1982-04-23

ROUTINE PROCEEDINGS


Hon. Walter Baker (Nepean-Carleton):: Madam Speaker, I have a motion to raise under Standing Order 43 on a matter of urgent and pressing necessity. I move, seconded by the hon. member for Brampton-Georgetown (Mr. McDermid):
That pursuant to the resolution of the Corporation of the City of Nepean of April 13, 1982, the federal government do not proceed with the proposal to place a toxic chemical transfer station within the city of Nepean, and that before any action is taken on such a facility anywhere a study be undertaken for a location in other areas not reviewed by the feasibility report done by Reid Crowther & Partners Limited for the Department of Public Works.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


ST. GEORGE'S DAY MOTION UNDER S.O. 43
Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, since today is St. George's Day I move, seconded by the hon. member for Don Valley West (Mr. Bosley):
That this House extend to all those loyal subjects who celebrate St. George's Day tomorrow, including the Greeks and Lebanese who also claim St. George, our sincerest good wishes and continued success in their endeavours.


Madam Speaker:: Perhaps the House would like to express its sentiments by applauding.


Some hon. Members:: Hear, hear!


THE CONSTITUTION
Mr. Tom McMillan (Hillsborough):: Madam Speaker, the signing by the Queen of the proclamation bringing into force
Canada's new Constitution was of profound historic significance for all Canadians. The occasion marked the completion of the work toward full Canadian sovereignty launched by the Fathers of Confederation at their first meeting in Charlottetown in 1864. I therefore move, seconded by the hon. member for Don Valley West (Mr. Bosley):
That the House supports the Prime Minister's statement in the House on Wednesday that active consideration should be given to making an official copy, with original signatures of the proclamation, to be placed in Province House at Charlottetown where the Fathers of Confederation held their historic meeting that gave birth to our great country.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NUCLEAR ARMAMENTS
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Madam Speaker, in light of the growing conviction of the peoples of the world that their respective governments need to know that they are concerned about the drift toward global nuclear death, and the insanity of anyone, even if he is a president, thinking that nuclear war is winnable, a concern demonstrated this week in North America by the grassroots movement Ground Zero, and by hundreds of thousands of Europeans earlier this year, I move, seconded by the hon. member for Vancouver East (Mrs. Mitchell):
That this House instructs the Prime Minister, (1) to show that he is serious about his nuclear suffocation strategy by cancelling the Cruise missile testing in Alberta; (2) to make Canada a leader rather than an acquiescent observer in the struggle for mutual arms limitations at the United Nations Special Session on Disarmament by, among other things, calling for a global referendum on disarmament and, (3) to withdraw our nuclear team from Argentina immediately and have the wisdom to reject finally all the ways in which Canada has been contributing to the proliferation of nuclear weapons.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

April 23, 1982


THE ADMINISTRATION
Mr. Dave Nickerson (Western Arctic):: Madam Speaker, on June 14, 1981, the Grit cabinet holed up at Meach Lake to plot economic strategy for the forthcoming year. They gave us record high interest rates, a declining dollar, huge deficits, continuing inflation and skyrocketing unemployment. Therefore I move, seconded by the hon. member for Parry Sound-Muskoka (Mr. Darling):
That the Canadian public has been milked, manipulated, manhandled and "meached" enough and insists that the Prime Minister call off his proposed repetition of the Meach Lake disaster.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


INTERNATIONAL JOINT COMMISSION
Mr. Ray Skelly (Comox-Powell River):: Madam Speaker, I rise on a matter of urgent and pressing necessity pursuant to Standing Order 43. Important decisions are about to be made by the International Joint Commission on acid rain, Great Lakes water quality, the flooding of the Skagit Valley, and the Garrison diversion project. Whereas the Liberal government has failed to appoint a Canadian co-chairman of the IJC, leaving the position open for some 15 months now; whereas the IJC has refused to release the experts' report on the Skagit Valley to members of Parliament, leaving only the B.C. Social Credit government to defend Canadian interests in this dispute, and whereas the Liberals may have exhausted their list of friends in need of jobs with their recent appointments to the science council, the CBC, and the parole board in British Columbia, I move, seconded by the .hon. member for Skeena (Mr. Fulton):
That this House immediately provide the Prime Minister with a list of prominent Canadians who are experts in either environmental problems, international law, or Canadian-American relations, who would be willing to serve on the IJC even if they have never run as Liberal candidates.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


REGIONAL DEVELOPMENT
Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. The government's refusal to take positive, sensible action to move the nation out of its recessive situation has resulted in the withering of our business base, and high levels of unemployment. This economic morass continues to create, particularly in regions of Ontario, a climate of apprehension and hesitancy in industry which only compounds the problem. I suggest there is one way the government could begin to get the ball rolling again. Therefore I move, seconded by the hon. member for Simcoe North (Mr. Lewis):
That the Minister of Regional Economic Expansion implement at once the long-promised expansion of regional development incentive grants in Ontario, through the creation of new boundaries, or the enlargement of existing ones.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. John Bosley (Don Valley West):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. News reports indicate that the cabinet is to visit Ottawa this weekend to discuss the economic disaster it has created, but according to the same news reports no new action is contemplated. Therefore I move, seconded by the hon. member for Peace River (Mr. Cooper):
That the Prime Minister make a statement on motions indicating in his view how bad things have to get before action, rather than public relations gestures will be taken, action such as abandoning the budget.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


ROYAL CANADIAN MOUNTED POLICE
Mr. Rod Murphy (Churchill):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. It is ironic that while RCMP Commissioner, Robert Henry Sim-monds, at a luncheon speech yesterday to the Empire Club demanded access to an individual's mail, to tax files, and to
April 23, 1982

medical records, yet at the same time in a courtroom in Quebec, Inspector Kenneth Hollas admitted that the RCMP has used so-called Puma units in every major Canadian city to break in, illegally, plant electronic listening devices, and steal membership lists of several unnamed political parties. Therefore I move, seconded by the hon. member for Skeena (Mr. Fulton):
That this House instruct the government to deny any RCMP requests to increase their powers through writs of assistance until they prove they are willing to "get their man" or woman, while respecting the laws of Canada-which they are supposed to enforce-and starts to demonstrate respect for the rights of individual Canadian citizens.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Hon. Sinclair Stevens (York-Peel):: Madam Speaker, my question is for the Prime Minister in anticipation of his cabinet meeting this weekend. As the Prime Minister knows, in 1968 there were 358,000 Canadians out of work, which represented at that time 4.5 per cent of the labour force. Now 9 per cent of the labour force is out of work representing almost 1.25 million Canadians. Since the Prime Minister has been in office practically the entire time since 1968, would he explain to the House what he feels is the most significant reason why unemployment in percentage terms has doubled and, in real numbers has tripled since 1968?
[DOT] (U15)


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, it would be difficult to point out the many economic reasons why this has happened. I believe the hon. member would be able to mount a list of his own, but it is obvious that one of the main causes is that Canada is an exporting country, a country which relies very heavily on international trade. Almost one third of our GNP depends upon international trade. Of course flowing from that is the fact that most of our markets are in as high or higher unemployment situations, which means that most purchasers of our goods, whether they be processed or raw materials, have economies which are as bad or worse than ours and therefore cannot buy our products. But because we are more dependent upon international trade than many other major countries, it affects us in a less controllable way. This is one of the reasons. There are many others.
Oral Questions DECLINE IN EXPORTS


Sinclair McKnight Stevens: Madam Speaker, my supplementary question is directed to the Prime Minister who cited world conditions as one of the contributing factors to rising unemployment. As the Prime Minister knows, in the Report of The Special Committee on a National Trading Corporation in June, 1981, it was pointed out that "between 1969 and 1979 Canada suffered a 33 per cent decline in its over-all share of world exports" and that "this performance was the worst among industrialized countries during this period." In view of the fact that the Prime Minister has been in power practically the entire time since 1969, how can he explain that our share of world trade has actually deteriorated to the point that, on manufactured goods, our deficit is now $16 billion higher than it was then, which represents something like 700,000 Canadians who are not working due to this deterioration in our share of world trade?


Pierre Elliott Trudeau: Madam Speaker, I find it difficult to understand the statistics put forward by the hon. member. I will look into them and perhaps be able to give a more precise or contradictory view of these statistics. They seem difficult to understand because in the last few years Canada has broken all previous records in its positive trade balance, in the sense that we have had larger positive trade balances in the last few years than we had at any previous time in our history. I will look into the statistical matter, but the hon. member draws attention to an important-


Mr. McDermid:: Raw materials.


Pierre Elliott Trudeau: Pardon?


John Horton McDermid: Raw materials.


Pierre Elliott Trudeau: The hon. member draws attention to an important factor. There has been a worrisome trend in the productivity of the Canadian economy due to many factors, but this drop in productivity can explain that we are becoming less competitive in world markets and also the general disposition of Canadians not to take into account that the OPEC crisis of 1973 and its follow-up have made Canada a less fastgrowing country than in the past. This is something which much of our society is not prepared to accept. In other words, we have a tendency to live beyond our means and not to take into account the fact that we are not growing as fast and as rich as we were before the OPEC crisis.


MEASUREMENT OF PRODUCTIVITY
Sinclair McKnight Stevens: Madam Speaker, again my question is directed to the Prime Minister. I would hope he might develop his last theme a little more, in that he indicated that our deterioration in productivity is due to the fact that we are living beyond our means. Would the Prime Minister indicate whether, if that is his rationalization for the figures

April 23, 1982
Oral Questions
given by his seatmate, the Minister of Finance, in last November's budget which, at page 4, made clear in "the current economic situation" brought out at that time, that Canada's growth in productivity from 1973 through to the present was one eighth of the growth experienced by the United Kingdom and Italy, and was compounded in the case of Japan, to a growth of 3.3 per cent, and in the case of France, to 2.5 per cent; only 0.2 per cent per annum, he is willing to stand up in the House and say that the only reason we ended up at the bottom of the list as compared to those other six countries listed by the Minister of Finance on productivity growth is that this nation has a tendency to live beyond its means and that his government's lack of direction to get us back to prosperity had nothing to do with it?


Pierre Elliott Trudeau: No, Madam Speaker, I did not link those two as cause to effect. I just indicated that these were two elements, that we had suffered a slower growth in productivity and we also had a tendency to live beyond our means. These were two of the causes but I did not link them causally. However, the reality is there.
The figure of the hon. member confirms what I said, and what the Minister of Finance has been saying. There is a worrisome loss of productivity per worker in Canada. I think that the hon. member is well enough versed in the subject to know that many economists who have studied this problem have not yet found an explanation for it. It is not such a simple-minded one as the hon. member gives when he says that the government has failed to give direction. It concerns the state and maturity of our economy, and our inventiveness or lack of it. It has to do with many factors, and it would be no cure to the current state of affairs to say that the government can change it all, unless the hon. member thinks that a socialist government which would direct everyone's lives should be in power, which is not my view.


PRIME MINISTER'S INTENTIONS
Mr. Bill Kempling (Burlington):: Madam Speaker, my question is also to the Prime Minister. We now understand from department estimates that unemployment is expected to rise to 9.2 per cent in 1982. We hope that forecast is wrong. If we annualize the latest consumer price index, we see that inflation is running at 15.6 per cent. We hope that goes down. Interest rates remain unacceptably high, postal rates are rumoured to rise again, and our trade in manufactured end products-I stress "end products"-is in a massive deficit position. As well, gasoline is above two dollars a gallon and rising. We are paying 6 million dollars per day to subsidize imported oil while shutting down some of our own wells.
I ask the Prime Minister in all seriousness what people in the street are asking, and that is, does he really now what he is doing? That is what the people are asking. Is he waiting for a
miracle, and would it not be better for him and the country and all concerned if he resigns?


Pierre Elliott Trudeau: Madam Speaker, I would want to add to my previous answer where I made some remarks about intervening in peoples' lives. I think I should correct that by saying that I did not mean a socialist government because many socialist governments are social democratic governments and are not any more authoritarian than the one which exists in this country. We happen to have a very distinguished minister from the French government in the gallery-


Some hon. Members:: Oh, oh!

He is not only a minister of a friendly government that is very important to us, but also an old friend whom I am very happy to welcome to our country.
As for the question put by the hon. member, Madam Speaker, he asked whether it would not be better for me and for the country if I resigned. For me it would probably be better, and as far as the country is concerned, that would depend on the person replacing me, but if that person were the Leader of the Opposition, I am sure it would be worse for the country.


PRESENCE IN GALLERY OF MR. ANDRE LABARRERE, MINISTER OF PARLIAMENTARY RELATIONS OF FRANCE AND OF MRS. MAUROY, WIFE OF PRIME MINISTER OF FRANCE
Madam Speaker:: I would ask the House to allow me to introduce this distinguished minister, Mr. Andre Labarrere, who is the Minister responsible for relations with the French Parliament.


Some hon. Members:: Hear, hear!


Madam Speaker:: And I also wish to draw the attention of the House to the distinguished presence in our gallery of Mrs. Pierre Mauroy, wife of the Prime Minister of France, to whom we extend a cordial welcome.


Some hon. Members:: Hear, hear!


THE ECONOMY
William James Kempling: Madam Speaker, my supplementary question is also directed to the Prime Minister. Every Liberal finance minister, from Edgar Benson to the present minister, has said that government spending was too
April 23, 1982

high and that he would reduce it. Each one has said that the level of inflation was unacceptable and that he would reduce it. The Prime Minister has had 14 years in which to do something about these matters, but they seem to be getting more out of control every day. The problem is that the people of Canada just do not believe that the Prime Minister and his ministers are competent to deal with the matters facing Canada.
I will donate $1,000 to a fund to assist the Prime Minister in his adjustment to retirement, if he will go.


Some hon. Members:: Oh, oh!


William James Kempling: And I do not even want a tax receipt.


Some hon. Members:: Question, question!


William James Kempling: My question is, will the Prime Minister accept my invitation?


Pierre Elliott Trudeau: Madam Speaker, I think we should refer this matter to the standing committee on rules and regulations. This seems like an overt attempt at bribery.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


EXTERNAL AFFAIRS
Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, my question is directed to the Prime Minister. On Monday in this House I asked a question of his Minister of Energy, Mines and Resources. At that time I alleged that Argentina intended to divert plutonium from Canadian Candu reactors in order to make the bomb, or nuclear weapons. Now we find, according to a newspaper report today, that there is a government document in existence which states that Argentina was anything but stupid when it bought the reactor and that the Department of Energy, Mines and Resources knew that fact. Can the Prime Minister confirm that an Ottawa firm has plans to ship $4.2 million worth of nuclear fuel to Argentina before the end of June, a fact which the government document states the government is anxious to hide?


Pierre Elliott Trudeau: Madam Speaker, as you know it is not my habit or custom to comment on so-called leaked cabinet documents. I consider that to be the best course of conduct and the only one in keeping with my oath of office.
In so far as the facts are concerned, I cannot comment on the particular ones mentioned by the hon. member, not having had enough time to read more than the headlines. However, I do know that we signed an agreement in 1976 or 1977 to build a Candu reactor in Argentina. That was done after we had
Oral Questions
obtained assurances from the Argentinians that full safeguards would be implemented in that country. That is the present situation. I imagine that we are discharging the other obligations under the contract, just as we expect them to discharge theirs.


Ian Gardiner Waddell: I think that Britain was pretty sure, at one point, that Argentina would not invade the Falkland Islands, so perhaps the Prime Minister might want to reconsider its assurances.


REQUEST THAT SHIPMENT BE HALTED
Ian Gardiner Waddell: Madam Speaker,
I would like to ask the Prime Minister a supplementary question. Apparently this contract for $4.2 million involves 3,000 reactor fuel bundles. Given the fact that there seems to be a Canadian economic boycott against Argentina, will he assure this House that he will give instructions to stop this shipment to Argentina of the fuel bundles to which I have referred? If he is not prepared to give that assurance to the House now, will he please explain just exactly what is this economic boycott against Argentina?


Pierre Elliott Trudeau: Madam Speaker, I am surprised that the hon. member, who shows such knowledge of the history of the Falklands and of the psychology of the British, does not even know what kind of sanctions we announced against Argentina in this House less than two weeks ago. These sanctions mean that we are not importing goods from Argentina.
[DOT] (U30)


Ian Gardiner Waddell: Apparently we are prepared to send Argentina anything, including possible nuclear fuel.


REQUEST THAT CANADIAN PERSONNEL BE WITHDRAWN FROM ARGENTINA
Ian Gardiner Waddell: Madam Speaker, I have a final supplementary for the Prime Minister. Does the Prime Minister realize that one of the great moral issues of our time is the nuclear matter? He used to feel that when he was a little younger. In the last couple of years he has spent two thirds of his time on the Constitution and one third of his time going around the world trying to sell nuclear reactors. Perhaps he might be remembered more for the latter than the former. The hon. member for Winnipeg-Birds Hill referred to Ground Zero and the demonstration this weekend in Vancouver-


Madam Speaker:: Order. Will the hon. member please ask his question?


Ian Gardiner Waddell: Will the Prime Minister stop being hypocritical and say in this House that he is prepared to withdraw the Canadian team of scientists who are now in Argentina helping to build the reactor from which Argentina will build a bomb?

