companies have gone under. Operations have been transferred to the United States. Jobs have been lost. Most people out there thought that the future looked bright for them. They invested their life earnings, and much of that has disappeared.
The ripple effect has spread into the manufacturing plants in Quebec and Ontario. There is no way of telling just what the loss of activity in the oil patch means to the steel mills and

May 13, 1982
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auto plants in central Canada. I dare say that the impact has been devastating. Companies in Alberta are not buying the cars or trucks that they would ordinarily buy, and this is reflected in the eastern market.
I am normally an optimistic person, Mr. Speaker, but I fear for my country. I fear because there are men across the aisle who do not know what they are doing, nor do they seem to care. I fear for my country because the clumsy, ham-handed, bumbling of the government is fueling the fires of separation and separatist talk and action in the provinces.
I fear for my Canada because there are more than a million Canadians without jobs and unable to find work. I fear for my Canada because for many the dream of owning their homes has vanished in the smoke of high interest rates and double digit inflation. I fear for my Canada because the government is doing nothing to stimulate the economy. It has done nothing for productivity, for industrial strategy, for research and development. We had the promise of the Minister of Industry, Trade and Commerce (Mr. Gray) that if interest rates increased he would resign, but he is still with us, Mr. Speaker.
We are still hewers of wood and drawers of water, Mr. Speaker. Dr. Larkin Kerwin, President of the National Research Council, says that the Japanese do so much with so little and we do so little with so much! It is tragic, when the potential is there for greatness and for prosperity.
Laurier said that the twentieth century would belong to Canada. May we expect a statement from the right hon. gentleman amending Laurier's prediction? Will we perhaps hear him say that the twenty-first century will belong to Canada, or maybe the twenty-second century?
We have been content for too long to let the external forces of world patterns and conditions pull and tug us along. We have been passive instruments, not active movers, shakers and doers.
It is the responsibility of the government to establish the climate in which all this can be brought about, Mr. Speaker, and we hold it responsible. If it cannot achieve this then it should resign and let someone do the job who can.


Some hon. Members:: Hear, hear!


Mr. Ralph Ferguson (Lambton-Middlesex):: Mr. Speaker, I was shocked to hear how members of the opposition described the national energy policy, which was agreed to by the western provinces through negotiation and compromise on all sides. A lot of Canadians may fail to realize that under the terms of the British North America Act and the new Constitution it is recognized that resources within a province come under provincial jurisdiction. When a product crosses a provincial or international boundary, however, it comes within the jurisdiction of the federal government. It is in these areas that an agreement had to be worked out between the producing provinces and the federal government.
I want to make it plain, Mr. Speaker, that the federal government does not set retail prices. It establishes the price paid by refiners for crude, however; that is, the blended price. As of January 1, 1982, this stands at 70.6 per cent of world
price. After a refinery purchases the crude at the blended price, several costs are added to the retail price, such as the cost of refining and of transportation to market. Profit margins for refiners and retailers are often influenced by local competition. And retail sales taxes, a constant 9 per cent for federal taxes, but from zero to 40 per cent for provincial taxes in the case of gasoline. There is no provincial tax on gasoline in Alberta, but in the province of Quebec it amounts to 40 per cent. The breakdown of federal government taxes is 0.72 cents per litre of gasoline for the Canadian ownership charge, with which we have purchased Petrofina, which will be paid for this coming fall. The sales tax is 2.40 cents a litre. The excise tax is 1.5 cents. The upstream tax, including federal corporation tax, is 2.79 cents a litre. The total federal tax per litre of gasoline is 7.41 cents.


Mr. Friesen:: Would the hon. member entertain a very short question?


Ralph Ferguson: At the end of my statement, Mr. Speaker.
I would also like to point out that the petroleum compensation charge returns to the industry. Perhaps Ontario has gone up to 40 per cent in their new budget, but before six o'clock tonight the province of Ontario took 16 per cent, the Government of Canada took 18.8 per cent, and the producing provinces had 12.3 per cent. However, the industry had 42.9 per cent of a litre of gasoline. Add the petroleum compensation charge to the 42.9 per cent, and that would appear to be a very logical division of income from that litre of gasoline that retailed at 39.1 cents per litre.
Getting back to the agreement arrived at last September, it was agreed that, subject to the fiscal undertakings contained in the agreement, it was the intention of the government to set the rate of the petroleum and gas revenue tax at 16 per cent effective January 1, 1982. There would be provision for a 25 per cent resource allowance, and then an incremental oil revenue tax at a rate of 50 per cent on incremental old oil revenues after deduction of related Crown royalties. I wish to point out that in many of the provinces those royalties ran as high as 21 per cent. In the province I come from, where we own our mineral rights, those royalties are 12.5 per cent. For one of the Indian bands which appeared before the Standing Committee on Finance, Trade and Economic Affairs a year ago in March, the royalties averaged 60 per cent. So when we talk about the need for royalties to be reduced, particularly on low producing wells, the need is there. The Government of Canada recognized this because it made an adjustment in its incremental oil revenue tax to compensate for this. This assistance came into effect January 1, 1982, and is known as the low productivity well allowance. It applies to wells which produce less than 3.18 cubic metres of oil per day, or less than 20 barrels. That arose from the comprehensive energy agreements reached with the producing provinces in the fall of 1981. I believe, if my figures are correct, that this will apply to approximately 40 per cent of wells in Alberta and may account
May 13, 1982

for about 10 per cent of the oil produced. It will apply to most of the wells in my own riding, which are very small but very important.
I would suggest that in the administration of this tax there is a need for an agreement with the producers on wells operating in one central collection system, wells which are still in existence today. There should be a special allowance made so that one common gathering tank can be used to collect the oil, and the tax should then be applied on the total, and averaged out over the total number of wells. Some of these wells are more than 100 years old and maybe they are only producing one, two or three barrels a day. It is a very expensive proposition to have a collection tank for each one of these wells, but working out a single system of collection and bookkeeping to administer the tax will be a big help. I have already made submissions to the minister in this regard and he has looked upon them very favourably. I suggest these taxes are not out of line when you consider what is being paid in other countries by the oil industry.
Looking back in history, the North American petroleum industry as it is known today did not begin in Texas or in Pennsylvania; it began in Eastern Canada, my own area. The technology spread into other areas of Canada and around the world. But they had their problems, too. It was back in the late 1800s and the early 1900s that drillers from my constituency went into 70 different countries in the world with their technology to produce the oil. The irony of it was that within a very few years the price of oil tumbled drastically and a lot of those old wells in my area were shut down because of the flood of cheap oil hitting the market, particularly from the United States. The potential is still there because even the fields discovered back in the 1850s still contain approximately 60 per cent of the oil originally discovered. So it is a very positive move on the part of the minister to ensure that the low producing wells had a special tax incentive to allow them to extract the rest of that oil. Perhaps as this is applied to Alberta a lot of the service rigs will go back to work bringing these wells back into productivity.
In listening to the previous speakers, I could not help thinking that theirs is a typical response. I should remind the hon. member across the floor that it was not the federal government which made the production cuts last year which resulted in the increase of oil imports. I would like to make a couple of comparisons. For example, the 1981 annual report of Amoco Canada says:
The federal government's National Energy Program, announced in late 1980, was primarily responsible for a near one-third reduction in both the company's 1981 net income and cash flow. Subsequently, the long-awaited pricing and revenue sharing agreements concluded between Ottawa and Alberta in September, 1981, did very little to improve the company's financial performance. Moreover, the Alberta crude oil production cutbacks, imposed during the ... negotiations, seriously reduced our production during the year. The after-effects of these cutbacks were continuing to impact on our production beyond year end.
The amazing part of the entire report is that drilling and exploratory activities from 1977 until 1981 showed a success ratio which increased from 32.6 per cent to 44 per cent. That was a tremendous increase in the success ratio. Also it is
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amazing that while total exploratory wells drilled were down in 1981, extension and development wells in oil producing sectors nearly doubled in 1981 over 1980. They knew where that oil was, so those were the wells they developed. They developed seven wells in 1980 compared with 13.9 wells in 1981. Their net oil wells increased by 50 wells. By December 31, 1981, there were 901 oil wells, compared with 851 wells in 1980.
Turning to page 15 of the annual report of Imperial Oil, it shows that in 1980 the company had an interest in 35 wells drilled in Canada, and that in 1981 it had an interest in 44 wells, for an increase of nine wells. These were exploration wells to determine the location of oil fields. However, we know that there was a decrease in gas well development. I can understand this because of the thousands of shut-in gas wells in Alberta currently. There is no market for the gas, so they are capped. It is only logical, consequently, that they would concentrate their development in oil producing areas, especially when there is a surplus of natural gas. Perhaps the most telling statement, when we look at the annual reports and compare them, can be found in the 1981 annual report of Imperial Oil. It was the statement of the retiring chairman of the board and chief executive officer, Mr. J. A. Armstrong, in which he said:
The industry is passing through a period of transition but Canada, almost alone among industrialized nations, possesses the opportunity for achieving selfsufficiency in all forms of energy within the foreseeable future. And it is energy development, more than any other industrial activity, that offers Canada the greatest prospects for economic growth. For a resource-rich country in a resource-hungry world, energy development represents a major opportunity and a major priority. And hydrocarbon development, for obvious reasons, heads the list.
The federal government certainly recognizes the importance of energy development to Canada's future. Its growing role in the petroleum industry is to be expected at a time when oil supply has become a matter of national concern. Imperial, for its part, supports many of the objectives contained in the federal government's National Energy Program, in particular the achievement of selfsufficiency in oil.
He was very emphatic that Imperial Oil supports many of these programs. He continued:
And moreover, we have never been opposed to the intent of the program in promoting greater Canadian ownership of the oil industry. It is entirely reasonable that Canadians should play a greater role in domestic energy development.
However, it is reasonable, too, that a proper balance be struck between competing energy objectives. The urgency of energy development and the need for increased Canadian participation in that development, while both important, are very different objectives. Reconciling them represents a significant challenge for both government and industry. Canadianization will certainly reshape the oil industry and can do it in a way that benefits all Canadians.
It is very obvious that the largest of these Canadian oil companies endorses the programs of the federal government in its annual report and is prepared to proceed and expand in coordination with them.
Little more needs to be said in this regard as to the benefits of the program to all Canadians. It is the major thrust of the Government of Canada to ensure that Canadians are in charge of the energy which will shape the future of this great nation. It will allow the companies to work together, not only Imperial Oil but the other companies involved in the search for new

