1982-12-06

THE HON. MEMBER FOR NUNATSIAQ

['No.']
Madam Speaker:: Order. I have received a communication from the Hon. Member for Nunatsiaq (Mr. lttinuar) stating that it is his desire to sit in the Chamber as a Member of the Liberal Party of Canada.


Some Hon. Members:: Hear, hear!


Madam Speaker:: Accordingly, 1 am now able to advise the House that the seat to be occupied by the Hon. Member will be No. 125.


Mr. Nielsen:: He knows not what he does.



Mr. Gordon Taylor (Bow River):: Madam Speaker, whereas the Minister of the Environment (Mr. Roberts) justifies the desecration of a park by stating that affordable accommodation is being provided, and whereas the Minister admitted that he has secured no guarantees from Buchanan and Company with regard to rates, which the company now indicates will be in the area of $500 to $800 per month, which is not affordable accommodation, I move, seconded by the Hon. Member for Western Arctic (Mr. Nickerson):
That this House soundly condemn the Minister for inefficiency and his heartless unconcern for the workers and for the destruction of a park.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


DIAMOND JUBILEE OF INSULIN USE
Mr. Jim Peterson (Willowdale):: Madam Speaker, I rise under the provisions of Standing Order 43. Whereas on
January 11, 1922, Leonard Thompson, a 14 year old diabetic, first received insulin, and whereas this was the first time insulin was ever used on a human being, and whereas recognition should be given to the great role Canadians have played in developing insulin and combatting the disease of diabetes, 1 move, seconded by the Hon. Member for Gatineau (Mr. Cousineau):
That 1982 be proclaimed the Diamond Jubilee of the use of insulin.


Some Hon. Members:: Hear, hear!


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. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, figures just released by Statistics Canada show that tourist travel to Canada has trailed off rather dramatically during the past year. There is, of course, no particular reason why the tourist industry should be spared the effects of policies of the Government any more than the rest of society. However, because it provides so much of the income which fuels the economy of my riding of Parry Sound-Muskoka, I feel roused to comment. I therefore move, seconded by the Hon. Member for St. Catharines (Mr. Reid):
That, in view of the rampaging effects of the Government's policies throughout the entire economy, the House call upon the Minister of Finance to restrain himself and to reassess his program for economic recovery before the entire country goes the way the petroleum industry did under his tutelage.


Erik Nielsen: Under his tinkerage.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.

December 6, 1982


POLITICAL PARTIES
Mr. Rod Murphy (Churchill):: Madam Speaker, considering the fact that the two opposition parties, along with the vast majority of Canadians, believe that only a new government will be able to solve the economic situations which leave thousands of more Canadians unemployed each month, and considering the fact that on August 3 the Liberal Government retained power by winning a vote in the House by 27 votes with 35 Conservative MPs absent-


Some Hon. Members:: Shame!


Rodney Edward Murphy: -and that on November 1 the Liberals retained power on a Tory non-confidence motion with 24 Conservative MPs absent, and that last Thursday 31 Conservatives stayed away in order to allow the Government to retain power by a margin of 27 votes, and that on Friday, 34 Tories stayed away from votes on two motions in order to allow the Government to limit family allowance cheques and to retain power by 28 votes, I move, seconded by the Hon. Member for Selkirk-Interlake (Mr. Sargeant):
That this House urge Conservative Members of Parliament to stop absenting themselves from this House every time there is a chance to bring down this Liberal government and that the Leader of the Official Opposition use his remaining influence with his caucus to remind them that the only way we can put Canadians back to work is if Conservative MPs will come to work.


Madam Speaker:: Order. I do want to remind the Hon. Member that I cannot put this motion to the House, because it seems to be out of order. It is not acceptable to refer to the absence from or the presence of Members in the House.


LABOUR CONDITIONS
Hon. James A. McGrath (St. John's East):: Madam Speaker, the Newfoundland and Labrador Youth Advisory Council has completed a study on youth unemployment in Newfoundland. It released its findings on Friday last and found that there is a staggering 42 per cent unemployment rate amongst young people in Newfoundland. Therefore, Madam Speaker, if there is unanimous consent, I would move:
That this House directs the Minister of Employment and Immigration to meet with his counterpart in the Government of Newfoundland with the view to putting in place a special program to deal with this disastrous situation.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


MINES AND MINING
Mr. Thomas Siddon (Richmond-South Delta):: Madam Speaker, whereas the recently announced closure of the Pinepoint Mine in the Northwest Territories now threatens the jobs of 4,500 workers at the Cominco smelter in Trail, British Columbia, and inasmuch as the Government's new plan to tax northern employee benefits, announced last week, is most inappropriate and will further undermine the mining industry's ability to compete on foreign markets, thus magnifying the reasons for the shutdowns at Pinepoint, Cyprus Anvil, and elsewhere in the North, I move, seconded by the Hon. Member for Prince George-Bulkley Valley (Mr. McCuish):
That the federal Government hold in abeyance all plans for increased taxation affecting the mining sector of our economy, including the proposed northern benefits tax, until the industry has recovered to the point where its competitive position in world markets is secure.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


METRIC CONVERSION
Mr. Bill Domm (Peterborough):: Madam Speaker, I have learned that a Unionville consulting firm has just been employed by the Metric Commission to rewrite our Canadian sporting rule books in metric. This was done at a cost of $89,190. Imagine, no longer will there be a forty-five yard line, Instead, with one yard to go for a first down, it will be .9144 of a metre to go-or face confiscation of the football, or fines and a possible jail term. I move, seconded by the Hon. Member for St. Catharines (Mr. Reid):
That we save $89,190 by scrapping the printing of this metric rule book and use the funds to create jobs for some of the one and one half million Canadians who are presently unemployed.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


FOREIGN INVESTMENT REVIEW AGENCY
Mr. Lome Nystrom (Yorkton-Melville):: Madam Speaker, lask week Bowater Newfoundland Limited of Corner Brook announced the layoff of 746 employees. These lay-offs come despite the fact that the company made a profit of over $40
December 6, 1982

million in Canada in the last two years and paid dividends to its British parent firm of over $30 million during that same period. In light of these facts, which show yet again that a foreign-controlled firm will not voluntarily act in the best interests of Canadians, I move, seconded by the Hon. Member for Regina East (Mr. de Jong):
That this House implement a 1980 election promise made by the Prime Minister, namely: "that the Foreign Investment Review Act be amended to provide for performance reviews of how large foreign firms are meeting the test of bringing substantial benefits to Canada".


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


VETERANS AFFAIRS
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam
Speaker, as the Division of Laboratories, Ministry of Health, in British Columbia has made positive findings of both strongyloidiasis and amebiasis in Canadian Far East prisoners of war, I move, seconded by the Hon. Member for St. Catharines (Mr. Reid):
That this House direct the Minister of Veterans Affairs to take immediate action and arrange for special pension compensation for these afflicted Hong Kong veterans.


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


Mr. Baker (Nepean-Carleton):: Campbell said yes.


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


WELFARE
Mr. Neil Young (Beaches):: Madam Speaker, the number of people applying for welfare in Toronto is the highest number since metropolitan Toronto was formed, and since a high proportion of the applicants are considered employable but simply cannot find work, I move, seconded by the Hon. Member for Hamilton Mountain (Mr. Deans):
That this House instructs the Minister of National Health and Welfare to offer immediate assistance by increasing the amount of transfer payments to be used for welfare purposes, and the Minister of Employment expedite the implementation of the NEED Program in Metropolitan Toronto.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.



ORAL QUESTION PERIOD


Hon. Allan Lawrence (Durham-Northumberland):: Madam Speaker, 1 know that a ministerial briefing was prepared so that the Solicitor General today would be able either to furnish some identity or lack of identity for a gentleman by the name of Jacques Laliberte. Can the Solicitor General tell us if anyone by the name of Jacques Laliberte has been or is now a member of the Canadian Security Agency?


Hon. Bob Kaplan (Solicitor General of Canada):: Madam Speaker, I regret to give monotonous replies, but again the identity of that individual, and his existence or non-existence, as I understand it, and his role, are one of the issues being pursued in a trial on serious charges which is presently under way in Britain. I would ask the Hon. Member to allow that type of evidence to come out as it should in that tribunal and not this one.


INFORMATION AVAILABLE TO ROYAL CANADIAN MOUNTED POLICE
Allan Frederick Lawrence: Madam Speaker, Ministers should not be able to blow and suck at the same time. If no comment is to be made in any of these matters by any Minister of the Crown, then they should stick to it, but they do not. For example, on Friday morning in the House we were told by the Minister of Justice, and I quote from Hansard: "much of the information released in the last week or two" was not the same kind of information that was before the RCMP and the Government of Canada at the time the decision was made not to prosecute. With that type of comment, obviously they are trying to do two things. The Solicitor General was in the House and he heard what his colleague stated. What information released at the trial of Professor Hugh Hambleton in Britain was not available to the RCMP here in Canada at the time the decision was made not to prosecute?


Robert Phillip Kaplan: Madam Speaker, the statement that my colleague made the other day was not a matter which would be relevant to the trial taking place in Great Britain. The question that the Hon. Member has asked me is one that I prefer to answer after that trial.

December 6, 1982
Oral Questions OBTAINING OF EVIDENCE


Mr. Chris Speyer (Cambridge):: Madam Speaker, my question is for the Minister of Justice. At a press conference after Question Period on Friday, the Minister of Justice went through the sequence of events; that there was insufficient evidence at one point in time to justify any prosecution, a letter dated April, 1980 was taken from his predecessor which indicated that subsequent evidence came to light after that, and then he made this statement:
There's an old tradition of the law that, if evidence has been obtained either through threat or inducement, it is not available to the prosecution.
That was within the context that the Canadian Courts were not capable of having a conviction. My question to the Minister is: what inducements or what threats were made to Hambleton for him to make such a statement?


Hon. Mark MacGuigan (Minister of Justice):: Madam Speaker, I was discussing the law that was applicable. I was not discussing the facts. The hon. gentleman can apply the law to the facts as he wishes.


NATURE OF QUESTIONING
Chris Speyer: Madam Speaker, my supplementary is directed to the Minister of Justice. There is a law with respect to the admissibility of statements, but I am asking the Minister, within the context that he told the press that there would not be a prosecution in a courtroom of Canada as a result of obtaining this subsequent evidence because it would not be admissible either through threat or inducement, was there any threat or any inducement that would prevent his Department from instigating a prosecution against a spy who gave away the secrets of our country to the Russians.


Mark R. MacGuigan: Madam Speaker, I think 1 see the Hon. Member's problem. He is drawing a conclusion which I did not draw. 1 did not say there could not be a prosecution subsequently in this case. I said if one were to consider whether there were to be a prosecution, one would have to look at these principles of evidence.


THE ECONOMY
Hon. Edward Broadbent (Oshawa):: Madam Speaker, I have a question for the Minister of Finance. It concerns the interesting speech of the Prime Minister to a Liberal gathering on the weekend. The Prime Minister, at a $150-a-plate Liberal dinner, said that economic recovery was at hand. Unemployment at this point in the year is up 55 per cent over last year. On Friday, Statistics Canada indicated that the 15-month trend of a decline in the economy was no reason to believe that improvement was just around the corner. Considering that we are now losing jobs at the rate of 1,700 per day, does the
Government have access to information which has eluded the rest of us, or is this simply what Liberals pay $150 a plate to hear?
[ Translation]


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker, perhaps my hon. colleague would care to look at the statement I made in the House on October 27 of this year, when I said that the Government was expecting to see economic recovery in the last quarter of this year and during 1983. 1 also said on that occasion, as the Hon. Member is well aware, that we expected high levels of unemployment to continue into next year, unfortunately, despite the fact that the economy would be showing a positive growth rate. Those are the predictions I made in the House at the end of October. They are the same predictions we are using today in projecting economic growth for the coming months.


John Edward Broadbent: The Minister carefully avoided dealing with what the Prime Minister had to say. No one in his right mind, at this point in December, 1982, would assert that recovery is at hand. We have the worst level of unemployment since the last depression and every indication is that the situation is getting worse, not better.


LABOUR CONDITIONS
John Edward Broadbent: I would like to ask the
Minister a question which is directly relevant to the job situation now in Canada. Last week my colleague, the Hon. Member for Churchill, raised a question concerning the layoffs by Bowater in Corner Brook, of some 700 employees. At that time the Hon. Member for Churchill pointed out that this company, in spite of significant profits recently, was shutting down. This plant is putting hundreds of Canadian workers out into the street. The Minister indicated that he would be prepared to look at this situation.
Today it was learned that the assertion made last week was absolutely true, that Bowater has paid $33 million in dividends in the last two years, based on a profit of $44 million which was earned here in Canada, mostly in Newfoundland. Is the Liberal Government prepared to investigate this foreign-owned company which has taken profits earned in Canada out of Canada, put Canadian workers out of a job, and transferred its profits back to Great Britain? Will the Minister investigate this?


Marc Lalonde: Madam Speaker, in order to help the Hon. Leader of the New Democratic Party see the situation in more exact terms regarding the economy generally, I would like to remind him that housing
December 6, 1982

starts in November, for instance, on a seasonally adjusted basis were at approximately 135,000 units. In October they were only at 107,000 units. Housing starts were up 30,000 units in a single month. Therefore, there are indicators that there is a turnaround, and there are some positive elements talcing place in the economy.
As far as the point raised by the Hon. Member is concerned,
1 indicated to his colleague last week that 1 was taking his suggestion seriously and I would examine whether there were any particular steps which should be pursued following his representations. I thank the Hon. Leader of the New Democratic Party for the information he has provided today, and I will certainly make sure that this is pursued further.


FOREIGN INVESTMENT REVIEW AGENCY
John Edward Broadbent: Madam Speaker, as 1 have said in another context, the people of Canada are getting just a little tired of the Government of Canada studying situations. They want, just for a change, some action by the Government.
In this particular context, we are losing hundreds of jobs, as I have said, at the rate of 1,700 per day. In the last few days it was Bowater, a foreign owned firm in Newfoundland; a couple of weeks before that it was the Iron Ore Company of Canada in Schefferville, a company which earned millions of dollars in profits in this country but was busy transferring those profits abroad.
Given our concern about jobs, instead of emasculating FIRA is the Government of Canada prepared to do what other industrialized countries have done with equivalent agencies, that is to say, improve the powers of FIRA so it would have the authority to ensure that profits earned by foreign firms in Canada are reinvested in Canada to produce Canadian jobs?


Marc Lalonde: Madam Speaker, it is typical of the New Democratic Party to suggest action before they themselves have thought about it. That is not the style of this Government. We want to act, but after getting the proper facts, not on phony assertions which may be made right and left. We are going to get the facts and decide whether action is required, and we will act decisively if action is required and justified in the circumstances.
As far as FIRA is concerned, the previous Minister of Finance and the Government have indicated that we are improving the efficiency of the operation of FIRA.


John Edward Broadbent: What does "efficiency" mean?


Marc Lalonde: We intend to go on doing so. The steps have already been announced in last June's budget, they have been
Oral Questions
taken by the previous Minister of Industry, Trade and Commerce, and they are also being implemented by the current Minister.


LABOUR CONDITIONS
James Aloysius McGrath: Madam Speaker, has the Minister of Finance or the Minister of State for Economic Development, or any Minister of the Government of Canada, been in contact with the head of the Bowater Corporation in London to determine whether or not these lay-offs can be avoided?


Marc Lalonde: Madam Speaker, I understand that the Premier of Newfoundland claimed he had been in touch with the Chairman of Bowater, while the Chairman of Bowater said he had never seen him in his life. To my knowledge, no member of the federal Government has been in touch as yet with the Chairman of Bowater, but I will refer this matter to my colleagues and check whether any of them have already done so.


NATIONAL SECURITY
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, my question is for the Minister of Justice and relates to the Hambleton spy matter, but more particularly with respect to why spies in Canada are apparently not prosecutable. The Minister will understand that we in Canada, because of the ineptitude of the Government, have become the laughingstock of the world with respect to the prosecution of spies, people who are taking information and selling it to foreign countries. The Minister has indicated that the Official Secrets Act is too broad, and he has indicated that the Treu case and The Toronto Sun case are examples of that. I would point out that those cases involved domestic disclosure of classified information, whereas in the Hambleton matter we are talking about the sending of information to our enemies.
Does the Minister feel that spies can be prosecuted under the Official Secrets Act? If not, where are the amendments to the Official Secrets Act, and would he please table in this House the legal opinion of his predecessor as to why the prosecution in the Hambleton affair could not proceed?


Mark R. MacGuigan: Madam Speaker, my hon. friend is asking for a great deal of legal advice in one question. The law applicable here is the Official Secrets Act, as he said. This is an act of this Parliament. We endeavour to give this meaning and application in every case in which it is brought forward to us. I have spoken of the fact that there are some deficiencies in

December 6, 1982
Oral Questions
that legislation, and I hope to bring forward amendments to remedy them, but in the meantime we will certainly in good faith attempt to apply the Act in every case where the facts warrant. When facts come before us we judge them on the basis of that Act and the traditional interpretation of that Act, and of course on the weight of the facts themselves. That is exactly the kind of decision that my predecessor made with respect to the Hambleton case.


Ramon John Hnatyshyn: Madam Speaker, I only have to refer to the Prime Minister's statement at his press conference last week in which he indicated that the Department of Justice is always doing that, that is to say, always advising against the prosecution of spies in our country.


TIMING OF DECISION TO PROSECUTE IN GREAT BRITAIN
Ramon John Hnatyshyn: Madam Speaker, 1 have a supplementary question for the Solicitor General. Over the weekend he posed the incredible and novel proposition that somehow the Security Force in Canada was using reverse psychology in telling Mr. Hambleton to beware of a hostile reception in the United Kingdom.
First, when was the Government actually aware that the United Kingdom was going to proceed with the prosecution of Mr. Hambleton? Second, what was the deal between Canada and the United Kingdom with respect to proceeding in the United Kingdom as opposed to proceeding in Canada in the prosecution of the alleged spy, Hugh Hambleton?


Robert Phillip Kaplan: Madam Speaker, first, as to the headlines, which I also read, speculating about reverse psychology, I can assure the Hon. Member that I said no such thing. In none of the articles that I read was such a position attributed to me. It is speculation, and it just hangs there for what it is worth. I have not said that the Security Service informed him that he would be prosecuted if he went to Great Britain. He was informed that he might receive a hostile reception.
I would remind Hon. Members that the British interviewed him for a long time after he went back to Great Britain. It may well be that the prosecutorial decision was made on the basis of what he said after he arrived in Great Britain. We were not informed, and it was not indicated to the Security Service that the hostile reception would be prosecution. It was simply indicated that he might receive a hostile reception.


DELAY IN AMENDING OFFICIAL SECRETS ACT
Erik Nielsen: Madam Speaker, I have a supplementary question for the Minister of Justice. It was in 1968 that the MacKenzie Commission reported to the Government which was led by the Prime Minister. It recommended, I believe, well over 300 changes, or it had 300 recommendations. One of the more urgent was that the Official Secrets Act be amended. Why has it taken the Government 14 years plus to
present amendments to the Official Secrets Act which would provide that the kind of problem that he and his colleagues speak of could be dealt with?


Mark R. MacGuigan: Madam Speaker, the primary problem in the case we are speaking about is the problem of the evidence, not the problem of the law. As I have said several times in the last few weeks, this law is the result of recommendations of the McDonald Commission and it is very much under reconsideration. We hope to be in a position, before long, to bring forward amendments to the Official Secrets Act.


Erik Nielsen: Madam Speaker, the Minister has not answered my question about why it has taken the Government 14 years to do something about the recommendations of the MacKenzie Commission on the security of this country.


POLITICAL CAMPAIGN CONTRIBUTIONS BY FOREIGN COUNTRIES
Erik Nielsen: Madam Speaker, may I direct my second question to the Solicitor General. Have there been or are investigations being made into the possibility of foreign countries contributing to the election campaign funds of political parties in this country, and have activities been undertaken by such countries to encourage or urge individuals to run for election to this House of Commons? If there have been such investigations, what have been the results?


Robert Phillip Kaplan: Madam Speaker, under the new election campaign expenses legislation any such clandestine activity would be illegal, unless it were disclosed. If it were done by a foreign power in a clandestine way, such action would be conduct that would come within the ambit of the mandate of the Security Service. It would be a matter that could be legitimately investigated by the Security Service.


QUERY RESPECTING POSSIBLE INVESTIGATIONS
Erik Nielsen: Madam Speaker, I have a brief supplementary question. I know the law, but I am asking the Minister whether any investigations had been conducted into that kind of conduct in the past, or whether any such investigations are going on at the present time.


Robert Phillip Kaplan: Madam Speaker, I do not consider it to be in the public interest to answer that question.


LABOUR CONDITIONS
A. Daniel McKenzie: Madam
Speaker, in the absence of the Minister of Labour I will direct
December 6, 1982

my question to the Minister of Transport. The International Association of Machinists and Aerospace Workers of Air Canada has been informed that 585 employees of that group will be laid off. Mr. J. J. Bourgeault, the Senior Director of Labour Relations for Air Canada, stated on May 19, 1982, that "application of early retirement policy will apply equally to any employee groups". Will the Minister inquire why Air Canada is not willing to apply this policy of a voluntary separation program to the machinists and aerospace workers, but solely to management personnel and employees of other bargaining units in the Air Canada family?


Hon. Jean-Lue Pepin (Minister of Transport):: Madam Speaker, I have inquired about this. In the case of management people the separation is a permanent one and they are not subject to recall or to the protection of collective agreements, et cetera. In the case of mechanics they are subject to recall and are protected by collective agreements in terms of pension, security, priority to certain jobs should they become open, and so on. The two situations are quite different.


REQUEST THAT MEDIATOR BE APPOINTED
A. Daniel McKenzie: Madam
Speaker, as 26 machinists will be laid off in the Winnipeg area alone, I should like to ask the Minister if he would consult with the Minister of Labour to consider appointing a mediator to investigate why Air Canada is discriminating against its machinists, all members of the International Association of Machinists and Aerospace Workers. Will they do everything possible to stop these lay-offs?


Jean-Luc Pepin: I will do so,
Madam Speaker.


DEVELOPMENT OF ATHABASCA OIL SANDS
Mr. Jack Shields (Athabasca):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. Has the Minister had discussions with Imperial Oil or Shell or Canstar, or the provincial Government, with regard to establishing a fiscal regime so that the development of the Athabasca oil sands can take place?
Hon. Jean Chretien (Minister of Energy, Mines and
Resources): Madam Speaker, we are having continuing discussions with the industry and the Provinces on this subject. If there is some progress to be announced I will be very pleased to tell the House of Commons about it, but I have nothing to announce at this point.


DISCUSSION OF FISCAL REGIME
Jack Wendele Shields: Madam Speaker, 1 was not asking whether there was a project to be announced. I was
Oral Questions
asking whether a fiscal regime had been developed or is in the process of being developed, to control the development of the tar sands and the oil sands in northeastern Alberta. Perhaps I should direct my question to the Minister of Finance. Is he having these discussions?


Hon. Jean Chretien (Minister of Energy, Mines and Resources):: Madam Speaker, I replied to both aspects of the question. My answer applied to the development of projects. Of course there are discussions about tax regimes. 1 am having discussions about that with the Saskatchewan and Alberta Governments.


LABOUR CONDITIONS
Mr. Sid Parker (Kootenay East-Revelstoke):: Madam Speaker, my question is for the Minister of Finance. Considering that the announced lay-offs by Bowater are not taking effect until next April, and considering that Bowater made over $44 million in profits in the last two years, will the Minister ensure that the Government will demand that these lay-offs will not take place?


Marc Lalonde: Madam Speaker, I have already answered that question in answer to the Leader of the New Democratic Party.


PUBLIC WORKS
Mr. Nelson A. Riis (Kamloops-Shuswap):: Madam Speaker, may I put a question to the Minister of Finance. In his responses to questions in this House in the last number of weeks, he has often been forced to say that there is nothing the Government can do in the short run, to combat lay-offs in all parts of Canada. Perhaps there is a solution that the minister ought to consider. Municipalities across Canada, such as Kamloops and Salmon Arm, have capital works projects ready to go, in the amount of $18 million each. If the Minister is interested in job creation and in stimulating the economy from one end of Canada to the other, would he give some consideration to establishing a special public works emergency fund so that muncipalities across Canada could get these road projects, sewer and water projects and parks projects, that are now waiting for financial support, off the ground?


Marc Lalonde: Madam Speaker, I will consider any suggestions put forward by anyone in this House. I will give all suggestions very serious consideration.

December 6, 1982
Oral Questions
As a general statement, however, 1 should like to point out that it would be very wrong for provincial or municipal Governments to sit on their hands and hope that the federal Government is going to dish out hundreds of millions of dollars to them. Municipal Governments and provincial Governments, like the federal Government, have the power to borrow. If there are projects which are worth-while for the community, I encourage them to exercise their responsibilities as elected officials, to go ahead with the projects, to go to the market and borrow money like the federal Government is borrowing, and to do something that is required in the community. They should not wait for the federal Government to finance every action which is taking place in the country.
As I indicated, the federal Government set aside over $1 billion in addition to the previous amounts set aside for direct job creation last October. This is a significant amount of money which we are putting aside for all kinds of job-creation programs across the country. 1 hope municipal Governments, like others, will do their share in this regard, and try to use this period of recession to stimulate activity, proceed with projects which they themselves can finance on their own, and not just wait for grants from the federal Government. This being said, 1 take the statements of the Hon. Member as a representation. As I said, I will consider it together with numerous other representations which have been made by other Members.


INCOME TAX
Mr. F. Oberle (Prince George-Peace River):: Madam Speaker, my question is directed to the Minister of Finance as well. It concerns the announcement made by his colleague, the Minister of Indian Affairs and Northern Development, on his behalf last week, of the imposition of a very significant new tax burden on northern residents, a burden which will result in an increase of between $2,000 to $3,000 per year for the average worker in the North who is employed in the mining and resource sector industries.
Could the Minister tell the House why he chose this particular time to make this imposition on northerners, having regard to the fact that they are already hit hard and that economic circumstances multiply themselves several times by the time they are experienced in the North? Why is it that he imposed this tax at this time?


Marc Lalonde: Madam Speaker, I should like to tell the Hon. Member three things. First, the announcement was not made by the Minister of Indian Affairs and Northern Development on my behalf. I made it myself, and I associated that Minister and the Minister of State for Mines with this particular announcement.
Second, the tax will not generate the figures to which the Hon. Member referred of $2,000 or $3,000 per individual.
Third, there is no tax. The remission order is being continued in 1983 and, as a matter of fact, it is being extended to workers who were not covered by the remission order in 1982. They will benefit from an exemption in 1983 which was not available to them in 1982.
The taxation of benefits will only start in 1984. It will start on a very gradual basis. The taxation of benefits will grow 25 per cent a year. It will start with only 25 per cent of the taxable benefits being eligible for taxation. The figures to which the Hon. Member referred are quite small and I would like him to bear that in mind when he considers the steps that have been taken, which I think are quite fair to the people of the North who were benefiting from the particular remission order.


Frank Oberle: This is a display of a strange twist of logic. The Minister says that it is a tax which was always on the books but had never been paid and that simply because it has to be paid now it is not a new tax. I must have attended a fairy-tale session last week when I sat in on the press conference, including stations of the CBC northern service, when the Minister of Indian Affairs and Northern Development, on behalf of the Minister of Finance, announced a new tax.
In fact it is not a serious imposition when it is figured out on a monthly basis, as the Minister did but, when the monthly figures are multiplied by 12, it is an imposition of between $2,000 and $3,000 on average taxpayers or average northern workers. There are no ifs, ands or buts about it.


REASONS FOR CHANGE
Frank Oberle: Madam Speaker, did the Minister of Finance take into consideration that the average home owners in the North pay between $200 to $300 in some instances for utilities to heat their homes, that they pay $4 for a gallon of gasoline, and that freight costs often multiply essential consumer commodities by four times? Is there any equity and fairness in his tax system at all? Why was logic not considered, that changes to the tax Act would have been a much better compromise to replace the remission order?