April 23, 1982
Oral Questions


Pierre Elliott Trudeau: Madam Speaker, I am not quite sure if the hon. member's rhetoric is in order, but it certainly is most distasteful. He knows about the Candu reactor. He knows about the efforts this country has made in order to have full-scope safeguards.


Mr. Fulton:: They had full-scope safeguards.


Pierre Elliott Trudeau: I am afraid the hon. member's colleague who is belching near him should realize that he too-


James Ross Fulton: There is only one pile of excrement here and it's standing up, buddy.


Madam Speaker:: Order, please.


Pierre Elliott Trudeau: Madam Speaker, it is difficult to answer when hon. members do not want to listen.


CULTURAL AFFAIRS
John William Bosley: Madam Speaker, my question is for the Minister of Communications, who will know that the arts and culture industries, like all sectors of our economy, are experiencing real difficulty this year. The government has hurt that sector on two fronts. First, it has reduced its year-over-year support for this sector in real dollar terms. Second, the budget seriously hurt investment in our arts and culture industries, particularly by its provisions for capital cost allowance and its attack on charitable foundations.
The minister has been travelling the country suggesting to those involved in one of our most important sectors that they can expect the new cultural initiative strategy to include serious new incentives for private investment in the arts and culture field. Can he tell this House and Canadians whether he has some foreknowledge that we are going to have a new minister of finance who will in fact respect the need for private investment in that sector, or will he admit that, when he tells Canadians there will be more private initiatives and private investment, he is kidding them?


Hon. Francis Fox (Minister of Communications):: Madam Speaker, I am delighted with this opportunity to answer the hon. member's question. Part of it is purely and stupidly political in the most partisan sense of the word. As for the serious part of his question in which he requested information on government support for arts and culture, I should like to remind the hon. member that this year we actually increased the federal contribution to the Canada Council. The hon. member may recall that only two or three weeks ago, we announced that we would be continuing the publishing assistance program which means another $25 million over three years for that sector.
The hon. member mentioned the matter of taxation and tax benefits. He knows as well as I do that there have been no changes in this area for the current year, and that the Minister of Finance has decided to postpone any changes in the area of tax incentives until next year. I also wish to point out that this year, under a program launched as part of the federal government's cultural initiatives strategy with the consent of all the provinces of Canada we on the federal side have been able to inject some $40 million over three years in the cultural sector, and if we add to this the contributions expected from the provinces and the private sector, it will mean an additional contribution of over $100 million for arts and culture over the next three years.


WEEKEND CABINET MEETING
John William Bosley: Madam Speaker, the minister has been better than some at delaying the attack by the Minister of Finance on this sector. He also knows that the estimates show that total government contributions to the arts this year, year-over-year, are 9.7 per cent over last year. The cabinet will be meeting this weekend at Meach Lake, presumably to discuss improvements to our economic circumstances. Will the minister tell this House what he is going to recommend to that minister on Sunday? For example, will we get a commitment that after five years of waiting for implementation of the Disney report, which is extremely important to the health and welfare of our artists, we will finally see its recommendations to relieve the tax burden on artists and important cultural people in this country, implemented?


Francis Fox: Madam Speaker, I believe that the priority we give to cultural affairs is already a well-known fact, and I may add to my previous figures, which were actually too conservative, I must admit, that this year, the Government of Canada has announced it will spend a further $185 million, over four years, on the construction of a new national gallery and a new museum of man. The hon. member is well aware that a commission of inquiry is travelling across Canada, has held hearings and has even submitted a preliminary report. I am of course referring to the Applebaum-Hebert Commission. The hon. member himself has written to just about every single cultural organization in the country to complain that I was intending to take action before the report was published. Now he is asking me to divulge the recommendations that we as a department intend to make to the Minister of Finance or to other ministers in the Canadian government, and I am sure that if I gave him the answer he wanted, he would again say how awful it is that the minister responsible for cultural affairs in Parliament intends to take action before the Applebaum-Hebert report is tabled in the House. The hon. member should make up his mind what side of the fence he intends to be on during the months ahead.
April 23, 1982


John William Bosley: The minister will be interested in knowing that the replies coming back to that letter suggest that his process is not trusted by the community.


An hon. Member:: What community?


John William Bosley: The arts community which the minister claims to represent.


REQUEST THAT GOVERNMENT TAKE ACTION
John William Bosley: Madam Speaker, my supplementary to the minister is this. He has had five years to deal with issues such as the Disney report, issues which are supported by the community, issues on which they asked the minister to take action before the Applebaum-Hebert commission was started. Why does the minister continue to wait to take those actions to assist the cultural community which it has pleaded for, and I think specifically of the Disney report, for five years? Why not now when they support this being done?


Francis Fox: Madam Speaker, on the contrary, there is a broad consensus among the cultural groups in this country which shows that they have every confidence in the Applebaum-Hebert process which is quite different from the process initiated by the previous government. It so happens that our formula, namely, to hold in-depth consultations with the arts and culture sector in all areas of the country, is preferable by far to the process initiated by the previous government.
However, having initiated this process and established a commission consisting of outstanding Canadians from all areas of arts and culture in this country, I feel that before making or proposing any changes, we should have a chance to see what general orientation the commission would like to see this country take in the cultural sector.


THE ECONOMY
Mr. Ian Deans (Hamilton Mountain):: Madam Speaker, my question is for the Minister of Finance. It was alluded to previously that the Minister of Finance will be meeting with his colleagues this weekend to discuss economic conditions in the country. As a result of his budget, economic conditions have in fact worsened. Projections for unemployment have risen dramatically since the introduction of his budget, to the point where we are now looking at probably close to 1.5 million people who will be unemployed in the coming year.
The answer the government has given has been make-work projects, makeshift projects, work sharing that has resulted in more rather than less unemployment.
Oral Questions
Is the minister aware that there is before the government right now a number of project proposals that could create employment? For example, we could have employment in Trenton, Nova Scotia and Hamilton, Ontario if the order were placed for hopper cars to move grain. If we were to accept the proposal of the shoe industry that there ought to be reasonable quotas on imports, we could create close to 6,000 jobs in Canada. If we were to accept the proposal of Firestone Tire & Rubber Company, we could safeguard 600 jobs and perhaps create 400 more. If we were to accept the proposal of the auto industry for Canadian content regulations, we could create 30,000 jobs. Is the minister prepared to accept these proposals now and create new jobs, rather than share the existing jobs and ultimately reduce the number of available jobs in Canada?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: The hon. member has listed at least four or five major concerns, or major proposals or major worries in various industries. I want to assure him that each of these proposals is receiving very careful consideration. He has referred to the impact of possible hopper car purchases or authorization on jobs in Nova Scotia and Ontario. I have already met with representatives from at least one of these communities and have assured them that I am paying attention to the problem, along with the Minister of Transport. If the hon. member wants assurance that each of these possibilities is being examined with diligence, I can give him that assurance this morning.


REQUEST THAT PROPOSALS BE ACCEPTED BY GOVERNMENT
Ian Deans: Madam Speaker, I am not interested in having them "examined with diligence." Since the proposals have been before the government in almost every instance for the better part of the last year, taken together with the fact that there is a massive shortfall in the number of housing units being built, which could create a massive demand-create another 100,000 jobs, what is it that the government is waiting for? How many more people must become unemployed before the government accepts that these proposals are concrete job-creation proposals, rather than the nonsense being proposed by the Minister of Employment and Immigration?


Allan Joseph MacEachen: Madam Speaker, the hon. member seems to be living in a world that is unrelated to what is happening in the House of Commons.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Ian Deans: Unreal? What about the House of Commons?

April 23, 1982
Oral Questions


Allan Joseph MacEachen: If he knew what was happening-


An hon. Member:: What about the House of Commons?


Allan Joseph MacEachen: I can understand that attitude. If people tuned in on the hon. member in question period they would not have very much confidence in what is happening here occasionally. The hon. member mentioned the question of housing. He ought to know that in the budget there was a provision of $300 million to support rental construction and housing. He ought to know a bill was brought into the House by the minister of housing which had the potential of creating 60,000 jobs. What did his party do about that bill? How much help did you give to it?


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: You voted against 60,000 potential jobs. That is what you did.


Some hon. Members:: Oh, oh!


ENVIRONMENTAL AFFAIRS
Hon. Bud Cullen (Sarnia-Lambton):: Madam Speaker, I have a question for the Minister of the Environment or his parliamentary secretary. The United States energy department has commissioned and received a report on acid rain. The report indicates that unless there are significant reductions in both sulphur dioxide and nitrogen oxide emission, rain 40 times more acidic will fall on the eastern United States. I suppose that also includes that portion of Canada north of the eastern states. Has the government received a copy of this report? It has been withheld from circulation, although I understand that Southam News has received a copy. Has the government received a copy and, if so, will it use that report to buttress our position on the acid rain situation?


Mr. Jim Schroder (Parliamentary Secretary to Minister of the Environment and Minister of State for Science and Technology):: Madam Speaker-


Some hon. Members:: Hear, hear!


James Duncan Schroder: Yes, the minister has received a copy of that report. Officials of the department received the report some time ago. It was received in an informal fashion, as are many such reports that deal with scientific and technical information.
The 1980 memorandum of intent, which was signed by both governments, provides for an open and frank discussion of matters and problems dealing with acid rain. The Canadian government supports this intent strongly. We are very pleased that in the report the Minister of the Environment is supported strongly in his attitude to reducing the emissions.


Some hon. Members:: Hear, hear!


EDUCATION
Thomas Michael McMillan: Madam Speaker, my question is directed to the Minister of Consumer and Corporate Affairs. Last October the government of Prince Edward Island rejected an application from a so-called Universal Life Church in California for a charter to establish a university on Prince Edward Island. Within a month of that decision, the federal Department of Consumer and Corporate Affairs granted a self-styled bishop of the same church letters patent to run the same university on Prince Edward Island. Did the department know that the Universal Life Church of California is the focus of a major investigation by the United States Internal Revenue service? Has the department satisfied itself that the bishop's corporation on Prince Edward Island will not flood Canada with worthless degrees, thereby debasing diplomas from genuine institutions of higher learning?

Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): Madam Speaker, obviously I was not aware of the facts just quoted to me by the hon. member. In any event, 1 may remind him that according to the legislation governing incorporation as a non-profit corporation, certain procedures are prescribed, and if those procedures have been complied with, the officials of my department have no discretionary power. Anyone who complies with the regulations can obtain incorporation as a nonprofit company. I assume that is what happened in this case. In any event, I shall investigate and report back to the hon. member.


INTEGRITY OF CANADIAN UNIVERSITIES
Thomas Michael McMillan: Madam Speaker, my supplementary question is provoked because the "discretionary power" to which the minister has referred is about to be removed by Bill C-10. To protect the Canadian public, the federal government requires special procedures to be followed at present. There are regulations and procedures prescribed to be followed in the establishing of certain types of corporations-for example, banks, insurance companies and cooperatives.
Since practically anyone off the street can get a federal permit to set up a Mickey Mouse university to sell worthless degrees, will the minister undertake to work closely with the legitimate university community in Canada to devise safeguards to protect the integrity of the Canadian university community and Canadian university degrees against fly-bynight operators of the kind to which I made reference in my first question?


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: Yes, Madam Speaker. I think the suggestion of the hon. member is worth-while. Indeed, I would be ready to
April 23, 1982

entertain an appropriate amendment to the legislation to clarify this situation and avoid difficulties in the future.


Walter David Baker: Hear, hear!


ROLE OF CANADIAN NEGOTIATORS
Hon. Roch La Salle (Joliette):: Madam Speaker, my question is directed to the Minister of State for International Trade. Yesterday, the member for Manicouagan, parliamentary secretary to the Minister of Industry, Trade and Commerce, stated that international trade negotiators showed more concern for their own careers than for the interests of Canada. In view of this statement, which seems based on information previously checked by the parliamentary secretary, can the minister inform us whether he intends to investigate and to take the necessary corrective action, so that people who represent Canada in negotiations on foreign trade act in the interests of Canada instead of trying to protect their own careers, as alleged by the member for Manicouagan?


Hon. Ed Lumley (Minister of State (International Trade)):: Madam Speaker, I have not seen the parliamentary secretary's statement, but I will check the statement and have a reply for the hon. member at the next sitting of the House.


Roch La Salle: Madam Speaker, I have a supplementary. Considering the minister's reply, and since the minister's parliamentary secretary is aware of the considerable selfinterest demonstrated by our international negotiators, how could the minister not be aware of this attitude prevailing among his officials, and could the minister tell us whether he, too, is able to confirm that these international negotiators are more concerned with protecting their careers than with working to further the interests of Canada?


Edward C. Lumley: Madam Speaker, as I said, I have not seen or read the statement by the parliamentary secretary. Until such time as I have had an opportunity to do that, I do not think it would be fair to make a comment on the question of the hon. member.
Oral Questions


EXTERNAL AFFAIRS
Donald W. Munro: Madam Speaker, my question is directed to the Right Hon. Prime Minister. Would he agree that the stop-over made by the French Prime Minister at Saint Pierre and Miquelon before his visit to Canada was motivated primarily by the desire to strengthen the French position that the French Prime Minister is going to explain to the Canadian authorities, which concerns France's claims to a fairly extensive economic zone in the Gulf of St. Lawrence?


Pierre Elliott Trudeau: I am not sure, Madam Speaker, but it seems to me that it could be interpreted as the perfectly normal desire of a French head of government to visit islands that are in fact a French department. He would have all the more reason to do so, because it so happens, if I remember correctly, that the municipality is headed by a socialist mayor. There is nothing unusual about this. There may be other reasons as well. The islands themselves are very beautiful, and the setting is magnificent, especially when the sun shines. Besides, anyone who has time to stay on the islands will find that the food is extremely good. So, there are some of the reasons that might justify the presence of Prime Minister Mauroy in this French territory. That being said, it is common knowledge that there is a dispute between Canada and France on the subject of the islands which has been going on for a number of years, that yesterday both sides expressed the hope that some progress would be made towards resolving the dispute, and that we are all making considerable efforts in this direction.


VISIT OF PRIME MINISTER OF FRANCE TO SAINT PIERRE AND MIQUELON
Donald W. Munro: Madam Speaker, after all, this is a return trip, and the Prime Minister could have visited or stopped at Saint Pierre and Miquelon on his way back.

I would like to ask the Prime Minister whether he will be disposed early next week to make a statement on motions relative to this question so that he may gather the views of those in this House who have a consuming interest in the outcome of the discussions which are now taking place about waters which have long been considered Canadian waters.


Pierre Elliott Trudeau: Madam Speaker, I think it is rather incongruous to suggest that the Prime Minister would have been better advised to stop at Saint Pierre and Miquelon on his way back from a visit to Canada.

April 23, 1982
Oral Questions
Considering the difference in time zones, this was an opportunity for the Prime Minister to have a rest before starting on his Canadian trip, and a good reason for stopping on his way to Canada instead of on the way back to France, especially since, if he had stopped on the way back, people would have said that he wanted to have a rest after the harassment to which he may well be exposed in the province of Quebec, it is not a desire to-


FINANCE
Hon. John M. Reid (Kenora-Rainy River):: Madam Speaker, my question is directed to the Minister of Finance. It concerns the recent debate in Canada about devaluing the Canadian dollar as a means of stimulating the economy. I raise it today because that has been one of the policies followed by the Government of France, whose Prime Minister is the guest of the Government of Canada today.
In view of the fact that the Canadian dollar was devalued some 20 per cent from 1977 to 1979, a massive devaluation by anyone's standards, has the Department of Finance done any studies of the long-term and short-term benefits and costs of this massive devaluation so that we might have this information in the debate that is now going on?


Allan Joseph MacEachen: Madam Speaker, there are, of course, departmental views, studies and documents on the question of the impact of a devaluation or depreciation of the currency. I am not sure whether these reflections are brought together in any particular document which could be made available, but I will examine that.
I will take advantage of this opportunity, inasmuch as the hon. member has raised the question of devaluation, to say that that is not a policy the Government of Canada proposes or intends to pursue. In the current circumstances we believe that would be most unwise.


FISHERIES
James Ross Fulton: Madam Speaker, my question is directed to the Minister of Fisheries and Oceans regarding the Kemano completion project in northwestern British Columbia.
I am sure the minister knows it involves an inter-basin water transfer proposal. Yesterday the vice-president of Alcan provided me with Alcan's announcement that it is doing site location studies for a smelter before it has received the go-ahead for the hydroelectric proposal. Would the minister endorse here today in the House a plan of action which would do two things? Would he put before the House his department's assessment of the impact of Alcan's Kemano
project? I am sure he will recall that just over a year ago he had to take Alcan before the Supreme Court of British Columbia on this same matter. Second, would he support the implementation of a river management scheme such as has been called for by elected representatives in northern British Columbia?


Hon. Romeo LeBlanc (Minister of Fisheries and Oceans):: Madam Speaker, as usual the hon. member confuses oranges and apples. The reason I went to court with Alcan and the reason the court sustained our appeal was that the question of low-water levels was based on a dam which was utilized to retain water in the Nechako River.
The second issue, better known as Kemano II, is a proposal or suggestion that Alcan has brought forward and appears to have pulled back. In fact the latest position of Alcan is that it will not go ahead with the project unless and until there is full public discussion. Alcan has recognized, even publicly, that although it held a licence for many years, the mood of the country has changed a great deal. I suspect our going to court may have helped Alcan to understand the issue.