May 13, 1982
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resources, in a way which will benefit all of Canada and the oil industry in particular. When we look at the huge investments required in the Beaufort Sea, the Arctic, Hibernia and other offshore areas, we realize that it will take the joint efforts of a consortium to pool their resources to find new discoveries. We now have the power as a federal government to ask them to drill step-out wells which will determine the extent of the fields, so that Canadians are ensured supplies in the future.
When we look at the projections made back in the early 1970s and at the glut on the market at the present time, we realize that Canadians have a right to know and, consequently, it stands to reason that this legislation is before us in the House of Commons. It ensures that the various taxes are in place, taxes which will allow the industry to expand and to search out new areas to be developed. The present programs are different than the ones of the past.
Earlier I referred to the industry in my own area. In the town of Petrolia alone there were some 600 wells, many of which were drilled but never plugged. As they dried up, they were abandoned. That area can no longer be water-flooded or pressurized, but we must work out new schemes to recapture that old oil. Perhaps we should listen to the suggestions of one of the old pioneers who died about six weeks ago. I am referring to Mr. C. O. Fairbank, whose father once represented the Petrolia area in the House of Commons. One of his ideas was that we need to put down shafts in the shallow fields and run laterals out from there to let the oil seep in without pressurizing it.
The flexibility is in the legislation before the House. It takes into consideration the establishment of a level of tax which recognizes the need of the industry for cash flow. The industry must have adequate funds to do the job. Some activities, notably exploration, cannot be readily financed through debt alone. Either internal funding or new equity capital is needed.
Some members in the industry have suggested, however, that the oil and gas sectors must have the cash flow equal to all their projected capital investment. I find this difficult to accept because there are no compelling reasons why the industry should have such a favoured position, particularly with the returns on the investments, when the returns on the investments even this year are so attractive compared with the returns in other sectors of our economy. For example, I look at the fact that over a few years 2 per cent of that total GNP in the United States was going to the OPEC nations.
We in Canada must be certain that the climate here is as was reflected in the statement by the chairman of the board of Imperial Oil. That climate must be created in order for the Canadian companies to go ahead and expand and develop those resources here in Canada. I was delighted to read last week about the increase in value of the shares of Dome Petroleum in response to another find in the Beaufort Sea.
I would like to draw to the attention of the House that in spite of the gloom and doom that we hear from the other side regarding the megaprojects, it is not only Canada who has had
to postpone such projects. Other countries have also had to postpone projects. For example, there is the Exxon-shale project in the United States which has been stopped. In Colorado the lignite gasification program has been shelved and the panhandle coal gasification project in Wyoming has been scrapped. Mexico has delayed a huge project there, and so has Nigeria. The United Kingdom has delayed some projects in the oil field in the North Sea. The Netherlands is continuing theirs, but their emphasis is on small fields requiring a minimum financial commitment. The British Petroleum Company is turning to less costly equipment as an alternative for its North Sea development. The investment costs per barrel of oil produced is thereby being lowered.
The uncertainty of the world oil market and the pricing uncertainties have led the French to shelve plans to buy 40,000 barrels per day of heavy crude from Venezuela, as well as shelving plans to build a plant in France at a cost of over $1 billion. I suggest that even though the Alsands project has been put on hold. New technology is developing so rapidly that these plants may have been obsolete by the time they were built. Petro-Canada is very heavily involved in the experimentation and development of this new technology. I can only hope that this will continue over the next few years as the Beaufort Sea begins production along with the Hibernia oil. We know that there will be security there not only for the province of Alberta but for all of Canada, and by working together we can create the harmony which has existed since the national energy agreement was signed last September. The achievement of that agreement was a major step, as far as I am concerned, in the development of one of our primary resources that Mr. Armstrong of Imperial Oil described so well in his annual report.
Perhaps I should point out that it has been implied on many occasions that the price of gasoline may be cheaper in some parts of the United States. That may be true if one considers the level of provincial sales tax applied in Canada in various provinces, along with the federal tax. However, when these provincial sales taxes are removed or lowered to a more reasonable level there is very little difference. I would suggest that a litre of heating fuel is cheaper in Canada at the present time than it is in the United States.
I believe that we will have a much more secure future in Canada, with the energy reserves which exist in this country, if we develop them in an orderly manner.
Much has been said about equipment moving south across the border to the United States beginning in September of 1980. I want to make it clear that this exodus did not just start with the introduction of the National Energy Program on October 28, 1980. It started in September of that year. As well, many of those rigs were shallow rigs that could not achieve the depths required for the deeper fields in western Canada. There were also rigs which were left unused because of the thousands of gas wells that are capped owing to the lack of export markets.
It was interesting to note that in the last few months the activity in the United States has dropped off dramatically, and
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the more modern rigs which are capable of reaching the deeper oil in Canada are beginning to return. It is also interesting to note that although some companies are suggesting that they are not renewing leases, they are in fact renewing leases in areas which have the highest potential. The reason for this is the new technology which has been developed for this.
It was only a few years ago that the seismic rigs did not have the capability of producing three dimensional readouts of the formations below the surface. This technology is now available, and I believe that the success ratio, which I referred to in the annual report earlier, demonstrates their present capabilities as compared to a few years ago. Activity is taking place in areas which show potential, and the emphasis is now being concentrated on oil production rather than on production of both gas and oil. No doubt it should be very plain to those in the oil industry and those who follow it very closely that the reason for the decrease in the over-all activity is that this activity has been stepped up in the sector of oil production itself.
I believe that the taxes proposed in the bill we are debating tonight are essential for the continuation and expansion of Canada's oil industry. It is important that the terms of the proposal are set out in the bill so that the oil companies know what lies ahead and that the provinces and the country as a whole know what is ahead of us. These taxes will benefit those Canadians in the provinces that produce oil as well as all Canadians. Taxes have to be expected by the industry involved in this sector.
1 should like to say in summary that when the industry adjusts-as Imperial Oil has shown it is doing in its annual report-and when we realize the potential which is laid out in the annual report of Petro-Canada and the reserves we have, I believe that our objectives can be achieved. This bill is a major step in the right direction.