Marc Lalonde: Madam Speaker, I remind my hon. colleague that the average northerner never had access to this particular benefit. It was limited to a very restricted number of people who happened to work in the North for large corporations or certain Governments. That was the limit of the benefits. They were not available to the average northern citizen or resident. Indeed we have very carefully taken into account the serious recession which the industries in the North are knowing at the present time by not imposing the taxation of those benefits in 1983, and by starting the taxation of them on only a gradual basis in 1984. It will take four years after 1984 before they become fully taxable.
In addition, we have put specific ceilings on benefits such as housing allowance, for instance, so that there would not be
December 6, 1982

excessive taxation of these people. 1 invite my hon. friend to examine more fairly the proposal or the plan which was announced, and he will come to the conclusion that he should not be talking about the kinds of figures he indicated.


FINANCE
Hon. Don Mazankowski (Vegreville):: Madam Speaker, my question is directed to the Minister of Finance. Canada's chartered banks are flatly refusing to process Small Business Development Bonds for farmers and small-businessmen who are in financial distress. What action has the Minister taken in this regard? Has he met with the banks? If, as the banks suggest, the present program is unworkable, is he actively considering any changes to the program to make it more workable to meet the desperate need?


Marc Lalonde: Yes, Madam Speaker, I am examining the situation very carefully in order to ensure that there is no undue prejudice caused to either farmers or small-businessmen.


FUNDING FOR FARM FINANCIAL ASSISTANCE PROGRAM
Donald Frank Mazankowski: Madam Speaker, my supplementary question is also directed to the Minister of Finance. Under the special Farm Financial Assistance Program the funds appropriated for this fiscal year have been expended and farmers are not being accommodated. Has the Minister had any discussions with his colleague, the Minister of Agriculture, in this regard? Is he actively considering the prospect of increasing funding for that particular purpose so that farmers who are in financial distress at this time will be able to use the Program in a more effective manner?


Marc Lalonde: Madam Speaker, the Hon. Minister of Agriculture is well-known for his great interest in farmers. Everyone knows that he has their best interests at heart all the time. Indeed he has made very strong representations to the Minister of Finance, and representations coming to the Minister of Finance from the Minister of Agriculture are always examined with great attention and sympathy.


PIPELINES
Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. He has heard about plant closings and job losses in the House today. I want to give him an opportunity to create some jobs on a rather massive scale. Is the Minister aware
Oral Questions
that, if the whole Alaska Highway Gas Pipeline went ahead, it would mean 350,000 man-hours of work and 1.2 million tonnes of pipe construction for Stelco in Hamilton and Ipsco in Regina?


Some Hon. Members:: Oh, oh!


Mr. Epp:: You were against it.


Ian Gardiner Waddell: Before my Conservative friends have heart attacks here as they line up behind their Leader, is the Minister aware that the previous Minister of Energy said in this House in July, 1980, that the Government was convinced of the United States commitment to complete the whole line by 1985? In light of the commitment which "old iron clad" said we had, and in light of the fact that all these jobs could be created, what has the Minister personally done since taking office to get the pipeline construction going, the whole pipeline for the North?


Joseph Jacques Jean Chrétien: Madam Speaker, the first thing that I did to make that project work was that, contrary to the Hon. Member, I voted for it in the House of Commons.


Some Hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: It was a long time ago, and of course, we were depending on that. I am very pleased to see that the Hon. Member for once in his life wants us to collaborate with the Americans. We are willing to do so. In fact, we need their collaboration. In order to justify the construction of the pipeline from Alaska to the southern parts of the United States there is a need, first, to find financing for it and, second, to find a market for the gas. This matter is under the control of the American administration, over which I do not have great influence.


SEARCH AND RESCUE PROVISION OF SERVICES ON WEST COAST
Mr. Ray Skelly (Comox-Powell River):: Madam Speaker, my question is for the Minister of National Defence. Over the last year we have had three studies on search and rescue operations on the coast of British Columbia. We have had an interdepartmental study, a joint Coast Guard and a DND study, and a DND study on deployment of air resources.
In addition to the removal of weather ships, the Government has now removed two vessels, one from Campbell River and one from Prince Rupert. As well, the Government has removed two of the three crash groups from CFB, Comox. The Government has also reduced coverage from 9 a.m. to 5 p.m. Monday to Wednesdays. The Government has apparently refused to deploy the air resources on the coast of British Columbia in a proper and effective manner.

December 6, 1982
Oral Questions
Would the Minister be prepared to describe why the three studies are top secret and why there has been a substantial reduction in the available resources on the coast of British Columbia? For example, we get three vessels in lieu of six. Also, when will the Minister consider an effective deployment of his rotary wing air resources on the coast of British Columbia?


Hon. J. Gilles Lamontagne (Minister of National Defence):: Madam Speaker, the Member asked many things on search and rescue. First, I do not know of any secrecy with regard to the studies that we are currently doing with a view to ensuring more effective search and rescue on the coast of British Columbia as well as on the east coast. We try to utilize our facilities in the best way possible so that we can effectively cover the area where there are the most incidents. I am sure that my Department in co-operation with the Department of Transport, has studied the air and the sea aspects in detail so as to improve our search and rescue operations.
I can assure the Hon. Member that our search and rescue facilities are much better today than they were a year ago. We intend to continue our examination of those facilities as much as possible, and I know there has been some improvement.
I could write to the Hon. Member and give him details. The Premier of Newfoundland has written to me about this matter. 1 will give him a complete review of what we are doing in Newfoundland covering all aspects of search and rescue. But, as I have said with reference to the Hon. Member's question, there has been an improvement in search and rescue in British Columbia.


CRIMINAL CODE
Arthur Jacob (Jake) Epp: Madam Speaker, my question is directed to the Minister of Justice. It concerns Dr. Morgen-taler's announcement of his intention to open an abortion clinic in Winnipeg. Has the Minister been in touch with the Attorney General of Manitoba? Has a plan of action been determined which would prevent the opening of an abortion clinic such as this, rather than having it opened first and then having charges laid, which obviously will result in many young Manitoba lives being lost?


Mark R. MacGuigan: No, I have not been in touch with the Attorney General of Manitoba on this subject, because it is not necessary, Madam Speaker. The responsibility for enforcing the Criminal Code is entirely in the hands of the Attorney General of Manitoba. If he wanted to consult with me in some way on the law, I would be available, but that is not the usual course for Attorneys General to follow. Just as the Attorney General of Ontario has said that he will apply the law if the occasion warrants it, 1 am sure the Attorney General of Manitoba will follow the same course.


Arthur Jacob (Jake) Epp: Madam Speaker, I am aware of the administration of justice in that way. I phrased the question in terms of whether the Minister had been in contact with the Attorney General of Manitoba. I recognize his responsibility is to administer the law but there have been other Attorneys General, such as Mr. McMurtry of Ontario, and the Attorney General of Saskatchewan, who have said if that eventuality occurred they would prosecute.


QUERY RESPECTING AMENDMENT OF CODE
Arthur Jacob (Jake) Epp: Madam Speaker, in view of the situation in which we find ourselves, namely, that the Criminal Code has some very specific requirements concerning the setting up of therapeutic abortion committees in hospitals before the process can be undertaken, is the Minister now considering amendments to the Criminal Code which would prevent, or at least put a prohibition on the opening of such abortion clinics, rather than leaving the law as it is?


Mark R. MacGuigan: Madam Speaker, there really is no need for additional law. It is in the hands of the Provinces, in this case, the Province of Manitoba, to determine what is an accredited hospital. A Province may even decide that a freestanding clinic of this kind should be classed as a hospital, although I am not aware that any Province has yet done that. Therefore all aspects of the problem as they affect the situation in Manitoba are in the hands of the provincial Government and, in particular, in the hands of the Attorney General. I see no role for the federal authorities. Madam Speaker, and no, we are not contemplating changes to the abortion law at this time.


NATIONAL SOVEREIGNTY
Mr. Maurice Foster (Algoma):: Madam Speaker, my question is for the Minister of State for Finance responsible for customs. In view of the very depressed state of the Canadian steel industry and the advantages which would flow to this industry if the Canadian customs zone were extended from the 12-mile limit to the Continental Shelf, and in view of the fact that most countries such as Australia, New Zealand, the United Kingdom and Norway have already provided for this extension, can the Minister say when the Government of Canada is going to move to extend our custom zone to the Continental Shelf?


Hon. Paul J. Cosgrove (Minister of State (Finance)):: Madam Speaker, the question of the Hon. Member involves not only areas of customs jurisdiction, and I believe the Minister of Industry, Trade and Commerce responded to a similar type of question last week. He indicated that the matter is under consideration by the Government, and when
December 6, 1982

the Government is in a position to advise Hon. Members, he will do so.


EFFECT OF FOOTWEAR IMPORT QUOTAS
Mr. Bill Clarke (Vancouver Quadra):: Madam Speaker, my question is for the Minister of State for International Trade. Could the Minister tell the House what action he has planned in order to resolve the problem of hundreds of shoe retailers who face extinction because of the reimposition and cut-back of shoe quotas which are drastically reducing the lines which these shoe retailers have offered for decades?
Hon. Gerald Regan (Minister of State (International
Trade)): Madam Speaker, the Hon. Member will be aware that, with the reimposition of quotas on importation of shoe wear, meetings took place with representatives not only of retailers but also of importers and manufacturers. Subsequent to those consultations, quotas were arranged to try to take care of the interest of all groups in the most equitable manner possible. 1 am confident that, on the basis of the quota assignments that have been made, while it may be that retailers will end up selling more Canadian shoes than previously, they will indeed be able to survive and there will not be undue hardship.


POSITION OF INDEPENDENT RETAILERS
William Hillary (Bill) Clarke: Madam Speaker, I wonder whether the Minister is aware of two facts. First, the quotas were given out so late that the appeal date had passed, and an appeal is being refused now by his Department. Second, the retailers in question have nothing to do with the chains and are only concerned with about 15 per cent of the quotas about which the Minister has been talking.
Hon. Gerald Regan (Minister of State (International
Trade)): Madam Speaker, the Hon. Member should be aware that both independent retailers as well as the chains were represented at meetings and consultations that I had. In relation to their volume and numbers, the amount apportioned to them is an equitable amount. 1 certainly want to carry out this unfortunate necessity of restricting imports in a way that will provide the minimum dislocation possible to the retailers as well as to the importers', but the Hon. Member will be well aware that there are Canadian jobs at stake and the Canadian manufacturers of shoes have been very very hard put as consequence of a sudden, very rapid increase in the volume of imports of footwear. I would hope that the Hon. Member might show some concern for the Canadian workers who have lost their jobs as a result.
Oral Questions


PETRO-CANADA PURCHASE OF BRITISH PETROLEUM SERVICE STATIONS
Mr. Jim Hawkes (Calgary West):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. In Committee on Friday morning the Minister of National Health and Welfare indicated that it was a Government priority to buy service stations to protect Canadian jobs. Could the Minister of Energy, Mines and Resources indicate to the House how the buy-out of British Petroleum service stations became a priority, one more important than pensions and family allowances, and could he explain how that will protect Canadian jobs?


Joseph Jacques Jean Chrétien: Madam Speaker, I think that this transaction has been well explained to the House of Commons. It was a commercial transaction involving Petro-Canada, which was buying the stations of BP. Of course, because Petro-Canada is very popular, it will be in a position to pay it easily because it will sell 20 per cent more gasoline than the present owner of the stations. Of course, concerning the other part of the Hon. Member's comment, its purpose was not job preservation. It was a good investment by Petro-Canada and it will be paid commercially, as a good commercial decision should be.


Frederick James (Jim) Hawkes: Madam Speaker, the more Petro-Canada sells, the more we buy from Mexico, Venezuela and so on.


Joseph Jacques Jean Chrétien: That is not true.


FUTURE PROSPECTS
Frederick James (Jim) Hawkes: The previous Minister of Energy, Mines and Resources was one of the greatest job cutters in Canadian history. He destroyed about 40 per cent of the jobs in that industry and in related industries.


Erik Nielsen: Old Slasher Lalonde!


Frederick James (Jim) Hawkes: Do we have any indication from the present Minister that something significant will happen and that we are going to restore jobs in that industry and in those related service industries which serve oil and gas exploration and development?


Joseph Jacques Jean Chrétien: I would like to inform the Hon. Member that figures for last week indicate that rigs in Canada were operating at 76 per cent of capacity, the best in a long time, because in the spring they were operating at only 22 per cent of capacity-

December 6, 1982
Petition


PETITIONS
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the three hundred and forty-sixth report of the Clerk of Petitions stating that he has examined the petition presented by the Right Hon. Member for Yellowhead (Mr. Clark) on Friday, December 3, 1982, and finds that the petition meets the requirements of the Standing Orders as to form.



ROUTINE PROCEEDINGS


Mr. Blaine A. Thacker (Lethbridge-Foothills):: Madam Speaker, as a Member of this House, it is my privilege and duty to present two petitions. The first is on behalf of 152 members of the Netherlands Reformed Congregation from my riding. The purpose of their petition is to express strong opposition to the proposed legislation contained in Bill C-10. They believe that Bill C-10 reflects a dangerous use of power on the part of the civil government and a potential tool for subjecting churches to the moral decisions of civil courts.
The petitioners hope that in your examination of the petition you will find the petition in order, will sense the urgency and strong commitment in their plea, and use the discretionary power vested in your office to allow discussion and referral to the appropriate committee at the earliest possible moment.


Blaine Allen Thacker: Madam Speaker, the second petition I wish to present is on behalf of 150 members of the same Netherlands Reformed Congregation, in which they wish to express their concerns about Bill C-53. The petitioners set forth a number of points which they believe the House should consider when the legislation is discussed next.
I note that their petition has been sent to the Minister of Justice (Mr. MacGuigan) and the Chairman of the Justice Committee, and 1 hope that the committee will consider their views seriously.


Sidney James Parker: Madam Speaker, it is my privilege and duty to present a petition signed by hundreds of citizens of Ontario and Quebec. The purpose of the petition is to express the clear and strong opposition of those citizens to Bill C-133, legislation which would reduce the
indexing of the pensions of public servants. The nature of the petition is to oppose the passage of Bill C-133 at second reading and thereby prevent the cut in indexing of Public Service pensions.


Some Hon. Members:: Hear, hear!


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 4,478 and 4,564.


Mr. Mazankowski: 1.	Is there a body known as the National Library Advisory Board and, if so (a) what are its stated purposes and terms of reference (b) what is the composition of the Board?
2.	Who are the current members and what are the lengths of their appointments?
3.	Do members receive any remuneration and, if so, within what ranges?
4.	What were the total costs associated with the Board for the fiscal year (a) 1980-81 (b) 1981-82?
5.	What tasks did the Board complete in those fiscal years?


Mr. Jack Burghardt (Parliamentary Secretary to Minister of Communications):: I am informed by the National Library of Canada as follows:
1.	Yes. (a) Section 9 of the National Library Act (1969-c. 47, 17-18 Eliz II) states that "The Governor in Council may establish a Board, to be known as the National Library Advisory Board, to advise and assist the National Librarian in the organization and development of the Library and to advise and assist in the development of the relations of the Library with other libraries and library and educational associations and institutions".
(b) "The membership of the Board shall consist of (a) The National Librarian; (b) the Parliamentary Librarian and the Dominion Archivist, who shall be members ex officio; (c) four other persons, one each representing and nominated by the Canada Council, the Social Sciences and Humanities Research Council, the Association of Universities and Colleges of Canada and the National Research Council of Canada; and (d) "11 other persons, at least five of whom shall be professional librarians and each of whom shall be appointed by the Governor in Council to hold office for a term of not more than four years".
2.	The list of current members, with the dates of their appointment (where applicable) is as follows:
December 6, 1982

Current Members	Term
Mr. John Dutton	May	25,	1981	toDirector	May	25,	1984
Calgary Public Library
Rev. Paul-Emile Filion	April 16, 1981 to
Director of Libraries	April 16, 1984
Concordia University
Mr. Nicholas Goldschmidt	Canada Council appointment
Ex Officio
Dr. Francess G. Halpenny	December 9, 1979 to
General Editor	December 9, 1982
Dictionary of Canadian Biography
M. Louis-Edmond Hamelin	June	17,	1982	toRecteur	June	17,	1985
Universite du Quebec a Trois-Rivieres
Miss E. Diane MacQuarrie Director
Halifax City Regional Library
Dr. Peter Meincke President
University of Prince Edward Island
Mrs. Anne B. Piternick Professor, School of Librarianship The University of British Columbia
Madame Anna Rovira Directeur
Bibliotheque municipale La Salle, La Salle
Mr. Elmer V. Smith Director, CISTI National Research Council
Dr. W.I. Smith Dominion Archivist
Mr. Erik J. Spicer Parliamentary Librarian
Dr. Guy Sylvestre (Secretary)
National Librarian
Dr. T.H.B. Symons Vice-President
Social Sciences and Humanities Research Council
Dr. Otto Tucker Professor of Education Memorial University of Newfoundland
Mr. Ronald Yeo	January 22, 1981 to
Chief Librarian	January 22, 1984
Regina Public Library
3.	By Order in Council of May 13, 1982, the members receive $225, and the Chairman $325, for each day they attend a meeting of the Board or a committee of the Board. (P.C. 1981-1412)
4.	The total costs associated with the Board were (a) $7,720,
(b)	$7,460.
5.	The National Library Advisory Board advises and assists the National Librarian in the organization and development of the Library and its relations with other libraries and other
Order Paper Questions
appropriate institutions. It does this on a continuing basis by advising on and reviewing the priorities of the Library, its developments and its ongoing activities. It is also an important channel for making known the services of the Library in the Provinces and for soliciting suggestions for making its services more responsive to the needs of its users.
In the period under review, the Board met three times. In October, 1980, the meeting was held in Saskatoon and at a public session the Library's programs were summarized, questions were entertained and briefs were received. In November, 1981 the National Library Advisory Board met with the Advisory Board on Scientific and Technical Information to discuss Telidon and its application to library and information services. As a result of this meeting, the Board recommended that the National Library act as a clearinghouse of information on the applications of videotex and teletext to library services.
During the two fiscal years under review, the Board furthered the development of a decentralized network to facilitate the exchange of bibliographic data and the sharing of library resources. This recommendation was first set out in the "Future of the National Library of Canada", presented to the Secretary of State in 1979, after extensive consultation across Canada and with the support of the National Library Advisory Board which assisted with the establishment of priorities. In particular, the Board established committees to investigate in depth and make recommendations on some of the issues posed by the application of the combined technologies of computers and telecommunications to the evolution of a bibliographic network as well as those which need examination for the sharing of data and library resources. The progress made in these areas has resulted in the formation of the Bibliographic Common Interest Group, co-ordinated by the National Library, as part of the iNet (intelligent network) trial mounted by the Computer Communications Group of the TransCanada Telephone System. Six libraries with autonomous computer systems are able to interconnect to exchange bibliographic data and to facilitate document delivery. The Board also received recommendations concerning electronic publishing, the legal aspects of network development and the unauthorized use of copies of databases and requested that these issues be investigated.
In the same period, the Board made formal recommendations to the Secretary of State on the establishment of national library services for the visually and physically handicapped. It also actively supported the Library's submission to the Parliamentary Special Committee on the Disabled and the Handicapped which recommended that the Library act as co-ordinator of Canadian library services. As a result of the proposal, endorsed by the Special Committee in its report "Obstacles", the National Library received the resources to set up a program in 1982/83.
The Board has also been concerned with the conservation of the Canadian literary heritage and the alternative methods of storing and retrieving material. Its attention has focused especially on newspapers which are not collected on legal deposit
October 29, 1981 to October 29, 1984
Association of Universities and Colleges of Canada appointment
July 13, 1981 to July 13, 1984
May 14, 1981 to May 14, 1984
National Research Council appointment Ex Officio
Ex Officio
Ex Officio
Ex Officio
Social Sciences and Humanities Research Council appointment Ex Officio
September 22, 1982 to September 22, 1985

December 6, 1982
Order Paper Questions
by the National Library. The Board commissioned two surveys of newspapers; the first gathered information on the policies of provincial, university and other libraries on the collection and maintenance (in original or in microform) of newspapers; the second survey brought together information on the availability of newspapers on interlibrary loan and on the reference services available to researchers in libraries where newspaper collections are maintained. The Board has now asked a committee to make recommendations for a policy which will ensure that newspapers are systematically collected and maintained so that this vital primary source will be available to future researchers.
Both the review of priorities and ongoing activities and the study of special issues by the Board are undertaken in order to fulfil the National Library's objective which is to facilitate the use of library resources of the country by the people and Government of Canada.


Mr. Siddon: 1.	What was the total cost to the Government for the design, production and distribution of the pamphlet entitled "Canada Update from the 1981 Census"?
2.	How many copies of the pamphlet were printed and distributed to date?
3.	(a) Who did the design and production of the pamphlet (b) was the person an outside contractor and, if so, how was the contract awarded ?


Hon.   J.-J. Blais@Minister of Supply and Services: 1. The newsletter "Canada Update from the 1981 Census" cost $9,822.54 to design, produce and distribute.
2.	As of November 16, 1982, approximately 29,000 were printed and distributed. Subsequent mailings will be only on request and for the next issue will involve 6,338 copies.
3.	(a) The design, typesetting and camera-ready artwork were done by Statistics Canada staff, (b) The designer is an employee of Statistics Canada. The printing was done by Dollco Printing, Ottawa, selected under the standard Supply and Services contract tendering process.


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


Madam Speaker:: The questions enumerated by the Parliamentary Secretary have been answered.


Rodney Edward Murphy: I rise on a point of order, Madam Speaker, with regard to Order Paper question No. 3,487, which I asked last November 26, 1981. It was comprised of a series of questions relating to the Public Service superannuation fund and to how much money is in the fund and how much the Government has made in terms of windfall profits. Those questions directly relate to Bill C-133, which we will be debating today in the House. On November 18 of this year I asked the Parliamentary Secretary if I could receive an answer
to that question prior to the Bill being discussed in the House. I would like to know if that will be possible.


David P. Smith: Madam Speaker, I did send off an inquiry and I will send another one today.


Rodney Edward Murphy: If we cannot have that information before the debate starts in the House of Commons, can we have a guarantee that we will have that information before the Bill is discussed in the Standing Committee on Miscellaneous Estimates?


Erik Nielsen: What good will it do you?


Rodney Edward Murphy: Will we have the information before we debate this important Government legislation?


Erik Nielsen: Ironclad.


David P. Smith: It is possible, Madam Speaker. I will do my best to try to obtain an answer for the Hon. Member. The Government is not under any obligation to answer any of these questions, but notwithstanding that fact, we have answered over 83 per cent of the questions placed on the Order Paper in this session alone. Over 3,816 questions have been answered. I think that speaks for our good faith.


Some Hon. Members:: Hear, hear!


Erik Nielsen: That's four a day.


Mr. Gauthier:: Madam Speaker, while we are on this subject, 1 would like to refer to a question 1 asked about a month ago regarding Bill C-133, namely. Question No. 4,532, a thirteen-part question. 1 wondered whether the Parliamentary Secretary to the President of the Privy Council (Mr. Smith) would be willing to take this as notice and provide the answers before the debate starts in committee?


David P. Smith: I cannot assure him of that, Madam Speaker, but I can assure him that I will make my best effort to try to obtain an answer.


Madam Speaker:: Shall the remaining questions be allowed to stand?


Some Hon. Members:: Agreed.
December 6, 1982



GOVERNMENT ORDERS


[Stage Direction]
(NO.2)

Hon. Herb Gray (President of Treasury Board) moved: that Bill C-133, an Act to amend the Supplementary Retirement Benefits Act (No. 2), be read the second time and referred to the Standing Committee on Miscellaneous Estimates.
He said: Madam Speaker, this Bill is being presented to implement one of the elements of the six and five program announced in the June 28 budget.


Some Hon. Members:: Shame!


Herbert Eser (Herb) Gray: This program is a cornerstone of the Government's program of economic stabilization and renewal.


Arthur Jacob (Jake) Epp: Not a cornerstone, a millstone.


Herbert Eser (Herb) Gray: I might remind the House that the purpose of the six and five program is two-fold. First, it is intended to set a clear example of federal leadership so that we can deal effectively with the problems of inflation, high interest rates and unemployment and to make our economy more productive. The second objective of the program is to provide funds to be reallocated to job creation.

Mr. Speaker, Bill C-124, the Public Sector Compensation Restraint Act passed by Parliament last summer, was the first in a series of measures to reduce inflationary income expectations. The Bill restricted wage increases of employees in the public sector to 6 and 5 per cent, for a period of two years. Another measure applied the 6 and 5 program to the inflationary component of indexing of family allowances, old age security pensions, public service pensions and personal income tax. Thus, the purpose of Bill C-133 is to apply the 6 and 5 program to public sector pensions. The bill is not a pension policy but should be seen as part of a comprehensive response to the economic problems facing Canada today. As I said before, it is one of the many economic measures that were contained in last June's budget.
In that budget, people who have been employed in the federal public sector and who therefore have more assured incomes and relatively more job security than most other Canadians were asked to accept less protection from inflation temporarily so that inflation could be reduced and the Government could free up needed financial resources for job creation in the private sector.
Bill C-133 does not single out federal Public Service pensioners as the cause of inflation any more than any other group of Canadians. Rather, the Government chose the public sector
Supplementary Retirement Benefits Act (No. 2)
as a vehicle to project an unmistakable signal to all of the participants in the Canadian economy that we have to have lower income and price increases if we are to deal satisfactorily with problems of inflation, the problems related to it of high interest rates as well as the problems of unemployment.


Walter David Baker: Nobody believes that. [Translation]


Herbert Eser (Herb) Gray: Mr. Speaker, the general goal of the program is to encourage the private sector to follow the example set by the Federal Government and its share to reduce inflationary demands on the economy. In Bill C-133, cost-of-living adjustments paid under the Supplementary Retirement Benefits Act are capped at 6 per cent in 1983 and 5 per cent in 1984. These restrictions will apply to all individuals receiving retirement benefits as a result of employment in the federal public service.

Without this legislation, public service pensions would be increased by 11.5 per cent in January of 1983. This percentage reflects the full cost of living adjustment prescribed by the present law. That adjustment of 11.5 per cent would arise out of the relative increase in inflation in the 12-month period ending in September, 1982 over the average increase in the previous 12 months.
The restraint program is designed to alter inflationary expectations. It seeks to counteract the expectations of inflationary increases and the resulting future inflation which comes from assuming that price performance in the past will turn out to be the case for days yet to come.
Since Bill C-133 received first reading there certainly has been a fair amount of public discussion surrounding it, principally by those who oppose it. The debate has also produced a great deal of confusion and factual error over the nature of the present indexation arrangements. I would like to deal briefly with some of those more common misconceptions at this time.
Many of those who oppose the limitation on increases in Public Service pension indexation argue that public servants have fully paid for their indexation through their contribution of 1 per cent of salary, together with the matching direct contribution by the Government as employer, towards the cost of this benefit. This is not the case. Approximately 90 per cent of the indexation benefits paid to Public Service retirees are currently charged directly to the Consolidated Revenue Fund of the federal Government.


Walter David Baker: Fine way to make a case.


Herbert Eser (Herb) Gray: The Consolidated Revenue Fund is made up of moneys raised from the taxpayers of Canada generally.


Mr. Stevens:: That is right-you bet.