ROLE OF ALCAN VICE-PRESIDENT
James Ross Fulton: Madam Speaker, I am sure the minister is aware that the vice-president of Alcan is a former colleague of his. He is a former secretary of state, minister of state for science and technology, and minister of Indian affairs and northern development. He is none other than Mr. Hugh Faulkner, and he is responsible for environmental matters for Alcan. Would the minister tell the House what role Mr. Faulkner plays regarding the Kemano project as it relates to the minister's department, and would the minister table for the use of this House his studies on the impact of Kemano II so that the House can have some idea of what implications the Alcan proposal would have respecting fisheries matters?


Roméo LeBlanc: Madam Speaker, the hon. member repeats his old habit of trying to smear people every time he brings their names out by somehow inventing some conspiracy. As fas as I know Mr. Faulkner is a private citizen and is exercising his freedom to work for whomever he wishes. I have not had discussions with him on this issue. If I have to, I will, and I will treat him as I would any other citizen in the country.
On the second question, obviously I will examine the hon. member's suggestion. I favour full public discussion of the Alcan issue, and I am told the company does too.


SMALL BUSINESS
Mr. W. C. Scott (Victoria-Haliburton):: Madam Speaker, my question was for the Minister of State for Small Businesses and Tourism but in his absence I will direct it to the Minister of Finance. It deals with a letter circulated to all hon. members
April 23, 1982

by the firm of Grieve, Horner and Associates in Toronto pointing out the disastrous effect the government's high interest rate policy is having on the small business community in Canada. Last year more than 8,000 small businesses went bankrupt. This year the trend is worsening, aggravated by the effects of the federal budget.
I would like to ask the minister if he has discussed with his cabinet colleagues the wisdom of adopting the U.S. Chapter Two legislation policy whereby small businesses can obtain moratoriums from their creditors and avoid bankruptcy long enough to work their way out of financial problems.


Allan Joseph MacEachen: Madam Speaker, I am quite concerned about the impact of high interest rates on small businesses, and it is for that reason that we have provided, through the small business development bond and the small business bond, large sums of money for small business at preferred rates of interest. There has been flowing into the small business sector, as a result of this policy, close to $3 billion, according to the latest estimate, and I believe that is probably a more beneficial solution than the one proposed by the hon. member. However,
I will do him the courtesy of examining the proposal which he says is in effect in the United States.


BILINGUALISM
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam
Speaker, my question is directed to the Prime Minister, and it is in regard to Government of Canada directive No. 2080-1 which covers francophone participation in the Ontario region. This directive establishes special recruitment teams whose sole purpose is to search out and hire francophones in Ontario and Quebec for federal civil service employment.
How can the Prime Minister justify this preferential treatment for one group of Canadians over another? Does he not feel that francophones are perfectly capable of finding jobs without the special assistance they are now receiving from the federal government?


Pierre Elliott Trudeau: Madam Speaker, I would have to refresh my memory on that particular circular; I cannot brag about remembering it. It does seem to me to be an answer to a situation where it was difficult to attract Francophones to Ottawa, (a) because the attractions of Quebec City were also very great, and (b) because very few qualified French Canadians knew they would be able to work
Oral Questions
in a language environment conducive to the kind of productivity of which they are capable. Perhaps the aim of the circular was to underscore that so that they would be made aware of the advantages there are in working for this great federal government.


Some hon. Members:: Hear, hear!


EFFECT ON ENGLISH-SPEAKING CANADIANS
A. Daniel McKenzie: Madam
Speaker, these hiring and promotional practices are causing severe morale problems in many federal government departments. RCMP members have been told they will be dead-ended if they cannot learn French.


Some hon. Members:: Oh, oh!


A. Daniel McKenzie: The Human Rights Commission is currently investigating the discriminatory Anglo-Franco promotion policy within the Department of National Defence, and unilingual English students are no longer being hired in the House of Commons as tour guides, where 95 per cent of the visitors speak English.
I would like to point out to the Prime Minister that, if this trend continues, unilingual English Canadians will become second-class citizens, so will the Prime Minister retract his government's discriminatory hiring and promotion practices, and return to the merit system, instead of giving one group of Canadians preferential treatment over others? I would like to point out that these practices violate at least three sections of the Canadian Human Rights Act.


Pierre Elliott Trudeau: Madam Speaker, I am sure the hon. member's representations will be examined, and if there is a violation of the act, justice will be given to whomever deserves to receive justice. 1 suspect the hon. member is not favourable to the government's policy of bilingualism. If that happens to be the case, Madam Speaker, 1 just want to point out to him that he is in direct contradiction to the policy of his party and his leader.


Some hon. Members:: Hear, hear!


Madam Speaker:: I would just like to point out to the hon. member that his reference to the guides is quite incorrect. Guides are required to speak both languages, or more than two languages, but we have employed some unilingual guides who may guide English-speaking groups.


A. Daniel McKenzie: Madam Speaker, there has been correspondence from officials of the House of Commons to the effect that they will no longer be hiring unilingual English people, and I would like to bring that correspondence to your attention because there is certainly some confusion in that area.

April 23, 1982
[ Translation]
Order Paper Questions PETITIONS


TABLING OF REPORTS OF CLERK OF PETITIONS
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the reports of the Clerk of Petitions stating that he has examined the petitions presented by hon. members on Thursday, April 22, 1982, and finds that the petitions meet the requirements of the Standing Orders as to form.



ROUTINE PROCEEDINGS

[Stage Direction]
[ Translation]

[Stage Direction]
Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): Madam Speaker, I have the honour of tabling, in both official languages, the progress report on the financial aid program for homes insulated with urea formaldehyde foam, a summary of research contracts made by the National Research Council and a letter from my hon. colleague the Minister of National Health and Welfare (Mrs. Begin), on grants given to various research groups working on the hazardous effects on health of urea formaldehyde foam.

[Stage Direction]
appointment of an independent reviewer to examine the File and to give a view as to what parts can be made public, and, if not, for what reason?
2.	Is it government policy to withold important details of foreign espionage within Canada and all related matters and, if so, what factors justify isolating the Canadian people from this information?
Hon. Bob Kaplan (Solicitor General):: 1. No. The Tas-chereau papers although in the possession of the security service of the RCMP were not documents generated by the security service. The so-called Featherbed file is a file of the security service. Although it has been dormant since 1975 and is dormant now, it is an operational file. Its release is not in the public interest because of some or all of the factors referred to in connection with details of foreign espionage referred to in No. 2 below.
2.	It is government policy to exempt important details of foreign espionage against Canada and related security matters from disclosure if it is in Canada's national interest to do so. Factors leading to such a policy decision include:
(a)	the probability and extent of injury to Canada's national security;
(b)	the possibility of violation of the right of privacy of an individual;
(c)	disclosure resulting in violation of any law relating to the privacy of an individual; and
(d)	injury to a confidential agreement made between the Government of Canada and any other government.


Mr. Cossitt: 1.	Is the entire Featherbed File still in existence and, if so, under whose control is it and at what location?


MR. HEAP-TESTING OF CRUISE MISSILES ON CANADIAN SOIL
Mr. Dan Heap (Spadina):: Madam Speaker, I have the honour to present a petition from citizens in the city of Toronto calling upon Parliament to request the Prime Minister (Mr. Trudeau) to refuse to allow the testing of Cruise missiles on Canadian soil.


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. 3,235, 3,245, 3,767 and 4,157.


[Stage Direction]
2.	Were any sections destroyed within the past four years and, if so, to what did they pertain?
3.	Will the government guarantee that the entire Featherbed file will be kept intact (a) before (b) during (c) after its transfer from the RCMP security service to the new civilian security service?
Robert Phillip Kaplan: 1. Yes, the entire Featherbed file is still in existence. The identification of the controlling official and location of the file is not considered to be in the public interest.
2.	No.
3.	There is no present intention to destroy or reduce the Featherbed file. The government will guarantee the Featherbed file will not be destroyed or reduced without a public statement on the subject.


Mr. Cossitt: 1. Will the government apply the same policy with regard to the release of the Featherbed file as it did to the so-called Taschereau papers, namely the

Question No. 3,767-Mr. Cossitt:
With reference to the answer to question No. 3,230 which stated in part that the government will not guarantee that it will not destroy, alter or change in any
April 23, 1982

way RCMP security files during the changeover from the RCMP to the new civilian security service, did the government adopt a new policy of political interference with RCMP files and, if so, what are all the reasons and is one reason to remove anything politically embarrassing to the government?


Robert Phillip Kaplan: No.


Mr. Munro (Esquimalt-Saanich): 1.	How many bids were submitted during the search in February 1981 by the Department of Fisheries and Oceans for a large ice-strengthened stern trawler to undertake research and patrol work off Newfoundland?
2.	To whom was the contract awarded?
3.	Were there arrangements for a charter deal and, if so, what was the per diem rate agreed upon?
4.	How many offers were made to the department in its search for a charter vessel to undertake hydrographic work off the west coast of British Columbia and in the western Arctic?
5.	To whom was the contract awarded and for what amount?
6.	(a) Which section of the department makes the selections between offers and makes recommendations to the minister with respect to the offers (b) what special qualifications do the personnel of this section possess enabling them to carry out the process?


Roméo LeBlanc: 1. Eleven firms submitted bids in response to the Department of Fisheries and Oceans' tender call for a medium offshore ice-strengthened stern trawler for fisheries research off the Atlantic coast.
2.	Owing to the high costs involved a contract was not awarded.
3.	See 2 above.
4.	Four firms submitted bids in response to the department's tender call for an ice-classed ship for hydrographic surveys off the Atlantic coast and eastern Arctic in 1981 with the option for annual extensions for similar work in the Beaufort Sea and western Arctic in 1982 and 1983.
5.	The contract was awarded to the M.V. Polar Circle owned by Carino Company Limited of St. John's Newfoundland at the following daily rates: 1981-$5,700; 1982- $6,156; and 1983-$6,649. '
6.	(a) Ship branch personnel, in concert with the program personnel who will be employing the ship, evaluate all offers received and invariably recommend the "lowest qualified" offer to the minister prior to seeking Treasury Board approval to enter into a contract.
(b) Ship branch personnel are a very experienced and thoroughly professional group representing the complete spectrum of maritime related disciplines and together with equally qualified and experienced program personnel (the end users) possess the essential experience and expertise required to participate in the chartering process. The ship branch officer responsible for charters has 37 years professional marine experience which includes eight years experience
Order Paper Questions
negotiating contracts and managing the department's national charter programs.


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered.


David P. Smith: Madam Speaker, if question No. 2,765 could be made an order for return, this return would be tabled immediately.


Madam Speaker:: Is it the pleasure of the House that question No. 2,765 shall be deemed to have been made an order for return?


Some hon. Members:: Agreed.


Mr. Beatty: 1.	What is a complete list of all (a) contracts (b) other agreements made at any time between the Department of Communications or any other department acting on its behalf and Norpak, Limited or any affiliated or associated company or the principals of Norpak, Limited and, in each case, what was the (i) date and duration (ii) dollar value and nature of the contract or other agreement?
2.	Were tenders or other competitive solicitations issued and (a) if so, what other individuals or companies participated (b) if not, for what reason?
Return tabled.


David P. Smith: Madam Speaker, 1 ask that the remaining questions be allowed to stand.


Sinclair McKnight Stevens: Madam Speaker, 1 would again draw the parliamentary secretary's attention to question No. 2,042 placed on the Order Paper on January 29, not of this year but last year. This touches on the Prime Minister's world tour in December and January of 1980-81. Would the parliamentary secretary once again explain to the House why this information is being concealed?
At a time when people wish there was more freedom of information in this House, basic facts such as what his trip cost is being denied to the Canadian taxpayer. What is the parliamentary secretary's explanation?


David P. Smith: Madam Speaker, I am very pleased the hon. member has drawn this matter to my attention and I will be delighted to make inquiries into this question on his behalf.


Sinclair McKnight Stevens: You have said that 12 times.


Madam Speaker:: Shall the remaining questions stand?


Some hon. Members:: Agreed.

April 23, 1982
Energy Administration Act



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Thursday, April 22, consideration of the motion of Mr. Lalonde that Bill C-103, to amend the Petroleum Administration Act and to enact provisions related thereto, be read the second time and referred to the Standing Committee on Energy Legislation.
Mr. Scott Fennell (Ontario):: Madam Speaker, I appreciate the opportunity to continue my remarks on Bill C-103. Since the adjournment of the House last evening some interesting information has come to my attention, and that is that this bill is adding additional taxes on existing taxes and increasing inflation. Today the CPI in the United States has dropped for the first time since 1965; their first quarter inflation rate is now down to 1.5 per cent.
The bill we are discussing, Mr. Speaker, is adding fuel to the fires of inflation. It is not solving the problem this country is suffering from. Our inflation rate is going up because of government expenditures and taxes, but the United States is now down to an inflation rate of 1.5 per cent in the first quarter. I think this government is incompetent and doing a great deal of damage to this country, and I am going to continue to discuss this bill which I think is a disaster for Canada.
This bill is like so many programs this government has introduced which benefit incompetent operators and force the competent and highly skilled people to move out of the country. The November 12 budget is an extension of Liberal thinking. I am relating this to Bill C-103 because it results from the 1980 budget. I am relating this to the oil industry because that industry is suffering from lack of funds. Because of this lack of funds there is no incentive to invest in Canada.
The Minister of Finance (Mr. MacEachen) on November 12 removed interest deductibility. He will make the argument that he is still permitting an amount up to $10,000 and people with immense investments are able to write off their total investment. But I am talking about the guts of Canada, middle Canada, the ones who take the risk. I am talking about the $18 billion I referred to last night which left Canada. That was risk money. Not only has the government removed the wealth from Canada, but it is now removing the guts from the middle of Canada, the people who are the risk takers. They are the people who had the courage in the past to believe in this country. This bill is doing the same thing again. It is discouraging people from investing.
Through this National Energy Program the government will tax savings in the life insurance industry. This money in the insurance industry is a large sum. In the past a proportion of it was invested in the Canadian west, but the government is going to tax it. All this government does is tax, tax and tax. This government has one tax laid upon another. Why does this
government not get some creative programs together rather than taxing the guts out of this country?
What amazes me the most about this government is how its backbenchers always stand up and vote for every piece of legislation. If their leader stands up, they all stand up. However, in this energy legislation that we are dealing with, a peculiar situation has cropped up. It affects every member from the province of Quebec and they should consider it when they vote on this bill. I am talking about the expropriation factor.
I have had the opportunity to discuss the problem with people from Mirabel. Those people had 80,000 acres of land expropriated. They have no one on that side who will listen to them; therefore, they are now coming to me. On Thursday, April 8, some of these people came to Ottawa to talk to the minister who was supposed to be here. He told them that he would be in the House at 12:15 p.m. to meet them. He was not there. Their own Member of Parliament avoided these people all day. Eventually, my office located where their member was which enabled them to present a down payment to buy back the land.
I say to members on the other side that by voting for this bill, under which the province will have no approval regarding expropriation, they are hurting everyone in the province of Quebec. Let me tell hon. members on the other side, having dealt with those fine gentlemen from Mirabel-those poor people whose lands were expropriated, taxed for the right to be expropriated and who have not been given a chance to buy back the land-they are the ones they will be hurting and they are mad. I understand why people are not voting Liberal in the province of Quebec. It is very simple; they are not being represented. I am pointing this out to hon. members because the name of any member who votes for this bill will go to that association at Mirabel from my office. I have a responsibility to those people and the reason I have a responsibility is the same responsibility I had for the people whose land was expropriated at Pickering. At least they had a fighter, and I am going to fight hard on behalf of these people. If the Minister of Public Works (Mr. Cosgrove) were here, I would really attack him on this point.
I am delighted to see that President of the Treasury Board (Mr. Johnston) here today. We are talking about economic incentives in Bill C-103. The President of the Treasury Board wrote a book and in his book he talked about economic incentives. It was a sound book and a good book. It was the kind of book that could have been written by somebody on this side, but the President of the Treasury Board is an expert in his field.
On March 26, 1982, the President of the Treasury Board spoke to the Calgary Chamber of Commerce. I do not believe he wrote this speech himself; I believe it was written for him by the bureaucracy. In his speech he mentioned that one of the reasons he entered political life was because of his frustration with the bureaucracy. I have to endorse that stand because it is the reason that brought me here, too, and I acknowledge that.