The Acting Speaker (Mr. Ethier):: Is the hon. member for Surrey-White Rock-North Delta (Mr. Friesen) rising on a point of order?


Benno Friesen: The hon. member indicated earlier that he would entertain a question if there was time left at the end of his speech, so I presume that he is ready to hear me now.


The Acting Speaker (Mr. Ethier):: Order, please. Is that agreed?


Some hon. Members:: Agreed.


Benno Friesen: The hon. member for Lambton-Middlesex (Mr. Ferguson) has an incredible talent for taking the most universal and complex of subjects and reducing it to the most unutterable simplicity. He has again invoked the concept of sharing, just as long as the resource is energy and it is western Canada and central Canada that benefit. However, in his earlier remarks, he indicated that the Canadian ownership charge was being collected in order to pay for Petrofina, which would be paid off this fall.
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I would therefore like to ask the hon. member, is he promising that, after Petrofina is paid off, that tax will no longer be collected, or will it be a temporary tax like the one which was invoked in World War I, called the income tax?


Ralph Ferguson: Mr. Speaker, I am sorry that my memory does not go back as far as World War I, as does the memory of the hon. member across the way.


Benno Friesen: Mine does.


Ralph Ferguson: I heard about that, but I suggest to the hon. member that when the charge of 0.72 cents per litre has been collected to the extent that it has paid for the acquisition of Petrofina, there may have to be an adjustment. If, for example-


Some hon. Members:: Oh, oh!


Ralph Ferguson: -another company has been taken over. I would like to suggest to the hon. member across the way that we understand that the Ontario government may need assistance to help pay for Suncor. It is looking for another buyer to buy out 25 per cent of it. I do not think we should get involved in that one because of the fact that it has paid approximately twice too much, according to a story I read in The Globe and Mail. 1 do not think we can get involved in that with our Canadianization tax.


Charles James Mayer: Six times too much!


Ralph Ferguson: I am certain that if the Canadianization tax is extended to another level for another purchase, we will make a better selection than did the government of Ontario when it elected to buy Suncor for twice as much as its real worth.


Blaine Allen Thacker: Mr. Speaker, it is always a riot to hear the speeches of the gentlemen on the other side because they go on to give the impression to the Canadian people that everything is just hunky-dory and rosy in this country, that the government is not at fault in the slightest degree for the situation in which Canadians find themselves, that everyone is to blame except the gentlemen and ladies on the other side. Well, that does not wash with the Canadian people any more. When the hon. member who last spoke stated that the Canadian ownership charge may come off and then went on to fudge and widget around, he left no doubt that the government will not reduce the taxes of the Canadian people when that is paid off; rather, it will buy out another company because, you see, once it starts on this road to socialization, taking everything over, it cannot have private companies operating because their level of efficiency is so much more superior to that of the Crown corporations that it makes the Crown corporations look bad. Therefore, the government must take it all over. That has been the history in every country in the entire world where there has been socialization.


David P. Smith: They are over there in the corner, Blaine, that is why.


Gordon Edward Taylor: They are over there, across the way.

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Blaine Allen Thacker: Bill C-112 causes me great sadness because there is no doubt that Canada is in deep trouble. I will not state the statistics on unemployment, the position of our dollar or our inflation rate. There is no need to do so because Your Honour knows of them, and so do the Canadian people. But what most Canadians do not realize is that their trust in government is a misplaced trust because it is a trust which has been broken and breached by the Liberal government over some 14 years.
However, let us look at where we are. We sit here, a small number of people, 24 million, on the resources of half-continent. Other countries have huge populations and small resources. They are in trouble, and so they should be in trouble, because the vast bulk of those countries have tried this route to socialism, whether one looks at Sweden, the United Kingdom or at the ultimate in socialization, which is Russia and the East bloc. Most of those countries were wealthy countries at one time. Indeed, if one looks at Roumania, Poland or Russia, one finds that they were exporters of food until they became socialized, which simply means that the decisions are made by a small group of people.
That is what the National Energy Program does. It takes that huge oil industry which we had, where millions of individual decisions were made throughout the course of the year, where there was instant adaptability to changing climate, circumstances and finance in the world and all the other items of change, and it brings that decision-making to Ottawa. We now have a small cabinet which is really inundated with so many other concerns that it honestly cannot make those decisions, and we also have a bureaucracy which is totally isolated from the reality of the world. Those people in the cabinet are making decisions. Of course, it has not worked in any other country in the world, and it will not work here.


Mr. Orlikow:: Mr. Speaker, 1 wonder if the hon. member would permit a question.


Blaine Allen Thacker: Mr. Speaker, I would be delighted to answer any question at the end of my comments.
Mr. Speaker, why, in 1982, do we find ourselves in this situation, and particularly why, in 1982, do we find that during the last fourteen year period-although it is true that inflation has affected the entire western world-Canada, with its small population and its vast resources, has dropped from third to thirteenth place? Now, hon. members opposite never talk about that, but the reality is that they have taken this great country, this small number of educated, ambitious, pioneering people, and they have reduced us from third to thirteenth place. Why is it that Japan, comprising 114 million people, sitting on a rock in the middle of an ocean, has done so well?


Mr. Rose:: Feudalism.


Blaine Allen Thacker: It is not because of feudalism. It is feudalism which has destroyed this country because, as the hon. member knows, we are taking over land, we are expropriating the oil industry, and we are reducing people to slaves.


An hon. Member:: Tell us about PWA.


Blaine Allen Thacker: The reason for this has been the result of the last 14 years. Of course, it is because we have been engaged in a process of socialization. Our friends to the left in the NDP have effectively been the government of this nation.


David P. Smith: Nonsense!


Blaine Allen Thacker: Well, they have been. Why has the Canadian ownership charge gone up so much? Why do we have 400 Crown corporations? Let me tell Your Honour why Crown corporations do not work. Not only are they inherently inefficient because they do not have to meet and face their shareholders, but they also have a permanent pipeline into the public purse. We know that if 400 corporations were set up in private industry in all of the areas in which the Crown corporations are now operating, at least a third, and probably half of them, would be gone because of the natural cleansing process of the marketplace. In the marketplace, the inefficient are weeded out, those with bad management are weeded out, and if some other company comes up with a new process, it takes over if it can produce the product more cheaply.


David P. Smith: Tell us about Suncor.


Blaine Allen Thacker: But not one of these 400 Crown corporations has ever failed, because to become a Crown corporation and take from the public purse means you never have to say you are sorry. You do not have to meet the test. Therefore, what happens? The industry is permitted to continue, more money is poured in, which it never saves in the long run, and it builds up such a massive load that when it collapses tens of thousands of people lose their jobs.
The most recent example was in Nova Scotia where, in order to save jobs, the government became involved in SYSCO, turned it into a Crown corporation and kept pouring in money. I guess in SYSCO's case it amounted to something like $1 million a day or $1 million a month, but it finally came to an end. So all of a sudden, thousands of people were laid off. Under the market forces, where government is not keeping companies, there is a constant cleasing at the bottom. But those people can be absorbed because they are usually from smaller companies.


An hon. Member:: That's what happened to Chrysler and Massey Harris.


Blaine Allen Thacker: Absolutely. To the extent that the government keeps Chrysler going-


An hon. Member:: Thirty thousand people out of work.


Blaine Allen Thacker: Yes, sir, we will keep them and then drop them, all at the same time, perhaps when we have 15,000 or
20,000	going.


David P. Smith: What is your position on Petro-Canada this week? Are you for it or against it?
May 13, 1982


Blaine Allen Thacker: The hon. member opposite speaks about Petro-Canada. There is no doubt that it will succeed. It will succeed if it has to take every last tax dollar out of every last Canadian's pocket. As the last speaker said, they will not do away with that tax. They will purchase another company. They must take away all private companies because they set up a competitive position which makes Petro-Canada look sick.
We have over $2 billion in Petro-Canada, and it cannot make it on the open market. If we were not kicking in $400 million a year and $800 million for the purchase of Petrofina, PetroCan would be gone. It cannot compete. It would not be able to compete if we were in government. It does not matter which is the label of the government. It is just an inefficiency that is inappropriate, particularly in the oil and gas industry.
The Canadian people will learn a lesson in the co-operative movement. The government has offered to the co-operative movement $100 million if it will kick in some money and set up a co-operative oil and gas company. I predict with absolute certainty that the members of a co-op will suffer a terrible loss.
The oil industry is not like the airline industry to which you give routes. All it has to do is to buy some planes, put some people on them and fly back and forth. You can do away with competition, as was done with Air Canada.