Herbert Eser (Herb) Gray: Only the balance of the indexing benefit, that is approximately 10 per cent of those payments, comes directly from the supplementary retirement benefits account. This is

December 6, 1982
Supplementary Retirement Benefits Act (No. 2)
the separate account set up to receive employees and employer contributions to provide for pension indexation.
To explain why this is so, I would remind Hon. Members that the present law provides what amounts to full indexation for inflation to all Public Service pensioners and their survivors. But an indexation program was first introduced only in 1970 and a large number of such pensioners retired before that date. Those who retired before 1970 made no contribution for indexing, and the majority of those retired in the years since 1970 have contributed only a small portion of the over-all costs of the benefits being paid.
Those critics of Bill C-133 who are aware of all this say yes, but if the supplementary retirement benefits account was combined with the basic pension accounts, there would be sufficient funds to support full indexation. Again, this is not the case. Looking at the program as a whole, if funds were taken from the basic accounts to support full indexing, shortages would arise in these accounts so that the basic pensions would no longer be properly funded.
Some of those who have commented on Bill C-133 have referred to an alleged $14 billion surplus in the public service superannuation account.


Sinclair McKnight Stevens: They are crazy.


Herbert Eser (Herb) Gray: I am informed that no such surplus exists.


Sinclair McKnight Stevens: That is right.


Herbert Eser (Herb) Gray: The $14 billion presumably refers to the balance in that account as of the last fiscal year end, that is, March 31, 1982. The balance at this time is in fact $15.5 billion. However, the important thing to note is that this money represents the amount which, together with future interest earnings, is needed to pay the accrued basic superannuation benefits-the basic pension-to all existing Public Service pensioners and their survivors, as well as the benefits which have been earned to date by current employees.
Other arguments have been made to the effect that the Government has broken a contractual agreement with its pensioners and has also violated an agreement that unilateral changes would not be made in the public service pension plan without prior consultation with employee representatives. While 1 regret that prior discussions did not take place before the June budget on this matter, 1 can only say that this measure was proposed as part of the over-all restraint program announced in that budget, and that it is not normal practice to reveal measures, so announced, in advance.
The capping of indexing for inflation is a temporary measure for two years which is, of course, quite different from any permanent changes which might be proposed for the plan and which would be discussed in advance.
With respect to the alleged contractual nature of pension arrangements, as Hon. Members are aware, there is no formal contract which parallels the written wage contracts existing between the Government, as an employer, and its employees. While 1 gather there was consultation with employee representatives on the question of providing full indexing for
inflation of Public Service pensions prior to that program being implemented, it in fact came about through a Bill introduced by the Government and approved by Parliament in 1973. Therefore, it would be more realistic to view such pension arrangements as being long-term but, at the same time, flexible and involving the employer and generations of employees, where changes can be made in the relevant legislation to reflect varying economic circumstances.
This was, in fact, what happened in 1973 when Parliament adopted the policy of full indexing of Public Service pensions and took the additional step of applying that policy retroactively to many persons who had paid little or even no extra contributions at all. Also, another modification to reflect economic circumstances was made as part of the Anti-Inflation Board program when Parliament put a cap on Public Service indexing to limit it to an increase of $2,400 for 1976.
Notwithstanding these comments, however, and due in large measure to the representations of several members of our caucus supporting the Government, the Government has given additional consideration to how six and five should apply to the Public Service pension arrangements. The Government recognizes that there are retirees who have made some contributions towards the cost of indexation and that moneys are set aside for this purpose in the supplementary retirement benefits account. The Government has accordingly given further consideration to whether the capping measure should apply both to that portion of the benefits paid out of the Consolidated Revenue Fund. As a result, it has concluded that indeed the capping should not apply to both of these portions.
Therefore, I propose to move, at an appropriate later stage in the debate on Bill C-133, an amendment which would be based on the principle that the six and five cap would apply only to that portion of the indexing which would be paid out of the Consolidated Revenue Fund-that is, from general tax revenues-but not to the indexing which would be charged against employees' credits in the supplementary retirement benefits account-that is, coming from direct contributions by employees and by the employer specifically for indexing.
Such an amendment would be in keeping with the Government's over-all approach on the application of the restraint measures to federal allowances and pensions. That is to say, as the House knows, the Government has proposed that the programs financed out of general tax revenues, the Family Allowance and Old Age Security, would have temporary limits placed on their increases in indexing for two years. However, the Canada Pension Plan, for which direct contributions are made by employees and employers, has not been included in the six and five restraint program.
The effect of the amendment will be to limit the increase in Public Service pensions to 6.5 per cent in 1983 and 5.5 per cent in 1984. The funds available for reallocation to job creation after adjusting for the proposed change are estimated to be $60 million in 1983 and $105 million in 1984.
December 6, 1982

1 want to stress that the Government remains committed to the principle that retired Canadians have protection against the effects of inflation. That is why we are proposing that over the next two years indexing for inflation for recipients of the Old Age Security and the Public Service pension will continue up to the limits to be set for the restraint program. The six and five program does not reduce any inflation protection which has been paid to date. What is proposed is a limit on the amounts for increases in indexing payable from general revenues during the restraint period.
As I said earlier, Canada Pension Plan benefits remain fully indexed, as do the income security benefits of those drawing the Guaranteed Income Supplement so that a measure of full inflation protection will remain on a portion of the incomes of many retirees, including recipients of Public Service pensions. More important, though, is the effect of the six and five program on breaking inflationary expectations. As the consumer price index, interest rates generally and mortgage rates come down, any real income losses from the cap on increases in indexing will disappear.
I know that the introduction of this Bill and the public discussions surrounding it have raised many questions about the state of the superannuation and indexing accounts. These include questions on the funding and financing of the program, the philosophy behind the use of the funds in the accounts and whether the various accounts should be combined, just to name a few of the issues or questions. However, I regard these as long-term issues and I believe these must be addressed in the context of the debate which will take place over the coming months about the direction and form of our national pension system, both public and private, once the green paper on national pension reform is released later this month.
Let me assure everyone that there will be full opportunity for consultation before any changes are decided upon and any proposals made to Parliament concerning the superannuation plans of federal Public Service employees. In passing, I want to recall the work done on these issues by the Miscellaneous Estimates Committee in a previous Parliament.

Mr. Speaker, all Canadians should be very happy about the successful results so far of the 6 and 5 program and the promising signs of further success in the near future. We are getting closer to the 6 and 5 era, which is the purpose of the first stage of this important program.

A review of retail prices since the June 28 launching of the program shows inflation moderating. On an annual basis, inflation in October was an even 10 per cent, the lowest rate since May, 1980. On a monthly basis, inflation in October was 0.6 per cent.
[ Translation]
Mr. Speaker, considering the 0.5 per cent recorded in July, August and September, we can certainly say that inflation is stabilizing at the levels we have set. If we continue this trend,
Supplementary Retirement Benefits Act (No. 2)
it will also help to stabilize the real income of Canadians, including retired Canadians.

To conclude, let me repeat that this Bill is part of a broad policy package intended to steer us toward lower inflation and renewed economic growth. Therefore, I urge all Members to support this Bill and its early adoption.


Walter David Baker: Mr. Speaker, we have just heard an extraordinary speech by the Minister. Just a few moments ago in one of the last passages of his discourse to the House, the Minister said there would be full consultation before any changes would be made in the superannuation program affecting the public servant. It is interesting to note that that promise about full consultation was made some time ago. It is precisely that promise which the serving public servant and the superannuates say was broken.
I do not know why anyone in the federal Public Service, anyone who represents federal public servants or anyone who is interested in the question of equity and good conscience in terms of this matter should be prepared to accept that representation by the Minister. He read carefully from a prepared text. I do not know why he should expect that when we had similar undertakings from the Prime Minister (Mr. Trudeau) and the former President of the Treasury Board with respect to the same kind of consultation-no changes regarding inflation as an eroding power on superannuates' income.
Earlier in his speech the Minister said, and none of us is quite sure what he meant, that this amendment would limit increases in 1983 and 1984 respectively to 6.5 per cent and 5.5 per cent. I believe that is what he said. What he is saying to this House is that with 0.5 per cent, "I can buy you". That is what he is saying to all the people he is today asking to support his program.
Instead of having a six and five program, apparently it is now a 6.5 and 5.5 program. That is what he seems to be suggesting to the Members of this House. We will have to examine it in some detail, but that is what he said today.
I am going to deal with the problem that affects certain members of this House of Commons and a little later, I hope, a much larger number. If anyone who is interested in this program regards it as a great leap forward in equity, they had better think about it overnight. They will have some time to think about it before they leap and grab at this, clutch it and hold it close to their bosom as a salvation.
What this represents is not a great victory but a failure by Members of Parliament to persuade the Government. They did their best to attempt to succeed with respect to this, but it is a great failure.
The Minister was very careful not to tell this House what this Bill is. He set it in a broad framework. I will tell Members what it is. It is part of a vicious trilogy of legislation being dealt with in this House of Commons. We are not through dealing with it all; This is the third leg of the vicious trilogy of legislation.

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Supplementary Retirement Benefits Act {No. 2)
The first piece of legislation, which affects those who are not in a position to look after themselves, is Bill C-131 dealing with the recipients of Old Age Security. The Government decided that the senior citizens would be put into the trenches to be the cannon fodder in this fight against inflation.
The second thing they are saying is that mothers of young families, the young children themselves, are to be the second tier in the trenches behind the Old Age Security recipients under Bill C-132 dealing with Family Allowances and limitations thereto.
The third leg in the trilogy is the public servants. That is an interesting phrase. Let me tell you what that means in terms of who it affects, Mr. Speaker. Broadly speaking, it affects every serving public servant because the six and five program as applied in Bill C-124 has an effect thereafter on their best six years. It affects every retired public servant because the six and five program as applied in Bill C-124 has an effect thereafter on their best six years. It affects every retired public servant because the retired public servants are grateful for the support willingly given to their superannuation by those who are still working. It affects every serving and retired employee of every Crown agency and Crown corporation in the country. It affects the Members of this place, certainly, and Her Majesty's judges. More importantly than that, if affects every member of the Canadian Armed Forces, both serving and retired. It affects as well those who are serving and those who have served in the Royal Canadian Mounted Police.
The group which is sometimes forgotten in all of this discussion about six and five is not just those who are still in the work force in the broad public sector and, therefore, have some clout in terms of future bargaining, but the wives, the widows and the children of those who are serving and those who have served. Those are the ones who are affected by this piece of legislation.
I am going to characterize this Bill, even with the amendment which we are going to have a chance to look at and the figures which are going to be produced later on, in this way: it is a mean, vicious, wretched, immoral act of this Government. That is how it ought to be characterized. Any Government which would put those who have retired into the trenches with respect to the battle against inflation and run them ahead of itself as the shield against inflation ought to be ashamed of itself.
I do not think the President of the Treasury Board (Mr. Gray) ought to count this as a red letter day in his ministerial life. This is his first major piece of legislation. Bill C-119 was his first piece of legislation and that was nothing of which one can be terribly proud. In fact, it has not yet even been scheduled at the Miscellaneous Estimates Committee. In any event, I do not believe the Minister should be proud that his first major piece of legislation is a Bill that breaches faith and an undertaking and defies a moral obligation. Whether this Government likes it or not, the funds with which we are dealing, never mind the statements which have been made,
every contribution which has ever been made over the last 50 years, is a contribution of funds which are impressed with a trust. If you or I, Mr. Speaker, tried to convert moneys impressed with a trust from one purpose to another, the Crown Attorney would be called in. Governments are no better than anyone else, even majority Governments. It is a breach of a moral obligation to the serving public servant as well as those who have served in the broad sense I have described, including the wives, the widows and the children.
This piece of legislation is unsupportable. The gall of this Government in this matter is breathtaking, to move in that direction and then to say, "But we will consult a little further now". What happened to the consultation before? Our Party is opposed to this Bill; make no mistake about that. This piece of legislation to cut indexing for serving and retired public servants so that their incomes in retirement will not reflect the cost of living is being proposed by the same Government which decided it would be a good thing one way or the other to index mortgages. It said that in the budget. The Lortie Commission dumped on it, but that proposal has not gone to sleep because the Economic Council of Canada has decided it would be a good thing to index mortgages for, supposedly, younger people buying homes, people still in the work force who can protect themselves. But with respect to that group of public servants who are said to be docile, quiet, who do not make much noise and are not very popular in the country, "We'll deal with them; we'll cut their indexing. We won't let that be reflected".
There is another side to this, Mr. Speaker. This same Government which is asking for a cap on indexing is exactly the same Government which looks after its friends. You must have read in the paper, as I have, about the generous golden handshake for the senior public servant, Michael Pitfield. It is marvellous what the Government has done for him with respect to his pension. It is allowing Michael Pitfield to leave the Public Service with a special deal which will allow him to contribute to his indexed Public Service pension at a certain rate so that when he has reached the period of life when he, too, can no longer bargain, he is going to be protected, even though he did not serve, even though he decided to leave voluntarily. It is generous, Mr. Speaker. This is what the Order in Council said, and I quote:
-to approve ... the continued participation of Mr. P. M. Pitfield under the Public Service Superannuation Act on the basis that he shall contribute 50 per cent of the contributions payable under the act until such time as he takes his pension, the other 50 per cent of the contributions to be paid by the Government-
1 should add, a "grateful" Government. The article continues:
-and ... to deem ... the salary of Mr. P. M. Pitfield to be at the 8th decile of the DM-3 level as amended from time to time until he takes his pension."


An Hon. Member:: What is that level?


Walter David Baker: What is that level, my hon. friend asks. At his present rate of pay, it could easily total $100,000 by the time he is eligible for retirement at the age of 55 on June 18, 1992. There is still a Santa Claus, Mr. Speaker. And yet, for the least of the public servants, for the least of the
December 6, 1982

widows, for the least of the children of public servants, that Minister has the gall to stand up in the House and say: "We are going to do it for Pitfield, but we are not going to do it for you".
Well, Mr. Speaker, we do not intend to stand idly by and see that kind of thing happen. The Government might as well face up to that. Technically, Michael Pitfield could have worked for the Government for 20 years and be paid for 40 through his pension, at the level of a Deputy Minister. That is really generosity worth noting in this country. Yes, Virginia, there is a Santa Claus! Is there not someone over there who can blush at that? Cannot the former President of the Treasury Board, who has now gone to his glory in another portfolio, blush at that? Is there no one over there who does not see the injustice of it all? Is there anyone over there as my friend, the Hon. Member for Annapolis Valley-Hants (Mr. Nowlan) says, without a sense of shame? I hope there is. I hope there is someone over there with the guts to stand up against that kind of inequity for the least of those in the Public Service.
Does the Government need to renege on its contractual obligations, Mr. Speaker? I am going to read from a letter to the Editor of the Ottawa Citizen where that question was put. This is the answer:
The refusal to honour indexing commitments for public servants would reduce the government deficit by less then $60 million in the present fiscal year (based on an average contribution per pensioner of approximately $450 less income tax). That is a substantial sum, but placed against a budget deficit of $23 billion, it will not do much to reduce inflation.
What is really at stake is public trust and confidence in the government. While it may be politically opportune for the government to make public servants and public service pensioners "whipping boys" to divert attention from much more serious matters, the question is, who will be next? Will the government decide to default on other contract commitments?
In the conduct of affairs, whether they be public or private, the "broader principle" is that there must be rules for the game. Neither governments nor individuals should be allowed to change the rules to fit personal convenience. In that direction lies chaos and anarchy.
That is the reason the community is aroused about this matter, whether you are talking about old age pensions, mothers' allowance or this Bill in particular. It is a breach of trust, pure and simple, a breach of a moral obligation. That is why we oppose this Bill.
Members know the history of this legislation, Mr. Speaker. They know it has been some 50 years in development. They know it was Arnold Heeney who indicated clearly that there was an undertaking and obligation to serving public servants which ought to be met. When public servants of that day wanted to have pensions bargainable, the Government said no, that could be difficult. It could lead to all kinds of anomalies and problems. "Do not make it bargainable and we will make a deal with you; we will not change those things without consultation".
That is the history. The Government held to the bargain for a long period of time. In 1973 the Government finally took the 2 per cent cap off. I spoke for my Party in 1973 and said it was a good thing. Why? Because indexation does not put public
Supplementary Retirement Benefits Act (No. 2)
servants marching ahead of the economy; it keeps them up to date. It just keeps them in line. Why is it a good thing that we keep those people in line? For the same reasons that we keep recipients of the Canada Pension Plan in line-because we have a special obligation to those who have gone ahead. This Bill is a denial of that obligation. I read in 1974 the directive of the Treasury Board that said it was the policy of the Government to keep everyone in line to ensure that no one would lag behind. That was the reason for indexation. I read what the Prime Minister said in a letter to the National President of the Defence Employees' Association. This is what the Prime Minister said on October 12, 1977:
In our society, pensions provide a means of sharing risk so that we can retire in reasonable security and dignity, without fear of the future. Protecting pensions from inflation by indexing them to increases in the cost of living should be an integral part of our pension schemes.
It was, it is, and if this Bill fails, it will still be. He goes on:
Indexing does not give pensioners an increasingly larger claim on our economy's production-
Remember that, my friends in the Liberal Party; that is what your Prime Minister said. He continued:
-that is, more money to buy things they could not earlier afford. Rather indexing merely enables pensioners to maintain, roughly, their same standard of living.
I do not normally quote the Prime Minister, but it may be only the Prime Minister whose words will have some influence on those over in that party who can change the course of this legislation if they want to. The Prime Minister went on to say this:
Even a modest rate of inflation destroys, at a devastating rate, the buying power of people on fixed incomes. Pensioners are out of the workforce and cannot bargain or strike for larger incomes. They are not the cause of inflation; they are its victim. We have an obligation to help protect them.
That is what the Prime Minister of Canada said in 1977 when the problems facing pensioners then were not as serious as they are now. If that was the truth in 1977, why has it suddenly become the anti-truth in 1982? Why has the situation suddenly changed? When he said that, the need for protection was not as great and the disparity was not as great as it is now. Yet today, when we have all those problems, and with increasing uncertainty, suddenly the Liberal Party, the Liberal Government, changes course and puts all pensioners in the front line of the fight against inflation.
In 1981, the then President of the Treasury Board said it was the position of the Government that public servants would be protected from inflation. At the Committee on Miscellaneous Estimates not too long ago he said, in answer to a question of mine, that it was not the intention of the Government to bring in legislation to deal in isolation and individually with Public Service pensions.


Erik Nielsen: He is listening to you now.


Walter David Baker: But that it would be considered as part of an over-all program of pension reform. That is fair ball, but this is discriminatory. When you move a Minister from one portfolio to another, does it mean that what

December 6, 1982
Supplementary Retirement Benefits Act (No. 2)
was the truth before can become a lie today? 1 suggest not, and no one in the country will believe it.
You will never convince, Mr. Speaker, the serving public servant that the money we are talking about does not belong to him, that he did not contribute, that there is not a contract or an obligation, because the argument is irrefutable.
As best 1 can, I have given the history and this will be examined in committee if the Bill goes through. The Bill will never get to committee, of course, if some Members of the Liberal Party do their job.
1 am told the legislation would rob the average pensioner of about SI,200 over the next two years, would impoverish them and drastically lower their standard of living. Some people think that Public Service pensions and the pensions paid to widows are huge and that these people walk around with their pockets heavy with coinage from the pension to which they have contributed through an arrangement made by the Government. That is not so, Mr. Speaker. Former public sector workers and their survivors currently receive an average pension of only $6,900. That is better than nothing, but it is not a large pension. These are the people who will be affected by the Bill.
1 think that the public should know that the Senate of Canada maintains that a two-person family earning less than $11,030 in 1980 was said to live in abject poverty. The Government would like to weave a fantasy of wealthy public servants with both feet in the public trough. But that is not so, Mr. Speaker. Even if it were partially true, any Government would have to think twice before it attacked those who cannot protect themselves; but that is what the Government is doing through this Bill.
I want to speak to my friends in the House who have spoken out about this legislation, Mr. Speaker. The discussion first started in the warm days of July, 1982 when the breezes that flowed over the Ottawa River had a remarkable effect on some Members. The Ottawa Citizen of July 9, 1982 quoted the Hon. Member for Ottawa West (Mr. Francis) as follows:
I personally find it unacceptable that the government plans to limit pension indexation. The government is a trustee of the indexation fund but the money belongs to the pensioners.
No doubt the Hon. Member will be speaking in this debate and will develop what I think is a fairly reasonable theory about where payments can be made. If he speaks, he will condemn the President of the Treasury Board for the line of reasoning he has brought forward. I certainly expect him to enter this debate and to oppose the Bill.
Then the Hon. Member for Hull (Mr. Isabelle), who is in the House listening to the debate today, spoke on the matter when the proposal to limit indexation was included in one of the MacEachen budgets. The same Ottawa Citizen article reported him as saying:
-they should leave the pensions at full indexation. Eighty per cent of retired civil servants are not getting very big pensions and most are out of the workforce so they can't increase their incomes.
I agree with him; he is right. Some time during the course of this debate I want him to stand up and say this. When the time comes, I want him to put his vote where I believe his mouth is-that is, to oppose the Bill.
The Hon. Member for Ottawa Centre (Mr. Evans), who is my good friend, is also in the House today. That Ottawa Citizen article quoted him as saying:
I have not seen any evidence that the contributions paid to the supplementary fund are inadequate and that the fund is not solvent.
I want to take a good hard look at the government proposals.
I assume he has taken a good hard look, Mr. Speaker. I shared a platform with him at the RA Centre the other night when he made what I call a courageous speech, indicating that he opposed the Government's proposal to reduce indexation to six and five. 1 presume he will not be purchased or bought by 6.5 and 5.5.
Then there is the Hon. Member for Ottawa-Vanier (Mr. Gauthier), the Chairman of the Standing Committee on Miscellaneous Estimates on which I have the honour to serve and which will deal with this Bill. According to that Ottawa Citizen article he said that the pension indexation fund:
-is similar to investing your money at a trust company. There is now $889 million in the indexation fund and it is paying a 14.9 per cent return on investments.
That is not bad, Mr. Speaker. He went on to say:
Suddenly one day the trust company phones up to announce that arbitrarily and unilaterally it will only pay six per cent because the customer is expected to set an example.
He was also at the public meeting at the RA Centre. He and I had the privilege of sharing the platform. At that time he gave us a trust company analogy in both official languages and he said he was going to stand against this measure. There was not a public servant of the some 800 in the hall who did not understand that and left the meeting with content in his heart that the Hon. Member for Ottawa-Vanier (Mr. Gauthier) was on his side.
At that great meeting at the RA Association there was also the Hon. Member for Vaudreuil (Mr. Herbert). He had been denied a pension. He said he was opposed to this, that he supported indexation, that this was not the Government's money but it belonged to public servants. He pointed to the audience of public servants and superannuates who agreed that it was their money and who cheered him to the rafters. They even tolerated him when he said that, on the other hand, he was a Liberal and would not want to vote against the Party. He gave the clear impression, however, that his heart was in the right place but that his vote might be in the wrong place. It was marvellous that night. There was an ecumenical euphoria in the hall when Liberal after Liberal stood up and said: "We are opposed. We will vote against it.". One said, "We do not want the Tories in office again; we don't want to risk it." I will help them out with suggestions about how we can get around that in a few minutes, Mr. Speaker.
I want to talk now about something that has worried me. I go to church from time to time and every now and again my minister warns me against backsliding. The Hon. Member for
December 6, 1982

Provencher (Mr. Epp) understands what I am coming to. I suspect the person who spiritually ministers to the Hon. Member for Ottawa-Vanier has warned him against backsliding from time to time as well. That is why 1 was shocked to read the headline in the Ottawa Citizen of November 25, 1982: "Grit MPs back off from revolt over PS pensions".
As 1 have said, as the Hon. Member for Provencher has said, as the Hon. Member for Yukon (Mr. Nielsen) has said, as the Hon. Member for Victoria (Mr. McKinnon) has said, as the Hon. Member for St. Catharines (Mr. Reid) has said and as the Hon. Member for Bow River (Mr. Taylor) has said, they could hardly believe what they read, in view of the courage that had been exhibited at the Recreation Centre in front of 800 public servants. The Member for Ottawa-Vanier said they were worried about bringing down the Government; that it was a matter of confidence in the Government if they voted against the Bill.
1 agree that it is a serious vote, given that the President of the Treasury Board characterized it as an absolutely essential part of the six and five program. I just do not believe the President of the Treasury Board when he says that it is essential, but that is his view. In any event, these Liberals have indicated that it would be a blow and that they were worried about bringing down the Government.
I will help them out because I believe the fate of the Bill does not lie with the New Democratic Party or with the Progressive Conservative Party. Its fate lies with the backbenchers of the Liberal Party. The question of retired public servants lies with those Members of the Liberal Party who are prepared to put their votes where their mouths are. There may be more. The rate of this Bill also lies with those who believe in simple justice and wonder whether it is right to deny a moral obligation which has stood the test of time, which has been backed by the Prime Minister and by former Presidents of the Treasury Board, and which has been relied upon by people who made their retirement plans on the basis of these things, those who are no longer in the work force. It lies just as much with Members of Parliament outside the National Capital as it does with Members of Parliament within the National Capital, but it lies very heavily on the latter because they represent the largest single group.
I want my friends opposite to remember that there are federal public servants in British Columbia, Alberta,.Saskatchewan, Manitoba, Ontario, Quebec and the Maritime Provinces. There are federal public servants who serve with our troops in Lahr and Baden. There are federal public servants in the Middle East. There are federal public servants all over the world. Their eyes are on Parliament today. I know it is difficult for some of my friends in the Liberal Party to rise and vote against their Party. It is tough. It is not in the Canadian tradition.
When we dealt with Bill C-131, I said that I would give them an opportunity, that I would plead with them and that I would try to help them. I want to tell them how. It should be a
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blow to the Government for sure, but it would be a blow to the Government worth sustaining. I put it to my friends that it would not bring down the Government. Is there anyone in his right mind who believes that the federal Government or the Liberal Party would want to go to the country riding on the backs of old age pensioners, retired public servants and those in receipt of Family Allowances? Is there anyone who believes that they really want to go to the country? Nobody does. They know in their heart of hearts that, although it would be a blow to the Government, it would be the best message the Government ever received. They would be saying: "Send back the Bill, redo the Bill, rethink our attitude". Then the very next day the Government House Leader, aided and abetted by his Parliamentary Secretary who sits in the House today, would have a motion in which the House would be asked again to vote confidence in the Government.
Do Hon. Members remember Lester Bowles Pearson who did exactly that? I did not like it any more than anyone else. It was a dilution of the things we knew about the British parliamentary system, but there it stands as a precedent.


Mr. Evans:: Why didn't you do it?


Walter David Baker: Because we were dealing with a budget. I have never held that a budget as such or a budget motion is anything other than a matter of confidence. This is not. This is a Bill arising out of the budget, the budget already having been approved by the majority of the Members of the House of Commons. There is quite a difference. I tell the Hon. Member for Ottawa Centre that he should think about it overnight. I say to him, "Give the Government a message". They should rise on their hind legs, defeat the Bill and send it back.
If they do not do so, people will wonder ever again whether or not the word of the Government or those who say they are opposed to a measure can be accepted. They will wonder ever again, if there is a public meeting a little later about indexed pensions or anything else, whether or not those who speak and take positions can be believed and relied on.
I tell my dear friends that it is absolutely important for everyone to understand that the eyes of a great number of Canadians, 300,000 public servants and other people who care about reasonable equity and justice, have been and will be on the House of Commons as we deal with Bill C-131, Bill C-132 and Bill C-133. I want to give the Government a chance. I want to give backbenchers a chance to think about it. I want to give their caucus a chance to think about it. It is for that purpose that I will move an amendment which I hope will be supported by my friends in the Liberal Party, on whom the fate of this legislation rests when the matter comes to a vote. Therefore I move, seconded by the Hon. Member for Provencher (Mr. Epp):
That the motion be amended by deleting all the words after the word "That" and substituting the following therefor:
"Bill C-133, an Act to amend the Supplementary Retirement Benefits Act
(No. 2), be not now read a second time but that it be read a second time this
day six months hence."

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Supplementary Retirement Benefits Act (No. 2)
The Hon. Member for Provencher, a Member from western Canada, is prepared to support this amendment. The purpose of it is to indicate that there can be time for those opposed to inequity, to injustice, to the breach of moral obligation and to the breach of contract by the Government with its employees, to prevail upon the leaders and the Treasury Board to breathe some life in 1982 into the statements made by the Prime Minister in 1977.