April 23, 1982
In his speech he said "It is not necessary for the government to be involved in commercial business enterprises." If that is the case, how can the President of the Treasury Board vote for Bill C-103, vote for Petro-Canada and vote for the creation of more Crown corporations that always lose money? I do not know how the President of the Treasury Board can say one thing in one place and say another thing in another. In his speech we find this sentence:
Creation of wealth is what the private sector does best: redistribution of wealth through public sector expenditures and social programs is what the government
does best.
That is a non sequitur. He is saying, "You can do it, and we will take it all away". Will the President of the Treasury Board please explain what he means? I believe his basic philosophy is being destroyed by this government. Further on in his speech, the President of the Treasury Board said this:
-1 believe that government should not displace private capital in business enterprises-
Why should you not give tax incentives instead of funding the way the government does and the way it buys corporations? The President of the Treasury Board also said that he believed in supporting investment activities. Why then is the President of the Treasury Board against interest deductibility? The President of the Treasury Board also said this in his speech in Calgary:
Canada has high interest rates because we have high inflation.
As I said at the beginning of my speech, the CPI in the United States has gone down for the first time since 1965; it is now at the rate of 1.5 per cent. There is no logic to the President of the Treasury Board's statement, and I hope he will answer all of my questions.
Toward the end of his speech he said something that really upset me. He said:
-that the government is in business suggests to me a necessary corollary of equal importance: that of bringing business and businessmen into government and the policy-making process.
The business and the business community were not brought into Bill C-103. The people out west are destroyed. The investors in Canada have been hurt. But the ones who have been hurt the most by this energy program are the small entrepreneurs. The government's energy policy has destroyed the man who is the long-haul trucker, the service contractor, the flat-rig operators and indirectly the automobile industry, because for every job lost in the west two jobs are lost in Ontario and Quebec. But that is what the government is recommending. Would the President of the Treasury Board please put forth his own ideology and quit mimicking the ideology of his emperor?
This government works on half programs. A good way to describe Bill C-103 is half a U.S. program and half a U.S.S.R. program. The half I refer to of the United States would be the windfall profits tax. The government has to tax something so that it is not inequitable to society. But the U.S.S.R. half is the tax to be imposed for Canadian content, to nationalize the oil industry in Canada. The Liberals may call this the Canadian
Energy Administration Act
monetarist's dream, but the rest of Canada call it the Canadian monetarist's nightmare.
I have close contact with my constituents. I hear from them constantly. They know that I am in here Fighting. They know the tough situation with which I am faced. They know that backbenchers opposite are like a flock of sheep who vote on all bills even though they do not believe in them, and this is true even for some of the cabinet ministers. The Liberal government is like a barn full of hogs stampeding to the trough. Every piece of legislation is the same-grab, grab, grab, take it away.
The government, through the Minister of Employment and Immigration (Mr. Axworthy), provides band-aids. Let us talk about these government band-aids. For example, there is the summer employment program. In good times it is of great benefit to assist students in obtaining jobs, but this year the program is setting up daycare camps for the children of the unemployed. The unemployed have nothing else to do. I believe this is morally wrong because it breaks up the family unit. The government should try to hold families together. This is what Canada is about. In the last 14 years the Canadian family has fallen apart, the individual family has fallen apart. The minister gives a band-aid solution to create labour. It is taken away with Bill C-103 and given through another program. This is wrong.
I should like to review a few of the financial implications of Bill C-103 and how it is hurting people. We must keep in mind that every job lost in the west affects two jobs in the rest of Canada. For example, the net internal funds generated by Imperial Oil stayed flat between 1979 and 1982, but I should like to point out that taxes imposed during the same period- and some of these taxes have been imposed but not legalized- have gone from $1,254 billion to $2,712 billion. This comes very close to a 200 per cent increase in two years. This is what is happening. The government is grabbing it all, leaving little money for the little guy, not providing any funds for large multinationals, and taking away incentive for multinationals to find new oil in Canada. Instead the government implements a compensation charge which amounts to 24 cents per gallon out of the pockets of Canadians to subsidize the multinationals to purchase overseas products and to export $6 billion worth of jobs every year.
I draw the attention of hon. members opposite to an article entitled "The Energy Crisis is Over" which appeared in the November, 1981, edition of Harper's magazine. They should read this article concerning the American energy crisis. Although it is old right now, it is holding true even more now than it did when it was written. Why is the energy crisis over in the United States? It is because President Reagan expanded the philosophy of Mr. Carter, which was a basic belief in private enterprise, and removed all controls on oil. The leftwing media jumped on this and said, "Disaster, this is disgraceful; it will push up the price of fuel 10 or 12 cents." I do not need to say any more, but by May of 1981, prices had

April 23, 1982
Energy Administration Act
started to fall; with private development the prices started to fall in the United States. Bill C-103 is the absolute reverse and hurts the country. It is destroying initiative in the private sector and the possibility of self-sufficiency. It is doing absolutely nothing for the country other than filling the grab bag of the Liberal government.
Who are the real losers in the legislation? It is not the government. It will be the government in the long run, but today it does not realize this. When that much money is taken out of society, who are the real losers? The real losers are middle Canadians or working Canadians who are the guts of the country. I should like to relate the situation in Canada to the figures in the United States where there are lower taxes, lower CPI and lower inflation. Canadians will pay higher taxes with this bill. Also it is creating higher unemployment, higher inflation and higher rates of interest. As I mentioned last night, higher interest rates were created by the deployment of risk capital to other countries. Bill C-103 will certainly Canadianize the oil industry in the United States and drive it out of Canada.
Who will be the beneficiaries of this legislation beyond the government? It will be foreign banks and passive Canadian investors who put all their money in safe Canadian bonds. Canadians should really consider the safety of those bonds. We have great potential and assets behind us, but we are not doing anything with them. We are not producing. I have challenged the Minister of State for International Trade (Mr. Lumley). I think he is an honourable gentleman who is trying his best, but what is the government doing to create productivity in the country? It brings in Bill C-103 which removes people from the employment ranks in the west and in this part of the country.
I should like to continue on this point by referring to something which I was told this morning. On April 2 I referred to an engineering company connected with Lasco Steel, a very successful corporation which was moving its offices from Whitby. I obtained the facts of the matter this morning, that this was a direct result of Bill C-103. A senior officer of the company told me that its personnel was reduced by 50 per cent since the introduction of the National Energy Program. It has dropped from 323 people to 151 people, which is actually more than 50 per cent. On April 2 I also indicated that the engineering firm was moving its office to Texas or perhaps that it was closing its office. It is not closing its office in Whitby, for the sake of clarification, but nine senior engineers are being moved to Texas. These are nine qualified Canadian engineers. The Minister of Employment and Immigration referred to the fact that his department has to bring in 20,000 to 25,000 skilled people. I believe this is so because many people are being driven out of the country. This gentleman told me, "Yes, it is true that we are cutting back seriously. We hope it is over and that we will not have to lay off any more employees, but any future expansion will take place out of the country". Also he referred to the fact that over the last 12 months the firm had been hoping that something would be resolved on the Alsands
project. The Alsands project is the tragedy of Canadian industry, the tragedy of the Ontario economy.
Also I should like to refer to the fact that Ferco Engineering put together a consortium of six engineering firms called Tars which guaranteed one million man hours of work. He wants to know what will happen because his company cannot keep people employed. He does not know how it will keep them involved. What the government is doing is having disastrous and tragic effects.
I would like to illustrate how a few other industries are affected by Bill C-103; for instance, the rubber industry. Contracts for the manufacture of hundreds of millions of feet of conveyer belts have been cancelled or delayed prohibiting further expansion of the rubber industry. Fewer car tires are being produced because all our cars are being imported with the tires already on them. The government does not demand Canadian content wherein we could ship rubber tires abroad for those cars which are to be imported.
Steel works and rolling mills are being affected. I have already mentioned Lasco Steel. That company is now down to 40 per cent of capacity and it is one of the most successful Canadian steel companies. The manner in which they must operate now is to employ their workers for one week in every three. The reason for this is that they cannot afford to carry the inventory while we have high interest rates.
Another company which I contacted indicated that it had 402 tons, involving 1,500 man-years, lost. It has been dislocated because they have been forced to lay people off. The National Energy Program and Bill C-103, instead of trying to deal with problems which may arise in the future, is just attempting to grab money now without any concern for the future.
I will not dwell on the problems of the automobile industry.
Another sector which is concerned about Bill C-103 is the wire, rope and cloth industry. Just imagine the potential millions of yards of wire rope that is not being produced. We should be proud of the fact that this is a competitive Canadian industry which produced an excellent finished product in Canada.
Another industry adversely affected by this bill is the structural steel industry. Algoma was ready to sign a contract with an engineering firm in order to expand its operations and thereby employ more people in northern Ontario, which is a critical part of Canada. But this bill has forced the postpon-ment of those plans. Algoma is in a holding position, as is the rest of Canada.


Mr. Foster:: Mr. Speaker, I rise on a point of order. I represent the Algoma constituency and just this morning I talked to the president of Algoma Steel. He told me that indeed it was spending $240 million this year on the expansion of its tube mill. As well, it plans to spend over $1 billion in the next five years on the expansion of its facilities.
April 23, 1982


The Acting Speaker (Mr. Blaker):: Order, please. If the hon. member wanted to seek the consent of the hon. member who has the floor in order to ask him a question, or if he wanted to phrase his remarks in a different manner, it might more closely approach a point of order. However, the hon. member is debating right now.


Thomas Scott Fennell: Mr. Speaker, I am pleased that the hon. member for Algoma (Mr. Foster) raised that point. I agree that Algoma is planning to spend that amount of money. I acknowledge that the design engineering is proceeding. The hon. member can verify with the president of Algoma that it is Ferco who is going the design engineering. However, Ferco Engineering is concerned that this project will be postponed. Since Algoma has not given a firm commitment to go ahead, Ferco does not know where it stands. I acknowledge that Algoma is preparing for this expansion in anticipation of proceeding, but I gave this example in relationship to the fact that Algoma was in a hold position, the same as Canada is in a hold position. The hon. member should check with Algoma and its consulting engineers.
The hon. member referred to the fabricated pipe industry and said that he thought it will proceed. The provisions of Bill C-103 will make certain that it will not proceed. The compensation charge encourages the importation of oil into Canada, the export of $6 billion a year and that Canadian oil is not used or developed.
We can also look at what has happened to the boiler and pressure vessel business. That industry has almost shut down. I am sure that my colleague, the member for Cambridge (Mr. Speyer), can confirm this fact. He is faced with the prospect of his constituents who work in the boiler industry being unemployed. Once again it is a result of Bill C-103, which proposes to take money from the private sector and transfer it to the government trough. It is unfair and inequitable.
I am sure everyone knows what has happened to the valve manufacturers. Fortunately, since the tariff is not excessively high in this area, that industry is not able to export their product to the United States. However, some of the U.S. concerns have been told of the undesirability of importing so much from Canada. Since there is no demand, valve manufacturers cannot sell their goods in Canada. As a result, workers have been laid off with the anticipation of more severe lay-offs in the future.
The turbine manufacturers and the pump industry have also reassessed the situation. Their conclusion from reading Bill C-103 is to ask what prospect there is for success when the government takes away all hope from Canadians. Contracts for the manufacture of compressors have been cancelled virtually every day in the last year. There is no longer any compressor industry-which was a major industry-in this country.
One of my constituents is the director of the electrical association in my riding. He wanted me to tell the government what Bill C-103 is doing to the companies in his association. It is removing the incentive to expand. He told me that they had a number of contracts from the west which are now being
Energy Administration Act
cancelled. People in Ontario are hurting, with the exception of those people represented by the hon. member from Ottawa because his area is well protected by the civil service. There is no industry on which he has to depend. I invite him to come to my riding and talk to some of my constituents.
I could go on and cite examples of other industries in trouble, such as the transportation equipment industry. Trucks and semi-trailers which were being built to be sold in western Canada were being partially constructed in Ontario and shipped to western Canada. I can cite one example after another.
I would like to read some conclusions about the National Energy Program made by the C.D. Howe Institute. I am sure the hon. gentleman this institute was named after would be shocked and embarrassed to see what his Liberal successors are doing. The conclusion by the institute states:
The NEP is an economic policy that is severely constrained by political factors. It represents the federal view of how Canada's energy resources can be used as a tool to orchestrate the country's economic future, with the federal government conducting and playing the leading role.
It went on to say that Ottawa has failed to realize that it is a co-operative arrangement between the provinces. The leader of the Liberal Party has stated that there must be co-operation with the west for this program to succeed. The institute went on to say:
But the policy takes risks. If the attractiveness of competing activity in the United States has been underestimated, if reduction in oil demand has been overestimated, if the oil sands projects are delayed much longer, and if the response to frontier options is weak, Canadians may pay lower prices and own more of their industry by mid-decade, but they should also be aware that part of the price may be lineups at the gas pumps.
I am speaking in this debate on Bill C-103 because I am concerned for my children and my grandchildren. We have stopped development in Canada. We have encouraged multinationals to buy oil overseas. We have done everything to discourage the private sector of this country.
I hear the President of the Treasury Board and I do know that his philosophy was right before he became a cabinet minister in this government. I admired that gentleman; I have read his book. However, will he get his guts together and his back up and stand up for Canada and for the people he represented for so many years as a very able lawyer in Montreal?


Some hon. Members:: Hear, hear!


Thomas Scott Fennell: I also appeal to the hon. members of this government who are from Quebec to please consider what has happened and go to talk to the people at Mirabel who have been ill treated before endorsing unilateral expropriation under this bill. I ask them to go and talk to their people to see how they have suffered.
Therefore, I say that this bill will mean nothing but another disaster to Canada. I plead with the minister, withdraw it. We took 16 days in which to try to get our point across. I guess the

April 23, 1982
Tabling of Reports
public was with us. That has been proven. At least, we got the bill broken down. However, to my way of thinking, that is not enough: the whole of Bill C-94 should have been withdrawn and abandoned.
I appreciate the opportunity of speaking in this House and the fact that your Honour has been bearing with me and has allowed me to express my views. I tried to stay on the point as much as possible, and I think I did. However, I am concerned for Canada and I really hope the minister will take my words to heart and do something about withdrawing this entire bill.


Some hon. Members:: Hear, hear!


Mr. Lachance:: On a point of order, Mr. Speaker. I have consulted both sides of the House, and I think that if you were to ask the unanimous consent of the House for reverting to routine proceedings, tabling of reports of Standing and Special Committees, you would obtain that consent, Mr. Speaker.


The Acting Speaker (Mr. Blaker):: The hon. member for Rosemont (Mr. Lachance) indicates that there may be unanimous consent to reverting to tabling of documents for the purpose of tabling a committee report. Is there unanimous consent?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Blaker):: Agreed.



ROUTINE PROCEEDINGS

[Stage Direction]
[ Translation]

Claude-André Lachance: I wish to thank my hon. colleagues for their courtesy.
Mr. Speaker, I have the privilege of tabling, in both official languages, the fourth report of the Standing Committee on Justice and Legal Affairs.
[Editor's Note: For above report, see today's Votes and Proceedings.]


The Acting Speaker (Mr. Blaker):: Agreement has been sought and given by the House to the tabling of the report.
The House will now revert to Government Orders, and the Chair will recognize the next hon. member who wishes to speak on Bill C-103.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that Bill C-103, to amend the Petroleum Administration Act and to enact provisions related thereto, be read the second time and referred to the Standing Committee on Energy Legislation.
Dave Nickerson: Mr. Speaker, it is a pleasure to speak once again on another item in the continuing saga of the national energy policy. This one is particularly insidious and is very onerous to the Canadian people because it will take a lot of money out of their pockets. If we look at the principles behind the national energy policy which are again incorporated into Bill C-103, we find that what the government wants to do is to impose strict control on the Canadian oil, gas and energy industries. The government wants to be able to direct where energy will come from, how it will be sold, the prices at which it will be sold and the amount of public revenues which will be generated. The government wants to regulate and tighten all aspects of the Canadian energy industry.
The members of the NDP may be a little more honest than the hon. gentlemen opposite. Their policy is to nationalize the energy industries and they are quite frank about it. They want to nationalize the oil and gas industry in the same manner they want to nationalize the steel industry, the banking industry and everything else. Pretty soon they will want to nationalize the little family farm which is presently somewhere down on the list, but its turn will come.
The hon. gentlemen opposite have a different approach to things. They are a little bit more intelligent, and I give them credit for that. They are a little bit more clever. I am not saying much, because one does not have to be too clever to be more clever than the average member of the New Democratic Party. The plan of the Liberals is to turn the energy industry into a utility where people will be able to make a certain return on investment, but there will be no real incentive to go out into the market and compete or to try to find new sources of energy as cheaply as possible, because the profit motive will no longer be there. Energy in Canada will be produced on a utility basis. The investor-owned corporations still involved in the industry, if they survive, instead of trying to maximize their profits and efficiency, consider new ideas and take new risks, will try to justify as large a cost base as possible under the new system in the same manner as many people in the gas distribution business at the present time. This is really the aim of the government. A few senior bureaucrats in the Department of Energy, Mines and Resources will be able to control all energy matters in Canada by diktat.
That is really what the national energy policy and Bill C-103 are all about. The government has a plan to control, not necessarily own, the Canadian oil and gas industry and other
April 23, 1982