An hon. Member:: What about Pacific Western?


Blaine Allen Thacker: Canadian Pacific cannot get in. They can make it work, but the oil and gas industry depends on people with creativity, people who are prepared to work 18 and 20 hours a day. You do not get that in a Crown corporation. Members opposite can laugh, but I am confident that in a few months or years Canadians will come to realize that.
I want to deal with some comments made by previous speakers. The hon. member for Lambton-Middlesex (Mr. Ferguson) seemed to imply that the producing provinces totally agreed to all of the provisions in the agreement which they signed and therefore were in favour of the federal taxes. That simply is not the case. The province of Alberta had a position to protect its citizens in their capacity as owners of the resource. The federal government had a position to protect what it thought was the national interest. They negotiated and ultimately came to an agreement. Albertans were party to that agreement only to the extent of protecting Albertans as owners of the resource and were in no way condoning all the federal taxes.
They really had no choice because the federal government had unilaterally come out with a National Energy Program which said it would do this and this and this. The provinces had no choice because under the Constitution the federal government was really intruding into provincial jurisdiction. For example, these taxes were put on as a royalty, so the provinces had no choice but to defend themselves. That led to a stalemate. Months and months passed, and finally a mutual agreement was reached under which the citizens of Alberta
Taxation
were satisfied with the royalty portion they were keeping. That does not imply they were in favour of the federal taxes.
The hon. member for Lambton-Middlesex pointed out that the blended price is now 70.6 per cent of the world price. Canadians now pay 70 per cent of the world price to the owners of the resource, but the retail price is much higher than in the United States. In the United States, they give the owners 100 per cent of the world price, and yet their retail price is less than ours. The difference, of course, is in the taxation.


Mr. Kelly:: It is provincial.


Gordon Edward Taylor: There is no tax in Alberta or Saskatchewan.


Blaine Allen Thacker: I know my facts. If the backbenchers on the other side had been doing their job for their constituents, they would know the facts. The difference is in taxes, provincial and federal, which means that Canadians are paying more.
In the United States there is an excess profits tax. If the world price goes up and the cost of producing the resource does not, there is an excess profit which the U.S. government taxes away to the benefit of its citizens. When the world price drops and there is less profit, there is less tax. We have not chosen to do that in Canada. We have a fixed tax. Whether the price is up or down, a Canadian citizen must continue to pay that price. That is why our retail price is more than in the United States.
Let me give an example. In Ontario the price per gallon was recently $1.67. Of that, 22 cents went to the people of Alberta as owners of the resource. That was the royalty, 22 cents. The Ontario government took 25 cents by way of a tax. The people of Ontario and other provinces need to know that their provincial governments are taxing oil and gas being sold at the pumps. That 25 cents is more than the owners receive, an interesting point.
Let us look at the federal tax. Why is the federal government taxing the purchaser 53 cents on a gallon of gas which sells for $1.67? That is regressive tax. That is not part of the progressive income tax system where the rich pay more than the poor. When you put a tax on a gallon of gas of 57 cents, it hurts the poor much more than those of us with a higher income.
The federal government is not prepared to tell the people that it has increased taxes. It is trying to sneak it in. My job as an opposition member is to bring that out. I hope people will remember that, particularly those in the province of Quebec, because they will be hurt. Later in my speech I will point out that if there is a war in the Middle East tomorrow, the people in the Atlantic provinces and Quebec will be the first to be hurt.
Of that $1.67 per gallon, 63 cents goes to the industry, the searchers, producers, refiners, distributors and retailers. They receive 63 cents. The government, which does not do one stitch, not one thing, receives 57 cents, more than twice what the owners receive.

May 13, 1982
Taxation
The hon. member for Lambton-Middlesex referred to the United States megaprojects that are being cancelled. The reason is that so much conventional oil has been found. They can cut back their megaprojects because they float. One thing about the Americans, they have the ability to cut and bleed and get on with it. Because of our government trying to solve every problem for every citizen, it does not work in Canada.
I want to make some comments in response to the Minister of State for Finance (Mr. Bussieres). I was astounded at his admission, which was the first I have ever known. He said this is tax by regulation, and the reason is that it gives the government more flexibility to quickly increase taxes. That is exactly what he said. It is true. It gives it the power to increase taxes by a minister signing a piece of paper. Never will those taxes come before this House for review, nor will they therefore, they hope, get out to the Canadian people. Sir, it is a gimmick to avoid facing the people with taxes. When you think about it, the whole purpose of Parliament originally, the entire and sole reason for Parliament, was to control the purse, so that the ruling governments, which in those days were the monarchs, would have to come to the people to get the money.


Benno Friesen: Quite so.


Blaine Allen Thacker: Well, we are being thrown back in time because the Liberals, for a while at least, are going to avoid it. Then he too went on to imply that the Alberta government had agreed to all the federal taxes. Of course, as I pointed out earlier, that is absolutely untrue. When the Premier of the province of Alberta signed that agreement he was not agreeing to the federal taxes. He was saying in effect that that was their jurisdiction, that "Canadian people will have to deal with the federal government for those taxes, the Alberta people will have to deal with me with respect to the royalty." And he did a good job for the people of Alberta.
The Minister of State for Finance went on to say that the Canadian tax regime is approximately equal to that of other countries, and therefore the Canadian oil companies should be happy. If that were so, Mr. Speaker, why is it that there were some 275 oil rigs leaving this country? If our tax regime is so good and so comparable, why did they leave? It costs hundreds of thousands of dollars to pack up a rig, take it across the border, then get it established, buy more leases, and enter into agreements. It cost a lot of money. Why did they go? The truth is that the tax regimes are not the same.
We have had a substantial change because prior to the National Energy Program, we used to encourage industries, through tax deductions or tax credits, whichever we felt were best, and we would bring in a tax deduction for an oil company doing some work. Any company could therefore go out, do the work and get the benefit of the tax deduction. Now the National Energy Program has changed that. All of the tax money is being collected in Ottawa and the money will then be given out, depending on whether the Liberal government and its bureaucracy decides the company is deserving. What will be the test? The test will be, "Where are you going to drill?"
If you are going to drill in Alberta, you are not going to get very much. If you are going to drill up in the Beaufort on federal land, you are going to get a lot. So taxpayers from the province of Alberta, for example, will be paying tax dollars to Ottawa. If a company wants to work in Alberta, they are not going to get the same grant as would a company going to work on other land, like federal land. That is inherently unfair, because under the tax deduction system the company made the decisions based on where the oil was and where they could get at it. So that is a substantial change, and it will mean less oil production.
The point that is really interesting to me as an Albertan is that prior to the National Energy Program, even though the manufacturing industry in central Canada was having some problems and needed to have federal government help, we had one part of our country that was really going flat out. That was the oil and gas industry in the western basin, moving up into the Arctic and moving off to the offshore on the east coast. That industry was providing tens of thousands of jobs, not for Albertans, Mr. Speaker, because we do not have very many of our own people, but providing jobs for boys and girls from Ontario, Quebec and the rest of the country. We were becoming more unified as a result of that. We were mixing, and it was great.
Now that is all over. As a result of the National Energy Program, the rigs leaving and people not drilling, the Alsands and Cold Lake being cancelled, it is the Ontario young people and the young people from the rest of the country who are now having to go home without a job. The spin-off benefits of the Alsands, where there would be pipe produced in Ontario, equipment and clothes in Quebec, rail cars and pipe in Nova Scotia, are no more. It is not there, Mr. Speaker. Those people are losing their jobs. So it is ironic that, to express a very selfish Albertan point of view, for Alsands not to go on is in the best long-term interests of the people of Alberta. If it is not used by our generation, it will be there for our children, our grandchildren and our great grandchildren. Alberta was prepared to have all of that oil produced. Even with our conventional oil, it would be best if Albertans could leave that in the ground. But they are not doing so, because, in the Canadian dimension, they are producing 1.2 million barrels a day to send it down the pipeline for the rest of Canada. Even at 50 per cent of the world price, that has built up the Alberta heritage trust fund. Alberta could have decided to hold production down, because the Constitution permits that, just export 200,000 barrels a day and keep the remainder for Albertans for the rest of all time. But that is not right. So they built up the heritage trust fund.
That brings me to the next point. The Minister of State for Finance was indicating that Albertans were somehow greedy because they had built up that heritage trust fund. Mr. Speaker, that heritage trust fund has helped the rest of Canadians in several ways. First, it is a source of money that other provinces could come and borrow. It keeps the interest in the country, as
May 13, 1982