Some Hon. Members:: Hear, hear!


Sidney James Parker: Mr. Speaker,
I noted with interest the comments of the Hon. Member for Nepean-Carleton (Mr. Baker). In his closing remarks he stated that this was a breach of contract. He should realize that when the six and five program was brought in under Bill C-124, which his Party supported, it was also a breach of contract with many Canadians across the country. He and his Party supported it. In fact, his Leader stated that they had not gone far enough. Now the President of the Treasury Board (Mr. Gray) is starting to go a bit further.
It is a sad day for me that I have to rise in the House to speak on Bill C-133. It is difficult to discuss the Bill before the House of Commons because so much of the language which we need to describe the Bill is unparliamentary. For example, it removes pension protections for which public servants have already paid. What do we call a person who takes something that belongs to another person without that person's consent? This is what I want to ask. The Bill also provides a pension level less than that promised to public servants. What do we call it when a person sells something to another person and delivers much less than he promised?
Then there are the Conservatives. The Conservatives say they oppose this Bill. They say they oppose it in the same way they oppose the Bill to reduce indexing on Old Age Security. But what are the Conservatives going to do with that opposition? They are not going to do very much. Even last November 18, when the subject of Bill C-133 came up in the House, the Conservative House Leader asked the Government House Leader whether he would bring the Bill forward the following day so they could deal with it expeditiously.
There is also a word for a person who claims to oppose something but then does nothing to back it up. We cannot use any of those words in the House of Commons. If we cannot use the words describing what this Bill really does in Parliament, we can at least describe the effect it will have.
First and most important, this Bill will permanently reduce by 10 per cent the real incomes of over 150,000 retired federal public servants. Thousands more widows or retired public servants will see their incomes cut as well.
Once again, the Government has tried to say that this Bill will only affect people who can afford to be affected. The average pension of people retiring in 1982 is $8,100. The average pension of all retirees from the federal Public Service
is $6,900. The average pension going to widows of public servants is $3,200.
Let us put these figures into perspective. A couple living in one of Canada's largest cities requires an income of nearly $12,000 annually to keep above the poverty line. If inflation for 1983 and 1984 remains in the area of 10 per cent, which seems likely, people retiring this year will see their real pension income decreased in purchasing power by about $1,400. People receiving survivors' pensions will see their purchasing power drop by over $500. While this is happening, there are no guarantees about prices. What happens when housing costs and rents go up, energy and heating costs go up, food costs go up, medical costs go up, a factor very important to senior citizens?
Pensioners are not just facing a temporary loss of income. When our economy recovers and our workers return to their jobs, they may be able to catch up with some of the losses they have incurred. They may do this through productivity or bargaining. But pensioners will never catch up because they will never have that opportunity.
This Bill and Bill C-131 impose pension cutbacks which will reduce the incomes of retirees for the rest of their lives by making their pension base lower. That is a fact that must be understood.
One idea that must be put to rest in the House today is that the pensions attacked by Bill C-133 are some sort of Government charity. They are not. They are pensions which have been bought and paid for by working public servants.
Since 1924 public servants have had sums deducted from their wages to pay for retirement pensions. Like many employers in the private sector, the Government also makes contributions to the pension funds and interest on those funds is added. The difference is in the amount paid by public servants. Public servants pay a base rate of 6.5 per cent of their salaries into pension contributions, which include the Canada Pension Plan. Over and above that amount, and this must be understood, public servants pay a further 1 per cent of their salaries into an indexing fund to cover the costs of indexed pensions. In fact, public servants pay one of the highest pension contribution rates of any employer-sponsored pension plan in Canada. The Government is also aware that there is enough money in the pension funds to pay the pensions of retired public servants, even though the Government has paid a very low rate of return on the money it has held for pension purposes.
Public servants have chosen to pay a larger portion of their incomes into pension plans than other people, and for a very good reason. They know that pension plan contributions are a form of deferred income. They are putting off a portion of their income today for their future needs. Public servants chose to put off a larger than usual portion of their incomes in order to guarantee themselves a secure retirement, protected from the ravages of inflation. Throughout their working lives public servants paid a portion of their pay cheque to give themselves a safe future. On the basis of that indexed pension, which they had paid for, many public servants have taken an early retirement.

That secure future, paid for during their working lives, is now being threatened by this Bill, which will reduce their standard of living by 10 per cent. In essence, we know that pensions are nothing more than a way of putting off earnings until retirement. The Government, through this Bill, is, in effect, confiscating a part of those previously earned wages. For working public servants, wage controls will affect their present and their future wages. Retired public servants, through this Bill, are actually having their wages reduced retroactively. The pension indexing which is being stolen from these retired public servants has been acknowledged as a vital part of their pensions. Let me quote one important commentator on this subject as follows:
-Put simply, people must be protected in their retirement years. The Canadian Government has pledged that they will be better protected in the future than they are now-[DOT]
Pensions which are not protected against inflation naturally tend to dwindle over the years. People who thought they had purchased protection for the rest of their lives find that they have more serious financial problems the older they become. The unfairness of that situation, particularly when the savings pool to which they have contributed may have been reaping inflationary interest premiums, is not tolerable in a nation which believes in social justice-
The Prime Minister (Mr. Trudeau) said that at the 1981 National Pension Conference. For the President of the Treasury Board to bring in this Bill now on behalf of the Government of Canada is a disgrace and a shame.
However, the then President of the Treasury Board made similar comments to those of the Prime Minister last year concerning public service pensions. He agreed that our pensions were indeed simply deferred wages and said:
The federal Government remains dedicated to the principle that public servants' pensions are to be protected from inflation.
I see the former President of the Treasury Board is sitting in his place and laughing. He will not be standing up with some of his backbenchers who have indicated that they may vote against this Bill. No doubt they will be properly told to get back in line.
The action being taken by the Government is so morally wrong that it has even forbidden companies in the private sector to do the same thing. Pension plans, registered under the Canada Income Tax Act, are prohibited by law from reducing either benefits or any right to benefits of a supplementary pension. What is illegally and morally wrong for insurance companies is now before the House as Government policy.
When collective bargaining was being introduced to the federal public sector many years ago, the Government approached the associations which existed at that time. The Government proposed to exclude superannuation from collective bargaining. In return, the Government said there would be unilateral changes in the program. That was a gentleman's agreement. It is now pretty clear just how much a gentleman's agreement with a Liberal Government is worth. It is something like the iron-clad guarantee made by the former Minister of Energy, Mines and Resources when we were dealing
Supplementary Retirement Benefits Act (No. 2) with the Alaska pipeline. I imagine there are some retired public servants who are now wondering just how much the word of any Liberal Government is worth.


Rodney Edward Murphy: Less than 6 per cent.


Sidney James Parker: I think they must also take into consideration the fact that when they elect these members, it is the policies of the Liberal Party and of the Conservative Party for which they are voting, not the individual. It is evident that the individual cannot carry the load for the electorate and cannot entice the Government to carry out programs for the protection of the people.
Just a couple of weeks ago, the Public Service unions in this community held a public meeting for retired public servants. Nearly 1,000 people came. Many were turned away, as was mentioned by the Hon. Member for Nepean-Carleton (Mr. Baker) during his speech. However, before that audience of 1,000 people, the Hon. Member for Ottawa-Vanier (Mr. Gauthier) and the Hon. Member for Vaudreuil (Mr. Herbert) promised that they would fight the Bill and vote against it. Those were pretty tough fighting words.
Unfortunately, those tough fighting words lasted only until the audience had gone home. Within days, those two Hon. Members changed their minds and said they would vote for the Bill. At this time, I would like Hon. Members to know that when we were at that meeting here in Ottawa, which 1 attended, we were told by the chairman of the committee that there was a vote in the House and that we must return to the House. That is how the meeting dispersed that night. In fact, when I returned to the House I found that there was no vote being held in the House.


Rodney Edward Murphy: Cowardly behaviour.


Sidney James Parker: I do not know where that information originated. A disservice was done to the Public Service of Canada because that fact was not admitted while the audience was still there. That would have been more courageous and honourable. At least the Minister of Transport (Mr. Pepin), who could not break Cabinet solidarity, had the decency to make his position clear by refusing to attend.
The Official Opposition has also been playing fast and loose with its stand on the Bill. The Hon. Member for Nepean-Carleton told those at that same meeting that his party would do everything in its power to prevent the passage of the Bill.


Walter David Baker: That is why we moved the motion today.


Sidney James Parker: He conveniently forgot to mention the promise of his House leader that if the Government would bring the Bill forward, the Conservatives would deal with it expeditiously-


Walter David Baker: We cut its throat.


Sidney James Parker: That does not come as any surprise, either. When the Government brought forward its six and five budget
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December 6, 1982
Supplementary Retirement Benefits Act (No. 2)
last summer, the Leader of the Opposition (Mr. Clark) had only one complaint. The Leader of the Conservative Party said that the idea did not go far enough. The Bill must go far enough even for the Leader of the Opposition now. We think the Bill goes too far. We think it is an outright theft of wages put away by public servants in the past toward their old age. We think it is nothing more than a raid by the Government on the pension account which will end up with retirees losing $100 million. We think it is a move which will drive thousands of retired public servants below the poverty line in their standard of living. Perhaps most of all, we think it is a betrayal of the Government's own employees. Never again will a Government employee be able to trust the word of the Government as to how its pension funds are handled. They will always know that at any point in the future the Government may unilaterally reduce their pensions or raid their pension account for its own purposes. That betrayal of the trust and confidence of public servants will have longer-term consequences than those of which the Government may be aware.
In closing, I can do no better than to quote the words of our own House Leader when he was speaking on Bill C-131, the Old Age Security Act. At that time he said: "We are not only opposed to the point where we want to vote against this Bill, but we are opposed to the point where we will not facilitate its passage in any way". That quote stands on the record.
We have raised a number of issues. I would urge the Government to reconsider what it is doing, to withdraw the Bill at the present time and look for other sources of money than taking it on the backs of civil servants and from the indexing of their pensions.


Mr. Hal Herbert (Vaudreuil):: Mr. Speaker, no doubt some will find it strange that I should be speaking this afternoon; first, that I should have chosen to speak and, second, that the Government should be allowing me to speak this afternoon on this Bill in view of the remarks that I have made publicly and which I will be repeating this afternoon.
The reason I have chosen to speak is that I have heard so much rhetoric from Hon. Members of the Opposition in the last several days on Bill C-131 and C-132 that I felt that for my own constituents, at least public servants and retired public servants in my riding, it would be a good thing for me to put my position on the record in totality, so that there is no misunderstanding about the position I have taken on this Bill.
I have just listened to the remarks of the Hon. Member for Kootenay East-Revelstoke (Mr. Parker), which remarks do not surprise me. It is same socialist line we have been hearing in the last several days. I will allow only one thing: it is consistent with what I expected to hear from him. In fact, he only said one thing that surprised me. He said he found it difficult to discuss the Bill. I would have thought he would find it very easy to discuss the Bill. Certainly I will not have any difficulty in discussing the Bill. However, I will particularly address my remarks this afternoon toward the Tory Party, because it is the hypocrisy which I have heard from that Party in the last several days which makes me angry enough to want to speak this afternoon.
First, I have publicly said that I do not like Bill C-133, and I repeat it. It is simple. I do not like it simply because we are reducing the expectations of retirees from the Public Service. We are cutting down the amount that they were expecting to receive in 1983 and 1984. That is a fact and no one can deny it. However, it should be abundantly apparent that if we succeed in reducing the rate of inflation in 1983 to 6 per cent, the amount they will receive next year, 6 per cent, will compensate them for the increase in the cost of living.
Which, of course, brings us to the Government's efforts to reduce inflation and to do it across the board. I must ask myself, first of all, whether it is fair to apply these reductions to the superannuation payments of public servants. Certainly I have publicly said that I believe that public servants have, with their own money, purchased something. I will come to the definition of "something" in a minute. They believe that they have purchased full indexing of their pensions. However, with what did they pay for full indexing? Those who retired previous to the imposition of the charge for indexation paid nothing whatsoever. Those who have retired since, those who retired before 1975, have paid one-half per cent. Those who have retired since 1975 have paid 1 per cent.
Quite apparently, even with a person who has recently retired in the last year and has contributed to indexing since the 1975 change to 1 per cent, or the one-half per cent prior to that, the amount of that contribution is certainly inadequate to cover the amount of indexation for all the years ahead. Thus one could argue that if the amount is inadequate maybe the Government should have approached it in a different fashion, that it should have increased the levy on public servants. That is one approach that one can take.
I have also argued that the Government, and I hope this will happen fairly soon, should put together the amount that is in the fund to cover indexation with the amount that is in the original fund to cover pensions, and that these two together should be enough to cover indexing in future years. It should be abundantly apparent that even the amount that is presently in the fund to cover indexation is more than enough if we can reduce the rate of inflation to a low level of, say, 3 per cent, 4 per cent, or 5 per cent.
I did indicate at the meeting which was held on Monday evening, November 22, at the Recreation Centre in Ottawa, that I did not like Bill C-133. At the same meeting I was asked the direct question: "Will you vote against Bill C-133?" I said: "No, 1 will not". I want to explain that in full right here and now.
First of all, I was elected as a Liberal to support Government policy.


Mr. Nickerson:: Even if you do not agree with it.


Harold Thomas Herbert: Government policy at the present time is the full program of six and five.


An Hon. Member:: Hear, hear!
December 6, 1982


Harold Thomas Herbert: 1 support that in its entirety. The Tories, I had thought, also supported it in its entirety. I must admit that when six and five was originally introduced 1 did not think all the way down the line. 1 did not think down to the level of the old age pensions and to the level of Family Allowances.


Dave Nickerson: You did not think at all.


Harold Thomas Herbert: I am on the record already as stating that, in the case of Family Allowances, we should start economizing. In fact, I have even suggested freezing Family Allowances entirely, not even increasing them by 6 per cent. I suggested that we put some sort of a freeze on the basic old age pension and that we index only those receiving the GIS, indexing the total, of course, of the GIS and the OAS together. The reason I suggested this is that I believe that when the Government is short of funds, when there is an obvious need to direct our moneys to those most in need, we should make every effort possible to redirect our funding to those who are likely to suffer the most from the present high rates of inflation.
1 find the arguments that are based on universality frankly hypocritical. I admit that that is a plank of my Party and I have no hesitation in supporting the principle of universality. I also point out that, as long as we have the OAS universal and the GIS revenue-tested, as long as we have Family Allowances universal and the Child Tax Credit means-tested, and so on and so forth, we only go as universal in our programs as we can afford.
In principle one can support universality, but I have bluntly asked the Members of the Socialist Party on several occasions, if there is a shortage of funds to whom do we give the money? Do we share it among everybody? Do we share it among my constituents who are well above average in income, or do we try to direct that funding at those who need it most?
1 find it quite incredible that the Members who have spoken in the last few days on behalf of the Tory Party should so work on the emotions of people in this country. I have heard all kinds of things said by the Tory Party but we know for a fact that if they ever were to form a Government in this country they would crucify the social programs that presently exist. If you look at the total spending on social programs, the only way they can achieve their end result of a balanced budget is either to increase taxation, or decrease social programs, and in either case the poor will have to pay. So let us discard this rhetoric that we hear from the Tory Party.


Mr. Blenkarn:: How are you going to vote? What is wrong with the amendment? You could vote on that one.


Harold Thomas Herbert: We can talk as much as we want about reducing spending, but another thing is important. Will no Member of the Tory Party who supported the principle of six and five, stand up and admit that if all programs continue to be fully indexed, then we will carry into 1983 the rate of inflation which exists in 1982?


Walter David Baker: That is nonsense.
Supplementary Retirement Benefits Act (No. 2)


Harold Thomas Herbert: Since the objective is to cut the rate of inflation in 1983, then we have to anticipate what the rate is likely to be and reduce the carry-forward to that level. Since our objective is to have a 6 per cent inflation rate in 1983, then we have to carry forward in our social programs that same rate of inflation, 6 per cent. That is why, much as I detest Bill C-133-1 say so publicly and I have said so before-and much as I do not like the fact that the pensioner is not going to receive as much as he or she anticipated he or she would receive, if we are going to stick with our principle of six and five, which is to reduce inflation by not carrying it forward into the following year, then we have to do it right across the board.
I suggest to the retirees, the public servants who are now on pension, that the amount that they are going to contribute is no more or no less than the amount that everyone in this country is being asked to contribute. Everyone is being asked to take just a little bit less, which will cause a little more hardship, a little more difficulty and a few more problems.
As I have said to many public servants who have come to me, employees working in my constituency who have complained about six and five, when you look at the number of persons who are unemployed today, they should thank God they have not only a good job with security but are going to get a 6 per cent increase next year. I say to retirees that their contribution, difficult though it may be, is going to help us to achieve the objective of a 6 per cent inflation rate next year. I feel that if we make an exception for the retiree, we have to make an exception for the old age pensioner. If we make an exception for the old age pensioner, then we have to make an exception for the mother who receives Family Allowances.


Gordon Edward Taylor: They have already made exceptions.


Harold Thomas Herbert: If we make an exception for those people, then we make an exception right across the board and forget entirely the program to try to reduce inflation.


Walter David Baker: You have already made exceptions.


Harold Thomas Herbert: There is an exception, a noted exception, and 1 have not heard the Tories talk about it.


Walter David Baker: 1 did.


Harold Thomas Herbert: The Canada Pension Plan will go ahead with full indexing. The reason is that in order to change that Plan we have to have agreement with the Provinces. Most of those Provinces have Tory Governments and those Tory Governments will not go ahead-


Gordon Edward Taylor: They do not break contracts.


Harold Thomas Herbert: -with an agreement whereby we could control the CPP and increase the amount next year by only 6 per cent.


Walter David Baker: Thank God for that.


Gordon Edward Taylor: They do not break contracts, that is why.

December 6, 1982
Supplementary Retirement Benefits Act (No. 2)


Harold Thomas Herbert: That is despite the fact that the Canada Pension Plan is probably under-funded, unless we can bring down the rate of inflation.
I find my position relatively easy inasmuch as 1 do not like cutting old age pensions, I do not like cutting Family Allowances and I certainly do not like cutting the pension of a retiree. I do not like having my own salary cut either, and 1 do not like cutting the salaries of the employees in my office. 1 have been in business since the last war and this is the first time I have seen one of my employees have to suffer a cut in salary. Many times I have not given an increase, but never before a cut; but I have had to do it. We have had to do it because we are facing a crisis. That must be obvious to everyone. Unless we can get down the rate of inflation so that we can remain competitive with the United States, with which we do most of our business, we might as well throw in the sponge entirely. We do not have any choice.
1 said on that evening at the Recreation Centre in Ottawa that I did not like Bill C-133 and 1 would work, if 1 could, to get changes.


Donald Alex Blenkarn: What changes have you got?


Harold Thomas Herbert: 1 have a suggestion to make that has not been discussed. 1 have not even discussed it with the Minister. For example, we might think along the lines of taking the money we are taking away from the retirees and putting it back into the fund since it is supposed to belong to them. The fund, which many people will maintain, certainly the actuaries, is inadequate, will be boosted somewhat. Thus we defeat the purpose we talk about of taking it away from individuals. In effect, we would return it to them. That is the suggestion 1 will discuss with the Minister.
The Minister came up with a suggestion today which in part solves this problem of what belongs to whom. In all fairness to the retirees, they have a pretty good deal. We talk about the word of Government. 1 want to deal with this because it was referred to in the closing remarks of the Hon. Member for Kootenay East-Revelstoke. I will stand up in this House today and say one thing. I have no hesitation in saying that maybe next week I am going to say something different. 1 am not ashamed of changing my mind when the circumstances change.


An Hon. Member:: Typical Liberal.


Harold Thomas Herbert: 1 do not mind what they say about typical Liberal. 1 look upon it as being honest. I see a situation where, if it is necessary for me to change my mind, I will change my mind.
On this particular Bill, 1 have not changed my mind. I do not like the Bill and I said so. 1 will vote for the Bill. I said so. I intend to vote for the Bill because it is a Government measure.


Gordon Edward Taylor: Because the Government told you to.


Harold Thomas Herbert: I heard a remark from the Tory backbench that the Government told me to. Let me get that on the record. Not one Minister, in fact not one single Member, has approached me and asked me to change my position on this Bill.


Gordon Edward Taylor: Vote against it and see how many Ministers you get.


Harold Thomas Herbert: Those Ministers have asked for suggestions. They have asked for a resolution of a problem which we all face. I can say in all honesty that no one on this side likes what we are doing with Bill C-133. I am darned sure the Minister does not like what we are doing in Bill C-133. However, if we cut the old age pension and the Family Allowance-and 1 am talking about the cut in the increase, not in the basic dollars- how can we be consistent if we do not cut this pension as well?
It is far easier to be a Member of the Opposition. In those short two months when I was sitting on the other side, I had a lot of fun. I could stand up and criticize willy-nilly. I could pick what I wanted to say. It was an easy couple of months. 1 must admist I was a little sad and it was the only reason I was sad when that Government was defeated, because I was going to lose some of my freedom to do what the Opposition does, just use one piece of the package in an argument.


Walter David Baker: You will soon be free in Vaudreuil.


Harold Thomas Herbert: We will see. It is far more difficult when one forms the Government to form a fairly consistent policy. That at least is what we are doing now. If the Government is imposing on me the undesirable choice of voting for a Bill that I do not like, I accept it because of the principle behind which it is being presented. The total package is an effort to bring down inflation next year to a 6 per cent level. Everyone, including Members of Parliament, when they get a 6 per cent increase, will receive an increase that covers the true cost of living.
If we bring inflation down next year to 6 per cent as we hope, the old age pensioner who only gets a 6 per cent increase will get enough to cover the increase in the cost of living. The mother who only gets a 6 per cent increase in Family Allowance will also get enough to cover the increase in the cost of living. If we achieve that, then surely the retiree, the person only getting a 6 per cent increase in pension, will have very little to complain about.


Sidney James Parker: What happens if you don't?


Harold Thomas Herbert: If we don't, it is because of one reason only, and the NDP should realize that. It is because we have tried to set an example. We have taken the federal Government, federal public servants, federal Members of Parliament and those who the federal Government can control, and put them legally, by Bill C-124, within the six and five package.
We have asked for the voluntary co-operation of the Provinces. That initially was refused. It has now been given to us in
December 6, 1982

part. At the present time the private sector has had mixed reaction. 1 am pleased that most of the major associations in the private sector are doing their best to co-operate with the federal Government in its efforts to cut inflation to 6 per cent. If the Members of the NDP, who are so quick to jump on the Government for attempting to put a cap on the increase for next year, were honest, they would criticize the various union leaders who are still looking for increases of 10, 12 and up to 18 per cent.
On Friday last I talked to a gentleman in a municipal office. He said when the municipal employees asked for 18 per cent, the municipality said: "Thank you, federal Government, for setting us an example", and then said to the employees: "You take 6 per cent". And they have taken it. If the NDP were to look at the pensioners they talk about and use their good offices to exert an influence on the private sector, which has gone haywire in its increases, and as a result achieve an inflation rate in 1983 of 6 per cent, the retiree receiving a 6 per cent increase would not lose one nickel.
That is my explanation of why, despite the fact that I do not like to see Bill C-133 and wish that I did not have to go through this process, as I said two weeks ago and as I repeat, I will vote for the Bill. It is because I support the principle of six and five.


Donald Alex Blenkarn: Mr. Speaker, 1 wonder if the Hon. Member would permit a question?


Harold Thomas Herbert: Yes, Mr. Speaker.


Donald Alex Blenkarn: The Hon. Member said that he was dissatisfied with the Bill. He offered some suggestions with respect to negotiations that might help restore some of the money to the public servants' trust fund with respect to the indexation part of that fund. Would the Hon. Member take kindly to the hoist of the Bill for six months to allow him to use his good offices to make that negotiation and bring some fairness to it, as suggested by the Hon. Member for Nepean-Carleton (Mr. Baker)?


Harold Thomas Herbert: Mr. Speaker, if it was that simple, I would give a simple answer and the simple answer would be yes. However, the Hon. Member knows, as everyone in this House knows, that if this Bill is not passed by January 1, an 11 per cent increase goes into effect.


Walter David Baker: Eleven and a half.


Harold Thomas Herbert: Approximately 11 per cent, if the Hon. Member wants to be precise. The point is that unless this Bill is passed before January 1, the increase according to the present legislation will go into effect at that time. 1 will give him my word on one thing. I do not give up on an issue. Even if this Bill goes through, I am not giving up. 1 want to see a change made in this legislation so that we will not again be in the position where we have to go through this particular exercise.