aspects of the energy system. It is not really necessary to own things in order to control them. The government envisages Petro-Canada as having much greater participation in the business than we would like on this side, but at this point in time it does not see it as encompassing the entire industry. The government found that it could control the industry without necessarily owning it or nationalizing all of it, although we have seen from the bills put before us in the last couple of weeks that it does intend radically to increase the nationalization which has been going on for some time.
I think that such a system as envisaged by the Minister of Energy, Mines and Resources (Mr. Lalonde) and his cabinet colleagues will be detrimental to Canada in the long run. I have some concern as they are taking over a dinosaur. They are using billions of the taxpayers' dollars to take over an industry which has reached its peak. I think that funds would be better invested, if they were to be invested by the public sector at all, on new and upcoming sources of energy. Instead of buying out the oil industry which is at or past its peak, the government should be devoting the same taxpayers' dollars to investments which will return a greater dividend in the years to come.
The policies being pursued by the government will result in higher prices in the long run. They will result in decreased efficiency of the energy industries because the incentives will no longer be there. The utilities in the business will operate on a bureaucratic basis very similar to that of government. One can see that at the present time there is very little difference between the way in which the bureaucracy of Imperial Oil operates and the way in which the bureaucracy of the government operates. There does remain one fundamental difference in that the bureaucrats, for want of a better word, who work for Imperial Oil can get fired if they screw things up too badly, whereas people in the employ of the government rarely suffer that fate. However, there is a general tendency on the part of the technocrats in the Liberal government to want to extend their existence and the way they do things to Canada in general.
I think it is important that we maintain a proper distinction between what properly comes within the purview of the government and what properly should come within the purview of the private sector of the economy. It is my opinion that the energy industries in Canada can best be developed by the private sector.
We are slipping into state control of the basic resources of the country. The analogy I like to think of is the ancient hydraulic civilizations of Egypt and Mesopotamia. The governments of the day controlled all life in those earlier civilizations by controlling the most important and basic resource, water. If the state controlled the water, they controlled everything. They had control over the individual lives of all the people. They controlled everything through control of the major resource, water.
Energy Administration Act
I am sure the Minister of Energy, Mines and Resources, the Prime Minister (Mr. Trudeau) and others in government are thinking in exactly the same terms for Canada. If they can control energy supplies, they can control everything.
It is frightening when you think about it and where a country like Canada, which heretofore has had very high regard for the freedom of its population, might end up. Look at what might result from these policies that have been consistently employed by a Liberal government for some 14 years.
The other aspect of Bill C-103 is revenue. The Government of Canada has discovered in the oil and gas business a new source of revenue. I should not say new because there have always been reasonable taxes on oil and gas at the federal and provincial levels in the past. It now looks upon energy, oil and gas in particular, in the same way we look upon whisky. It costs a couple of dollars to produce a bottle of whisky and there is $8 or $9 tax on it. The tax is out of all proportion to the value of the commodity. This may be well and good in the case of a luxury such as alcoholic beverages. We can live with that and accept it. Most people are quite prepared to pay very high taxes on alcohol and tobacco because they are strict luxuries. We do not really need them. Hopefully some of those moneys will go to use in other areas.
People do not mind paying high taxes in those areas. However, the Liberal government has adopted that way of looking at taxation on oil and gas. Unfortunately, people have become used to it. When they go to the gas pump, of every dollar they pay, 30 cents goes to the explorers, producers, refiners, distributors, marketers, retailers, wholesalers and everyone else in the business doing production work. The remaining 70 cents goes to governments, federal and provincial. People are accepting that. It is wrong that they have been led into that acceptance. When you go to the gas pump, the price per gallon or litre should specify the amount of taxes you are obliged to pay to various levels of government.
We should not treat gasoline, and especially home-heating oil, the same as whisky. Taxes and royalties on energy products should bear a reasonable relationship to the true value of those products. A rate of royalties and taxation not dissimilar from the federal sales tax would be reasonable. I am surprised the Canadian public has accepted what is going on. I guess there has been some kicking back; unfortunately, their protestations have been in vain. Those opposite have pursued them relentlessly, beaten down the Canadian public and forced them to pay these energy taxes.
This bill legitimizes the 28-cent a gallon tax that has been unlawfully collected for some time, in some instances going back two years. Canadians know those taxes were unlawful, that there had been no parliamentary approval given. What could they do about it? They could not go to court. They would have spent millions of dollars on a lawsuit to prove they had been unjustly taxed and a few weeks later the government would have turned around and brought in retroactive legislation, such as it is now doing. That is not the way taxes are

April 23, 1982
Energy Administration Act
supposed to be levied in a free country. It is not the way citizens of a free country should be subjected to a government that has very little else in mind except getting as much money as possible by bleeding dry the taxpayers of the country.
Remember the mandate given to the present government in the election two years ago; remember the election slogans at that time-"Vote Liberal and keep energy prices down". The 18-cent a gallon tax that had been proposed by the then minister of finance was shot down across the country. Now what do we have? We have a tax of about 70 cents a gallon. That has been in the increase in the price of a gallon of gasoline since those characters opposite found their way back into office as a result of promises to keep gasoline prices low.
The national energy policy in Bill C-103 has been sold to the Canadian public on three bases. The government said it would Canadianize the oil and gas industry. It said this would result in energy security and in fair prices. The National Energy Program and Bill C-103 fall down on all of these. Canadiani-zation was in progress and would have continued. The excessive rate of Canadianization, especially through nationalization and ownership by government and not by individual Canadian citizens, has had an adverse effect on the level of our currency. It has chased foreign capital out of the country at a time when it is most needed. That was not done in a balanced way.
We have had example after example presented to this House of the ways in which the oil industry and capital have been chased out of this country. The rigs are leaving the country as well as technical expertise. People in the industry have been leaving the country. I do not want to recite this time and time again. I just want to bring it to the attention of the House once more. May I call it one o'clock, Mr. Speaker?


The Acting Speaker (Mr. Blaker):: It being one o'clock, I do now leave the chair until two o'clock this afternoon.
Atone o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2.00 p.m.
The Acting Speaker (Mr. Blaker);: Order, please. When the House rose at one o'clock the hon. member for Western Arctic (Mr. Nickerson) had the floor.


Some hon. Members:: Hear, hear!


Dave Nickerson: If I recall correctly, Mr. Speaker, before the lunch break we were discussing the follies of the Liberal Party and in particular the failures of the Liberal cabinet when it came to formulating a reasonable energy tax policy. These, unfortunately, are subjects with which many Canadians are very familiar. We were describing how the national energy policy and its tax implications have driven out capital, equipment and people from Canada. By virtue of the National Energy Program, the Alsands project and the Cold Lake project, which would have done so much for the areas in the west in which they are located and for industries right across
Canada from coast to coast, have been set back and likely delayed indefinitely. The hon. member for Ontario (Mr. Fennell) gave a vivid description showing how these policies would affect many manufacturers in his constituency, everything from the rubber industry to valve manufacturers.
If we look at the supposed energy security aspect of the NEP, we find that this also has failed. Canada is just as dependent today, if not more so, on imports of oil from Mexico and from Saudi Arabia as it was before the implementation of this ill-founded policy. If we look at the fair prices component of this supposed policy, we see that this has not worked either. There is still disparity between one region of the country and another with respect to oil and gas and energy prices. There has been a tremendous increase in prices. We have not got security, we have not got fair prices; what we have got is higher and higher taxes, and higher taxes again under Bill C-103 which we are dealing.
The three enumerated aspects of the policy put forward by the sales pitch the government gave us-the Canadianization, the energy security, and the fair prices-have not worked.
What the national energy policy really entails is an increase in federal control, an increase in centralization. That is what they are really after. And it means also an increase in taxation. Look at the billions of dollars that are going to roll into federal coffers as a result of taxation measures associated with the national energy policy. There will be $50 billion alone as a result of the agreement between the federal government and the province of Alberta. That was the expected amount; the government has already made plans to spend that money. Now, because of the glut of world oil and the lowering of prices, their financial estimates are likely to be away out of line, resulting in even greater federal government deficits. That will lead again to inflation and to a continuation of the sorry state into which the Liberal government has allowed the Canadian economy to fall.
I have dealt with the overall policies contained in Bill C-103, and at this time I would like to go through the bill and deal with it clause by clause. I do not want to deal with the policy matters so much as with the specifics of the bill.


Ian Deans: No. That is for committee.


Dave Nickerson: The first item we notice is a change of name. It used to be the Petroleum Administration Act. The Petroleum Administration Act was originally brought in for a very specific purpose at a time where there had been a rapid escalation in the price of OPEC oil. It was felt necessary to shield Canadians from what was expected to be a short-term fluctuation in oil prices. That is how the government sneaked it through the House of Commons in the first place. Unfortunately, it is now becoming a permanent fixture. It will be in the statute books of Canada forever, and it no longer deals just with petroleum. The name is changed to the Energy Administration Act. That is what it will now be called, and if we look
April 23, 1982

through the bill we find that it also deals with coal and coal products. We wonder where the government will go from there. Does the government want to control uranium and geothermal energy? Where will it stop? The idea in this bill- and the government has now made it known-is that it is not just a temporary thing to deal with petroleum but a statute with which the federal government will control all aspects of energy in Canada for ever and ever. We will never get rid of this thing.
Let me deal with the oil export charge. Many of the observations we could make about this particular aspect could equally be made about the other provisions in the bill. The oil export charge was originally $8 a barrel. Under this legislation it will be raised or authority is given to the minister through order in council to raise the export charge to some $350 per cubic metre. According to my figuring, that comes out to a little over $50 per barrel. We are authorizing a manyfold increase, from $8 to $50 all in one fell swoop. What we are doing is giving authority to the minister and his colleagues in cabinet to increase taxes up to that maximum at any time they want.
Surely Parliament should jealously guard its privilege to set rates of taxation. We should not give blanket permission to the government to increase taxes whenever it wishes. We should make it mandatory that whenever the government wishes to impose additional taxes on the Canadian public it come back and get authority from the representatives of the people of Canada in this House.


Donald W. Munro: We know what happened to Charles I.


Dave Nickerson: 1 would like the same kinds of things to happen to some other people in this House with whom we are familiar.
With respect to the way this measure is to be administered, originally there was a board. I think it was called the petroleum administration board and it was charged with the administration of policy. That was something of a safeguard. I am afraid that boards and committees appointed by the Liberal government very often are composed of people who are appointed because of their party affiliations. We all know that, but at least they are outside government. They are people to whom complaints can be made. Presumably they have the time and the competence to look into the administration of affairs and come to judicious decisions not based on the political expediencies of the day. They have not always worked out in the way we would have liked, and I am sure occasionally they have done things at the persuasion of the government-things which people on their own might not have done-but these boards have served a purpose. However, under this bill the various boards which did exist in a safeguard capacity are now to be dispensed with, and it will be the minister, and the minister alone, who will decide how much tax we will have to pay, how much rebate we will get and how all the complex technical details contained in this legislation will be dealt with. There is no safeguard any longer. Previous safeguards were not
Energy Administration Act
as good as we might have wished, but now there are no safeguards whatsoever. The minister and his senior departmental officials will administer every last little item in this legislation, which undoubtedly will be passed into law.
If we look at Clause 10 of Bill C-103, we will see how the power and authority of the minister are being increased. The Minister of Energy, Mines and Resources will end up as a super minister. He will be the reincarnation of C. D. Howe. In fact, C. D. Howe will look like a piker, in view of the power and authority to be granted to one individual super minister. With the powers Parliament has already been forced to grant the minister under Bill C-48, for instance, and other energy bills Parliament has dealt with in the last few weeks, this man and his colleagues will virtually control the whole Canadian energy industry. Nobody else will have a say at all.
The minister will be sloshing around in millions or billions of dollars of taxpayers' money. He will be giving it out here and taking it in there and exercising all kinds of powers and authorities which normally should go through the parliamentary system. However, because these provisions are outside the normal budgetary provisions and the normal way by which we deal with tax matters, and because these funds are isolated from the Blue Book, taken out of the budget and put into special funds about which nobody really will know what is going on, the minister will be in his glory. He will be wallowing around in billions of dollars of taxpayers' money and directing the energy industry from a central location here in Ottawa.
That is the type of situation in which we will find ourselves if this type of legislation is consistently passed by the House of Commons. Time and time again we on this side of the House have pointed out these dangers and, because of the overriding majority of hon. members opposite and the way they stand up and vote whichever way they are told, we are getting ourselves into a sad situation.
Let us look now at the second provision of the bill, the one dealing with transportation fuel and the compensation recovery charge. The effects this tax-for that is what it is-will have on the Canadian shipping industry-for example, the shipping industry on the Great Lakes-have been well described to this House by my colleague, the hon. member for St. Catharines (Mr. Reid). All we have to do is read the editorial pages in technical journals dealing with shipping and the management of seaports to find out what the effect on the Canadian transportation industry will be. Here again we are giving the government blanket authority to raise taxes up to a maximum of $350 per cubic meter. According to my reckoning, that is about $1.60 per gallon. Again we are giving this authority retroactively, in this case back to May 1, 1981.
Another clause of the bill with which I have some difficulty-I just want to mention this in passing because it is a major item, and it has been discussed many times-is Clause 13, which claims Sable Island for Her Majesty in right of Canada. We are all well aware of the dispute between Nova Scotia and the federal government over the ownership of Sable Island. In this bill we do not keep to the good faith presumably shown in

April 23, 1982
Energy Administration Act
the recent agreement between those two governments; the federal government claims that ownership for itself alone.
Clause 15 of Bill C-103 grants to the governor in council the authority to establish maximum prices for crude oil produced in the Yukon and Northwest Territories, where this government claims sole jurisdiction despite the wishes of the people who live there. This is a battle we fought when Bill C-48 was debated and I do not want to repeat the arguments I made then. However, I would point out that this clause will create a great deal of difficulty in the north. People do not like being governed by regulation out of Ottawa; they would like some form of consultation. They feel they have the same ownership rights as any other part of Canada. They do not feel those resources are exclusively for the benefit of Canada, although they are quite willing to share them.
The government of Ontario retains the right to say what the maximum price should be for oil produced there. I think it should be set by market conditions, but the jurisdictional authority lies with the government of Ontario, the same as in Saskatchewan or Alberta.
However, this bill indicates that the federal government is going to grab for itself alone the authority to make those decisions in the two territories. The people who live there pose the very sensible question: Why should we pay the highest price in Canada for oil and gas when the federal government sets our wellhead price and does not attempt to equalize the price between the southern areas and the northern territories where much of Canada's oil and gas will be produced in the future? This bill would be another opportunity to legislate some form of energy revenue-sharing agreement between the territories and the federal government, as has recently been done with Nova Scotia and Newfoundland. But it is another opportunity lost.
The Government of Canada is selling out the interests of northerners in order to be able to supply southerners with a slightly reduced cost of energy for a short period, thereby keeping themselves in office. I suspect that is the real reason. It seems to me grossly unfair that oil and gas produced in the north is to be sold in the south for less than the people in the northern producing areas have to pay.
Another objectionable part of the bill is Clause 18, which deals with penalties for non-payment of these taxes. Under the old legislation, for a summary conviction the penalty was $20,000 or six months in jail. Under this legislation the fine can be $100,000 and one year in jail, or five times the fine and twice the jail sentence. Under the old legislation, for a conviction by way of indictment the maximum penalty was two years in jail. Under this legislation you will be liable to a fine of $1 million and/or five years in jail. I think these penalties are vicious, cruel and unusual punishment. It seems that in this country people get off kind of lightly for many Criminal Code offences, but if you forget to pay your taxes then the government comes down hard on you with these penalties.
The same argument I used in the case of oil in the Northwest Territories applies equally to this bill's provisions concerning the pricing of domestic gas. The federal government will have the authority unilaterally to set gas prices in the Yukon and Northwest Territories. However, the provinces will come in for some of the same treatment here. They are going to find out what it is like to be ruled by Ottawa. There is a provision in there which provides that if, in the opinion of the governor in council-which really means the Minister of Energy, Mines and Resources in this case-the federal and provincial gas pricing agreement is deemed to be ineffective, then the federal government by order in council has the authority to regulate those prices.
That is a terrible thing in a country where we would like to see agreement between the federal and provincial authority. Surely it would be to everyone's advantage to have some measure of co-operation between the two levels of government. But here the Liberal government says "No, if we do not like your suggestions on gas pricing then we will do it ourselves; we are not going to take any notice of the provinces. If we do not like what you have to say, we have the authority to do exactly what we want." That, Mr. Speaker, is what the government gives to itself in this bill.
In the former legislation the section dealing with domestic gas prices had a built-in safeguard. If the federal government set gas prices in a province it had to file that information before Parliament within a certain time, and there had to be the opportunity for debate because this is a very unusual use of the federal government's powers. Parliament would then have the opportunity to rescind it by way of a vote, which is unlikely to happen with a majority government but at least it made Parliament cognizant of the fact that this was a major and unusual use of federal powers. In Bill C-103 that safeguard has been taken away. The government can set gas prices and they do not have to tell Parliament about it. The safe containers legislation is an example of how the government misused its authority in that it failed to bring before Parliament certain statutory instruments issued under that legislation.
Let us go now to the petroleum compensation charge. Originally in Bill C-94, the omnibus bill, that dog's breakfast we eventually got rid of by ringing the bells for two weeks, the charge was to be a maximum of $20 a barrel. I guess we can claim a victory for Parliament because under the new legislation the maximum allowed by way of governor in council authority, the way government can raise taxes, has been reduced from $20 a barrel to $12 a barrel. This is something of an accomplishment for Parliament, in my opinion. But we must remember that under this one charge authority is to be granted for an increase in taxes in the amount of 35 cents a gallon, which is still a significant increase.
Again, under Section 30, the board which administered the petroleum compensation charge in the disposition of funds raised by way of that authority has now been eliminated. Once more, the authority lies solely at the discretion of the minister.
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The minister enjoys the prerogative of levying this charge and determining its amount, saying where that money will be spent and who will be granted the proceeds.
One of the worst things that has happened as a result of the petroleum compensation charge is that now refiners have found it cheaper to use imported oil than to use oil produced in Canada itself. This is an anomaly. I suppose no one could foresee this when this complex legislation was brought into effect in the first place. But so much for the designs of the national energy policy where encouragement is given to refiners by virtue of tax relief to bring in oil from Mexico, Saudi Arabia and other countries and not to use oil produced in Canada but to leave it shut in. This does nothing for Canada's balance of payments. It is an anomaly and I hope it can be rectified in the near future.
I notice that the provisions of the petroleum compensation charge which originally dealt only with petroleum, as in the title, is now being extended to coal products. If someone finds a good way to produce synthetic crude from coal, they will not be able to enjoy the benefits of that discovery because all the benefits will be taxed away. All the benefits will be taxed away the minute anyone uses initiative and expertise to come up with a better process advantageous to Canadians to reduce our dependence on foreign oil and to reduce our balance of payments. People will not be able to enjoy the benefits because the Minister of Energy, Mines and Resources will come along and take any profit which might be made from the discovery by way of taxes.
Next I want to deal with the Canadian ownership charge. Under Bill C-94 the amount would be a maximum of $4 a barrel. Again, Parliament can claim a victory by having reduced that amount to a maximum of $1.15 a barrel, or thereabouts if you work out the numbers of dollars per cubic metre. It is still under 3.5 cents a gallon. Another little charge is tacked on there somewhere else. The Canadian ownership charge is a misnomer for the Petro-Canada tax. It is a tax levied at every gas pump in the country to help pay for the government's acquisition of Petrofina. It amounts to something well over $1 billion Canadian. This amount is proving very useful for alleviating unemployment in Belgium, but it is not doing very much at all for Canada.
That matter has been debated many times in this House, and I do not wish to be repetitive and go over the whole Petro-Canada issue again. However, I do like people to be aware that every time they go to a gas pump they are paying a few cents a gallon toward the acquisition of Petrofina. This money would have been better used in looking for new gas and oil and energy resources within Canada.
The special compensation charge in the bill could amount to 5 cents a gallon if the government uses all the taxing authority which is to be made available to it under this bill. What we can say about the special compensation charge is that it was absolutely unnecessary in the first place. It was arrived at because of the inability of the federal government to agree with the government of Alberta over oil pricing. The deal that was worked out by December, 1979, was set aside and it took
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two years of fighting and bickering before an agreement was reached. The Canadian people, those who buy gasoline at the pumps and who use oil and gas to heat their homes, have paid for this failure on the part of the government. Canadians have paid for the antagonistic attitude the federal government maintained during those years.
Once more, the authorities previously invested in the petroleum compensation board have been transferred to the minister and his departmental officials. Again protection has gone.
One of these days I would like to make a list of all charges- the compensation charge, the special compensation charge, the ownership charge etc. There are so many of them floating around that never show up in the blue books. People do not know the extent of the taxes they are paying. The only thing they know is that a considerable amount of tax is paid when ever they buy gasoline at the pump.
Of all the energy bills originally comprised in Bill C-94, Bill C-103 is probably the worst and the most insidious. It certainly has the greatest impact on Canadians through their pocket-books. It will take money from every Canadian in this country. If we are at all concerned with the onerous levels of taxation in Canada, especially on energy, and if we are at all concerned with the methods of taxation and the way in which taxes should be imposed and seemed to be imposed by the people's representatives, then, Mr. Speaker, I submit that we must vote against Bill C-103.