against having to go outside the country to borrow the money, which means more dollars flowing out of the country.
Second, several billions of dollars of that heritage trust fund has gone into the Alberta home mortgage corporation, which lends that money out to Alberta citizens to build their homes. That means that there is more CMHC money available for other Canadians. The same occurs with the Agricultural Development Corporation. It uses Alberta heritage trust fund money, and that means that there is more money through the Farm Credit Corporation to other provinces. In that sense, it is a major help. If it were not for the heritage trust fund, more money would have had to flow into Alberta and there would be less available for other provinces.
Then what happens, Mr. Speaker? When Albertans have money, just as when Newfoundlanders have money, they buy a car. Where is the car produced? In Ontario. So you get this tremendous mixing. I was a member of the fiscal tax force and even the four Liberal members sitting on that task force joined us in agreeing unanimously that the Alberta heritage trust fund was in no way a detriment to this country and that the existing economic links would recirculate that money so that we would all benefit a great deal.
Mr. Speaker, I challenge the Minister of State for Finance to rise in his seat and tell me that if the oil and gas were located in Ontario or Quebec, or in both provinces, we would have the same National Energy Program. I can tell you, Mr. Speaker, there is not one way that one of those members opposite can stand and honestly say that if the oil and gas were in Ontario and Quebec we would have the same National Energy Program. Their people would not permit it. The only way they can get away with it is that it is in the west, in Alberta, with only 21 members, and while we stand here and try to explain to them the problems it is causing, it does not affect them because they do not have their own constituents there. That was true at least until a while ago. I think their constituents are going there now. The young men and the young women who went west to get jobs found no jobs there. I hope they are in yelling and screaming, because it is just not right. It should not be. If members opposite want to come with me, I will take you out and I will introduce you to people who have lost their jobs, to men and women who have put 20 and 30 years of their lives in building up a small business, only to have it smashed. Those are human beings, Mr. Speaker. Those are hot, living bodies out there that have lost it. They would not have lost it, if it were not for the National Energy Program.


Gordon Edward Taylor: Right on. All we have is empty seats on the other side.


Blaine Allen Thacker: Mr. Speaker, what have we got? Canadians need to know exactly what the government has done. In fact, this bill tonight contains three new taxes, but it is part of seven taxes that are increasing the burden of Canadians at the grassroots level. These are regressive taxes which are being levied on people. We have the PGRT, the IORT, the NGGLT, the COC, the PCC, an excise tax and a sales tax. There are seven
Taxation
individual and separate taxes which are coming out of the pockets of Canadians directly.
The whole National Energy Program is based on a false model designed by intellects who have never had to meet a payroll in their entire lives. The officials in the Department of Energy, Mines and Resources, and the minister himself, have never gone out and operated a business. They have never set up a business. They have never had to hire people. They have never had to produce. They have never had to pay people at the end of the month. They have never had to pay workmen's compensation premiums or unemployment insurance premiums. They have never had to make income tax deductions and Canada Pension Plan deductions. They have never had to stay up until midnight filling out their own papers. They are indulging in an academic, intellectual exercise. At will, by signing a paper, they can increase the workload of people in the field.
While it saddens me that Canadians have to do this, I am pleased they are starting to fight back, and they are fighting back in several ways. They turfed out a government which believed government should take everything unto itself. They turfed out the government in Saskatchewan. That government was buying land from people and denying them the right to own property. That government was nationalizing and creating Crown corporations. That government was into every conceivable type of business but still taxing the people because Crown corporations did not have to say they were sorry and therefore kept coming back to the Saskatchewan provincial purse. The government kept kicking in tax dollars until finally people said, "Enough".
When I was in Saskatchewan and knocked on doors for three days during the election campaign, it was a genuine pleasure to hear people say, "We have had enough." They wanted to turf the government out, and they did.
Canadians are beginning to rebel in another way, and I think that is just great because the ultimate way to stop a government is to stop the flow of tax dollars. Hon. members will have noticed that the underground economy is expanding enormously. At a time when we do not really need much cash because there are so many credit cards-and they are used- the use of cash in our society is growing enormously. The reason is that people want to be paid in cash because in an underground economy no taxes are paid. While that is unfair in the sense that other people are paying their taxes, it is a sign that people are waking up and saying "No". Rather than doing that, I encourage people to wait until the next election and put in a party and a government which would not take everything away from them.
As hon. members have heard me say previously, a slave is simply someone who is taxed 100 per cent in the sense that someone else makes decisions as to the human rights of that slave, where he lives, where he works and where he sleeps. As an economic creature, a slave is simply taxed 100 per cent. All that person's economic rent goes into the hands of someone

May 13, 1982
Taxation
else who decides how it is spent. That is exactly where we are because when we add up our municipal taxes, our provincial taxes and our federal taxes, we find that over 55 per cent of the sweat of our brows goes into the hands of someone else who decides how to spend it. That is the major difference between the parties in this House. The party to the left, the NDP, clearly would tax away 80 per cent or 90 per cent, as is done in the socialist countries of Sweden and the United Kingdom. In places like Russia and China 100 per cent is taxed away. Hon. members opposite in the Liberal Party now believe in the same thing. They want to take away so that they can pay back in the form of grants. This party would not do that, and this party will be a real alternative in the next election.
This bill deals with the goals of the National Energy Program. First, the bill deals with self-sufficiency. That goal has been lost, and that is a tragedy because Canada continues to use about 1.7 to 1.8 million barrels of oil a day. We were getting about 1.2 million barrels a day of Alberta light crude, and we were getting about 200,000 barrels of synthetic crude per day from Alberta's tar sands. We were importing about
400,000	to 450,000 barrels a day. We are still faced with the reality of importing 400,000 to 450,000 barrels a day and, if there is ever trouble in the Middle East, that supply will be cut off and we will be exactly where we were in 1978 during the last Middle East crisis when suddenly we realized we were exposed. When the OPEC increased the price, we were caught. We had no choice but to pay the price. If we were self-sufficient, we would not give a hoot what the rest of the world does. If the OPEC were to put its price up to $500 a barrel and if we were self-sufficient, we would decide how much we would pay in the Canadian interest.
But we are not there. We are still importing, and that is how we are getting ourselves into a real jam. If there is a war tomorrow, the people in the Atlantic provinces and Quebec will be cold. They will be cold because we will not be able to get oil to them.
Alberta's offer was incredibly generous. What Alberta said then was: "Pay us, as owners, up to 85 per cent of the world price, and we will guarantee that with that money we will put those tar sands plants in." As our conventional crude supplies dropped, as they are dropping even this year, Alberta would have guaranteed there would be synthetic oil in production to offset that, as well as to cover imported oil. Alberta also guaranteed that the extra money would be used in Manitoba to develop the hydroelectric project on the Nelson. Alberta guaranteed it would go into Quebec and Newfoundland to develop their water resources in the north so that we could be self-sufficient in all forms of energy. Well, that is gone, and it is a tragedy because it need not be gone. We as Canadians could be self-sufficient, and should not have to be beholden to anyone. No form of blackmail should get us.
The next goal of the National Energy Program was Canadi-anization. When the Liberal government, now in its socialist form, talks about Canadianization, Canadians should never be fooled because the government is not giving Canadians a chance to buy shares. Indeed, it is expropriating shares from
Canadian citizens. Many Canadians held shares in Petrofina. Those shares were expropriated. Many Canadians held shares in Altantic Richfield. They were expropriated. Many Canadians owned shares in Pacific Petroleums. They were expropriated. The Liberal-NDP coalition kept the right of property out of the Constitution because if we had the constitutionally entrenched right to ownership of property-and that includes shares-the government could not under the Canada Business Corporations Act, expropriate our shares because the clauses of the Canada Business Corporations Act dealing with that would be null and void. The government would have to buy my shares. It would have to negotiate with me. If it gave me enough money, of course I would sell, but the government could not take my shares away. We do not have the right to own property because that would block nationalization.
The Liberals agreed on a Friday to include the right to own property. The next day the Leader of the New Democratic Party (Mr. Broadbent) held a press conference and told the Prime Minister (Mr. Trudeau) that if he continued to propose the inclusion of the right to own property in the charter, the NDP would withdraw its support. The Liberals came crawling back on the Monday following. Having agreed to include the right to own property on the Friday, the Liberals withdrew that right and used their majority. In the next election campaign there will be a plank in my party's election platform proposing to give the people that right, and then they will truly have that right.
What has been the effect of his great Canadianization? Let me give exact figures. They are truly astounding. The amount of money which has left this country to purchase the shares of foreign-owned companies is $5.3 billion, the amount which has left this country by way of take-over when Canadian companies have borrowed money in the United States, primarily to buy other companies, was $4.9 billion. Then there was an unidentified outflow of some $8.4 billion, for a total cash out flow of $18.6 billion. Let me tell hon. members why $10 billion went out. We had foreign ownership of shares. The cost of those shares was a dividend, the long-term average of those dividends was 3 per cent to 5 per cent. It must be remembered that a dividend is only paid if a company is making profit. In good years you would lose the dividend and in bad years the dividend would stay because one would not be declared. What we have effectively done with $10 billion is to convert that from foreign equity ownership into foreign debt, on which we pay between 15 per cent and 20 per cent. So whether it is a good year or a bad year, 15 per cent to 20 per cent of that $10 billion goes out just to service it. That does not count the $10 billion for the principal, and that is the tragedy.
We have already been through this during the 1920s and even before, when most of Canada's foreign ownership was in the form of debt. A great intellectual exercise went on at that time when the bright boys of the day decided that because the interest flows out in good years and in bad years, the debt had to be converted into foreign equity, and then a dividend would
May 13, 1982