Mr. Joe Reid (St. Catharines):: Mr. Speaker, as 1 rise to address Bill C-133, I want to refer an old biblical adage to my
Supplementary Retirement Benefits Act (No. 2)
friends to the left, paraphrased somewhat. It goes something like this: Let he without sin cast the first stone.
I wonder how many times my friends on the left have wondered in their hearts and minds about the craftiness of the resolution which brought down the 1979 Government. 1 wonder how many times they have felt that they are reaping the whirlwind because they, with the majority of Canadians, are having to suffer the frustrations and the desperations of this Government.
It is the second time in a very short period that I rise, with other Members in this House, to address a pensions Bill. The short period of time is made shorter because of closure by this Government on Bill C-131. That is an act to limit the time for discussion and debate, an act to prevent the public from realizing the length and extent to which this Government is going to pin the problems of Government on the pensioner. The pensioner should not be the one to bear responsibility for the over-expending of this Government or the inflation which has struck us. In our wildest moments, as I said in respect to Bill C-131, we did not think that the pensioner would be in the front line of the restraint attack, the six and five attack. But that is what has happened and our Party is deadly opposed to Bill C-133, as we were with respect to Bill C-131.
The President of the Treasury Board (Mr. Gray), in the last minutes of his comments this afternoon, proposed to make an amendment. I suppose, true to the tradition of that Party, that amendment will be drafted more to bring his players into line than by what is in the best interests of pensioners. It will be a further variation of the six and five working together.
The Minister went on to say he would have to wait for the green paper before introducing equity and justice. We are told that the Government's green paper on pensions will be tabled within this next two weeks. That paper should have been the meaningful reform legislation upon which Acts such as this might be based, amended or related thereto, instead of bringing forward Bills C-131, C-132 and C-133, one after the other, to put legislation in place so that the reform paper will have no meaningful effect on pension reform.
How can a Government claim to be serious about pension reform when such a Government deals with pensioners as callously as this one does? How can a Government be serious about pension reform when it is prepared to destroy one of the bulwarks of any strong pension plan-the protection of pensions against the ravages of inflation? How can a Government point an accusing finger at the private sector for offering little more as protection against inflation when that Government is moving in the same direction? Finally, how can any Government hope to maintain credibility, trust and faith with its Public Service when it unilaterally goes back on its word, a signed agreement, in an exercise of political huckstering? And how else, Mr. Speaker, could one describe the Bill which was

December 6, 1982
Supplementary Retirement Benefits Act (No. 2)
presented this afternoon other than as an exercise in political huckstering?
Bill C-133 proposes to limit increases in Public Service pensions to 6 per cent in 1983 and 5 per cent in 1984, regardless of the inflation rate in either of those two years. This is done to save the Government an estimated $100 million over these two years. We on this side have grown to respect the sum of $100 million, unlike the big spenders sitting on the Government benches. However, we have to respect something else as well, the fact that some items of expenditure have greater priority than others. But how can one justify cutting Public Service pensions by $100 million when the waste, extravagance and mismanagement of our economy continues unabated? Anyone can pick up a newspaper at any time and read a tale of squander and waste. One can read where hundreds of millions of dollars are being spent in foreign shipyards because Canada lacks a shipbuilding policy. One can read where thousands of jobs are being lost because we lack a Canadian content agreement with respect to Japanese imports. One can read where another oil rig has left this country for the United States because of this Government's National Energy Program. One can read of a 70 per cent increase in the travel expenses of Ministers this year over last year, while they talk in terms of a six and five program. Against a background like this, Mr. Speaker, cutting a Public Service pensioner's cheque is not restraint; it is just simply being mean and misguided.
Last week a bright young fellow decided all Members of Parliament needed copies of all news releases which might be related to the six and five program. More than that, he decided that Members of Parliament needed that material indexed, prepared on high quality paper and enclosed in binders emblazoned with the "six and five" logo. This binder sums up better than any words possibly could the utter hypocrisy of both the six and five program and the Government's approach to the most serious depression we have faced since the 1930s. If restraint is to have any meaning, the Government must distinguish between governing in the best interest of all Canadians and governing in the best interest of the Liberal Party.
It is all right for me or for any other Member of Parliament to illustrate the 1,001 ways in which the $100 million could be saved other than by cutting Public Service pensions. But when we talk in terms of $100 milion, we tend to forget the real meaning of this Bill, the real meaning for those who will be affected by it. As of last month there were 90,000 former public servants receiving pensions. In addition, there were another 32,500 persons receiving survivor benefits. One reads about fat cat public servants and those huge, fully-indexed pensions which they are going to receive, and Michael Pitfield might just be in that category.
It might interest Hon. Members on both sides of the House to note that the average pension being received is $6,900. This, Mr. Speaker, is the "fat cat" which the Government wants to rein in or limit to six and five deindexing by way of Bill C-l 33. The Government says: "Oh well, the impact of the six and five program is not nearly as great as one would imagine". First of all, when your pension income is $6,900, every dollar counts.
Second, we are not talking about a meaningless amount of money which will be lost to those pensioners. Assuming inflation next year will be 11.5 per cent, and 10.5 per cent in 1984, the average pensioner will lose $1,409 over those two years, and the average survivor will have lost $557 from their "fat cat" meagre pensions. Once again, when we consider the average 1982 starting ground is $6,900, a loss of this order is anything but meaningless or "not so great".
The second reason for my opposition to this Bill is the very significant hardship being inflicted on individual pensioners. But there is a third point I want to make as well. We in the opposition are often critical of the Government's non-stop printing presses. Day after day, night after night, those presses are turning out what the Government calls information briefs or brochures. Some of us would prefer to call them propaganda brochures. One such product was the pamphlet prepared to let public servants know about their pension plan. Another was a much larger publication issued after the last National Pensions Conference. The first publication stated clearly:
All pensions are adjusted annually to cover cost of living increases.
That does not say, Mr. Speaker, adjusted to cover "some" increases; it says Public Service pensions are adjusted to cover cost of living increases. My mathematics may not be perfect, but 1 fail to see how a 6 per cent increase will cover 10 per cent inflation.
The National Pensions Conference held here in Ottawa in 1981, which I was pleased to attend, provided a forum for the Prime Minister (Mr. Trudeau) to adopt a holier-than-thou attitude with respect to the private sector. I have to wonder if he is not wincing just a bit, trying to square this Bill C-l33, and Bill C-l31 with what he said at that conference. Put simply, he said people must be protected in their retirement years:
The Canadian Government has pledged that they will be better protected in the future than they are now.
Once again, perhaps a Government Member could explain how 6 per cent is better than 10 per cent. Or is it simply that a pledge is only a pledge when it suits the political fortunes of a Government bankrupt of ideas? Where is the fulfilment of trust when pensioners are being deprived of something they paid for? However, Mr. Speaker, our Prime Minister could not leave well enough alone. He had to go on to say:
Pensions which are not protected against inflation naturally tend to dwindle over the years.
I certainly do not argue with that statement of fact, Mr. Speaker. Nor do 1 argue with his conclusion:
The unfairness of that situation is not tolerable in a nation which believes in social justice.
Where is the social justice in Bill C-l 33 or Bill C-l 31 ? Does social justice take a back seat to the re-election hopes of the Liberal Party, which we heard about at length from the previous speaker? This Bill in no way, shape or form lives up to the Prime Minister's remarks at that conference, nor does it offer a legitimate reason why it should supersede what he said. As 1 have already pointed out, the $100 million saved could
December 6, 1982

have been and still can be saved elsewhere, but this Bill hurts those who cannot afford to be hurt in difficult or even in good economic times. I have shown that these phrases, uttered in the sanctimonious tones of many Government speakers at that pension conference, fly in the face of the obvious.
There is a final point which needs to be emphasized. The pensioners in question believed and still believe that they have a formal agreement with the federal Government on the question of indexing pensions. In return for paying 1 per cent of their salary into a supplementary retirement benefits account, public servants were to receive full indexation of their pensions. That, in essence, is what the Government stated it would do. Even more importantly, that is the spirit of the agreement and that is what public servants had been told to expect. To announce 12 years after the fact that the fine print allows the Government to weasel out of the agreement is a breach of faith and political opportunism at its worst. For three nights running the Prime Minister spoke to the nation about trust, confidence and belief in our political leaders. Who would ever trust a Government which would attack pensioners while leaving the JetStar engines idling while the Government waits for the next six and five binge?
I am appalled at the persistence of this Government in bringing this Bill forward. In 1979 a Conservative Government found over $500 million worth of fat to be cut without too much difficulty. The same could be done today if there was an effort put into that task. That money is five times the amount being saved by this legislation, yet the Government refuses to cut waste because it is easier to ram a Bill through this House by closure and enforced voting than it is to pore over departmental budgets and estimates. Well, if the Government has lost the will to control its own spending, call an election so that the Canadian people can determine where expenditure cuts can be made and decide whether the Government will have the will and determination to get spending under control.
While I am unalterably opposed to this Bill, Mr. Speaker, some weeks ago, as has been mentioned earlier today, several Government Members were just as equally opposed to that legislation. Now they feel the winds of non-confidence blowing in their faces and we hear an about-face and a very different story today than that told on an earlier occasion. I suggest to you, Mr. Speaker, that it will be a sad day for Canada indeed if Government Members opposite vote for opportunism, selfpreservation and self-protection rather than for responsible government, good government and the people they represent in Parliament. The Just Society of 1968 is most certainly dead, thanks to today's Liberal Party of Canada. Will they not just take six months more to reconsider their position?
Supplementary Retirement Benefits Act (No. 2)



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Blaker):: 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 Winnipeg-Assiniboine (Mr. McKenzie)-Labour Conditions-Air Canada lay-offs- Application of early retirement policy to machinists, (b) Request that mediator be appointed; the Hon. Member for Richmond-South Delta (Mr. Siddon)-Mines and Mining- Union recommendations on stockpiling, (b) Restoration of competitive advantage; the Hon. Member for Halifax West (Mr. Crosby)-Atomic Energy of Canada Limited-Future of Nova Scotia heavy water plants, (b) Policy on sales to India.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Gray that Bill C-133, an Act to amend the Supplementary Retirement Benefits Act (No. 2), be read the second time and referred to the Standing Committee on Miscellaneous Estimates.
Mr. Gaston Isabelle (Hull):: Mr. Speaker, I believe it is important that Members for the various ridings concerned should make a contribution to the debate on Bill C-133 which is about to affect the indexation of Federal Public Service pensions. Mr. Speaker, I listened to the previous speakers and I also heard what the Member for Nepean-Carleton (Mr. Baker) had to say. I believe that in some parts of his speech he was right, while in others he was wrong. In any case, I am not going to try and analyze all the speeches made in the debate on Bill C-133. I think, in fact I am certain, that the Members opposite are electioneering on this subject. I also think that my friends in the New Democratic Party at least during the last election campaign totally ignored Section 32 of the Public Service Employment Act which precludes political activity by certain public servants. 1 am sure that to them, Section 32 applies only to Liberals and Progressive Conservatives. But quite honestly, Mr. Speaker, I must say that I, too, have had grave reservations and have given careful consideration to the implications of Bill C-133. I can honestly say that I am opposed to Bill C-133 in its present form. The reasons, Mr. COMMONS DEBATES
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Supplementary Retirement Benefits Act (No. 2)
Speaker, are simple. There is a matter of equity involved here, and if there was a mistake on the part of the Government that drafted the Act or the regulations or on the part of the bureaucrats who drafted this legislation when indexation was approved in 1970, we should certainly not try to correct the initial blunder by perpetrating a second one. Since we are on the subject of indexation of Public Service pensions, I think we should have had studies made, as suggested in 1976 when a report was tabled in the House concerning the entire question of Public Service pensions. However, it was not done, Mr. Speaker. The question came up again in 1978, when it was suggested that the procedure for indexing Public Service pensions should be changed not abolished altogether by linking indexation directly to the interest generated by the funds provided by employees, interest that could be redistributed to Public Service pensioners according to a given scale. The point was, Mr. Speaker, that in the case of galloping inflation, the interest generated would have been higher and the resulting funds would have been redistributed from year to year to retired public servants and would also have provided a basic scale for indexing wages. That would have been eminently logical, Mr. Speaker. We would not have been obliged to take this corrective action which 1 would qualify as grossly unfair via-a-vis this group in society which is no longer on the labour market.
Obviously, when legislation is introduced, there are exceptions for which provision must be made, and I think that the officials who prepared this legislation should and could have made an exception for retired public servants. Mr. Speaker, blunders are made. The other day, I noticed that a senior official who was Deputy Minister at Health and Welfare was transferred to Paris for a year, on the same salary he was getting before, while during that time his position was to remain vacant. The position in Paris calls for a salary that is $20,000 less than what the official was earning before. So he is getting the same pay he would be getting if he had stayed here in Canada, which is certainly a lot more than 6 and 5, Mr. Speaker and there are many other examples. In fact, the newspapers are full of them. So I hope these are not the same senior officials who drafted the 6 and 5 measures that apply to retired public servants, because we know what goes on in the upper echelons of the public service, Mr. Speaker. No one who has an important job is going to be affected by 6 and 5. They just change the category and the salary with it, and the 6 per cent will apply, as they say, over and above, so I think there is something here that we as legislators should do, but unfortunately, the system has not reached that stage yet.
When 1 see the Progressive Conservatives making modest attack on the system, and I said just now they were doing some electioneering, including my good friend from Nepean-Carleton (Mr. Baker) who is not above adding an extra quaver to his voice to sound more convincing, I think the people listening should remember that when the Progressive Conservatives formed the Government in 1980, they said without hesitation that they were going to eliminate 55,000 public
servants. I do not want to indulge in electioneering, and 1 just want to-
IMr. Baker (Nepean-Carleton): That is no excuse!


An Hon. Member:: 60,000 public servants.


Joseph Gaston Isabelle: . . . 60,000, I apologize, I forgot 5,000. In any case, I do not want to do any electioneering, and 1 just want to defend the rights of the majority of my constituents who are public servants and retired public servants. I agree with the 6 and 5 program as a general government policy, and 1 congratulate the Government for having adopted this measure, but I also think that this bill should allow for exceptions, and Mr. Speaker, retired public servants are an exception. Where pensions are concerned, there is a big different between 6 per cent of $4,000 and 6 per cent of $30,000, because someone who is drawing a pension of $30,000 will get nearly $2,000 that is easy to figure out while 6 per cent of $4,000 is only $240. People on low incomes need every cent to make ends meet, while to someone who is getting a pension of $30,000, whether he gets an extra $2,000 or $1,800 does not make such difference, it is not vital, so that is why I am saying that this bill is unfair, because if we look at the principle underlying indexation, the whole point was to maintain the purchasing power of pensions so that retired public servants would continue to have access to the same market basket and the same services, and this is the principle the Government committed itself to. Mr. Speaker, this was said in this very House in 1978 by one of our colleagues, who unfortunately is no longer with us today, and who has served this country well, and I am referring to Bob Andras, an exceptional President of the Treasury Board, who wanted to change the system in 1978, and who unfortunately was unable to have this plan implemented. Mr. Speaker, we are forcing retired Canadians to submit to the 6 and 5 restrictions, while in most provinces-I am not referring to the Federal Government here, although I may later on-public utilities including gas, hydro and telephone services, all of which are essential services that no one can do without, let alone pensioners, are increasing at a stupendous rate every year. Take hydro, for instance. We have a surplus of electric power, but nevertheless, prices are still increasing at an astonishing rate in la belle province, although it is against all the principles of political economics, and the same applies to natural gas.
So why are we saddling our pensioners with this reduction in indexation? No one is going to get rich with a cost-of-living indexation, especially-but this is of course hypothetical-if we expect that in one or two years, indexing may be 7 or 8 or 9 per cent. If we were sure that indexation would go down, why not maintain cost-of-living indexation for the 85 per cent, that is, the vast majority of retired public servants who are getting not more than $4,000 or $6,000?
Mr. Speaker, I feel that these people have served their country well as public servants, and this includes the Armed Forces, the RCMP, and all those who have served their
December 6, 1982

country in the course of duty and when they were in a position to do so. 1 remember when 1 was growing up in the Ottawa-Hull area, that the Public Service had trouble recruiting employees. Mr. Speaker, that was because the pay was not good. Today, pay levels may be somewhat higher than they are in the private sector, but the fact remains that to get people the pay has to be good. If it is not, they will not come. Maybe we have gone to the other extreme, and perhaps a review would be in order. In fact, a study was made in 1978 or 1976.
There is a mass of data, and when senior officials talk about the subject, they reel off a whole series of figures which do not mean a thing to the average person. No matter how many speeches are made and no matter how many reasons are given, retired public servants will never understand, and they certainly have no reason to, why the Government is taking away what they paid for. That is what is happening. Never mind the figures, never mind that this is going to mean a savings of $50 million and that if we do not cap indexation it will mean an increase of $100 million. We all know how governments conduct their finances. They make budgets and they always have budget deficits. Why? Because there are contingencies, of course, but there are other things that also happen to a budget. The individual person, the retired public servant, however, was first asked to pay 1 per cent extra to cover indexation, and this point was made over and over again. Now all of a sudden they are saying: Listen, drop everything, the country is almost bankrupt and now you have to help us get it out of this mess. Well, I do not think that is the way things work. They do not see it that way, and I think they are right. 1 hope that during the debate it will be possible to make some changes-and I see the President of the Treasury Board (Mr. Gray)-to put as it were a more humane face on this question by making a special exception for retired public servants. Once more, we are in favor of 6 and 5, and personally, I would have said more about this question, because to the people, 6 and 5 means a reduction. A lot of speeches have been made and of lot of figures have been produced, but we forget to tell people that what was involved was a salary increase that was being capped at 6 and 5 per cent. We get people writing us who think it is a reduction. Some people say: If you do not vote against the bill, we will not vote for you in the next election. We always have voted for you but will not this time. But if they vote against the Liberals for introducing this legislation, they will vote against me in any case. When all is said and done, I think they are doing a bit of innocent blackmail, because they are good people. However, I am not doing this for political reasons and 1 am not trying to do the Public Service Alliance a favour. In fact, I have had it up to here with the PSAC. So 1 am not particularly keen on doing them a favour, I am doing this for the pensioners, because I realized that we were really hurting a sector of the population that is particularly vulnerable because it is no longer part of the labour market.
My contribution to this debate has been to the point and will, I think, be understood by everyone, even if 1 did not quote any figures. 1 was very reluctant to parade vast numbers of
Supplementary Retirement Benefits Act (No. 2)
statistics in order to impress or depress people with all the data we are able to produce. In any case I am sure that the President of the Treasury Board (Mr. Gray), with his natural intelligence, his sensitivity to the plight of the autoworkers in his constituency, his broad political experience, his great wisdom and his understanding of the human condition, will realize that perhaps it would be advisable to introduce amendments that will go somewhat further than the bill he introduced this afternoon.
Mr. Speaker, this was my humble contribution on the debate on Bill C-133, a bill which I hope will be amended for the benefit of retired public servants who have served their country well and continue to do so.


Rodney Edward Murphy: Mr. Speaker, I rise on a point of order. 1 wonder whether the Hon. Member would agree to a short question.


Joseph Gaston Isabelle: With pleasure.


Rodney Edward Murphy: I agree with much of what the Hon. Member said in his speech, but I want to ask him a question just to make it perfectly clear. If there are no further amendments to Bill C-133 other than the amendments suggested by the Minister responsible earlier this afternoon, will he definitely be here to vote against the Bill at second reading?


Some Hon. Members:: That is an improper question.


Joseph Gaston Isabelle: Mr. Speaker, it is a hypothetical question because it might be the end of the world tomorrow and then no one would be able to vote. I do not know what will come, but if the Bill remains as is, I will do what I have to do.


Some Hon. Members:: Hear, hear!


Hon. Allan B. McKinnon (Victoria):: Mr. Speaker, I compliment the Hon. Member for Hull (Mr. Isabelle) for his wonderful last line, that he will do what he has to do. Of course, the next question is: What will he have to do? I admire his ability. I have seen people riding bicycles on tightwires before but never two bicycles at the same time! He has been doing this for the last half hour; it is quite a stunt.


Walter David Baker: It is hard on the seat of the pants.


Allan Bruce McKinnon: Yes, but he said that he was opposed to Bill C-133. I am afraid that 1 have to wait until tonight, a week from now or some time in the near future when the Speaker says, "All those opposed will please rise" to find out what he has to do.
Also I heard the Hon. Member for Vaudreuil (Mr. Herbert) indicate that he did not like Bill C-133. It is rather startling how many sympathetic people on the other side are filled with kindness and good heart in this regard, but also stick pretty closely to the President of the Treasury Board (Mr. Gray) in bringing in this terrible Bill. Actually, it is the first one I have seen brought into the House which deliberately upsets a

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Supplementary Retirement Benefits Act (No. 2)
contract and a piece of legislation that has been in effect for some time.
I thought the Hon. Member for Nepean-Carleton (Mr. Baker) made a particularly good speech this afternoon. 1 believe he represented the situation in this locality very well.
1 am sure the heart of the Hon. Member for Kootenay East-Revelstoke (Mr. Parker) is in the right place, but I wish he would manage to quit confusing Bill C-l 24 and Bill C-133.
We voted against-


Some Hon. Members:: Oh, oh!


Allan Bruce McKinnon: Let me try again. Bill C-l24 provided a small cut in the pay of Members of Parliament. The New Democratic Party opposed that Bill. That is the Bill we voted in favour of. It had nothing to do with the capping of indexation. Indexation capping is contained in Bill C-l31 and in Bill C-133, depending upon which pension is involved. But to try to say continually that because somebody voted for or against Bill C-l24 means that they vote for or against Bill C-133 is carrying things a little far.
After the budget was brought down, in the debates on the budget I raised the question on July 15 and again on August 2 that we were going to have to look at legislation, presumably in the fall, if we were going to carry out what the budget had indicated we would. 1 am particularly interested in pensions of servicemen and retired servicemen.
There are not too many Members in the Chamber who have a close interest in the Canadian Forces superannuation account or the Supplementary Retirement Benefits Act as it applies to the Canadian Forces superannuation account. I have a great deal of concern about this matter partly because it is so complicated. When the Hon. Member for Winnipeg is not here, there is hardly anyone who can give you a logical explanation as to why the Government keeps putting money from one account into another. It seems these accounts are overflowing with money, but in fact there is no money there. 1 feel that a contract has been broken with the servicemen who paid their contributions faithfully. They now find they will not get the pension they expected.
It is difficult to understand the attitude of some of our friends on the benches opposite. They are well known. I believe the Hon. Member for Nepean-Carleton referred to them this afternoon. First, there is the Hon. Member for Ottawa West (Mr. Francis) who finds it unacceptable that the Government plans to limit pension indexation. The Hon. Member for Ottawa Vanier (Mr. Gauthier) said that the pension indexation fund "is similar to investing your money in a trust company" which then decides not to pay out on the agreed terms. Any trust company doing that would have its charter removed. The Hon. Member for Hull, who has just finished speaking, said that they should leave the pensions at full indexation. He has now decided that he will do what he has to do.


Walter David Baker: Whatever that is.


Allan Bruce McKinnon: Whatever the Hon. Member for Hull does, he is not too specific about it. However, we will watch him with a great deal of interest when the vote comes. Then we have the vocal Member for Ottawa Centre (Mr. Evans). He said:
I have not seen any evidence that the contributions paid to the supplementary fund are inadequate and that the fund is not solvent.
I look at the funds quite often, and I have a great deal of difficulty finding that they are not solvent. 1 have tried to find out.
The last Member whom I shall refer to is the Hon. Member for Gatineau. He said:
I wonder if we can legislate on this matter since the money belongs to the pensioners.
What worries me is that a group of Liberal Members of Parliament can get together before 800 voters out there. These Members say something outside of the Chamber but say something quite different inside. We are witnessing that today, and it is not a nice thing to see, quite frankly. Members opposite go out and try to buy votes. They hope nobody will notice what they said. Then they come in here and hope that nobody will notice how they vote. One is opposite to the other, and it is embarrassing.
We have the prime example set by the Prime Minister (Mr. Trudeau). He sent out his famous telegram saying that he indeed was very aware of all of this and that he had noted the concern about indexation of Government pensions, that is should be maintained.
The Prime Minister philosophizes in a letter in which he wrote:
In our society, pensions provide a means of sharing risk so that we can retire in reasonable security and dignity, without fear of the future.
It is sickening for the Prime Minister to write that and have it sent to pensioners. They depend upon Members of Parliament to look after their interests. It is a joke when we hear that things are ironclad agreements. An ironclad agreement is a joke because it means that you do not intend to keep the agreement. The Prime Minister of the country put the pensioners at ease. He said the Government had no intention of removing indexation from pensions, but here we have a Bill that is going to do exactly that. The sad part is that this is the time when pensioners need indexation the most. I will have a few more words to say about that in a minute or so.
I just wanted to point out that five Members of Parliament and the Prime Minister are as sanctimonious as can be about the plight of the pensioners when they say that their plight is right next to their hearts, except that many other things come in between when it comes to legislation.
Let me come back to the matter of the servicemen. There seems to be a consistent effort to meld the servicemen's pension funds with the civil service pension funds. There are some good reasons why servicemen prefer that this not happen. It is particularly noticeable when we hear the Canadian Forces

December 6, 1982

Superannuation Act and the Supplementary Retirement Benefits Act treated as if the beneficiaries were exactly the same. Elowever, if one looks at the figures, it is quite alarming to servicemen and ex-servicemen because the Forces fund is in a much sounder condition than the supplementary benefits fund.
According to the report on the administration of the Public Service Superannuation Act, there was a balance on 31 March 1981 of $12.7 billion, with 308,000 public servants contributing to it. The Canadian Forces Superannuation Fund stood at $9,327 billion, with only 80,000 contributors. It is obvious from the number of contributors that the servicemen have a much larger vested interest in the superannuation account than the civil servants have. Both accounts seem to be running into difficulty as a result of what the President of the Treasury Board (Mr. Gray) is doing today. The Government is treating the Supplementary Retirement Benefits Act as if it were the same as the other fund. There is now approximately $25 billion in the two funds. By doing a little bit of arithmetic you will see that the interest on $25 billion would more than pay the entire pensions for both the servicemen and the civil servants.
1 have another grievance. 1 have a letter dated March, 1982, addressed to me which mentions interest. It is from the Minister of National Defence (Mr. Lamontagne). I understand that interest is never paid on these funds. Instead, a paper transaction is made. In 1980 to 1981, the last year for which we have records, the Government in the first quarter "paid" 2.05 per cent on this money. In the second quarter, it "paid" 2.09 per cent; in the third quarter, the amount was 2.01 per cent, and in the fourth quarter, the Government "paid" 2.15 per cent for the money that in theory was in the account. That comes to an annual rate of 8.6 per cent. Everyone knows that the interest rates in 1980 to 1981 were much greater than that.
If we take a look at the amount of interest that was credited to the Canadian Forces Superannuation Fund during that fiscal year, we see that on March 31 the amount credited was $131 million. In the actuarial liability account there is another $348 million, which comes to a total of $479 million. The payments made by Canadian Forces personnel amounted to $80 million. The payments out of the fund were only $280 million in 1980-1981 out of the total amount received of payments of $559 million. Yet we are told the fund is in desperate straits, that it is likely to go broke, and everyone is worried about it. 1 will tell Hon. Members who is worried about it. The servicemen are worried about it because they are the only ones who seem to be able to see money actually going into it. It goes right out of their pay and into the fund and then it goest off in strange directions. Some of it goes to the Canadian Forces superannuation account and some to the actuarial liability account. Servicemen certainly do not know what that is, but in their opinion they do not seem to be getting credit for the money that is in there.
1 was rather surprised when the President of the Treasury Board suggested that he would do a couple of things because of
Supplementary Retirement Benefits Act (No. 2)
the pressure which had been put on him by some MPs. First, he would raise the cap from 6 per cent to 6.5 per cent and then, the following year, it would rise from 5 per cent to 5.5 per cent. Anyway, it was very strange to hear his remark that anyone drawing the Guaranteed Income Supplement would not be severely capped. I am a bit puzzled as to just how this relates to the pay of servicemen or public servants, because I am sure the President of the Treasury Board realizes full well that if one is receiving any kind of pension amounting to $250 a month, except for a disability pension, one cannot qualify for the Guaranteed Income Supplement. One cannot receive anything from that fund. 1 thought that dragging in that red herring was a little bit beneath the President of the Treasury Board, as only a very few civil servants would ever draw the Guaranteed Income Supplement, I would hope.
The other matter is that this afternoon the President of the Treasury Board announced that those whose pensions were being paid from the Consolidated Revenue Fund would not be eligible for the increased cap, as I understood it. 1 realize that it is a little difficult to follow all these different terms, but if that is so, that would mean that the President of the Treasury Board is penalizing those people who drew pensions before indexation came about. There will be a slight penalty. That is the way it seemed to me. If I am wrong, and if someone from the Government has the gumption to speak in this debate besides the Minister, I will be pleased to hear about it, but that is the way it sounded to me. I see the Minister and his Parliamentary Secretary nodding their heads, so I will look forward to hearing how that will be corrected.
References to the pension index make interesting reading. If we consider the Supplementary Retirement Benefits Act, one finds that this was a promise, really a contract reached with servicemen and public servants, when they were told in 1974 that they would receive their indexed pension. It states:
"Pension Index", with respect to any year, means the average for that year of the Consumer Price Index for Canada, as published by Statistics Canada under the authority of the Statistics Act, for each month in the twelve-month period ending on the thirtieth day of September in the immediately preceding year;
That is a contract, it seems to me, that the pension will be indexed, and the amount by which the pension will be increased. That was the agreement. At that time, servicemen were paying half of one per cent of their pay to cover the cost of indexation. It was found at that time that they needed more money, and it was determined that from then on they would pay a full percentage point. Therefore, servicemen are now paying 7.5 per cent, 6.5 per cent going toward the Force's Superannuation Fund, and 1.5 per cent, I believe, for participation in the Canada Pension Plan or the Quebec Pension Plan, and then 1 per cent for the supplementary retirement benefit.
I might point out that because the cost of living and the consumer price index were increasing each year, pensioners were always behind because the pension contribution was