Maurice Brydon Foster: Mr. Speaker, I am pleased to be able to address a few words to Bill C-103, which will amend the Petroleum Administration Act and set up the energy administration act. This is a very important aspect of the National Energy Program. It has a number of elements to it. They relate to the oil export charge provisions; the establishment of the transportation fuel compensation recovery charge; amendments to the domestic oil and gas provisions; amendments to the petroleum compensation charge and petroleum compensation provisions; the establishment of the Canadian ownership special charge and it gives authority for the Canadian ownership account; finally, there are provisions relating to the special compensation charge.
Today I would like to talk about the Canadian oil industry as it was before the introduction of the National Energy Program in the fall of 1980. I want to talk especially about the dominance by foreign-owned oil companies and how the Canadianization program under the NEP is being implemented under this particular program.
Toward the end of 1980 we, as Canadians, were faced with an oil and gas industry that was very heavily foreign owned and controlled. A full 72 per cent of oil and gas revenues ultimately accrued to foreigners. Furthermore, some 78 per cent of these revenues were accounted for by foreign-controlled companies in Canada. This compares with levels of foreign ownership and control in the United Kingdom of some 52 per cent, and some 10 per cent to 15 per cent in the United States.

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I think we must put the matter in perspective. We hear Americans complaining about the move by the government to Canadianize the oil and gas industry. We must ask ourselves, if their oil and gas industry was 72 per cent controlled by foreigners, rather than 10 per cent or 15 per cent, what would be their attitude, response or concerns, especially with the prospects over the long haul of oil and gas reserves increasing dramatically in value as they have done in the last seven or eight years? Over this period of time there has been an increase from $2 or $3 per barrel to some $40 per barrel. The long-term forecast suggests that this will probably continue. We must think about the additional revenues which will flow out of the country in terms of interest and dividends.
Not only was the level of foreign ownership and control very high, but a glance at major industry competitors clearly shows the dominance of foreign companies in the Canadian oil industry. Eleven of the 15 oil and gas producers were foreign owned and controlled, with the top eight positions being held by foreign companies. Not only was the domination by foreign companies pervasive, but it seems likely that the situation will become even worse. Future major oil supplies in Canada will not be from traditional sources in the western basin. Rather, oil and gas supplies will be increasingly derived from massive oil sands plants on exploration sites in the Arctic Islands and on the east coast offshore. These future sources of supply require vast sums of money and a great deal of technology, technology which is often beyond the financial resources of small Canadian-owned independent companies. Foreign-owned companies were and in many cases still are in the best position to take advantage of the future opportunities of oil and gas reserves.
Given this situation, the following questions must be asked. What government in the developed world would tolerate this degree of foreign participation in an industry as significant as oil and gas? What government would allow such dominance in a strategic industry which in Canada's case is responsible for 10 per cent of our gross national product? These were the types of questions which the Canadian government faced in relation to its own economy in the autumn of 1980. Its response was the Canadianization objective and the policies embodied in the National Energy Program of October 28, 1980. In the NEP we sought to establish greater Canadian control of the oil and gas industry by the establishment of, and the increase in control by, Petro-Canada, as well as by the establishment of the Canadian ownership account which is embodied in this bill.
In the year since the announcement of the National Energy Program, some strides have been made toward Canadianization. The eighth, Hudson's Bay Oil and Gas, the fourteenth, Aquitaine, and the eighteenth, Petrofina, largest oil and gas companies have switched from foreign ownership to Canadian ownership and control. The level of Canadian ownership measured by upstream production reserve revenues have increased by over 6 per cent as a result of some $7.5 billion in
mostly private sector acquisitions. Petro-Canada, the nationally-owned oil company, now has refining and marketing facilities across Canada, after its recent acquisition of Petrofina.
Although the government is generally pleased with its progress, it realizes that there is much to be done. Before the Standing Committee on Energy Legislation this week it was rather impressive when the representatives of Petro-Canada indicated that for the $2.9 billion of investment made by the Government of Canada in Petro-Canada, the market value of the company is now estimated at $8 billion to $9 billion.
Of course, this is a nice increase in the value of that asset and an impressive capital gain. It is important for taxpayers to see a capital gain of that magnitude. If we look at the entire oil and gas industry and at the amount of capital gain we will see during the course of this decade, there is no question that we will see even greater gains than this one, which represents almost a 300 per cent increase. If we calculate the dividends and interest payments which will be made to foreign countries, principally to the United States, we see the urgency of getting on with the Canadianization program. It is for this reason that we are proposing the establishment of the Canadian ownership charge and the Canadian ownership account.
The Canadian ownership special charges, used initially to help Petro-Canada's acquisition of Petrofina Canada Incorporated, will consist of the following: a special charge on domestic petroleum received for processing or consumption in Canada and foreign petroleum amd petroleum products imported into Canada. Currently the charge is $7.25 per cubic metre, which is the ceiling set by this bill for the charge. No further increases are authorized by this legislation. Second, there will be special taxes increasing the natural gas and gas liquids tax, which is a tax on marketable natural gas, propane, ethane and butane. Increases in the natural gas tax are now 14 cents per gigajoule. The increases in the taxes on propane, ethane and butane are $3.55, $2.60 and $3.95 per cubic metre respectively. These amounts are the ceilings set in the bill for the increases. They would not be applied to exports of natural gas and gas liquids. No further increases are authorized by Bill C-103.
Revenue from these charges will be placed in the Canadian ownership account. Initially the revenues will be used to help defray the cost of the Petro-Canada acquisition. In future, the use of any funds from the Canadian ownership account for other acquisitions would have to be authorized by the governor in council, acting on the recommendation of the Minister of Energy, Mines and Resources (Mr. Lalonde) and the Minister of Finance (Mr. MacEachen). Such uses would be subject to a negative resolution in Parliament, in the Senate and the House of Commons.
It should be made clear that the direction of the Canadianization thrust has also been toward the mobilization of predominantly private Canadian investment-from existing companies, pension plans, insurance funds and individuals. To a great extent this policy has succeeded, since all but one of a dozen acquisitions to date have been by private companies. Furthermore, the government is acting as a catalyst for the
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establishment of a co-operative energy corporation which will bring into the oil and gas sector the savings of millions of Canadian co-operative members. Senator Argue played an important part in negotiating that arrangement with the Canadian co-operative movement.
A misconception which we have heard, particularly from abroad, is that the government is creating an unattractive environment for foreign firms which will reduce the value of these firms, thus allowing them to be purchased at fire sale prices. This is simply not true. The facts are that Canadian companies have paid prices which are above market value for foreign-owned assets. Furthermore, foreign-owned oil and gas subsidiaries trading in Canadian exchanges have done no worse than their Canadian-owned counterparts.
Another misconception involves the belief that the Canadi-anization policies for the energy sector will be applied in all energy sectors of the economy, specifically the minerals sector. The government has already stated that this is not the case and the evidence on the difference in the foreign ownership and control situation in the two industries is a major reason for the difference in the policies.
Finally, the objective of Canadianization does not mean that foreign investment and ownership in the oil and gas business is no longer wanted in Canada. Canada is well known for its exciting geological potential. The combined financial and fiscal incentive package offered by the government makes Canada one of the most attractive countries for investment. For example, a foreign investor operating in the north will, after tax deductions and incentive payments, be spending only 53 cents of every exploration dollar. In fact, a recent comparison made by Petro-Canada of rates of return expected by a foreign investor from a representative pool of new oil shows the following: Canada lands, 27.7 per cent; 24.4 per cent in the United Kingdom; in the United States, 21.6 per cent; and in Norway it is 18.3 per cent. I repeat that these calculations are for foreign investors.
The figures reveal that we have created an environment which will be attractive to foreign investors when compared to other locations. The government welcomes their participation and asks only that they take into account the legitimate aspirations of Canadians to own a share of this vital sector of our economy and exercise some control over decision-making in the petroleum industry.
This view is widely supported by the vast majority of Canadians. Indeed, it is one of the most popular programs established by the government in the National Energy Program. The results of a poll conducted by the Canadian Petroleum Association last year show that 84 per cent of Canadians favour the government's move to make the oil and gas industry at least 50 per cent Canadian-owned by 1990. This is a very important statistic because it is taken from a poll which was carried out by the Canadian Petroleum Association. Many of its senior members are not Canadian-owned petroleum corporations.
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With respect to the Canadian ownership special charge, I would like to mention the signficant change that was made to these provisions as they appeared in Bill C-94. The legislative authority that appeared in Bill C-94 to raise the Canadian ownership special charge above the present level has been removed. Under the new amendments, the existing Canadianization charge can be decreased, but not increased beyond that level by order in council. The change is as follows: the ceiling on the Canadian ownership special charge on petroleum has been lowered from $25 to $7.25 per cubic metre. The ceiling on increases to the excise tax on natural gas has been lowered from 60 cents to 14 cents per gigajoule and the ceiling on increases to the excise tax on natural gas and gas liquids has been lowered from $17 per cubic metre to $2.60, $3.55 and $3.95 on ethane, propane and butane respectively.
Therefore, this bill which is before us today comprises an important part of the National Energy Program. It puts in place the amended price which was foreseen when the policy was adopted; that is, that we would have one price for the oil in the existing western basin which was produced at relatively lower cost and that we have a higher price for the much more expensively produced oils discovered in the high Arctic or on the offshores of the east coast or the Beaufort Sea. We would have a new oil price for the tar sands, for tertiary recovery, as well as for the discovery of new oil in the western basin.
It also provides for the compensation on imported oil which has allowed Canadian oil prices to be well below world prices wherein we have had a gradual build-up in prices during the last several years. Consequently, we have had a greater growth than many western industrialized nations.
Therefore, I would contribute my support for this Energy Administration Act which is before the House. I hope that it will receive the full consultation, discussion and detailed consideration which has already been given to the Petro-Canada bill in the standing committee. At this point, I must compliment the members of that committee who have been meeting from nine o'clock in the morning until ten o'clock at night with only a break at lunch and dinner. I can attest to the fact that the committee is working very hard. It will have a great deal more work to do in the next few weeks in considering the bills which are before us. However, I am sure we will carry it through and conduct a thorough study at the committee stage on all bills, but particularly on Bill C-103 which is one of the most important aspects of the entire National Energy Program.


A. Daniel McKenzie: Mr. Speaker, I wish to contribute to the debate on Bill C-103. This bill is an act to amend the Petroleum Administration Act and a measure to impose many new taxes on Canadians. This bill authorizes two taxes which are already imposed upon energy consumers. Certainly, it bears almost no resemblance to the promises which were made by the Liberal Party during the last election when they promised Canadians cheap gas.
The petroleum compensation charge is currently levied at $6.30 per barrel. This results in price increases at the pump of 24 cents per gallon. The Liberal candidate who ran against me