just be paid in the good years. That is why we have foreign ownership today. Now we are doing exactly the opposite and turning it back into foreign debt and facing that hemorrhage of money.
There is another figure that must be considered, Mr. Speaker. At the present time $31.4 billion short-term speculative money flows into Canada. That is the international, Arab, petroleum, energy money-the petro-dollars, the international banking community money. It is the capital market that flows wherever the investment is best. In order to keep that money here and to protect our dollar, we have had to increase our interest rates to 15 per cent or 20 per cent. That is why Canadians are hurting today, Mr. Speaker. We lost all our direct investment money, $18 billion of it, and we have had to bring in $31 billion of speculative money.
That money would be gone by noon tomorrow if some other country offered an extra 2 per cent interest. That would justify cost and we would be left holding the bag. That is why we are forced to keep our interest rates up. It is not because of anything that the people of Canada have done wrong; it is something that the government has done to them. People should remember that is was done by a Liberal government.
I could go on for a long time talking about this, Mr. Speaker, and 1 could deal with the comments of the hon. member for Vancouver-Kingsway (Mr. Waddell). We can see how his speeches have changed, Mr. Speaker. He is beginning to understand the enormous loss being felt in the oil and gas industry. He is starting to realize that this represents jobs and that when a company in Alberta, Saskatchewan or B.C. is hurt, people in Ontario, Quebec, and the rest of the country are also hurt. I think the hon. member will be able to make a positive contribution to this debate soon, because he is beginning to see the ramifications of all that his colleagues are advocating. Many of them sit there laughing and smiling, but they should remember that it is their constituents who will be put out of work.


Some hon. Members:: Hear, hear!


An hon. Member:: Continue.


The Acting Speaker (Mr. Ethier):: Order, please. The time allotted to the hon. member has expired but he can continue with unanimous consent.


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: There is not consent. [Translation]


Mr. Pierre  Gimai@: Mr. Speaker, I should like to go back to some of the most interesting points made by the hon. member for Lethbridge-Foothills (Mr. Thacker) during his speech-a very good speech indeed-for which I congratulate him.
I think the first good point he made and that I was glad to hear, for having heard it often during my first year here in this
Taxation
House, is that because of what happened with the Alsands project, the Alberta people are going to keep the oil from the Athabaska oil sands and sell it later to Canadians. That is the sort of nonsense which members of the Progressive Conservative Party kept repeating the first year I sat in the House. They used to say that the main reason for raising oil prices to world levels and making fuel oil and gas more expensive for Canadians was to teach them to conserve it for the future so that future generations of Albertans might get higher incomes; well, last week, the official opposition turned this argument around and insisted on an emergency debate on this issue. It was somewhat strange, because they seemed to realize all of a sudden that the Alsands project had been set aside temporarily, owing to the fact that Canadians have learned to develop and use other sources of energy. What makes it even more surprising, as I said at the time, is the fact that Canadians had just learned from Premier Lougheed himself that Alberta oil did not belong to them, something he confirmed by reducing oil production first by 60,000 barrels a day, and later by
120.000	barrels a day. With that information, and having been told by the Leader of the Official Opposition, the right hon. member for Yellowhead (Mr. Clark), that oil had to be expensive-


Thomas Gordon Towers: Mr. Speaker, I rise on a point of order. I wonder if the hon. member would clarify one point. He said, "When the premier of the province of Alberta found out that the oil did not belong to the province of Alberta-". I wonder if he would clarify that point for me?


Mr. Pierre  Gimai@: What I mean, Mr. Speaker, is that while negotiations were in progress between Alberta and the Canadian government, the Alberta government twice cut back oil production and oil sales to the rest of Canada, the first time by
60.000	barrels a day and the second time by 120,000 barrels a day. These cutbacks proved beyond the shadow of a doubt to the Canadian people that the oil locked in Alberta's subsoil belongs, not to Canada, but to the people of Alberta, and more specifically, that it is controlled by the Alberta Premier, who may decide tomorrow morning, if he so wishes, that Alberta will not produce one more barrel of oil. This is what I was trying to say. That is the obvious reason why, from that moment on, the national policy established by the government to promote alternative forms of energy suddenly snowballed. All the people in eastern Canada come to the conclusion that since the Arabs could stop shipping us oil tomorrow morning in the case of a war and since Peter Lougheed could decide tomorrow morning to stop piping oil from the west, it was essential to turn to alternative energy sources. Many of my friends back home have installed wood-burning stoves. Many others have converted to electric heating. Still others have installed windmills to generate electricity, have turned to all

May 13, 1982
Taxation
sorts of other means, have added to the insulation in their homes and have benefited from the federal programs, with the result which seems to surprise the members of the official opposition seem to be surprised that we are now using much less oil in eastern Canada today than 10 years ago. Much less!
That is quite normal, and it is a logical result of what the official opposition party, the Progressive Conservative Party, wanted. As the hon. member for Lethbridge Foothills has just said, oil prices had to increase because Alberta must keep some for future generations. He has just said so himself. This is what we were told two years ago in this House. I remember hearing with my own ears that Canadians would have to learn how much oil costs. Members opposite are now surprised, Mr. Speaker, to see that Canadians are aware of the high costs of oil and that they are now using less oil, and these members now are requesting emergency debates because a project has been postponed as a result of this decrease in demand in Canada. I find this to be quite normal, and personally, I am grateful that it should be so, that we should be able to keep some oil for the future. I am very happy about that. Because actually-


Gordon Edward Taylor: Mr. Speaker, I rise on a point of order. The hon. member for Lethbridge-Foothills (Mr. Thacker) did not say anything of the kind. What we are saying is that they are importing 400,000 barrels of oil and-


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


Mr. Pierre  Gimai@: Mr. Speaker, in any case, the facts show that Canadians are using less oil than before. I heard some members talk about oil prices earlier. I heard someone mention a figure of 57 cents per gallon of oil in federal taxes. I tried to do a little arithmetic, Mr. Speaker. I have always known that there are 4.54 litres in one gallon of oil. At the present time, federal taxes per litre of oil are as follows: an ownership tax of 0.72 cents, a sales tax of 2.4 cents, an excise tax of 1.5 cents, and 2.79 cents for what is known as upstream taxes. This makes 7.41 cents, times 4.54 litres, which comes to the tremendous amount of 33.64 cents in taxes per gallon of oil. This falls mighty short of 57 cents a gallon, Mr. Speaker.