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determined from September to September. If the rates rose 7 per cent, for example, five years ago and 10 per cent four years ago, there was a 3 per cent difference which the pensioner had to pick up because he was paying the charges for that particular year.
1 can briefly indicate some of the figures. If we consider the figures for 1971, one finds that the benefit index was 104 per cent. In 1972 it was 106.5 per cent. That amounted to a 2.5 per cent raise. Therefore, in 1972-73, pensioners would receive an extra 2.5 per cent. However, in 1973, the cost of living rose by 5 per cent. In 1974 it rose by 7 per cent and in 1975 it rose by 12 per cent. Every year the increase given to pensioners was only based on the previous year's increase in the cost of living. Consequently, they were robbed a little bit each year. However, that does not seem to have bothered the Government. Now, strangely enough, when the rate of inflation is beginning to come down, the Government wants to tell them what the benefit index will be in advance. When it was rising, they were paid according to the last year's increase. Now the Government will decide what it will be ahead of time. Next year it will be 6 per cent and the following year it will be 5 per cent, so the Government will get them going both ways.
These figures are spelled out right on the back page of Bill C-133. If one considers the benefit index under column II, one can take the amount of SI,000, one month's pension, and compute what the benefit would be in 1984. One can divide 275.69 by 262.56 and multiply by $1,000 and arrive at an amount of $ 1,050, which is a 5 per cent increase. If inflation is more than that percentage, it is just too bad. One is only a pensioner, anyway, according to the hard-line attitude of the Government. The Government says, "We are sorry we made an awful mess out of running the country, but you have to pick up the cost". It is easy for Hon. Members opposite to say, but it is very hard for them to look people in the eye and tell them that they are doing it to them.
I have in my hand the eleventh annual report on the administration of the Supplementary Retirement Benefits Act. It was submitted to His Excellency, the Right Hon. Edward Schreyer, Governor General and Commander-in-Chief of Canada, by the President of the Treasury Board. 1 would simply like to point out how this has been arranged according to the Treasury Board which supervised. The Act, if this Bill is approved, will apply to some 26 different acts and groups of people, including the Canadian Forces Superannuation Act as well as the Defence Services Pension Continuation Act which, to my understanding, is now almost non-existent because people have gradually faded out of it.
At page 2 of the report, it states:
The amount of this increase in any January is equal to the percentage increase in the average of the Consumer Price Indices for the twelve months ending on the preceding September 30 over the average for the twelve months ending a year earlier.
In reference to financial provisions, it states:
Between April 1, 1970 and December 31, 1976 employees contributed 16 of 1 per cent of salary. Effective January 1, 1977 this rate was increased to I per cent.
This puzzles me. The Government is attempting to claim that the pension fund, amounting to $25 billion; is not sufficient to pay pensions. I suppose that would be hard to prove to a mortgage company. However, if that is not sufficient, I wonder if the Government has ever thought of asking the people if they are willing to contribute more. In the last couple of months I have spoken with many servicemen and retired and employed civil servants. Most of them would be quite willing to pay another half of one per cent if that were enough, or if it were important. However, they have said, "For God's sake, do not leave us high and dry so that we do not know what will happen in the way of inflation. It would appear that if the rate of inflation keeps on rising, we are the ones who will not become adjusted to it, and we would be willing to contribute". That thought occurred to people in 1977 and they did double their contributions at that time, but it has apparently not been considered at this time.
I would like to point out one other matter. The report continues:
Prior to January 1, 1974, the Act also provided that all supplementary benefits would be charged to the Account. Since that date, however, those benefits paid in respect of a former contributor are charged to the Account only until their accumulated total equals the aggregate of all amounts credited to that Account in respect of that person. Supplementary benefits paid in excess of that aggregate are then charged to the Consolidated Revenue Fund.
This is quite true. These are almost identical words to those found in the Act in Section 8(2), which is of interest. However, Section 9 states:
There shall be credited to the Supplementary Retirement Benefits Account in each fiscal year an amount representing interest on the balance from time to time to the credit of the said Account calculated at such rate as may be fixed by the Treasury Board.
We all know how miserly the Treasury Board has been with the interest they have paid on the alleged funds, that they allege are somewhere. 1 expect the President of the Treasury Board has that $25 billion earmarked for somewhere, but there might be people who are not quite as trusting as I am who might wonder if there is any part of it around. I believe the Government made a commitment during the collection and the putting together of those funds, so that the Government actually would consider that the pensioners had a vested interest and were entitled to be consulted and to get a fair deal.
The fund is growing so rapidly, and wording such as this, that the supplementary benefits paid in excess cf the aggregate are then charged to the Consolidated Revenue Fund, is looked on by the pensioner as an effort by the Government to prove that it has paid them back everything they paid in and an indication that it has no further real responsibility, and it is just out of the generosity of the Government heart that it is paying them anything extra from then on. This is what worries the pensioner because he suspects this kind of legislation is really there to take away any rights that ne has to the contract he thought he had with the Government.
December 6, 1982

I can never quite understand how the interest rates are worked out on this, but they seem to me to be much less than they should be.
In closing, Mr. Speaker, I would just like to point out that these funds have grown so enormously that the Government is neither going to write them out a cheque for it nor set up another fund of an equal size to be self-administered, or in any part administered, by the people who contribute to it, and the people who expect to benefit from it.
I suggested to a meeting of long service pensioners of the Canadian Forces, that perhaps they should try to get this on a sounder footing over a long period of time, say ten or 15 years. If the Government would guarantee to maintain the contract it has with the pensioners, paying them an indexation rate equal to the inflation rate, perhaps the pensioners would be willing to give up any real or imagined right to part of that $25 billion. They accepted that and indicated that if during that ten or 15 year period their contributions and the Government's contributions went into a fund, for instance in the form of Government bonds, which really are much more liquid than the imaginary kind of money being dealt with now, in about ten or 15 years they then would be able to have a funded fund, which is really what the civil servants want and what the Armed Forces want.
In closing, I simply say this is a Bill that I never thought I would see presented in Parliament; that the Government would try to balance its books-which is almost unheard of for this Government-and it would, first of all, pick out old age pensioners and, secondly, those people who thought they had a Government pension. Most of the people who are now retired are people who served their country in the Armed Forces. When they came back from overseas they decided they would stay on in the Forces partly, and to quite a degree, because there was a pension. Nobody ever dreamed of the inflation this Government has brought on in the last 20 years. Pensions had a lot to do with decisions being made by people to stay in Government service. The pay was not as good and the conditions were at times terrible. There were many other disadvantages to being in the Armed Forces, such as being posted at a moment's notice, and the necessity of having one's family educated in a variety of locations. The decision to stay in Government service was made because of the security that Government employment was supposed to offer.
It is shocking to think that the Government would have misled servicemen over the years and then simply, because of its mismanagement of the economy, put their contributions into the Consolidated Revenue Fund, and now acts as if they were just a drain on the taxpayer that should not be there at all, when in fact it gives no credence to these figures, figures that are quoted quite frequently by Ministers of the Crown.
A letter from the Minister of National Defence (Mr. Famontagne) to me on February 25, 1982 said:
The balance in the account-
That is the superannuation account.
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-as of 30 September 1981 was $9.89 billion.
He says that it is in there. Who does it belong to? The President of the Treasury Board thinks it belongs to him. There are quite a few people who think it belongs to the serving servicemen and the retired servicemen.
I would hope that the Fiberals, particularly those who represent their constituents in this area, and in other areas as well, might see what a shabby deal they are pulling here. They take a contributory pension, on which a recipient has no say either as to how much he contributes or how often he has to contribute to it, or how often it may be raised without his permission, and summarily decide that they will not give them the payout that had been promised. 1 can simply say that if any organization other than this Government did it there would be a class action lawsuit about it. In fact, I would not think that would be too bad an idea for the veterans to do so right now. When 1 say veterans, I mean the long service pensioners, I do not mean the disability pensioners that the Minister of Veterans Affairs (Mr. Campbell) might talk about.
I am sorry that the Minister of National Defence is not here at the present time. I had expected he would take part in this debate to support the 80,000 servicemen who are involved and the 33,000, 34,000 or 35,000 annuitants who are retired from the services and drawing these pensions to which they contributed. Perhaps he will take part in the debate this evening or tomorrow, if he has something to say in defence of those people who are contributing to the safety and security of this country.


Some Hon. Members:: Six o'clock.


The Acting Speaker (Mr. Blaker):: Is the House agreed therefore that the Chair call it 6 o'clock? There may be some difficulty, because it will be a matter of whom the Chair recognizes at eight o'clock. Normally I would recognize the Hon. Parliamentary Secretary to the Minister of Consumer and Corporate Affairs. Is that agreed?


Some Hon. Members:: Agreed.


The Acting Speaker (Mr. Blaker):: It being six o'clock, 1 do now leave the Chair until eight o'clock this evening.


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
Mr. Deputy Speaker:: Order. When the House rose at six o'clock, the Parliamentary Secretary to the Minister of Consumer and Corporate Affairs (Mr. Berger) had been given the floor.


Mr. David Berger (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, the purpose of the Bill before us this evening is to limit to 6 and 5 per cent

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any increase in Public Service pensions. Were it not for this Bill, this increase would come to 11.5 per cent, based on the last year's increase in the consumer price index.

It is important to understand that this is not a Bill on pensions, but a Bill which is part of an economic plan designed to bring down the rate of inflation from the 10 or 11 per cent we have known over the past couple of years to, hopefully, six and five per cent in the coming years. It is extremely important to remember this fundamental fact.
When I hear the criticisms of this Bill by Members opposite, I scratch my head and wonder what it is that they would propose. Do they prefer 10 or 11 per cent inflation? What is their plan of action? How do they propose to get inflation down to a lower level? What ideas do they have? Unless they have some ideas on how to reduce inflation in the manner that we are doing, I say their arguments have no force.
In trying to bring down inflation, there are a number of options the Government could have considered, one of which was mandatory wage and price controls. I have not heard any Members opposite come out in favour of that. Last winter, prior to the introduction of this program by the Government, a number of groups submitted briefs strongly urging that mandatory wage and price controls not be considered.
One brief was submitted by the Business Council on National Issues which represents a number of major employers in this country. It strongly urged the Government not to impose such a system, which we knew in 1974, 1975 on to 1978, because of the constraints that were involved, the administrative difficulties and the bureaucracy required to administer it.
They made a submission to the previous minister of finance during the series of consultations which he undertook in the spring and early summer, suggesting a system of voluntary wage and price controls, which the Government subsequently embarked upon. They included a premise in their suggestion. They felt that by and large Canadians are intelligent people who will respond to reason if presented with a reasonable argument. They felt Canadians would respond to the kind of appeal that would be made to them by the Government setting the example and asking industry to comply with the program voluntarily.
What does the Opposition have to say about that? Do they feel that some other approach would be better? A number of people from industry have supported this program. Members are aware of the industry committee established under the chairmanship of Mr. Sinclair. Since then a great number of companies have adhered to this program.
I want to bring to the attention of the House an article which appeared in yesterday's New York Times. Felix Roha-tyn, a prominent investment banker and chairman of the Municipal Assistance Corporation in New York, which engineered New York City's federal aid package in 1975, speaks of the alternatives to Reaganomics. In an extremely thought-provoking article he talks about the necessity of guarding against a renewal of inflation in the United States
caused by wage settlements in excess of productivity improvement. The article reads in part:
Wage and price controls in an advanced industrial society cannot work for long, and a formal, legislative policy, such as a tax-based incomes policy, is probably neither practical nor fair. However, a change in our labour cost structure has to be examined if low inflation is to co-exist with high growth. The most practical way to approach this would be for all major labour contracts to expire simultaneously every year, with wage increases related to existing economic conditions and current inflation; significant elements of profit-sharing should reward real productivity improvements. We should take a cue from Japan and Germany and have an annual, national wage negotiation involving business, labour and often the government. The result should be keyed to the performance of the economy. This is the practical equivalent of an incomes policy for most of the economy.
He looks at the matter of wage and price controls and he says they cannot work for an extended period of time. He looks at tax based incomes policy, and he says that is impractical as well. He argues for some form of an incomes policy which, I believe, our six and five program will ultimately lead to, where wage increases and salaries will be tied to the increase in productivity of the country or to the increase in the gross national product.
Mr. Rohatyn is not the first to advocate such a policy. Lester Thurow, who is, I believe, the favourite economist of my colleague, the Hon. Member for Lincoln (Mr. Mackasey) has written extensively about such a program. I do not hear the Opposition, though, Mr. Speaker, raising such matters. I do not hear them saying, "Well, yes, this is the kind of policy which should be considered in Canada." I do not hear them discussing the pros and cons of it. They just continue to harp about the so-called injustices in our particular program, and these injustices may very well be more perceived than real. I have to conclude that much of their criticism is, as the Hon. Member for Hull, (Mr. Isabelle), I believe, earlier today said, just pure electioneering. They are just playing to the public and trying to score points. They are criticizing the Government for the sake of criticism and trying to appeal, basically, to the fear of Canadians, rather than trying to arrive at a solution to our problems in a constructive manner.
What has seemed to have escaped the attention of both Opposition Parties is that prices as well have been controlled in this program. We are very well aware of the Government's restrictions as they have applied to companies within federal jurisdiction. They must come before federal regulatory agencies like the Canadian Transport Commission or the CRTC. We are also aware of the example of Bell Canada and the fact that their increase in rates was limited to 6 per cent. Indeed, Mr. Speaker, increases in prices throughout the third quarter, for the three-month period, August, September and October, slowed considerably from 3 per cent to 1.7 per cent in May, June and July. On a monthly basis, inflation in October was
0.6 per cent, and when taken with the 0.5 per cent recorded in each of July, August and September, it is solid evidence that inflation is stabilizing at targeted levels. On an annual basis, inflation in October dropped to 10 per cent from 10.4 per cent in September. This decrease continues the steady downward
December 6, 1982

movement from levels which were above 11 per cent prior to July. We have, therefore, dramatic evidence that our policy is beginning to take hold.
I do not claim, and I do not think anyone in our Government has claimed, that our policy is solely responsible for this decrease in the rate of inflation. It is undoubtedly true that a number of companies, and many thousands of small firms, have been restricting their wage and price increases throughout the recent recession, going back about a year or a year and a half. 1 have met countless shop owners and small businessmen in my constituency and elsewhere who have said to me they have not taken a raise in the past several years. In light of this kind of situation, it certainly would be unconscionable for the Public Service, which is not subject to the same kinds of competitive forces as the private sector, and which does not have to depend on the bottom line or the amount of cash which is in the till at the end of the week or month, to continue to have increases at the rate of 10 per cent or 11 per cent when other sectors of the economy cannot take the same kinds of increases and when many are suffering. Indeed, it really is only logical-the kind of logic, perhaps, which escapes the Members of the Opposition-that the Government impose the same restrictions upon its employees as do many companies in the private sector.
On the other hand, Mr. Speaker, it is true to say also that our program has had an effect on the private sector. I have spoken to a number of businessmen who have told me that when faced by their employees in the course of the past four or five months who perhaps asked for 12 per cent or 9 per cent or whatever, these companies said, "No, the Government has a policy which we intend to follow. It will be 6 per cent over the course of the coming year."
Finally, Mr. Speaker, I would like to mention briefly that what we are really asking pensioners to do under this Bill, which has been described as a great hardship for them by Members of the Opposition, is not as great a hardship when you look at the cold, hard facts.

Naturally, Mr. Speaker, no one readily wants to limit increases, but the difference between the amount which the pensioners will get as a result of this 6 and 5 per cent limitation and the 11 per cent they would have received otherwise is practically nil. I figured it out. It amounts to perhaps the price of a pack or half a pack of cigarettes a day. The difference will come to $37 a month in 1983. I am not a cigarette smoker, but as far as I know a pack of cigarettes these days costs about $2. So half a pack of cigarettes costs $1, which is the equivalent of the $37-odd loss incurred by the pensioners under this Bill. In my opinion, half a pack less a day is definitely not something which will create undue hardships for pensioners. It can hardly be labelled a loss since pensioners will in fact get an increase. It will be limited to 6 per cent instead of 11 per cent but, as I pointed out earlier, the rate of inflation has already begun to drop sharply. If we manage to bring it down to 7 or 6 per cent in the coming year, it is obvious that there will be no loss. Quite the contrary, the Canadian economy as a whole will be
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stronger so that pensioners and all Canadians alike stand to benefit from the upturn.
I am grateful to have had this opportunity to take part in the debate, Mr. Speaker. I hope Hon. Members opposite will take the floor and make more constructive contributions to this important debate.


Mr. Howard Crosby (Halifax West):: Mr. Speaker, Bill C-133, which amends the Supplementary Retirement Benefits Act, is simple in form and substance but its effect is shattering to more than 200,000 retired public servants and Armed Forces personnel across this land. The case for the senior citizens should be established and explained to fair-minded legislators and the Canadian electorate who, after all, will judge our performance in this House of Commons on measures such as this Bill.
Let me deal first with a specific provision of Bill C-133. It applies the Government's six and five policy to retirement allowances of those persons subject to the Public Service Superannuation Act so that regardless of the increase in the cost of living, those people are limited to a 6 per cent increase in 1983 and a 5 per cent increase in 1984. It should be made clear, Mr. Speaker, that the designation of the six and five is arbitrary, even imaginary, and not based on fact or even on an economic forecast. In fact, the economic forecast would indicate that the proper increase for the year 1983 would have been, but for the introduction of Bill C-133, something in the area of an 11.5 per cent increase in pensions payable to retired public servants and members of the Armed Forces. If we were to act on the basis of the prediction made by the Minister of Finance (Mr. Lalonde), who indicated that even he does not expect inflation to be reduced below 8 per cent, we would have that as a standard. But there is no basis for assuming that the inflation rate in 1983 will be 6 per cent or 5 per cent in 1984. It is not even anticipated that this is an achievable goal. So what the Government is doing with this restraint policy is simply acting on an arbitrary figure it sought to impose in order to save the public purse. We have to ask ourselves, Mr. Speaker, whether that is fair in the circumstances.
1 want to deal with the matter of inflation in Canada and how this economic evil may be attacked, but first let me consider the justification given by the president of the Treasury Board (Mr. Gray) when he presented this Bill to us. In explaining the Bill he said that it implements the Government's six and five policy which he claimed has a double-track effect of restraining Government spending while providing additional funds for job creation. Mr. Speaker, if that statement were made in the context of a business or social environment instead of a political context, the Minister would at best be condemned for violating business and social ethics. It is well within the realm of possibility that such an extravagant and misleading claim would be considered fraudulent, but unfortunately of a kind and character that would not be subject to a court of criminal law. Nonetheless, it should and does incense fair-minded people. The fact that the Minister

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would have the Canadian people believe him when he says he wants to restrain public spending and at the same time spend taxpayers' dollars to create jobs means that his fraud is of a public character. That is what I want to accuse the Minister and the Government of Canada tonight of doing, perpetrating a fraud on the Canadian public. It consists of the fact that the Government is restraining Government expenditure and at the same time it is spending more funds for things which the Government thinks will bring it political credit. 1 can say without fear of contradiction that the Goverment's six and five program constitutes a public fraud.
Let me review the program. You remember the night of June 28 when the then minister of finance introduced his budget in the House of Commons. In describing the world of six and five, he said that Canadians have been suffering from a double digit inflation rate and, unless it was brought into line, Canadians would continue to suffer. So what he proposed to do was to start a restraint program, and he would start it with the Government's own employees, the federal public servants. The Minister knew, when he rose in this House on June 28, that there was abroad in this country the idea that federal public servants were overpaid and underworked. Well, Mr. Speaker, there may be those in the Public Service whose jobs attract a salary beyond the salary they could achieve in the private sector, and there may be those in the Public Service who do not work as hard as they ought to, but to characterize the Public Service of Canada as overpaid and underworked is grossly unfair. In fact, the statistics indicate otherwise. Statistics indicate that in the last five years, between 1977 and 1982, the Public Service increases have been marginally behind the private sector increases. I think any person knowledgeable about salary ranges in the Public Service could establish very easily that in specific areas like engineering the salaries are substantially behind those paid in the private sector. In fact, for a medium range engineer, the salary would be something in the order of $3,000 to $6,000 less in the Public Service than in the private sector.
So one has to ask what basis the Government has for restraining the Public Service in the name of helping the economy of Canada. Even restraint of Public Service salaries and related expenditures would be justified if the Government practised and over-all policy of restraint, but we have reason to believe that Government spending programs have gone onwards and upwards since June 28 when this program was announced. We have seen the Post Office pile up ever larger deficits to the extent of $500 million a year. Canadian National Railways come and tell the House of Commons that their deficit is increasing to a similar extent. The Mirabel Airport continues to pile up huge deficits, week after week, to the extent of over $1 million per week or over $50 million per year. We have write-offs for our national ports to the extent of close to $500 million. The list goes on and on. I will not mention, as 1 have several times in the House already, the $24 million thrown away on the purchase of jets, the $5 million to buy firecrackers to celebrate Canada's birthday, or the amount of
money paid to public servants like Michael Pitfield who received a quarter of a million dollars in a settlement deal.
There is no evidence before us that the Government is serious about restraint. The only evidence is Bill C-133, in which the Government attacks retired public servants by taking from them the benefits built up, in many cases, over a lifetime of service. The Government is trying to tell the public that this is its restraint program; that it is so concerned about the amount of money being spent, it is going to cut back on the money it contracted to pay to public servants, in order to demonstrate how serious the situation is.
In a recent speech at a fund-raising event for the Liberal Party, the Prime Minister (Mr. Trudeau) referred to the bad times we are having in Canada and said that it is the worst time since the depression but that we are not to worry, because the worst time can be the best time. What he meant was that in times of adversity Canadians come together, look at themselves, and decide what to do about the problem. That may be true in the federal constituency of Mount Royal with its multimillion dollar homes and its $100,000 and $200,000 plus incomes, but it is not true in many parts of Canada. The worst times are not the best times.
It is a shame and a crime that the Prime Minister of Canada, viewing the situation with which so many Canadians are faced, could make the statement that the worst times are the best times. That is his assessment of the situation. In times of adversity you can see good things in the situation, according to the Prime Minister. 1 wonder if he would think that if he went to the coal mining town of Glace Bay with his colleague, the Hon. Member for Cape Breton-East Richmond (Mr. Dingwall), to see the devastation being effected in that area by this period of recession and if he saw people not only losing their jobs but the hope and expectation of employment in the future. I wonder if he would say then that the worst times are the best times.
If he went to the Strait of Canso with his colleague, the former minister of finance, now the Secretary of State for External Affairs (Mr. MacEachen), and saw the devastation there, as a result of the economic recession, would he still say the worst times are the best? I should like to see him in the town of Canso or Port Hawkesbury where they are about to close down the major source of employment, the heavy water plant, telling those people that the worst times are the best times.
What we have to conclude is that the Prime Minister and the Government and, I am afraid, all his colleagues in the Liberal Party, deal entirely in perceptions. They think they can sell deals to the people of Canada and that they do not have to worry about the facts of the situation and do not have to deal with the real people who are suffering, the pensioned off public servants. They think they can just deal with the perception that they are attacking the economic problem in Canada, that the businessmen will cheer and the chambers of commerce
December 6, 1982

across the land will join with them in their restraint policy without examining it.
That is why 1 stand in this House time and time again to tell the people of Canada that there is no restraint policy. The Government is not restraining spending. It has gone up and up and up, to $79 billion while revenues stay at $55 billion, leaving a $26 billion deficit. That is what is wrong with Canada. It is not the public servants nor the retired pensioners. They are not creating inflation in Canada. It is the Gover-nemnt that continues to spend and spend and to borrow money to finance that spending that is causing inflation. It will have to do a lot more than pretend, at the expense of public servants and retired public servants, that it is doing something about it.
What is the Government doing to the public servants of Canada who, many Canadians think, are overpaid and underworked? The average pension paid to more than 200,000 retired public servants and members of the Armed Forces, is $6,900. Michael Pitfield and his buddies retire on a much larger pension. In the length and breadth of the Public Service the average pension is $6,900. This, together with the old age pension, which is under $3,000 per year and is going down as a result of another measure that is before the House, gives an income of $9,000 per year for a retired public servant.
If these public servants received the increase they would normally be entitled to of 11.5 per cent, the increase in their pension would be something in the area of $763, whereas with a cap of 6 per cent they will only receive something in the order of $473. What this Bill will do is take $310 away from
200,000	public servants whose total income, including Old Age Security, is $9,000.
If I thought this measure was going to correct all the economic wrongs in Canada, if I thought it was going to change the course of our economic history, if I thought it was going to do anything for the people of Nova Scotia, British Columbia or the Northwest Territories, then I would support it. Even though we are calling upon retired public servants to make that kind of sacrifice, if it meant something for the greater good of Canada and all Canadians, then I think 1 would support it.
There is no way that anyone on the Treasury benches, the Minister of Finance (Mr. Lalonde) or the former minister of finance or 600 parliamentary assistants, can convince me that taking approximately $300 away from 200,000 retired public servants, is going to help Canada. How could that action possibly help Canada when the Government throws away $500 million on the post office, $100 million on this program and $100 million on that program and provides pension benefits to one public servant, the Clerk of the Executive Council, Michael Pitfield, of about a quarter of a million dollars?
There is no relationship between what the Government says it will do and what it does. That is beginning to bother not only Members of the Opposition but people all across Canada. They are beginning to realize that the Government talks not only from both sides of its mouth but, can I say, from several sides of its mouth. It always tells a different story and paints a different picture. What is most important, it creates perceptions. The Government of Canada never deals with facts. It
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never deals with the inflation rate nor with specific economic measures that are designed to reduce the inflation rate. It plays with the perception that if we cut back on public servants benefits, we will cut back on public expenditures. The truth is that payments in respect of Public Service salaries went up by 17 per cent in the year in which the Government announced its restraint program. The justification for that, given by the President of the Treasury Board was that Bill C-133 would implement the Government's six and five restraint program and that it was coupled with a job-creation program.
Unfortunately, when the former minister of finance, the Hon. Member for Cape Breton Highlands-Canso, announced this great restraint program, he did not mention job creation as being the other side of it. He picked that up later when the Government realized the problem in Canada was not really inflation or high interest rates but was unemployment. It did not find that out until a couple of months later when the unemployment rate went up a couple of points to 1.4 million people uenmployed. Then the Government began to realize that even though the Governor of the Bank of Canada and other high-priced economists did not like the rate of inflation or the interest rate, the real human problem in the country was unemployment. That is when it started to talk about job creation.
In the June 28 budget when the Minister of Finance announced measures the Government would take to cap salaries and incomes in the Public Service, he said that over a two-year period something in the area of $800 million would be saved. He immediately announced expenditures of $2 billion, most of which were directed at small business and some of which were directed at lowering interest rates. Now the Government has come forward with a job creation program in which it will spend $500 million to create 60,000 part-time jobs. It is trying to claim that that program is tied in with the caps on Public Service salaries and with increases in Public Service pensions.
There comes a time when even the Government has to give up trying to fool Members of the House and the people of Canada. If it does not know what it is doing, it can simply come to the Parliament of Canada and say, "We are sorry, ladies and gentlemen, we do not know what we are doing. We have made a number of mistakes in the past but now we want to co-operate with Members of Parliament and with people across Canada to remedy the situation." If the Government took that honest approach, I would have some sympathy for it. I would even be willing to explain to public servants and persons receiving Public Service pensions that they have to contribute in the same way as all Canadians. But that is not what the Government has done. It has simply redirected some of the funds without cutting back on expenditures at all.
Nonetheless, inflation will decrease in Canada. The interest rate will go down and is going down. The reason is that economic activity is grinding to a halt. The reason we will have