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in the last federal election stated that gas would not go up any more than 8 cents to 10 cents per gallon under a Liberal government. Obviously, he was being provided with false information by the Liberal Party with regard to cheap gas. But what is new about that? In addition, the PCC provides that the maximum would be about $12 a barrel and could thus raise prices by about 24 cents.
The Canadian ownership charge which was used to pay for Petro-Canada's purchase of Petrofina is levied at $1.15 a barrel and results in gasoline prices being 4 cents per gallon more expensive. As was pointed out by my colleague, the hon. member for Western Arctic (Mr. Nickerson), all that money-approximately $1 billion-went to Belgium in order to buy this company and provided absolutely nothing for the Canadian economy or any Canadian.
The government earns a total of approximately 60 cents per gallon of gasoline. A sampling of some major United States and Canadian cities has shown that the price of gasoline in some U.S. cities is less expensive. For example, the price of gasoline in Seattle is almost 3 cents per litre, or 13 cents per gallon, less than that sold in Vancouver. The price of gasoline in Detroit and Windsor is virtually the same. Other regions in the United States sell gasoline at 99 cents a gallon. Of course, this has been brought about by government regulations being removed. However, in Canada we see more government regulations and interference which drives the price of energy higher.
The government has given various assurances that the price of Canadian oil will remain below prevailing world prices. The price of old oil will not exceed 75 per cent of average world oil, and the price of new oil will not exceed 100 per cent on a floating year average. However, this does not protect consumers as the bulk of the federal taxes are added after the comparison is made. Thus, while crude oil may be cheaper at the wellhead, consumers may actually be paying more than the world price at the pump. This policy of the Liberal Party to pay world price for oil has had disastrous consequences on the price of gas and heating oil and what have you. This actually goes back to about 1960 when the Diefenbaker government introduced the road to resources program to open up the north. But unfortunately, in 1963, the Liberals dumped the road to resources program and did absolutely nothing about developing our resources in the north. If they had continued with Mr. Diefenbaker's road to resources program we would be selfsufficient today and we would not be paying world price for oil.
Also, imports are much higher than needed to complement Canadian supply. Canadian crude is being shut in. The result is that the PCC is being used to pay for imported oil that we do not even need.
The Conservative Party has long maintained that the introduction of these two taxes by notice of Ways and Means was improper. Now the multiple injuries arising from the budget of the Minister of Finance (Mr. MacEachen) are still being assessed. This budget is a far cry from the sensible
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budget brought in under the Progressive Conservatives, as theirs was not a budget which was trying to look for every conceivable, possible way to tax Canadians more and more. There is certainly a sharp contrast between the two.
Now, along comes the Liberal energy minister's National Energy Program, riddled with bullet holes which he tries to plug with all the dexterity of a one-armed paper hanger. The actions he announced last Thursday, designed to adjust his programs to the new reality of world oil glut and the shutdown of production in western Canada, managed to offend both producers and consumers in equal measure. Will these patch-up measures introduced by the Minister of Energy, Mines and Resources (Mr. Lalonde) result in resumed production in Canada's oil fields and the accelerated programs of exploration which the minister foresees? I ask, will they do that? The answer, almost certainly, is no. The minister himself indicated he knows it when he said that if the people who buy and sell oil do not act as he urges them, he will implement further measures if warranted. They will be warranted, all right, especially if the world glut continues and world prices keep coming down, as the minister hopes and prays they will not.
I would like to speak for a few moments about the bell ringing and about our reference for having the bill split up. We now find that the 98 cents a gallon taxing authority sought by the minister has been reduced to 52 cents a gallon. The bell ringing has saved Canadians 46 cents a gallon in possible taxes under Bill C-103. On April 4, the Conservatives voted against the 53 cents a gallon tax. The Liberals voted for the 52 cents a gallon tax. One should compare that to 18 cents a gallon tax.
Because the bill was split, this tax will be voted on three more times in the House of Commons between now and June 30. It can be stopped or reduced if the Liberal MPs can be convinced to vote against it. Concerned Canadians should write or phone their Liberal MPs and ask them to vote against the 52 cents a gallon taxing authority, as they promised in the last election that gas would not be increased over 18 cents a gallon. Public support for our bell ringing has already saved 46 cents a gallon. So let us see the Liberal hon. members getting down to business here and stopping this other huge increase.
Bill C-102, which is tied in with Bill C-103, would allow cabinet, not the elected members, to set up unlimited numbers of Crown corporations. There are 438 Crown corporations now. We do not need any more Crown corporations. Taxpayers will pay but the people they elect will not be able to vote on whether or not the taxpayer wants cabinet to run around spending money on new businesses. There will be a tax of four cents a gallon forever, to allow cabinet members to buy whatever they choose.
Bill C-101, which is also connected with Bill C-103, would allow the Liberal cabinet to give $4.9 billion of taxpayers' money to the board of directors of Petro-Canada to spend as it sees fit. The Liberals voted to decrease money for health care and post-secondary education by over $500 million. Instead, they want that money to go to the board of directors of Petro-Canada. So much for their priorities.
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We all remember Bill C-94, an earlier energy bill, and Bill C-103 is a devilish offspring of Bill C-94. The Liberal government has conceded that the energy bill will be split into eight separate bills in ways suggested by the Progressive Conservative Party. In addition, the Conservatives forced the government to concede to a timetable which guarantees over three months of debate and guarantees Canadian citizens the right to come before committees. It also guarantees members of Parliament the right to vote a minimum of 24 times on the separate parts of this package. It guarantees MPs the right to move amendments and have them voted on.
It is the Canadian people who achieved a victory which will now allow taxi drivers, homeowners, farmers and small businessmen the right to come before a Parliamentary committee to explain to Members of Parliament how a 98 cents a gallon tax increase will affect the cost of food, clothing and shelter. Then Canadians will have an opportunity to judge their Members of Parliament on how they will vote on that massive tax increase.
A few things to remember about Bill C-103 and the other energy bills are that they amend 15 current pieces of legislation, they create four new taxes, they allow the government to form new energy companies at will, they include 28 cents of taxes on each gallon of gasoline, and they provide for increases of another possible 70 cents. I will certainly be using these figures in the next federal election on the campaign trail to indicate clearly to the electorate that they will not be able to believe anything they hear from any Liberal after what the Liberals said in the 1980 election. At that time, they said they would lower interest rates and would give Canadians cheap gas. They will not get away with their packaged lies in the next federal election.
The bill incorporates many parts of the National Energy Program, which has been opposed by the Conservative Party from the outset. The Conservatives were voted out of power because of an increase of 18 cents a gallon for gasoline. The Liberals have already raised gasoline prices by about 65 to 75 cents a gallon, and now they plan this further increase of 75 cents a gallon in this series of energy bills. The Trudeau government's concessions to split the omnibus energy security measure into eight separate bills to be examined by a special standing committee able to call witnesses and to assign ample time for meaningful debate in the House of Commons and at committee is exactly what the Conservative opposition requested, beginning last December. So we finally won out in that battle. The concession that a special standing committee will deal with all aspects of the energy legislation over a six week period is something we requested more than a year ago. The assigned time will effectively mean that the House of Commons will spend most of April debating second reading of various bills, that there will be six weeks of special standing committee examination with witnesses, and that most of June will be devoted to report and third reading debates in the House of Commons. The Conservative Party has brought that about.
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Let me just comment on gasoline and heating oil prices. There have been 15 increases in the price of petroleum since the Liberals came into power on a promise of keeping prices down. The 1980 summary showed the last increase in 1980 brought total increases for that year to $4.70 west of the Ottawa Valley and $4.88 a barrel for eastern Canada. The Liberals promised that increases would not exceed $4 for the year. They also promised that gasoline prices would rise by no more than 14 cents a gallon. My opponents said eight cents to ten cents. Others across the country were saying 14 cents. They could not get their act together on what they were not going to give the Canadian people. In fact, increases in many centres across Canada approach twice this amount.
The 1981 summary shows that prices of gasoline rose by about 12.5 cents per litre or 56 cents a gallon, and heating oil by 7.9 cents per litre or 36 cents per gallon during the year. The Conservative Party stated we would not raise the price of heating oil. The last thing that should be increased in this country is the price of heating oil. However, that does not bother the Liberals.
In all, crude oil rose in price by $8.40 a barrel, not including special levies of $1.86 imposed and subsequently removed during the year. Federal taxes accounted for 75 per cent of this increase. In comparison, the Conservative budget would have raised crude oil prices by $4.50 a barrel. You can see the difference.
I now want to deal with oil sands. The blame for the delays with the oil sands projects, both Cold Lake and Alsands, rests squarely on the federal government. If the government had been reasonable with Alberta two years ago, both projects would have long been underway. The immediate problem with Alsands is beyond the government's control. World prices are falling. That is not the time to negotiate a rate of return.
The government's Canadianization policy is a distraction from the real task of finding oil. Since the mid-1970s, Canadianization of the oil and gas industry had been proceeding at a measured but accelerating pace. The Canadianization policy, a bastardization of the policy that we introduced while in power in order to differentiate ours from the Liberal's nationalization policy, has completely destablized the industry.
The government has completely twisted the rationale behind high energy costs. Whereas our government was prepared to accelerate the rise in the price of energy in order to encourage new supplies and only secondarily to encourage conservation and raise government revenues, the present government has raised prices, first, as a means of increasing government taxes, second to conserve oil and only third to encourage production.
While consumer prices for gasoline are only slightly more than they would have been under the Crosbie budget, heating oil is much more costly. There is no equivalent to our energy tax credit which Canadians would have been enjoying these past two years. They have lost that. The consumer is worse off under the disastrous budget of this Minister of Finance.

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The larger Canadian companies have used the Canadianiza-tion incentives as a means of growing to a point where their debt load threatens their existence. They have not found any more oil as a result of their increased size, but now they can at least compete with the multinationals.
Small Canadian-owned companies have experienced the brunt of the National Energy Program's contradictory policies. The pricing and exploration policy has more than removed any benefits from Canadianization. Some of the multinational oil companies have chosen to sell out, but most have had no choice but to stay with a decreased exploration budget. They are laying off large numbers of employees at the present time.
In conclusion I will say that two years of this Liberal government has produced an increased burden on consumers and a certainty that Canada's chance at obtaining oil self-sufficency by the early 1990s has been lost forever.
The way to measure whether you have a good government, good policies or good legislation is by the investment you attract. Not one aspect of the National Energy Program or of Bill C-103 has attracted one dime of investment. The NEP was responsible for driving over $18 billion of investment money out of this country. That was the last nail in the coffin. The NEP has just about destroyed the free enterprise system in Canada. This country cannot survive economically with that amount of money leaving the country.
The New Democratic Party has spent considerable time goading the Liberal government into these nationalization policies. They will have to accept a large part of the responsibility for the implementation of the National Energy Program, Bill C-103 and all the other bills with regard to their disastrous effect on the Canadian economy. It is certainly helping economic policies in the United States. They would be a lot worse off there if it were not for our $ 18 billion.
Now that the NEP has got the Liberals into this disastrous nationalization policy, their leader and the premier of the province of Manitoba have called for exchange controls. Their answer to the disastrous NEP is to bring in exchange controls. When you ask for such controls to be brought in to stop the outflow of capital from Canada to the United States and other countries, you do not have an answer to anything.
If you have good government and good policies, you attract money rather than drive it out. I hope the Liberal Party will wake up and realize that it is doing absolutely nothing to attract investment and to assist the Canadian economy. If they had any sense, they would withdraw this whole energy package and start again from scratch. I advise them to get free enterprisers to assist them, those with a knowledge of the industry, rather than socialist academics who write reams of theory on these different policies. We on this side can certainly lend them some people to draft sensible policies with regard to energy. I suggest they take another look at the Crosbie budget. It would be a step in the right direction.


Mr. Jack Masters (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, today we are dealing with an extremely complex piece of legislation. When
it is sorted out and implemented, we will have gone a long way toward helping this country progress and participate in the great future that will be ours. It should be in place before long. Like many Canadians, I abhor the fact that every time action legislation is planned, there is a long time lag before it is implemented, due to tactics that serve no purpose other than to obstruct.
Before talking about the petroleum compensation charge and a few other items, I should refer to the interesting outlook of members opposite about the energy program in Canada. On the one hand they want the private sector to look after it all. They make interesting observations about our energy program, but they do not get their act together. A predecessor of mine, who has been mentioned in the House in two different ways by members opposite, the Hon. C. D. Howe, was responsible for helping Canada, particularly in the west, to get their product to market by pipeline. That helped to raise Canada to a new plateau and helped with our GNP. It provided revenue from outside sources through the marketing process and by bringing the opportunity to the manufacturing centre to obtain energy from an exciting new source in quantity large enough to be significant.
What we are about to do now through the National Energy Program, I believe, is another of the very important items in the building blocks of Canada. We must recognize that the country and the world is changing profoundly and changing quickly in recent years. We have had the opportunity to be flexible and do better than most countries partly because of our natural resources but more because the will of the people is to make this country work and to take advantage of our resources, share them with one another and take a responsible position in the world in which we live.
At present there is a lack of activity in the oil industry, which is having a profound economic effect, for many reasons. It seems to be a temporary situation. I honestly believe that when this bill has been passed, when a total national energy program is in place, we will have opportunities for Canadians to control their own resources, and that is of fundamental importance to the good of Canada. We will see Canadians participating in the development of the oil and gas industry as never before and reaping the profits from it. The people of Canada will more properly have their say on how the resource-which by everyone's admission is a non-renewable resource and is not infinite-will be husbanded for the future use of the country. We can make immense use of this prime energy resource at this time in history and at the same time reduce our dependence on other parts of the world. That is a key element of the National Energy Program and the legislation before us. It will put us in a position where we will not have to rely on decisons made outside our country. We can make those independent Canadian decisions that are not hidebound to what happens in the area south of us or in Europe or in the Arab states.
April 23, 1982

We want to maintain control over our destiny, we want to be able to plan our future in our own Canadian way. In order to do that, some things are absolutely essential. One of the essential elements is the opportunity to control that nonrenewable resource, oil and gas and subsidiary products.
It is not only for its fuel and heating capabilities but for all of the other chemical elements that we count on oil to produce, to drive the economy and to give us a chance to trade in the world on a truly competitive basis. We will be able to make many of the rules ourselves here and will not have to depend on other people and on their resources. No other country would allow a great percentage of its prime resources to be controlled by others. The National Energy Program gives us an opportunity to regain control of our resources and put them to good use.
The process has been an interesting one. It is not admitted that there has been as much consultation as really has taken place in this area. The opposition is trying to create the impression that no one on this side of the House ever listens, that we on this side never sit down with those involved in the industry and learn from them.
At another point in my life, Mr. Speaker, I was involved very much in a body interested in the business community, namely, the chamber of commerce. I still have some private enterprise thoughts and feelings and the desire to ensure that the government listens to all segments of Canada, including the business community, particularly in things of this nature. A great deal of consultation has gone on and continues to go on.
What the hon. members opposite fail to say is that one of the big opportunities of the National Energy Program is that Canadians will be encouraged to invest in Canada and that by doing so we will gain from our investment in our own resources.


Some hon. Members:: Hear, hear!


John Gerald (Jack) Masters: We must recognize that we really need to have Canadians with a very strong sense of being Canadians, in position in large enterprises such as the oil and gas industry. We must have such Canadians in place so that they view things from a "Canada first" point of view. If members opposite find that a disagreeable or socialistic attitude, I am sorry. I am a proud Canadian. I feel we have the right to expect that we as Canadians will benefit most from our resources. As a trading nation we must have the investment dollars coming from other parts of the world. We must keep our doors open wide to that. The National Energy Program does not destroy that idea. It simply means that Canadians will be encouraged and will be given greater incentives to take a larger share of their future and be in a better position to direct their future.
I heard some interesting comments during this debate. Some hon. members spoke as if the National Energy Program were the cause of all our economic woes. There has to be some recognition that the current glut of oil was not anticipated.
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That may be the prime reason for the lack of activity in such projects as the Alsands project.
We all know we must keep searching for new oil. The petrochemical industry will be a large part of our present and future energy for the next 30 or 40 years. All of a sudden we have a downturn in our economy and in the world economy. There are other parts of the National Energy Program which have already begun to work. Conservation is beginning to have its effect. We find that we now have a glut of the product. We find we do not have the same sense of immediate urgency to look for those petroleum resources that we know are there.
We should look into this aspect of it. We know that part of the ongoing future of Canada will be in the megaprojects. One of the most important megaprojects will centre around the tar sands of Alberta and the resources of other parts of Canada as they come onstream. We have been blessed by the fact that it appears that we have more conventional sources of petroleum available to us than we expected. Those resources still exist and we must not forget that. We should realize the potential of the Alsands and other such resources. Nevertheless, the need to do so is not as immediate as it once was.
A timing dilemma was thrust upon us by a very sudden change in the world situation but, being the eternal optimist, I do not think we should be fooled by that because I expect we will see a greater need for energy in the future as the world's economy and Canada's economy turn around. The wisdom of putting in place a National Energy Program with which we can all live will be seen.
I for one am glad we now have a limit on the time for debate of the important matters before us because we really need to put into place legislation on which people can count for a period of time, and when the National Energy Program is passed and implemented, those people who will want to invest in this field-and many of them will be Canadians-will have a feeling of certainty. They will have the necessary knowledge of how to proceed and where to proceed.
However, the bottom line is that the National Energy Program will give us energy self sufficiency on schedule. It will give us the proper amount of Canadian control, and it will give Canadians the opportunity to invest more heavily in their own country and to benefit to the maximum from their prime energy resource of the day coming from petroleum.
I am pleased to have had this chance to participate briefly in this debate today. I hope we will continue to act in the proper fashion and get this legislation through so that we can carry on.
Finally, I remind all hon. members that there has been a great deal of consultation with the producing provinces and the people in the industry. They have been listened to, and I believe we have come up with the game plan Canada needs and can live with, and I believe it will help us to enjoy the prosperity which rightfully belongs to us.

April 23, 1982
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Donald W. Munro: Mr. Speaker, before beginning my principal comments I would like to refer to some of the remarks which have been made by the two previous speakers on the other side of the House.
I find it quite distressing that there should be such a broad difference of opinion on the course this country should follow in energy matters. We seem to have a dialogue of the deaf. Perhaps it is a dialogue of the deaf, the blind and the mute. I do not know how the mute carry on a dialogue, but there seems to be no understanding whatsoever-there is a disbelief-that the National Energy Program as set down in the House in October of 1980 has so far succeeded in driving Canadian enterprise out of this country. The minister of Energy, Mines and Resources (Mr. Lalonde) just does not believe that. I do not know why he does not believe that because it has. Somehow he has managed to convince the "trained donkeys" behind him of his view of the degree to which that false budget, which was more properly called the "National Energy Program, of October of 1980" has, in effect, destroyed a great part of the industry in Canada.
I heard expressions of hope from the hon. member for Thunder Bay-Nipigon (Mr. Masters). We must exist only on hope. We cannot survive on the basis of the legislation which is being brought before us. All we have left is hope.
This legislation basically boils down to the question of Canadian ownership. I think that is the main thrust. But I wonder if it is. When the Liberal Party says "Canadian" and "Canadian ownership", it somehow feels that ownership through the government is the same thing as Canadian ownership. Perhaps that is our problem. 1 do not believe that. I believe that Canadian ownership is ownership by Canadians individually, not through their government. Hon. members opposite have talked themselves into believing that when they say "Canada" and "Canadians" they are the spokesmen for Canadians. On a majority basis they are spokesmen here, I agree, but let hon. members opposite not carry this to the point where when they say "Canadian ownership" they mean ownership by the Canadian government. That is what they intend to do through Crown corporations.
Earlier this week we dealt with one of the eight energy bills which is designed to authorize the Minister of Energy, Mines and Resources to create as many Crown corporations in the energy field as he wishes. Presumably that will Canadianize something. It will not; it will "governmentalize", it will nationalize, but it will not encourage Canadians to invest in the energy field. We are being required to invest in Canadian enterprise through the tax system.
When the hon. member for Algoma (Mr. Foster) spoke, he said Canadian ownership could be encouraged by providing an investment climate in Canada which would induce Canadians to invest in this country. I do not believe this bill will create that kind of climate. I suppose there is a basic difference in philosophy between hon. members opposite and hon. members on this side of the House-this side to a certain point only, excluding the NDP.
The example of White Farm Equipment Company comes to my mind. White Farm Equipment Company was operating in Canada, and it got into difficulties. As a result of an application by the parent company-I think it was a 49-51 per cent proposition, the 49 per cent still being held by the parent company in Texas or somewhere in the United States-FIRA authorized the American parent to take over the White Farm Equipment Company of Canada, which manufactures not just trucks but farm implements as well. Why would an American company take on a bankrupt Canadian company? I think the answer is pretty obvious. The investment climate for Canadians to invest in Canadian companies is not nearly as good as the investment climate in Canada for Americans to invest in Canadian enterprise. That is the whole problem, and hon. members opposite consider that they are "Canadianizing" our petroleum enterprise when, in fact, they are destroying the incentive for Canadians to invest in their own country.
I have mentioned it before, and I will mention it again: whatever surpluses I have to invest I invest in Canada, and I have run into some pretty serious losses in the last couple of years as a result of the policies of this government.