The Acting Speaker (Mr. Ethier):: Order, please! It being ten o'clock, under the provisions of the order made on Friday, May 7, 1982, it is my duty to interrupt the proceedings and to put forthwith all of the questions necessary for the disposal of the second reading stage of the bill now under consideration, without further debate or amendment.
Is it the pleasure of the House to adopt this motion? [English]


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Ethier):: All those in favour will please say yea.


Some hon. Members:: Yea.


The Acting Speaker (Mr. Ethier):: All those opposed will please say nay.


Some hon. Members:: Nay.


The Acting Speaker (Mr. Ethier):: In my opinion the nays have it.
And more than five members having risen:


The Acting Speaker (Mr. Ethier):: Pursuant to the order made earlier this day the recorded division stands deferred until 3 p.m. on Tuesday, May 18, 1982.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Benno Friesen: Mr. Speaker, hon. members will know that for some time now I have been exploring the implications of the emergency planning orders as documented in The Canada Gazette of June 10, 1981. Among other things, the Minister of Energy, Mines and Resources (Mr. Lalonde) is empowered in peacetime to nationalize the energy industry in Canada. The minister of Industry, Trade and Commerce (Mr. Gray) is empowered to nationalize the means of production in Canada. These immense powers given to various cabinet ministers are of growing concern to me and, according to my mail and that of many other members, to Canadians all across the country. That is why ten days ago I rose to ask the Minister of Employment and Immigration (Mr. Axworthy) questions regarding the implications that order had for his portfolio, and therefore all Canadians. As I pointed out at the time, he is empowered to, "establish a population register for the effective management of manpower and arrange any required international manpower transaction." I emphasize, Mr. Speaker, that those are peacetime powers being given to the minister under a very loose definition of what constitutes an emergency. In answering my question, if you can call it an answer, the minister said:
-that any time there is a major catastrophe that would affect this country, there are obviously international implications in terms of the movement of workers and movement of people across borders.
May 13, 1982

I ask, Mr. Speaker, what constitutes a national emergency which would have those broad international implications? Suppose there were large scale floods. Is that big enough to call for an international transfer of manpower? Suppose there were an earthquake of massive dimensions in Canada. Should that empower the minister to register all manpower in Canada and transfer them to other sovereign countries in the world? Suppose there were a drought for several years in Canada as we experienced it in the 1930s. Is that enough of a catastrophe to justify empowering the minister to register everyone in Canada and then ship them out of the country? The specific question is: what kind of an excuse does the minister need? Under what circumstances does a domestic national emergency call for the Minister of Employment and Immigration to transfer Canadians to another country? These are the bizarre implications of the emergency planning order.
When the Solidarity union in Poland faced military rule, and in fact the entire country was under military rule, the Prime Minister (Mr. Trudeau) said that the demands of Polish workers were "excessive". I came across a quotation in the Solidarity union weekly newspaper which I should like to read. It indicated what might transpire as follows:
Militarization of work enterprises which converts bureaucratic directives into commands; military courts replace civil courts; all union activities as well as activities by other organizations and associations are terminated; all public gatherings outside of religious observances are outlawed; the censorship law is suspended, which means a position of arbitrary censorship could include the proscription of any publication; limitation on freedom of travel out of the country as well as-attention-movement within the country.
This was published by Solidarity workers two days before the imposition of martial law in Poland.
Several months ago in committee I asked the Minister of Justice (Mr. Chretien) whether a general strike would be enough to impose the emergency planning order in Canada. He said, "If it got serious enough, yes." That is an implication of bizarre proportions. On that same day I asked the Minister of Labour (Mr. Caccia) whether, according to the emergency planning order, he was able to regulate and control conditions of work, rates of remuneration, and occupational safety. Again, this is a peacetime power, and the Minister of Labour is able to abrogate all union contracts and is able to deny workers the legitimacy of union agreements which have been arrived at. I want to point out that the powers given to the Minister of Labour under peacetime are nothing short of dictatorial. At the time the Minister of Labour gave an even more alarming answer. He said:
Until that emergency situation appears on the horizon, the integrity of collective agreements will prevail.
What does he mean?


The Acting Speaker (Mr. Ethier):: Order, please. I interrupt the hon. member because his allotted time has expired.
Adjournment Debate


Joseph Roger Rémi Bujold: Mr. Speaker, we all know the interest taken by the honourable member for Surrey-White Rock-North Delta (Mr.Friesen) in the issue of emergency measures. It must be said however that, by itself, the emergency planning order gives the minister no authority to establish a population register nor arrange any emergency international manpower transactions. Those are the responsibilities of the national emergency manpower administration that can only be formally established in cases of serious national emergencies. And even then, the enactment of such an emergency act remains a prerequisite.
Section 5 of the order only requires the minister to develop and update appropriate plans and duties for the establishment and operation of the above-mentioned administration. It does not empower him to exercise responsibilities, powers and functions mentioned in the appendix to the order. The same goes for labour conditions, pay rates, work safety and labour relations, that would be the responsibility of the above-mentioned administration.


AIRPORTS-(A) POSSIBLE CHANGE IN STATUS OF DORVAL AND MIRABEL AIRPORTS-(B) REQUEST FOR INDEPENDENT EXAMINATION
Mr. Ian Watson (Chateauguay):: Mr. Speaker, in the answer he gave yesterday to my question dealing with a possible transfer of services from Dorval to Mirabel, which was directed to the Minister of Transport (Mr. Pepin), and in which I asked for a genuine consultation process with all the interested parties, namely the air transport industry, labour, Montreal businessmen and above all the public, the minister answered, and I quote:
It may well be that we shall have a public process of consultation on the decision I shall recommend to cabinet, but the decision has not yet been made.
If I read his answer correctly, this means he will first make a decision, then a recommendation to cabinet, and after that we might have that public consultation process.
This is just not good enough. What kind of a democracy are we living in when the minister, in a matter which is as important as this to a population of some two million people, is beating around the bush with regard to the question of a full public consultation with the air industry, businessmen of Montreal, the travelling public and the unions who represent the workers who may have to move from Dorval eventually? What is the problem with a consultation process? Is it because the department is afraid to have a full public consultation process? Are they are afraid of the facts?
I am absolutely amazed that we are faced with the situation where several options are being presented to the public while

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Adjournment Debate
another one is being presented to a particular segment of the public. They are the 33 mayors from the north side of Montreal who, as well as members on this side who are supporting that Mirabel effort, have legitimate local interests. However, that local interest is certainly not anywhere near as important as the more general interest which exists on the part of the vast majority of the people living on the island of Montreal and on the south shore opposite Montreal in the continuing full use of Dorval airport for domestic and North American service.
Under the circumstances, we are finding that the options that are being presented are limited. The two most important options are not even being considered. Those two options are the status quo or the closing of Mirabel altogether. If options are going to be considered, these latter two are legitimate and must be considered and be part of any public consultation process.
Finally, I think we should review the history of Mirabel for a moment. I was aware of and supportive of the political reasons for the construction of Mirabel airport in the first place. There were technological reasons advanced for it at that time: noise reduction and the argument that Mirabel would be the gateway for freight transfer and passenger transfer to the rest of North America. Technological developments have bypassed Mirabel. Sound has been reduced by two thirds, and aircraft can now fly almost twice as far. Therefore, flights from Europe can go to the centre of North America or even the North American west coast. The dream of Mirabel as a gateway to North America has gone forever.
The present reality is something quite different. Mirabel is there and we are losing in the order of $25 million a year in operating costs. That is regrettable. If we want to be totally hardnosed, I guess we should shut Mirabel down. At the moment I think we can consider leaving it open, hopefully, because the present passenger traffic, something which not even the so-called experts in the department could have predicted, will increase. However, I doubt that it will happen to the point where it would justify the full use of Mirabel.
We are now in a situation where it has been suggested that we replace the present $25 million operating loss with an expenditure of some $400 million at least, $200 million from the public sector and another $175 million or so from the private sector. The interest on that alone is two or three times the present operating costs of Mirabel.
There are other items here that we have to mention. The travelling public in Montreal certainly do not want the move. Business in Montreal certainly does not want the move. Twenty minutes may seem a minor amount of time to a lot of people, but it is just enough time, 20 minutes each way, to make many businessmen and the travelling public decide to take a plane to Toronto and make a transfer there, or to take a plane into the United States and make their transfer somewhere further down the line rather than to spend extra money
themselves on gasoline or on a $40 taxi trip. If the recommendation that the northern mayors are making is followed through, the end result will be a decrease in total passenger traffic coming through the combination of Mirabel and Dorval.