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a lower inflation rate over the next months and years is not the Government's six and five program. The reason is that there is no economic activity in Canada. The reason interest rates will go down is that no one is expanding his or her business or borrowing funds for business purposes, so the demand for money simply goes down. It is the lack of economic activity in Canada which is bringing down the inflation rate and the interest rate, not the Government's six and five program. One does not have to be an economist to recognize that fact.
The real fact in Canada is that there are 1.4 million unemployed persons. There were 55,000 more unemployed people this month over the figure for last month. We have every reason to believe that there will be another 50,000 to 60,000 people unemployed next month. The 1.4 million listed by Statistics Canada does not include all unemployed persons in Canada. There are all the people who have given up looking for work, 250,000 or more. There are all the people who are employed at jobs in levels well below their qualifications, that is another 250,000 to 300,000. There are all the part-time workers, the 800,000 who are working part time, at least half of whom want to work full time. There are not just 1.4 million unemployed. There are over two million or almost 2,5 million persons in Canada with serious employment problems. They are unemployed, have given up looking for work, are working below their job levels or part time. This is the result of the Government's policy. It will not be cured by any six and five restraint program. It will not even be helped by any six and five restraint program. All it does is to give the Government opportunity to take money from one sector of the population and spend it in another sector.
With the Government's record over the past decade of reallocating wealth in the country, it is no wonder that Canadians, particularly Members of Parliament, are wary about giving the Government the right to reallocate any wealth in the country.
Let us look at some of the programs which the Government has created. There is the $3,000 grant to purchasers of new homes and to new home purchasers. On the face of it, it sounds like a reasonable program. It helps owners and it helps stimulate the housing industry. But in the hands of the Canada Mortgage and Housing Corporation the program becomes a complete shambles.
I will not complain about that in the House of Commons because if the Minister of Housing does not know then he should that every recipient, whether the person is a new home purchaser or the purchaser of a new home, is disgusted with the Government before he or she ever receives a cheque. Recipients are disgusted with the Government because of the rigmarole through which they have to go to get the grants, the bureaucracy they have to face, the forms they have to fill out, the actions they have to take and the insults they have to endure from CMHC to obtain $3,000 grants. If the Government expected to get any votes out of the program, I can tell it that it will not.
It is the same situation with the home improvement program under which the Government provided Canadians with nonrepayable loans. Again we see the Government misleading the people. It cannot even call a grant a grant any more. It has to phrase it in some way that is hardly understandable to most Canadians. If Government Members think that is helping them politically, they are mistaken because everyone 1 have talked with who applied for home improvement grants is completely dissatisfied.
In the first place, I do not know of any contractors in Canada to whom one can go, certainly in my part of Canada, Nova Scotia, and expect them to do kitchen work in six months' time. It takes at least six or seven weeks to contact CMHC and arrange for an inspection of one's home, which is a prerequisite to the grant. It does not make any difference what one is doing in the home. If it is something which is clearly visible as home improvement work, a week, a month or six months later one has to have an inspection. Every CMHC office across the country cannot provide inspections for at least five, six or seven weeks. Again there is no connection between the Government's announced policy in the House of Commons and what is taking place out in the country.
It is interesting that I should have an opportunity to say this to Ministers of the Crown. They sit around Cabinet with their advisers in the bureaucracy and dream up these programs without any reference to what is going on in the cities and towns across the country. This time they made a disastrous and dreadful mistake. Whereas they promised to give elderly citizens an extra $35 a month during the election campaign- and I would be the first to admit that it might have brought them a few votes-whereas they promised to provide new home owners and purchasers of new homes with $3,000 grants, and whereas they promised to provide Canadian citizens who wanted to renovate their homes with interest-free loans, the plans have backfired because they are not administering them properly.
Time and time again as part of the Government's economic program to help get the economy moving again, we have heard of help for small businesses. One does not have to talk very long to any small-businessman across the country before finding out that in his or her opinion the Government is doing nothing to help small business. In fact, the complaint is still there that the Government is riding on the backs of small-businessmen. The Government places a burden of regulatory control or a burden of Government regulations which is actually swamping small business across the country. Small businesses which might have coped in good times with this myriad and morass of Government regulations now find the burden too onerous. They do not want to carry on with high interest rates and all other problems which arise from a recessionary period within the economy. Small-businessmen are giving up. When the Government comes forward in the House of Commons saying that it is taking $800 million from public servants to put in a program to help small-businessmen,
I am sure business persons across the country are asking, "Where is the help?" How many are actually seeing this help?
I have talked with a great many small-businessmen. None of
December 6, 1982

them have asked me to thank the Government for providing the help it claims it wants to provide.
I want to deal for a moment with the plight of pensioners across the country. As 1 have indicated, there is the idea that public servants have been overpaid for a long period of time, that they are not required to work as hard or their work is not as difficult as their equivalents in the private sector. It is very difficult to deal with that kind of subjective analysis. All you can do is to show people that in fact Public Service salaries are not as high as equivalent positions in the private sector, which has been proved time and time again by statistical analysis. You can show and demonstrate to person in the private sector that increases in that area have been higher for the last five years, though only marginally higher than increases in the Public Service. But you cannot deal effectively with the perception that really is the situation. You cannot always confront the perception with the facts because people are not willing to listen to facts once they have formed that idea.
1 want to say to the Public Service pensioners across Canada that it is a shame the Government has created this perception and aids and abets it by saying in this House of Commons and elsewhere that we have to cut down on the Public Service both in relation to salaries and benefits to public servants who are now unemployed and in the superannuation payments made to retired public servants. We have to cut down on that expenditure.
At the same time, the Government does not point out the plight of the public servants. The Government does not point out that the average retired public servant receives an income of $6,500. The Government does not point out that in some cases public servants have taken early retirement because their jobs have been abolished. The Government talks about security in the public sector, but there is no security for a public servant in a recessionary period any more than in some aspects of the private sector. You have to be careful when making comparisons here, Mr. Speaker. One cannot compare an employee in the federal Public Service to an employee in some small regional industry that is totally dependent upon the economy of that region or on the state of the business in which the employer is engaged. But if one compares federal public servants to those employed in large organizations in the energy field, such as Imperial Oil, or if one compares federal public servants to employees working for large banks, such as the Royal Bank of Canada, then one can make a fair comparison. But, Mr. Speaker, I do not think that you will then find that job security is any different among employers at that level.
However, the Government has said, and the Minister of Finance has said in this House of Commons, that public servants should accept less because they have job security and because they have the assurance that they will continue to be employed, and they should share with fellow Canadians who are not employed the benefits of their employment. That makes sense. That is a rational approach to the situation.
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I think that most Canadians, as the Prime Minister (Mr. Trudeau) said in one of his fireside chats, are willing to share. But Canadians want this sharing to be based on real facts. Canadians want this sharing to be based on truth. They want the sharing to be based on the fact that the public servants now employed do have job security. The President of the Treasury Board stood up last week and said that the Government will have to get rid of a lot of public servants, that it is going to have to cut down, because that is part of the program. What he forgot is that there may be 500,000 persons employed in the Public Service and he may be getting rid of only 10,000 or
20,000	but those public servants do not know who he means in that group. They do not know who of the 10,000 to 20,000 will lose his or her employment.
If you think that creates job security among people, Mr. Speaker, and if you think that one does not have to worry because he or she probably will not be the one in the small percentage of public servants who will lose his or her employment, if you think that gives public servants any sense of satisfaction or makes them happy at having spent most of their adult lives in the Public Service, then you are making an awful mistake, Mr. Speaker. One either has job security or one does not have job security. It is not a hit or a miss proposition to have job security. Job security is not based on percentages; it is based on the right to keep your employment against the wishes of your employer. If a person simply has a job at the whim or demand of one's employer, then a person does not have job security.
When you run down the whole list of assets that one gains by employment in the Public Service, and subsequent retirement, you find very quickly that the Government is taking most of the assets away. One has to ask what the Government is providing by way of compensation. What is it doing to make Canada a better place in which to live? What is the Government doing to contribute to economic security in the future? If there were a positive answer to that question, I think everybody in this House of Commons would say that the exercise was worthwhile. If this action that is being taken by the Government will help the economy of Canada and contribute to a better future for all Canadians, then I agree, and 1 am sure most Members would agree, that all Canadians ought to be called upon to share in this venture.
I have not seen any evidence that that will be the result of the Government's program. I cannot see any evidence that what the Government is taking from one sector and giving to another is going to produce anything substantial. 1 believe it is all a facade. 1 believe it is all phony. 1 think the Government is trying to fool Members of the House of Commons, the Parliament of Canada and the people of Canada. I think the Government has come to the end of the line. The Government realizes that it has mismanaged the affairs of Canada to the point where it cannot effectively administer the economy. This Government has overspent, as I have said, to the tune of $26 billion in the current fiscal year. This Government has run up a total debt of $132 billion. The Government has to use over $1 in every $4 in revenue to service that debt. Yet because of a

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situation aggravated by a world-wide problem in trade and business activity, we find ourselves with a gross economic problem.
There is no economic activity in Canada. There is no business income to pay off this debt. There is no money to invest. There is no reason to invest in new activity. Therefore, the Government can no longer depend upon the private sector to bail us out of this situation. What does the Government do? The Government does not call in the private sector and deal with the problem in a realistic way. The Government does not really examine the total process by which it has dealt with the economy. It simply announces a program for which the claim is made that it will resolve the economic problem.
The problem is that the Government's fraud is starting to affect people in a real way. When the Government of Canada comes to the House of Commons for legislative authority to take $1.61 a month away from each child under 18 in Canada; when the Government of Canada comes to the House of Commons for legislative authority to take $300 a year away from retired public servants and thus reduce their income, which is actually only at the $6,000 or $5,000 level; when you find those kinds of measures-not to mention the Bill before the House to deprive persons receiving Old Age Assistance of $19 a year-and you add them up, the children, the senior citizens and the Public Service pensioners who are being asked to contribute millions of dollars to the Government of Canada only to be redirected in some of the ways that I have already pointed out to pay for the massive deficits on the railway system, and the postal service, then you know that we are in trouble.
Even The Toronto Star was forced to write an editorial condemning the Government for its policy with respect to this Bill, Bill C-133. Even The Toronto Star has to question the rightfulness of depriving retired federal public servants of a reasonable increase in their pensions.
I would like to direct the attention of the House to exactly what we are doing here and why we are doing it, because I do not think anyone can seriously justify the breach of a contract embedded in this statutory provision-with the condonation of statutory provisions-in the name of restraint when the real effect of the breach of that contract is simply to transfer Government funds from one group of Canadians to another. In more specific terms, I do not see how the Government of Canada could ever justify breaching its contract with retired public servants and taking dollars out of their pockets unless it is part of an over-all, complete program whereby all public expenditures are limited to the same amount.
However, I have said time and time again that we know public expenditures are not being limited in that way. We know that the Government has no intention of decreasing its payments to people, even those in the employ of the Public Service, and we have seen that time and time again.
Let me close by simply saying that we have before us a Bill which, in effect, is a breach of a sacred contract between the Government of Canada and its retired public servants. The breach of that contract could only be justified on the most extreme grounds, and those grounds simply do not exist in this case. The action of the Government is wrong and I do not see how anyone in the House can properly support it.


Some Hon. Members:: Hear, hear!


Rodney Edward Murphy: Mr. Speaker, I congratulate the Hon. Member for Halifax West (Mr. Crosby) for much of what he had to say in this House. It can truly be said of him that he is one of a few Conservatives who can stand up and attack the Government on this particular Bill, Bill C-133, because he, of course, is one of two Conservatives in the House who have joined with us in opposing the Government's Bill to limit the wages of people working in the Public Service. I congratulate him for his efforts in August and for the speech he just made in the House.


David Berger: You are in good company.


Rodney Edward Murphy: I hope that he has the ability to convince the rest of his colleagues to ensure that they are consistent in their position.
I would like to refer to the Hon. Member for Laurier (Mr. Berger) who spoke in the House. One of the things this Liberal Member discussed was the fact that there were groups in this country who supported the Government's six and five program. He mentioned one group in particular, the Business Council on National Issues, and pointed out that that group did not want mandatory controls and was very concerned that we have only voluntary controls. What he really did not mention was who was in the group and what was its representative nature. That group is composed of chief executive officers and presidents of the largest corporations in this country, and it is involved in a direct and obvious conflict of interest in giving the Government recommendations on this legislation.
Let me refer to some of those people. I do not have a complete list of the BCNI members, but I do have a list of some of the people who have supported the Government's program and 1 know of some of their wages. If I can refer to an article in The Financial Post dated May 15, it lists the salaries and other equivalent remunerations of various people supporting the Government's six and five program and belonging to the BCNI. C. F. Baird, the Chairman of Inco Limited, a company which supports six and five, receives $425,645 a year. D. M. Culver, President of Alcan Aluminum, receives $532,941 a year. Ian D. Sinclair, about whom we have all heard in this House, is almost "Mr. Six and Five" himself. How much does that poor man make for his work on behalf of CP? He receives $556,228 a year. Mr. A. G. de Grandpre, Chairman of Bell Canada, receives $626,000 a year, and J. A. Armstrong, Chairman of Imperial Oil, receives a meagre $736,741 a year.


An Hon. Member:: And they are advising the Government.


Rodney Edward Murphy: Therefore, I am not surprised that they gave the Government the advice for the mandatory six and five
December 6, 1982

program, as well as the program which will affect Civil Service pensioners in this country. They comprise a group which has the most to gain and the least to lose by imposing what are called voluntary controls but what, in fact, are mandatory controls on the Public Service, on those who receive Family Allowances, old age pensions and, through this particular Bill, on those who are retired and receiving Government pensions. The Government Member may wish to quote those people as being ones who support the Bill, and 1 am certainly glad he did because that is the type of people to whom the Government should not be listening when it comes to a direct conflict of interest.
Let me turn to the person who introduced the Bill in the House today, the President of the Treasury Board (Mr. Gray). He said that before any significant changes were made to the Superannuation Act in the future, there would be full consultation with the workers. However, that is a promise that this same Government has made in the past. Those employed in the Public Service and those who are retired from it were told that they cannot negotiate Public Service pensions. They were told that the Government would not allow them to negotiate outright. It was the Liberal Government, needless to say. However, they were told there would be full consultation with retired people before there were any changes actually relating to superannuation. Therefore, what good was the Liberal promise that there would be future consultations with regard to Public Service pensions in the future?


Mr. Blaikie:: What good is any Liberal promise?


Rodney Edward Murphy: My friend, my colleague, the Hon. Member for Winnipeg-Birds Hill (Mr. Blaikie) just asked, "What good is any Liberal promise?" the Liberals have just reneged on a promise that they made to Civil Service pensioners. The President of the Treasury Board himself promised that he would resign if a Liberal Government could not bring down interest rates. Yet I see him sitting across from me tonight in a Cabinet seat. He, along with many so-called progressive Liberals, had promised that the Liberal Government, if reelected in the 1980 election, would strengthen the Foreign Investment Review Agency, but, as was mentioned, with regard to the Bowater lay-offs earlier today, that very promise has again been broken by the Government. The Government has not imposed any strengthening of regulations as far as the Foreign Investment Review Agency is concerned. In fact, it is weakening the legislation existing in this country today. A Liberal promise is not worth anything. Today that same Minister rose in the House and announced it was his intention to introduce an amendment at the appropriate time which would somehow recognize the contribution to pension plans of those who have retired so that they would not be receiving a meagre 6 per cent and 5 per cent increases. He said that he would allow increases over the next two years, not amounting to 6 per cent or 5 per cent, but, rather, to 6.5 per cent next year and 5.5 per cent the following year. I do not know what the intent of that amendment is, 1 do not know if it is to try to buy off some of the Liberal Members who are concerned about
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the effect that this Bill may have on their electoral possibilities in the next election, but 1 can tell you that going from 6 per cent to 6.5 per cent, or going from 5 per cent to 5.5 per cent is not going to help many, many pensioners in this country. It is a farce and it is a shame.
I would like to quote, not from Government spokesmen, not from great philosophers or great economists, but from some of the people who are receiving Government pensions at this time.
I am reading from the Federal Superannuates National Association, Nova Scotia, Central Branch, a publication of December 1982. Some of their arguments are as follows:
Our pensions, including indexation, are a form of deferred remuneration and should not be altered at the whim of Government or without prior consultation.
It also said:
Considering the statements made in the last three issues of the Treasury Board publication, "Your Superannuation Plan", any reduction of full indexation is an outright breach of faith with those already retired.
They go on to say:
We understand that the Supplementary Retirement Benefits Fund is not sufficient in itself to pay for indexation of pensions, but we are entitled to a share of the excess earnings from the main fund, and if our share of excess earnings was credited to the S.R.B.A. there would be sufficient to pay full indexation.
That same group says:
When the superannuation plan was introduced, the Government said it would be non-negotiable. However, no changes would be made without consultation. To date there has been no attempt at consultation.


An Hon. Member:: The Government does not believe in that.


Rodney Edward Murphy: Those are some of the concerns, some of the positions taken by the people who will be most directly affected by this legislation.
As the Minister knows, I have been trying for over a year now, through a question I placed on the Order Paper, Question No. 3,487, to get details of exactly what is in those plans, relating to money, exactly how that money is invested, exactly what rules the Government is imposing on itself with regards to those funds. I also question whether or not there are windfall profits to the Government by the division in the investment policies followed by the Government, with regard to the two superannuation funds.
To date, over a year later, the Government has not answered that series of questions. They answered the ten questions that were before mine on the Order Paper and the 13 questions that were after mine on the Order Paper; but that question is obviously politically embarassing to Members of the Government, and they are afraid to answer it. Yet that is the kind of information that the public service retirees, Members of Parliament and the public at large are entitled to have before we debate this particular legislation.


An Hon. Member:: Right on.


Rodney Edward Murphy: I can tell you that our Party will insist on that information before we let this Bill get through the Miscellaneous Estimates Committee, because that is the information we

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and others need to debate this Bill with the intelligence and the knowledge that is necessary. If the Government wants cooperation it had better provide co-operation to Members of all Parties of this House.
Earlier today we heard a number of Conservative Members speak on this Bill. Conservative Members have made a big deal of the fact that they are now taking the same position we are in opposing the Government's six and five regime. However, in what might be called a re-think process or operation by the Conservatives, they keep referring to this as the third of three Bills, the third of a trilogy, with regard to the six and five program. They talk about Bill C-131 which will limit old age pensions; they talk about Bill C-132 which will limit Family Allowances; and they talk about the Bill before us, Bill C-133 which will affect pensions of retired civil servants. But the Conservatives seem to have forgotten that this is not the third of three Bills, this is the fourth of four Bills; and the first Bill in this series was Bill C-124-


An Hon. Member:: Which set the stage.


Rodney Edward Murphy: -that set the stage, that announced the Government's basic principle of limiting wages, old age pensions, Family Allowances and the pensions of retired civil servants, to six and five.
When the Conservative Member for Victoria (Mr. McKinnon) was asked about this very point, he said, "Oh, C-124, that was the Bill that controlled the wages of MPs". That is certainly true, but there are 700,000 other Canadians whose wages were limited by Bill C-124, and the Conservatives had better try not to forget that. They had better tell the truth when the rest of their Members speak in this debate, that on the primary Bill on six and five they, as usual, supported the Liberal Government. For them now to say that they are against six and five is pure hypocrisy. The Conservative Party in many ways is like a bunch of streetwalkers.


Some Hon. Members:: Shame!


Rodney Edward Murphy: They decide that the best way to increase their take is to work both sides of the street. That is exactly what they are trying to do. They supported six and five one day when Ian Sinclair was down here, but now that the pensioners are concerned, now that those who receive Family Allowances are concerned, now that those who are retired are concerned- oh, my gosh, we are opposed, they say, to this Liberal Bill.
If the Conservatives had opposed Bill C-124, and if they had joined us when we kept this House sitting through June, July and August, then we would not have this legislation in front of us today and the pensioners, those receiving Family Allowances, and those who are about to have their pensions through the superannuation fund de-indexed would not have to fear this legislation, they would have been protected. But the Conservatives stepped back and allowed it to happen.
I remind the Conservatives of some of the things their Leader said. He said, in reaction to the budget of June 28, 1982 which announced the particular six and five regime:
We are relieved that it-
It is the Government:
-is beginning to accept that Government spending is a major cause of current economic problems ... it is a step in the right direction.
We are in the fourth step, and now the Conservatives should recognize what is involved in those steps. They should recognize what is involved on the road that they have so gladly walked down.
Earlier today, the Minister referred to the so-called success of the six and five program. We debate that success. We debate whether a program can be called successful as unemployment increases drastically across this country. We wonder if a program can be called successful as layoffs are announced day after day. We wonder if success can be measured in the form of the Government issuing posters, stickers, pamphlets and speaker's notes, and that is all the semi-annual report on the six and five can be called. They are speakers' notes for an election campaign, the only time I ever see stickers, pamphlets, posters and speaker's notes.
What the Government is doing, often with the support of the Conservatives, is running an election campaign against workers, women and children who depend on Family Allowances, and pensioners. It is an election program which becomes very obvious when you consider that Senator Keith Davey is in charge of it. The literature was not prepared by a Cabinet Minister of the bureaucracy, but by the "Chief Electoral Officer" of the Liberal Party of Canada. Those who are being affected by this program had better remember that.
I wish to talk for a few minutes about the effect of this Bill. According to information I have received, as of last month the average annual pension paid to some 90,000 former contributors is about $8,100. In addition, 32,500 persons are paid about $3,200 in survivor benefits. Therefore, the average annual pension paid as of November 1982 was $6,900.
When the Prime Minister (Mr. Trudeau) talks about sacrifice over television, he does not talk about those earning $3,200 or $6,900 a year, nor does he talk about those who make the great amount of $8,000 per year. These are the people who are making the real sacrifice. It is not the Pitfields, Jack Horner and all the other Liberals and Conservatives who are making a bloody rip-off of the Government system. They are protected. Those who earn $3,200 after their spouses die are making the real sacrifice.
What is the effect of this legislation on those people? After two years, those earning $8,100 a year will have lost $1,409. Those who earn $3,200 in pensions would lose $557 a year. The average Public Service pension recipient will lose $1,200 over the next two years. One of the Liberal Members referred to that as a package of cigarettes a day.


An Hon. Member:: Half a package.
December 6, 1982


Rodney Edward Murphy: 1 do not smoke, but someone earning $8,000 a year on a Government pension will not enjoy hearing a rather rich Liberal Member of Parliament referring to it as just half a package of cigarettes. They used to say, let them eat cake.
I wish to quote another Liberal. Speaking at the 1981 National Pension Conference, the Prime Minister said in his opening remarks:
Put simply, people must be protected in their retirement years. The Canadian Government has pledged that they will be better protected in the future than they are now . .. Pensions which are not protected against inflation naturally tend to dwindle over the years. People who thought they had purchased protection for the rest of their lives find that they have more serious financial problems the older they become. The unfairness of that situation, particularly when the savings pool to which they have contributed may have been reaping inflationary interest premiums, is not tolerable in a nation which believes in social justice.
The very information 1 have been trying to get from the Government, to quote the Prime Minister, is whether the Government has been reaping inflationary interest premiums. Is the Government making that kind of windfall profit which he is attacking almost as usury in this speech? If that is the case, how can the Prime Minister allow his Cabinet to introduce this type of legislation? In a letter which the Prime Minister wrote to civil servants a few years back, he said this:
Indexing does not give pensioners an increasingly larger claim on our economy's production, that is, more money to buy things they could earlier afford. Rather, indexing merely enables pensioners to maintain, roughly, their same standard of living.
The Bill before us is one of many steps the Government is taking to limit the pensions of the very people that the Prime Minister a number of times has said should be protected against inflation. Under the existing pension regulations, those people should not be receiving 6 and 5 per cent increases but, according to the formula which the Government designed, an
11.5	per cent increase next year. They are being robbed of over 5 per cent of the increases they are entitled to under the regulations this Government set down. This is a plan which those workers paid for in the past. It is a plan they are entitled to now and in the future.
We will oppose this legislation. We hope that Liberals who promised to oppose this legislation when they talked to retired public servants in their riding will oppose this legislation in the House. We also hope that the Conservatives will show up in the House to oppose this Government program.
As 1 mentioned earlier today in the House of Commons, there have been at least five occasions in the last four months, two last Friday and one the Thursday before that, when more Conservative Members of Parliament have been absent for serious votes in this House than the margin by which the Government won. Last Friday 34 Tories stayed away and the Government won by only 28 votes. Those votes were on the Government's intention to limit Family Allowances to 6 and 5 per cent increases. The Tories, as they are doing on this present Bill, got up and spoke against that Bill. They ranted, raved and did all the usual things that Tories are fairly good at, but when it came down to the actual vote in the House of Commons 34 Members of Parliament were absent. With more
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than one-third of their total caucus absent, the legislation passed by 28 votes. That is ironic.
What is more ironic is that the Conservatives have done the same thing in the House today. The reason we had two votes on Friday is that the Conservatives moved a motion to postpone the vote on Bill C-132, an Act to limit Family Allowances to six and five. And on their own amendment to delay for over six months the vote on the imposition of that important legislation, which they ranted and raved over, the Conservatives did not show. Again, there were 34 Conservatives at home, at quilting bees, attacking their Leader, whatever they were doing, and the Government won that vote by 28 votes.
This legislation would not be before us now if the Conservatives had showed up. We could be in an election campaign. Therefore, let every Tory, from the Leader to those in the backbenches, remember that when it comes to the vote on Bill C-133, the Bill they have been speaking against today, the Bill which they made the same amendment to postpone today, that they had better show up. I do not want to see an attack on the various Liberal Members from Ottawa, from Thunder Bay or from Cape Breton, if the Conservative Members show, through their usual lack of attendance, their lack of concern about the progress of legislation in this House. It is the Tories and not the Liberals who keep the Government in power. That is your warning, Mr. Tory, to show up and finally show your courage to vote against the Liberal Government which is imposing this bloody, stupid legislation on the pensioners of Canada.


David Berger: On a point of order, Mr. Speaker, I wonder if the Hon. Member would entertain a question?


Rodney Edward Murphy: Yes, Mr. Speaker.


David Berger: The Hon. Member referred to the members of the Business Council on National Issues, who, he argued, had a conflict of interest. 1 would ask him if it is not in the interest of all Canadians to lower the rate of inflation. I think he has addressed himself to that in his speech. Second, is it not true to say that inflation is the biggest redistributor of income to persons who have high incomes and substantial bank deposits?


Rodney Edward Murphy: Mr. Speaker, first of all, there was a conflict of interest because one of the greatest promoters of the six and five program was Ian Sinclair, the head of CP, who, in turn, had this Government legislate the workers of CP into the six and five program. So there was a conflict of interest, and that is one of the problems of listening to that person and that group of people. Second, when we fight inflation, we must make sure that we pick on those who are best able to fight, that we pick on those thousands of Canadians who are paying no income tax at the present time, that we pick on the 700 Canadians who earned more than $100,000 and who paid not one cent in tax in 1979, because those people-


Mr. Sargeant:: Make the rich pay.

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Rodney Edward Murphy: My colleague, the Hon. Member for Selkirk-Interlake (Mr. Sargeant), said, "Make the rich pay", and he is so right. Those are the people who can afford to pay for the Government's job-creation programs which we hear the Minister of Employment and Immigration (Mr. Axworthy) bragging about. Those are the people who are milking the cream of the profits from this society. Those are the people who should be making the sacrifices, not those whose husbands have died and who are only receiving $3,200.
We are all interested in the fight against inflation. We are all concerned about job creation. But I am sick and tired of Liberal MPs defending the rich, giving tax incentives, tax write-offs and tax reductions, as they did in the November budget, to those at the top, and then calling on the pensioners and those receiving Family Allowances, those who make low incomes in this country, to make the sacrifices. That is the hypocrisy we talked about earlier, and I thank the Hon. Member for his question.


Maurice Brydon Foster: Mr. Speaker, I am glad to have a chance to say a few words on Bill C-133. It is interesting to note that some of the Members across the way are making comments tonight that they see no reason to believe that inflation will come down during the next 12 months. Yet, if we look at the inflation rate since the six and five program was introduced on June 28, we would see that the inflation rate for each of the months, July, August and September, was in fact 0.5 per cent which, annually, comes out to exactly 6 per cent. In October it was 0.6 per cent. So it is hovering right around the 6 per cent annual rate which, 1 believe, is really encouraging and, I am sure, indicates the kind of support that there has been for this program.
I know that the Members in the Opposition do not like to see that much support for the six and five program. They are used to Gallup polls which go in another direction. But, clearly, the public support for the six and five program has been very encouraging, and the results, as far as inflation is concerned, are very encouraging. If we look at the Gallup poll taken I believe in September of this year, some 64 per cent of respondents said that they supported the program, some 67 per cent said they wanted to see the restraint program extended to provincial Governments, and 63 per cent felt the ceiling should also apply to the private sector. Another poll which was conducted by The Toronto Star of 200 Metropolitan Toronto residents in August found that 50 per cent of the full-time employed Torontonians were willing to accept a 6 per cent limit on their wage increases. Asked about the extension of federal guidelines to various employee groups, 83 per cent said they should apply to provincial and municipal employees, 75 per cent to employees of large corporations, 74 per cent to construction workers, 71 per cent to the medical profession, and 61 per cent said that they themselves should be governed by the 6 per cent guidelines. This program, of course, is at the federal level and is only compulsory for federal Government civil servants and Crown Corporations representing some
500,000	employees, but it is interesting that when the provincial Premiers came together this summer, although they were not really agreeable to it then, some seven out of the ten
provincial Governments now have adopted some kind of restraint program.
Surely, Mr. Speaker, the voluntary approach of the private sector is more desirable than a compulsory approach, because it seems to me that many unions and many collective bargaining agreements which were reached, say, last summer or the previous summer, and are in effect for a period of two or three years, even though they were well beyond the six and five guidelines, the economic circumstances demand and have resulted in a much tighter, more efficient, more productive shop situation.
I have heard recently of a large industry where there have been quite heavy lay-offs, where the demand for their products is not very great, where they have had to bring in tremendous efficiencies, and where previously a shop would have maybe 20 people working in it, they have now honed it down to 12 or 13 workers. In fact, they are putting in place a very austere and restrained work situation even though they have a collective agreement which runs over a three-year period and which is far above the six and five guidelines.
A Member across the way complained that the problem, Mr. Speaker, was really high unemployment and lack of jobs, not inflation. Well, it is both. The six and five program is designed to address both, because not only does it try to reduce inflation to 6 per cent next year and 5 per cent the year after- and it is looking very encouraging in that regard-but the money saved, some $750 million, principally in wages, over that two-year period is being allocated to job creation.
In my own constituency we have been able to announce a number of Canada Community Development Projects, I believe about 40 or 50, resulting in several hundred jobs this coming winter at a cost of over $1 million. That is considerably more than we were able to provide last year, and for an area like mine in northern Ontario where we have high seasonal unemployment, those job creation funds are very much needed and will be very beneficial this coming winter. But that is only one part of the Canada Community Development Project. It has a special feature for native people and for young unemployed Canadians. I am really pleased about that because if you look at the unemployment statistics, they reflect a very high level of unemployment among young people. In addition, there is a fund of $18 million under this Program for native peoples.
Last Friday morning, Mr. Speaker, I had the opportunity to attend a signing ceremony with the Minister of Employment and Immigration (Mr. Axworthy), along with the Ontario Treasurer, Mr. Frank Miller, and the Ontario Minister of Labour, Mr. Russ Ramsay. The agreement signed will put in place some $200 million, the federal share of which, $100 million, is reallocated funds from other sectors of the federal Government. That shows that the over-all thrust of the six and five program is toward restraint in the federal Government, while at the same time reallocating Government funds to
December 6, 1982

create jobs. I would just point that out to the Hon. Member across the way who said that the concern must be for jobs. Surely, when we are implementing direct employment programs, they should ultimately result in jobs in the private sector. I have a project in my constituency which we have been trying to get going for the last six months or year. It is to create a new shipping terminal to ship aggregates and sand to the United States. The markets are not too great right now, but as we come out of the recession in the next year or so there will be tremendous markets in the U.S. It is those kinds of programs or ventures which we should be putting in place because, after all, it is the private sector which generates the taxes which pay for the social security system we have in this country. So I think it is important that as we go about creating jobs, we create an infrastructure within the private sector which will create long-term jobs. That is really important.
I think it is also important, Mr. Speaker, even though this program is compulsory for MPs and civil servants, that we give leadership. I think the rollback in MPs wages was a good signal to the private sector in that regard. Although it is voluntary in the private sector, the compulsory aspect for federal employees is seen as a clear signal. I think the private sector has been responding in a tremendously positive and creative way, labour as well as management, in an effort to make industry more competitive, more productive and efficient.
I spoke recently with the president of a large corporation who said that whenever they discussed with their employees the idea of more productivity or improving the quality of workmanship, or greater efficiency, their response was pretty negative and along the lines of, well, the company is making lots of money, why should we worry about productivity? Yet during these past six months, when we have really been under the gun for markets, for opportunities for our products, and when everything is so tremendously competitive, that attitude has changed. Labour is saying, yes, how can we make the industry more productive, how can we keep those markets overseas, how can we co-operate and work together? That is one of the benefits of this situation.
There is not a lot that we can do to create new markets overseas, which are so important to a resource-producing area like my own, but we can put in place a very efficient and lean industry, one able to face that kind of competition with wage settlements comparable to those in the U.S. and our other trading partners so that we can have products which will compete in the world market. This Bill before us tonight, Bill C-133, is one part of that effort.
.
It can be argued that these employees, whether they are former MPs or civil servants, have a contract under which they contributed 1 per cent of their salaries in order to have full indexation-and I understand the Government matched that-and that they should not be restrained in any way. If we look at the over-all picture in the country, old age pensioners and people receiving the Guaranteed Income Supplement who
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do not have much or perhaps not even any Canada Pension Plan benefit, are restrained to six and five. I was pleased that the President of the Treasury Board (Mr. Gray) indicated that those full contributions, that 1 per cent from the employee and 1 per cent from the employer, would be passed on and that the only thing that would be restrained, in effect, was that part of the indexation which comes directly from the Consolidated Revenue Fund.
Surely if we are successful in reducing inflation-and the first four months of the program are very encouraging in that regard in many sectors of the economy such as food, transportation, housing and so on-and if we get it down close to 6 or 7 per cent in 1983, then the pensioner who would be affected by the Bill would only be so affected to a minimum degree. We hope that the restraint on inflation will continue and that it will come down to 5 per cent in the following years.
The cost of energy has had the effect of pushing inflation up in the past few years. It is interesting that a couple of weeks ago the Minister of Energy, Mines and Resources (Mr. Chretien) announced that next year's increase will be minimal, and that the compensation fund increases will be reduced. That will compensate for the increases coming as a result of the Canada-Alberta Agreement.
When the six and five program was announced in late June, many senior citizens receiving the Guaranteed Income Supplement and Old Age Security-not pensioners who would be affected by this Bill-spoke out and said they wanted to play their part. If we all play our part in trying to reduce inflation to 6 per cent next year, then people receiving 6 per cent or 6.5 per cent as indicated in the Bill, will suffer considerably less than they might have otherwise.
Those are a few thoughts that I think should be placed on the record, Mr. Speaker. The six and five program is designed to restrain benefits to federal civil servants and, as well, to create employment for this coming winter. It will probably be the worst winter since the 1930s as far as unemployment is concerned. Industries that are still operating and producing jobs have tended to tighten their belts and employ a minimum of staff.
I think we have to work together, the private sector, Government and industry, and use all the tools available to us. Whether it is the new program for employment and economic development to create jobs in the private sector or the program to create employment for forestry workers, there must be a coming together of all forces at all levels of Government.
During the past three or four months we have seen great cooperation between the private sector, municipal Governments and provincial Governments, not only to create jobs through the funds being made available by the six and five program, but to do worthwhile things in the community. The six and five program has been successful in giving people an objective to work toward rather than demanding high amounts of money at a time when the economy simply cannot afford it. I think there is an opportunity through the program to create jobs, to limit

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our expectations and to prepare for the opportunities which will be there when we come out of this recession later in the decade.
1 think we should support this program. The inflation rate is coming down, interest rates are coming down and there is the prospect for greater growth next year. At the same time, funds are being generated which can be used for job creation. After all, this is one of the main challenges we face in the coming year.


Gordon Edward Taylor: Mr. Speaker, I want to make it very clear from the beginning that I do not support this Bill. For a moment or two I want to deal with some of the comments of the Hon. Member for Churchill (Mr. Murphy). As long as he was speaking about Bill C-133, 1 thought his arguments were rational and good, but he spent a considerable portion of his time speaking on Bill C-124. During the course of his remarks he said that Members of the Progressive Conservative Party had supported the reduction of indexes for old age pensioners, for child welfare and for superannuates when they supported Bill C-124. That is what he said. I see the NDP Members nodding their heads.


An Hon. Member:: Shaking their heads.


Gordon Edward Taylor: I want to set the record straight. 1 have Bill C-124 in my hand, Mr. Speaker. It is entitled, an Act respecting compensation in the public sector of Canada. Nowhere does it mention Child Tax Credits; nowhere does it mention a reduction of indexes for old age pensioners; nowhere in the Bill does it mention a reduction of indexes for superannuates.
How could the Hon. Member for Churchill say what he did in the House today? How could he tell the people of Canada something that is not true? We did not support Bill C-133 when we voted for Bill C-124. We did not support Bill C-131 when we voted for Bill C-124. We did not support Bill C-132 when we voted for Bill C-124. What we did support was a reduction in our own salaries. We should set an example by taking a reduction. I would have supported a much greater reduction. The NDP opposed that. They voted against the Bill, and they should put that in their pipe and smoke it.
Bill C-124 states that it applies to employees of the various Departments, the staffs of Ministers, directors of corporations, to persons appointed by the Governor in Council, to Canadian Pacific and subsidiaries. Clause 9 of the Bill says that, "Every compensation plan for employees to whom this part applies shall be deemed to include a provision to the effect-".
Then we turn to the Schedule. 1 challenge Hon. Members of the New Democratic Party to show me where one of these Bills is in the Schedule. Schedule I refers to the Department of Agriculture and other various Departments. Schedule 1 deals with all Departments; in fact there are pages of them. Schedule II includes Air Canada, Canada Deposit Insurance
Corporation, the Canadian Cultural Property Export Review Board, and these types of things.
May I call it ten o'clock, but before doing so I want to say that the NDP was completely wrong when it said that we supported these other three Bills. We did not.


Some Hon. Members:: Hear, hear!


Gordon Edward Taylor: We supported reduction for those who could afford reduction, not for those who could not afford it.



PROCEEDINGS ON ADJOURNMENT MOTION

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

A. Daniel McKenzie: Mr. Speaker, this afternoon I directed a question to the Minister of Transport (Mr. Pepin) regarding the International Association of Machinists and Aerospace Workers of Air Canada being informed that 585 employees of that group will be laid off. I asked whether the Minister would inquire as to why Air Canada is not willing to apply its voluntary separation program to the machinists and aerospace workers, as it is doing to management personnel and employees of other bargaining units in the Air Canada family.
The Minister of Transport answered by indicating that in the case of management people the separation was a permanent one, and that they were not subject to recall or the protection of collective agreements. He also indicated that in the case of machinists they were subject to recall and were protected by collective agreements in terms of pensions.
The Minister said that the cases of the management people and the machinists were quite different. Why then was Air Canada prepared at one time to offer machinists the same basic program, although not nearly as beneficial to machinists as the one it offered management?
I should also like to point out that under the presidency of Claude Taylor, Air Canada has become one of the most efficient and well-managed airlines in the world. But serious labour problems have arisen in Air Canada with the proposed lay-off of 585 machinists. 1 hope Mr. Taylor will personally intervene and work toward a satisfactory solution, as has been the case with other Air Canada groups.
Also, Air Canada could be violating Sections 7 and 10 of the Canadian Human Rights Act by not treating all employee groups in the same manner. I am prepared to file a claim with the Canadian Human Rights Commission if this situation is not corrected. I hope I do not have to take those steps.
December 6, 1982

The International Association of Machinists is distributing cards across Canada which read:
As an Air Canada worker, my wages are being controlled under the six and five program. That's for the good of the country, so I'm told.
Now, Air Canada is threatening me with lay-off if I don't concede some of my existing benefits. That's JOB BLACKMAIL.
At the same time, the Company is offering a $21 million "Golden Handshake'' deal to its management personnel. That's downright discrimination.
The Air Canada voluntary separation program is an early retirement program designed selectively to trim management staff with a minimum of hardship for the employee. On August 30, 1982, Air Canada offered a voluntary separation program to its existing management staff levels due to economic conditions. This program will cost approximately $21 million, to be paid from the company's operating fund.
Meanwhile, on September 7, 1982, the union met with Air Canada to discuss the company's plan with regard to staff reductions of the International Association of Machinists across Canada. The company indicated that the total machinists group would be reduced by approximately 518 people. At that time the position taken by the union was to extend to the International Association of Machinists the voluntary separation program being offered to all management personnel. The company's reaction was that this was out of the question.
On September 24, 1982, Air Canada discussed with the union the possibility of the voluntary separation program for the International Association of Machinists but presented to them a substantially reduced program than the one being offered to management. The cost of including the IAM members in such a program would be approximately $3 million, and the union would have to make concessions for an equivalent $3 million to offset this program, which does not even compare to the benefits being offered to management. This could be a violation of Section 7 and Section 10 of the Canadian Human Rights Act. The company is voluntarily spending $21 million for management apparently, with no strings attached.
In a letter to the Minister of Labour (Mr. Caccia) dated September 24, 1982, from Air Canada, it was stated that layoffs from the International Association of Machinists would total 585 employees, not 518 as originally assumed. In the meantime, employees of other bargaining units in the Air Canada family have obtained the voluntary separation program.
On September 30, 1982, the company informed the union that if it is ready to accept certain concessions the company's committee would try to get approval for a voluntary separation program. On October 8, 1982, the union informed the company that it was willing to submit to its members the company's offer for ratification. The company replied that the offer no longer existed. On October 19, 1982, a letter was sent to the Minister of Transport requesting assistance. Just recently an acknowledgement has been received, but it was not a satisfactory one.
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The International Association of Machinists feels that with a voluntary separation plan, similar to what management personnel is receiving, the number of machinists who will be laid off effective January 3, 1983, and April, 1983, could be substantially reduced from the 585 total, therefore easing the burden on unemployment insurance.
I hope the Parliamentary Secretary will inform us tonight that the Government will intervene and try to get the two parties together. Let us try to come up with the same voluntary plan and the same satisfactory solution for the machinists as Air Canada has been providing to management personnel and other groups within Air Canada.


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, one of the tasks I take very seriously in Parliament is my role as Chairman of the Helsinki Parliamentary Group on Human Rights. If an individual Canadian or a certain group of Canadians were being discriminated against, as the Hon. Member charges, I would be the first Member in this House to fight for the protection of their rights.
Let us look at some of the facts surrounding the charges against Air Canada made by the Hon. Member for Winnipeg-Assiniboine (Mr. McKenzie).
Air Canada is using almost 15 per cent more manpower today to accomplish the same workload it performed five years ago. To remain competitive, it must reduce its scale of operations to match the traffic available. Faced with the prospect of lay-offs, Air Canada has examined and proposed various alternative ways of achieving the necessary cost reductions. For example, Air Canada pilots were offered, and overwhelmingly accepted, a five per cent reduction in flying time, which roughly corresponds to a 5 per cent cut in pay. I congratulate the pilots on their wisdom and co-operation in helping to solve a real problem.
The International Association of Machinists and aerospace workers, to which the Hon. Member referred, were offered the comprehensive package which included worksharing, leaves of absence and a voluntary separation settlement. 1 emphasize that the machinists were offered a form of voluntary separation settlement. Granted, it was not the same as that offered to management, and rightly so, because the union is protected by the security of the collective agreement, whereas a laid-off management employee is permanently separated from the company. The International Association of Machinists rejected the comprehensive package. This is regretted by Air Canada and by the Government as this package would have allowed Air Canada to retain many, if not all, of the employees without seniority which it is now being forced to lay off. However, those lay-offs are entirely within the terms of the collective agreement.
Laid off employees and contract groups generally remain employees of the company, retain certain rights and are guaranteed return to their jobs when work becomes available.

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In my view, this can hardly be described as discrimination against a certain group of employees, as unfairly charged by the Hon. Member for Winnipeg-Assiniboine.


A. Daniel McKenzie: I will file a complaint with the Commissioner against you.


MINES AND MINING-UNION RECOMMENDATIONS ON STOCKPILING. (B) RESTORATION OF COMPETITIVE ADVANTAGE
Thomas Edward Siddon: Mr. Speaker, on November 1, as reported at page 20232 of Hansard, I raised questions of the Minister of State for Mines (Mrs. Erola) and the Minister of State for International Trade (Mr. Regan) with regard to the very seriously deteriorated state of Canada's mineral industry.
Canada's mining industry produces some $10 billion of net benefits to Canada's gross national product and balance of payments because a large proportion of our minerals produced is exported, in excess of 80 per cent. As we have seen in the past year, most of Canada's major mining companies have had to exercise substantial lay-offs amounting to lost employment for thousands of mine workers across Canada, and in resource communities in particular, which depend heavily on mining operations as the mainstay of their economies. 1 am thinking of the asbestos mining industry of Quebec, the iron ore industry of Labrador, Northern Ontario and Quebec, the nickel industry in the Sudbury area, the uranium industry, the potash industry and the lead and zinc industries, as well as the mining activities in the Yukon, the Northwest Territories and British Columbia.
The questions really focused on determining whether or not the Ministers responsible had come to recognize the tragic deterioration of Canada's competitive position in international markets. To consider the nickel industry alone, for a moment, it is now known that there are some 25 other competing nations producing nickel, while in 1950 Canada was one of the world's three leading nickel producers. We have now developed a major industry in Sudbury, primarily represented by Inco and Falconbridge, which employ in excess of 15,000 workers, but that industry is only active to the extent of 38 per cent of its capacity. In fact, the world nickel industry is only performing at 57 per cent of total capacity.
The question 1 asked the Ministers was whether or not they had addressed this serious problem and had some solutions to offer. It has been recognized for some time that this problem did not just occur during the last 12 months. As pointed out in a brief to the Government earlier this year from the British Columbia and Yukon Chamber of Mines, Canada's share of metal mining markets has been in a state of decline for the past ten to 15 years. In fact, statistically speaking, we have seen our share of the world nickel market, for example, reduced from 75.7 per cent in 1950 to only 25 per cent in 1980. The Chamber of Mines, in identifying this problem, singled out the Minister of State for Mines and her policy discussion paper released last March, which totally failed to address this
problem of Canada's deteriorating competitiveness and the world market situation. The brief states:
Ignoring the decline in Canadian mineral production and independent studies that are critical of past federal policies has reduced the credibility of the Mineral Policy Discussion Paper. This deficiency must be corrected at once before it affects discussions with the provincial governments.
I would like to state some of the reasons Canada's competitive position has failed so miserably.
First of all, one of our most important customers for mineral resources is the United States of America which purchased more than 50 per cent of Canada's non-fuel mineral exports in 1980. The anti-American policies of this Government, both in terms of defence and security, but more particularly as represented by the National Energy Program, and our anti-investment policies with respect to foreign and American investment, have had a very detrimental impact on our potential for sales of minerals to the American market.
I want to point out, in case the Parliamentary Secretary is concerned, that the B.C. and Yukon Chamber of Mines say that it is not the current slump in the international marketplace that is at fault, but the vicious and deteriorating problem that has been developing over many years which cannot be ascribed to the current economic downturn.
In addition to the anti-American policies have been the antiinvestment policies and the tendency to protectionism of the present Government which has driven away many Japanese purchasers of minerals. If we do not want to purchase cars built in Japan, they have less desire to buy our coal. They have therefore cut back on their coal imports by 30 per cent in the past year. They are buying less lead and zinc, therefore Cyprus Anvil and the northern mines are going down. They are buying less iron ore, and therefore the iron ore industry of northern Quebec is in trouble.
What I am saying in a nutshell is that the anti-investment policies, the discriminatory and volatile tax policies of this Government, the high energy taxation and the lack of regard for our important trading partners are at the heart of this serious dilemma. I would be pleased to see what response the Government members have to offer to this very serious problem which is affecting thousands and thousands of mine workers across Canada.


Mr. Dave Dingwall (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, in response to the Hon. Member's concern, I must say that we on this side of the House are also very concerned about the situation.
The Hon. Member raises the question of stockpiling nickel, as did the Steelworkers Union in Sudbury last week when they met with the Leader of the Conservative Party of Canada. The Right Hon. Leader of the Opposition (Mr. Clark) described the proposition of stockpiling as "intriguing" and that his Party will "seriously examine it." He said, and I quote, "it makes sense". Serious examination will show that nickel is only one of our metals experiencing a world slump in prices; so
December 6, 1982

also is copper, zinc, lead, silver and iron ore, just to name a few.
With the exception of cement, Canada exports the major portion of its mining output, and must accept world market prices. Stockpiling not only upsets this world market even more, it is outrageously expensive. When markets recover it is very difficult to dispose of stockpiles.
Estimates have been made on a case-by-case basis of the costs of bringing operations that are temporarily closed back into production, but time does not allow a detailed examination of those here. Let it suffice to say that for a nickel stockpiling program alone, which would stockpile the difference between the amount of nickel produced in Canada in 1982, and 1981, which were not banner years for that industry, it would cost the Canadian taxpayers about half a billion dollars, using a nickel price which would only cover the producer's operating costs. This does not include those mines still open, but operating at a loss, who might also want assistance, particularly as their losses would be aggravated by the depressing effect of increased inventories. That is not to say that this Government does not care about the people in the Sudbury basin.
The Hon. Minister of Energy, Mines and Resources (Mr. Chretien) has been meeting regularly with all levels of Governments, with the unions and the companies, to come up with some creative solutions to this very disturbing unemployment situation. It ought to be mentioned that the Minister of State for Mines (Mrs. Erola) has been actively pursuing creative solutions to rectify a very, very difficult situation caused primarily by a world economic recession.


ATOMIC ENERGY OF CANADA LIMITED FUTURE OF NOVA SCOTIA HEAVY WATER PLANTS. (B) POLICY ON SALES TO INDIA
Howard Edward Crosby: Mr. Speaker, let me begin my remarks by pointing out to the House that Atomic Energy of Canada Limited operates in the Province of Nova Scotia two heavy water plants respectively located at Glace Bay and at Port Hswkesbury in the Strait of Canso. These two heavy water plants have been in operation for several years and employ jointly over 700 persons directly, and probably another 2,000 persons indirectly. Therefore, any cessation of the operation of these heavy water plants would result in a loss of jobs in the area of 3,000 persons in the Cape Breton area of Nova Scotia.
I would point out that that area of Cape Breton now has an unemployment rate of approximately 19.5 per cent. There is no question that if the operation of these heavy water plants in Cape Breton was endangered and if they were to cease operation, there would be a very serious problem created on top of the existing serious unemployment problem in the Island of Cape Breton which would affect the economy of the whole of Nova Scotia.
With that in mind, on November 3, 1982 1 rose in the House of Commons and asked the Minister of Energy, Mines and Resources (Mr. Chretien), and subsequently the Prime Minister (Mr. Trudeau), what action might be taken to ensure the
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continued operation of these heavy water plants by Atomic Energy of Canada Limited. On that day I was not successful in obtaining a clear and careful answer to my inquiry. Although the Minister of Energy, Mines and Resources did indicate there was a serious problem with the marketing of the Candu reactor both in domestic and international terms and the failure to sell Candu reactors domestically and internationally would mean there was no market for the heavy water to fuel these plants.
Given the problem with the Candu reactor program, in that it has been unsuccessful, I still want to ask the Government what it proposes to do in the face of this horrendous problem in Cape Breton Island and across the Province of Nova Scotia. What in a word is the solution?
1 do not believe, and 1 am sure my colleague from Cape Breton-East Richmond (Mr. Dingwall) does not believe the economy of Cape Breton and Nova Scotia can withstand this tremendous amount of unemployment which, beyond the persons immediately affected, would have a disastrous effect on the operation of the power plants that are related to the operation of the heavy water plants at Glace Bay and Port Hawkesbury. In addition, there is a vast amount of coal produced in connection with these operations that would be left without a market, as well as the effect on the miners who engage in that operation.
In search of a solution the employees of the heavy water plants have made the suggestion that the Government should consider the construction of three 600-megawatt Candu reactors in Canada to be related to other energy projects. They point out in graphic terms that this could be of great assistance to the energy industry across Canada because the reactors could be used to fuel and assist broader energy projects.
Those employees of the heavy water plants pointed out in very clear terms that the economic activity generated by the operation of the heavy water plants is a very serious concern because they pump a vast amount of money into the economy. In fact, it was indicated by Atomic Energy of Canada that the cost to that organization of operating the heavy water plants is in excess of $ 120 million per year.
One wonders what the obligation is of the Government of Canada in this situation. Let me refer to a remark by the Prime Minister made in June of this year when the unemployment rate had risen to 10.8 per cent. He said it is scaring hell out of the people. We now have an unemployment rate two points higher and the Prime Minister is saying that the worst times can be the best. That is the word from the Prime Minister of Canada to the working people of Glace Bay and of the Strait of Canso, that the worst times can be the best. We want more than words of that kind from the Prime Minister of Canada. The people need action, concrete proposals to meet those problems.
The Government ought to consider the suggestion made by the workers in heavy water plants, and determine whether the

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Adjournment Debate
construction of reactors cannot be accomplished across Canada and elsewhere in the world. The Government must review its plans and its programs and ensure the sale of these reactors to provide for the continuation of these heavy water plants, because if it does not, not only will the workers involved come upon economic disaster, but probably the whole Island of Cape Breton will experience an economic disaster, if it is not already in that situation at present.
1 hope the Minister of Energy, Mines and Resources will give a little more thought and consideration to this problem than he has in the past, that he will not content himself with the indication he gave to the parliamentary committee on November 23 when he simply said he had a proposal to close the heavy water plant and unless something happened, which he did not indicate he intended to make happen, he would have to abide by the recommendation of Atomic Energy and close the heavy water plant.


David Charles Dingwall: Mr. Speaker, in response to the concerns raised by the Hon. Member, 1 wish to inform him that we, on this side, do not need to take any direction from him, or his Party, about how we should be sensitive to those workers in Glace Bay and Port Hawkesbury. I should point out to the Hon. Member that the Minister of Energy, Mines and Resources (Mr. Chretien), as well as the Deputy Prime Minister and Secretary of State for External Affairs (Mr. MacEachen), met with the unions involved at both Glace Bay and Port Hawkesbury and explained the situation to them. The problem we have to focus our attention on is twofold, both domestic and international. There are no foreseeable sales for Candu reactors within Canada or, indeed, on the international market.
What is more appalling. Mr. Speaker, is the hypocrisy of the Conservative Party of Canada. We have the Conservative Member for Halifax West (Mr. Crosby), a "Crosby", unlike his colleague, the Hon. Member for St. John's West (Mr. Crosbie), or his colleague, the Hon. Member for Vancouver
Quadra (Mr. Clarke), or his colleague, the Hon. Member for Saskatoon West (Mr. Hnatyshyn), who each want those two heavy water plants closed.
Of course, the New Democratic Party is no better, including the Hon. Member for Winnipeg North (Mr. Orlikow). The NDP Convention of 1980 passed a resolution which in effect said, "close both those heavy water plants." Therefore, I find it somewhat despicable that the Hon. Member would come to this Chamber and put forward the case, if you will, that somehow he is concerned about the workers in those areas. It does not add up. On the one hand you have the Conservative Party arguing that the plants ought to be closed. On the other hand you have a member from Halifax, who is probably a leadership candidate provincially, trying to say to the workers in that area that he is very concerned about them.
I assure the Hon. Member that everything possible is being done to maintain the existence of the two heavy water plants in Glace Bay and Port Hawkesbury, both internationally and domestically. But he ought to know and appreciate that we are in a worldwide economic recession and individuals are not buying the Candu reactor. Therefore, I suggest very politely and respectfully that the Hon. Member's hypocrisy is second to none, other than that, of course, of the Leader of the Opposition (Mr. Clark) and those three Conservative Members who have said time and time again that the heavy water plants ought to close. We don't need that kind of debate in the House of Commons by the Hon. Member from Halifax. Thank you.


The Acting Speaker (Mr. Blaker):: The Chair will reserve the right of Hon. Members present or absent to invoke their rights tomorrow as they may see fit with respect to the word "hypocrisy".
It being 10.30 p.m. I do now leave the chair until two o'clock tomorrow afternoon.
At 10.30 p.m. the House adjourned, without question put, pursuant to Standing Order.

Tuesday, December 7, 1982