Marcel Dionne: Mr. Speaker, it is apparent to anyone who has followed the recent events and has read Hansard that the Minister of Transport (Mr. Pepin) is giving the Mirabel-Dorval issue his fullest attention. The solution must be one that is reached after a full examination of the long-term development needs of the Montreal area. Information provided to this House as recently as during the debate this afternoon has shown that there have been many reviews and opinions on this extremely complex and difficult issue. With the release of the interim report on airport role options in February, 1981, known as phase one, all interested parties were invited to submit comments and concerns on two proposed options, with a view to providing broader input to phase two, which is the detailed cost benefit and arrangements of these options. This indication represents a genuine public process of consultation as called for by the hon. member, but the process of consultation has gone farther than this.
The hon. member will recall that the minister has personally met with large delegations representing both the Dorval and Mirabel areas. He has also personally met with the president of Air Canada and CP Air to discuss the issue, as was recently disclosed in an article in the Montreal Gazette. So there can be no doubt that the minister is taking the issue seriously and has made considerable efforts to hear the interested parties. The minister is searching for the best possible solution. It may be that the solution will not satisfy everyone, but the hon. member can be assured that once the minister is satisfied that every aspect has been fully considered, he will not hesitate to recommend a course of action to his colleagues, however difficult it may be.


FINANCE-REQUEST FOR INCREASED TAX REBATE ON FARM FUEL
Charles James Mayer: Mr. Speaker, on April 8 I raised a question with the Minister of Finance (Mr. MacEachen) concerning the rebate on farm fuels. The reason I raised it was that 1 believe everyone knows that there is much difficulty, not only in farming communities, but also in the business community as a whole across the country. Specifically, in relation to the farming community, it is very important that we maintain a productive agricultural economy at home so that we can have access to relatively inexpensive food and so that we can meet what most people believe to be an expanding export market for our agricultural products. If we are to do those two things, we must ensure that farmers stay in production.
In the farming community, we have been experiencing some very large increases in the cost of farming, and it looks as though this will continue. As we all know, farming has become very capital intensive because farmers spend much money on
May 13, 1982

machinery and other costs, such as fuels, fertilizers, insecticides and pesticides, most of which are based on the petroleum industry.
Therefore, I specifically requested the minister to take a look at the taxes which are being collected simply on farm fuels, not on fertilizers made from petroleum products and not on insecticides and pesticides.
I see the parliamentary secretary is here this evening. He will know that approximately 40 per cent of the cost of farm fuels is made up of federal excise tax. It is presently about 40 cents a gallon on diesel fuel and 60 cents a gallon on gasoline. That is an alarming amount of money. The sad part is that that amount of money which the federal government collects from farmers in the form of taxes on farm fuel will increase.
I have some figures which my colleague, the hon. member for Red Deer (Mr. Towers), used in his speech this evening which point this out. In 1980, the cost on an average size farm in western Canada, a thousand acres, related to all petroleum products such as motor fuel, heating fuel and fertilizer, was estimated to be $11,800. In 1981 it was estimated at $16,750. the disconcerting figure is that the projected 1986 figure is $42,000. The tax on farm fuels is expected to go to almost half that, $16,800 for an average thousand acre farm. If that happens, farmers will have a very bad time trying to stay in business. The farm community will have a bad time meeting export commitments. We all know that a healthy agricultural economy adds to the domestic economy.
Despite the fact that we import a lot of food out of season, citrus fruits from the southern United States and all kinds of other foods that we cannot grow in this country because of our climate, when you compare our agricultural exports with what we bring in in the form of imports, you find that there is still a surplus of approximately $3 billion.
Canadian agriculture is thus a very large earner of foreign exchange. Therefore, it should be very important to this government to keep that industry healthy. It will not stay healthy if the federal government chooses to tax it out of business. I submit very sincerely that we are coming very close to that point.
The government should look at what it is doing to the farm community in terms of taxes. If through excess taxes we drive farmers out of business, and therefore have less food available domestically, the consumer will have to pay more. This will not only add to inflation but cause all other kinds of problems. The distinguished chairman of our agriculture committee, who is sitting beside the parliamentary secretary, will understand that a very efficient agricultural industry at home is important not only for our exports, but to maintain a healthy and productive economy at home.
I know that when the parliamentary secretary responds with an answer prepared for him by the department, he will state that any remission of taxes will add to the deficit and that the opposition is being inconsistent by screaming at the government to hold down expenses while at the same time proposing measures that will add to the deficit.
Adjournment Debate
Let me point out that farmers who go out of business do not pay taxes. They will require some form of social assistance and that will add to the deficit. They not only lose the job they created for themselves, but in many cases lose the opportunity to make jobs for others they employ.
Farmers who go out of business do not buy machinery. That hurts central Canada where a lot of the manufacturing takes place. We have seen evidence of that in the House. Massey-Ferguson, White Farm Equipment and International Harvester, which has a big plant in Hamilton, are all in trouble. When those equipment manufacturers are out of business or are suffering financial hardship as a result of farmers not buying their products, they do not pay taxes, and that adds to the deficit.
The government should take a close look at what the opposition is suggesting in the terms of an increase in the rebate on farm fuels. When the federal government is taking, as I said, approximately 40 cents a gallon on diesel fuel and 60 cents a gallon on gasoline, and the rebate is 7 cents a gallon, if farmers and businessmen apply for that rebate, there would be nothing wrong with increasing that, doubling it or tripling it, particularly when you look at what is going to happen as the National Energy Program and the pricing agreement reached with the producing provinces last September comes into effect. A $42,000 tax bill on a thousand acre farm means $40 an acre tax on farmland. I do not know how you can expect farmers to stay in business, to be efficient, to provide food for our consumers at home, and at the same time to look after what we believe our obligation is to the international community, to feed them, while at the same time, helping out our balance of payments.
I would hope that when the parliamentary secretary rises this evening to answer my question, he will take into consideration what the opposition is suggesting.


The Acting Speaker (Mr. Ethier):: Order, please. I regret to interrupt the hon. gentleman.


Joseph Roger Rémi Bujold: Thank you, Mr. Speaker. The hon. member for Portage-Marquette (Mr. Mayer) has expressed his concern about farm fuel costs and has requested that the present tax be increased.
The government recognizes that all Canadians are experiencing increased costs in a number of areas. All householders have to pay more for food, heating fuel and electricity. All persons who operate motor vehicles or equipment powered with internal combustion engines are experiencing cost increases, both because fuel is more expensive and because the costs of repair labour and repair parts have increased.
The government has mitigated the cost of gasoline for commercial users by rebating 100 per cent of the seven cents a gallon special excise tax which is imposed on all gasoline for use in internal combustion engines. Farmers are, of course,

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Adjournment Debate
entitled to receive this rebate when the gasoline is used in their farming activities.
The special excise tax is also rebated to municipalities, provincial government departments, clergymen, the handicapped, transportation companies and a number of other users.
Increasing the rebate to farmers beyond the amount of excise tax originally paid, would constitute a special subsidy to members of the farming community. I believe it would be difficult to single out farmers as being more deserving of a special subsidy than, for example, loggers, commercial fishermen, municipal transit systems, taxi operators, freight forwarders and the handicapped, as all of these users face the problems identified by the hon. member.
Proceeding in that manner would cause a substantial loss to the treasury and further increase the deficit. In the light of this fact, it would be difficult for the government to proceed as the member for Portage-Marquette has suggested. Even though farm fuel costs are rising, the cost of fuel is generally lower in Canada than in most other countries around the world. In some countries internal combustion fuel costs are more than double the costs being experienced in Canada, and those countries impose heavy tax levies on those prices as well.


The Acting Speaker (Mr. Ethier):: Order, please. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until 11 a.m. tomorrow.
At 10.29 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, May 14, 1982