Ian Deans: That is why you are so bitter personally.


Donald W. Munro: I am not bitter. I am proud to have invested in Canada, but the decision to do so has been mine. That investment was not made through taxation. That is where the crazy notions come in. Why should we be required to invest in things that they choose? Why should I not have that freedom of choice? That is where the philosophical difference is, and it is high time the Canadian people realized it. In Liberal eyes Canadian ownership means government ownership; in the eyes of the Progressive Conservative Party it is ownership by Canadians through individual decisions.
I was speaking of taxes. We are having trouble in the extracting industries, as I think the hon. member for Algoma and the hon. member for Thunder Bay-Nipigon would be aware. However, there is one extracting industry which is flourishing, that is the Department of National Revenue, the greatest extracting industry in Canada. It extracts more money from Canadians now than it has ever done in the past, in order to create what this government claims to be a Canadianization policy. A governmentalization policy is the best name for it because that is what it is.
If it were not so disastrous and distressing one would have to admire the ingenuity with which this government's public servants can devise means of sopping up through taxation every single pool of potential investment in Canada and discouraging individual investment decisions. It is destroying the Canadian ethos. I think of my mother and father who decided before the turn of the century to head west, one from Ontario and one from Nova Scotia. I still think of that trip in about 1890 when they went by train from Truro, I guess it was-because I am sure it did not stop at Stewiacke-to High Bluff, Manitoba. They went by their own decision to open up
April 23, 1982

this country, and how many are doing that today? Unfortunately, not too many.
The public servants 1 mentioned, who are so intent on sopping up everthing they can by way of taxes, are motivated of course by one thing, the high burden of debt this country is faced with, which was created by that side over the past 13 or 14 years. We celebrated 14 years of debt earlier this week. They are also motivated, I suggest, by the principle of socialism, in total disregard of the experience anyone can see with their eyes half open. It is beyond the doubt of any reasonable person that governments are not fitted to run industry as efficiently as the private sector which has other motivations. The comfortable security of state employment is enough to deaden initiative and incentive for all time, and it causes the public interest to be disregarded in an enterprise-oriented role.
Public servants have a role to play, I do not question that. It is a matter of service to the public. But they are not, by training or the nature of their jobs, capable of making the same sort of decisions about running an enterprise that the private sector is.


Ian Deans: How about Chrysler, Massey-Ferguson and a few others?


Donald W. Munro: The public service by its nature and makeup is just not equipped to be entrepreneurial, particularly when management is loaded with political appointees. And I can think of a lot of them. That role properly belongs to the private sector.
I hope, Mr. Speaker, that I have not been over-dramatizing the situation. But, unfortunately, the drama and tragedy of Canada is there for all to see. This government, in its economic, constitutional and other policies, seems bent on destroying this country, for reasons which I am at a loss to understand. It is sad to have to make that comment but I am forced to because, as I look back over just the last nine and a half years in which I have been in the House, I have seen Canada's unity, its potential being, shattered and lying there in front of us.
Last Saturday should have been a day of rejoicing, and it was because the Queen was here. It was not a day of rejoicing, let us be honest, because the Constitution was here. I think everyone, if they are honest with themselves, is prepared to admit that. I was delighted the Queen was here, but what changes did she bring with the Constitution? It should have been a day of rejoicing, but that feeling is tempered by the problems created by this government through its confrontational approach to every problem, economic, linguistic or others, and this in a federal union. It is not only nonsense, it is disastrous, sad and disgraceful.
On Wednesday of this week, Mr. Speaker, we gave second reading to a bill which would permit Canadian corporations to expropriate from non-Canadians, and which entitles them to apply for and obtain special concessions from the federal government such as write-offs, subsidies, loans and licences, which would be denied to those corporations who do not meet the requirements of Canadian ownership. I listened to that debate on Wednesday and heard some members on the other
Energy Administration Act
side say this will encourage foreign investment. That, Mr. Speaker, defies human logic. Why should any non-Canadian risk his money in an enterprise in Canada when he is faced with, not the likelihood or the possibility, but the certainty of having that investment taken away from him without any say in it whatsoever? I cannot imagine anything more calculated to destroy the desire of foreign investors to invest in this country. And these trained donkeys over there all voted for it.


Mr. MacBain:: Well, we are not horses' asses like you are.


Donald W. Munro: As I have said, I cannot imagine any non-Canadian investing in Canada with such a provision on the statute books. If non-Canadian investment is being deliberately discouraged, from what source is the investment to come? That was not a very smart comment the hon. member just made, was it?


Arthur Allister MacBain: I would not have said it if it were not true.


Donald W. Munro: We have heard there is no sufficient private investment in Canada to fill the void. I have asked myself for a number of years since being in the House, and for a number of years before that, whether there has been any real encouragement to Canadians to invest in Canada. The fiscal climate is just not geared that way. It is geared to collect money from Canadians so that the Canadian government can do the investing for them. That is what this government calls Canadianization. But I do not. I do not think that is Canadian-ization at all. I think it is governmentalization, and that is wrong. It is a dead end. There is no light at the end of that tunnel at all.
Stemming from the fact that there is no proper encouragement for Canadians to invest in this country, there are two possible conclusions confronting us. Perhaps the government is planning to bleed Canadians through taxes so that it, the government, can do all our investing for us. That is, of course, a form of state socialism, so dear to the NDP but foreign to the real Canadian Liberalism of Laurier and St. Laurent. I do not understand how Liberalism came on such sad days. If that is not the explanation, is the government planning to drive foreign capital out of the country entirely and leave us as a resource rich country, which is not going to be developed, for some non-Canadian predatory power? Those are pretty extreme conclusions to have to reach. We could become the battleground of the latter half of the twentieth century for those who want the resources we have, which we have so badly abused, and which we have failed to encourage Canadians to reap and harvest.
What sort of real full-blooded Canadianism is this? It is not my vision of Canada, nor, as I suggested in my comments a little earlier, was it the vision of my mother and father when they went out west. Where has Canada's individual initiative gone? I suggest that it is being sapped by this government's attempts, very successful I have to admit, to cause citizens to look to government for all things; womb to tomb, if you like. It

April 23, 1982
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is the great Robin Hood. The Liberals are robbing and they are a bunch of hoods, there is no doubt about that. But it is not the Robin Hood of history in any proper sense.
The government has created a brand of Canadians who seem to think that whenever they are in distress or have a little problem they have to rely on government. The government has encouraged that and thereby it has robbed Canadians of their initiative. Is this being done deliberately? Do not ask me. Is it malicious, or is it just downright stupidity? I wonder if it is MacEachenomics? It could be. One thing certain is that Canada is being taxed out of its patrimony. Canada will end up without its patrimony. I wonder what sort of country it will be when that happens.
A few other elements of our problem need to be underlined. There was a time when Canadians were taxed legally by parliamentary decision. That used to happen. In this bill, as we shall discover, we are being asked to cede-and no doubt the donkeys will assemble in sufficient numbers to grant the cession-


An hon. Member:: That is not right.


Donald W. Munro: It was the Prime Minister (Mr. Trudeau) who used the language. We are being asked to cede to the minister of energy in conjunction with the Minister of Finance (Mr. MacEachen) the decision on how taxes will be levied.
My recollection of the constitutional history of this institution, in which fortunately we can still speak freely, is that there were a number of monarchs or heads of state who decided to levy taxes on their own without consulting Parliament. In fact, it was that proclivity on the part of a number of British monarchs which brought this institution into being to be sure there were constraints placed on the monarch, that he would act within those constraints and that Parliament would determine what they were, would vote the money to the monarch and he could then do what he wanted.
Now we are seeing a reversal of that. I do hope, Mr. Speaker-because you will be out of a job-that this does not mean the end of Parliament. What we are doing is giving two ministers the power to increase taxes, and that is wrong. This bill also will make legal what has been collected illegally for over two years. The retroactive elements of this bill are really quite impressive. I do not know whether the people in the gallery are aware that they have been paying taxes for which there is no legal statute to entitle the government to collect those taxes, but they are paying them nonetheless. So am I, so is everyone here and so is every Canadian paying them, not only at the gas pump but when paying for fuel oil for furnaces. These taxes have been imposed for over two years. They will now, if this bill passes, become legal.
Finally, the unit that was once taxed-and I think this is supposed to introduce an element of confusion, and it does- namely, the $8 a barrel is now to become taxed on the cubic metre. I still have not worked out just how many barrels there are in a cubic metre or vice versa, but I gather there are more barrels than cubic metres than vice versa.


Miss Nicholson:: It is 0.1637.


Donald W. Munro: It is 0.1637? I had better make a note of that because I will need it one day if we go into this business. But the tax limit on a barrel which was $8 will become $350 on the cubic metre. Let us not get too excited about that because it means the tax level will be about $55, up from $8. That is only eight times more than the current tax. I guess we need not worry too much.
May I call it four o'clock, Mr. Speaker?


The Acting Speaker (Mr. Blaker):: It being four o'clock, the House will now proceed to the consideration of private members' business as listed on today's Order Paper, namely, notices of motions, public bills, private bills.



PRIVATE MEMBERS' MOTIONS


[Stage Direction]
Miss Pauline Jewett (New Westminster-Coquitlam)
That, in the opinion of this House, a full parliamentary review should be undertaken of Canada's external, defence and aid policies to redefine Canada's objectives in these areas.
She said: Mr. Speaker, as you have just said, this motion calls for a full parliamentary review of Canada's external, defence and aid policies in order to redefine Canada's objectives in these areas. Since this motion was first proposed almost two years ago today, there have been several parliamentary reviews in specific areas of foreign and defence policy. There was the parliamentary subcommittee engaged in preparations for the conference on security and co-operation in Europe. There was the parliamentary full committee discussing Canada's relationships with the United States under the NORAD agreement. There was the discussion by the committee of the Canadian Armed Forces Reserves and, of course, the very important task force on north-south relations. There is a more recent committee, which I am glad to say is still sitting, on Canada's relations with Latin America and the Caribbean. Another committee was terminated just a few days ago on security and disarmament in preparation for UNSSOD II. Other committees have also been active in defence and foreign affairs matters, such as Canadian trade relations with the United States. A very important report was made in that regard.
There is no question in my mind that many of these specific parliamentary inquiries have had some influence on government policy, particularly those reports which have forged new paths, developed new concepts, re-examined past practices and proposed different ones. I am thinking particularly of the interim report of the subcommittee on Canada's relations with
April 23, 1982
[Stage Direction]
Latin America and the Caribbean. I am thinking of the full report of the Commons committee on security and disarmament, but of the minority report prepared by six members of the full committee. Also the north-south task force has had some effect upon the position of government in north-south relations. Particularly when the committees, subcommittees and task forces have differentiated themselves from the status quo and have looked at exciting new ways in which policy might be developed, they have been important and influential.
In another respect many of the specific parliamentary inquiries have been valuable because they have brought forth a host of Canadians as witnesses or as brief writers representing hundreds of thousands of Canadians and therefore have helped to increase Canadian interest, concern and involvement in international affairs. Canadians care a great deal that the Parliament of Canada should be involved and make recommendations to the government on these matters. When it looked the other day for a moment as if the Latin American committee would be sabotaged, the protest from the Canadian public was so vast that the committee's life was in fact restored and retained.
We could continue with specific parliamentary inquiries. In the last two years since I put forward this legislation, there have been more than half a dozen. We could have a specific inquiry on the Middle East. Canada's relations there are a very important matter. We could have a specific inquiry on CIDA, its objectives, how well they are being carried out, and whether they should be defined differently. We could have a specific parliamentary inquiry on the structure and operations of the Department of External Affairs. I am sure many of my colleagues and friends in the other parties feel as I do, that we still need a comprehensive parliamentary inquiry to thoroughly examine Canada's role in the world. We have not had a real study of Canadian external policy embracing defence and development policies for approximately a dozen years. A foreign poicy for Canadians came out more that a dozen years ago. Since then there has not been any comprehensive government or parliamentary inquiry.
Donald W. Munro: The last one was in 1968.


Miss Jewett:: Yes, the last one was in 1968. Many people such as George Ignatieff, Walter Gordon and others, have suggested a royal commission. Perhaps the matter has reached such a degree of uncertainty about our foreign policy that we should have a royal commission. There are many good things to be said for it, but if we had a parliamentary inquiry with the power to travel across the country and to examine any aspects of Canadian foreign affairs, it might do as well.
There has been no effective leadership from the government in the field of foreign affairs in the last decade. I can think of only one example where Canada played an active leadership role, although it turned out to be only rhetoric, and that is at the United Nations Special Session on Disarmament in 1978 when the Prime Minister (Mr. Trudeau) spelled out his policy of nuclear suffocation. Professor M. J. Tucker said at York
External, Defence and Aid Policies
University in February of this year at a conference on Canada and UNSSOD II:
The strategy itself seemed to hold out hope that something could be done in a tangible way about the nuclear arms race in all its dimensions, while the prime ministerial presence at the special session seemed to suggest that Canada would be actively involved in this process.
Rather than Canada being actively involved in this process, Canada has said and done almost completely contradictory things. The Prime Minister, the Secretary for External Affairs (Mr. MacGuigan) and the Minister of National Defence (Mr. Lamontagne) have agreed on one matter. They have said, and indeed even boasted about the fact, that Canada is the only power which could have developed nuclear arms and did not. Canada has now said that it will no longer have nuclear arms on its land and the new fighter aircraft will not be nuclear equipped. They have made a great deal of the fact that Canada has insisted upon there being no nuclear role for Canadian forces in Europe. In other words, they have proudly said time and time again that Canada is non-nuclear. On the other hand, they have found no inconsistency whatsoever in Canada being involved in the creation of the guidance system for the new Cruise missile. It has given substantial grants to Litten Industries, for example, which is helping in the manufacture of the guidance system for the Cruise missile.
More recently, the government says that it has found no inconsistency in Canada's secretly agreeing, as we have now learned, to flight-test the air-launch Cruise missile over Canadian soil.
When we asked the Prime Minister approximately a year ago if he would make any statment on whether or not the neutron bomb should be deployed in Europe, he said that he did not have a position and that it was a matter for the Europeans to decide upon. Not only has Canada contradicted the strategy of nuclear suffocation or its spirit, it has, perhaps even more seriously, contradicted the spirit and, I believe, the letter of its own non-nuclear weapon status.
I cannot understand how the government can state that we are proud of the fact that we will not have nuclear arms on our soil, not equip our forces with nuclear arms or equip our aircraft with nuclear arms but will gladly equip every one else.
I am not the only one who viewed that as illogical reasoning behind its policy. The consultative committee on disarmament, meeting with the ambassador for disarmament, recently shared much the same view.
When a number of Europeans declare that they do not want nuclear weapons on their soil, the government scoffs at them. The government scoffs at the peace movement in Europe and claims that that movement is making unilateral decisions, as if the government itself did not make them. The government scoffs at the Kennedy-Hatfield proposals in the United States, and calls them unilateralist.
The government's position on the nuclear arms position, or lack of position, is so baffling that six of us who are on the Standing Committee on External Affairs and National

April 23, 1982
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Defence felt obliged to issue a minority report. Not only does a lack of leadership and follow-through on the part of the Canadian government become apparent in this area, it is evident in many other areas as well. There are some unbelievable contradictions in government policy. Government policy can differ, depending on whether you listen to the Prime Minister or the Secretary of State for External Affairs, as was evidenced by the Canadian responses to the imposition of martial law in Poland. Its policy with respect to that crisis was vacillating and unpopular.
Another example is Canada's position on El Salvador. Its policy was ill-informed and misjudged. The Secretary of State for External Affairs said on June 17, 1980, at the hearings of the Standing Committee on External Affairs and National Defence that:
-Central America is not an area of particular concentration of interest for us.
Last year in the House he said:
-it should be remembered that historically Canada has not had strong or important links with El Salvador. It is a country near our part of the world but hardly a neighbour.
In this same speech given by the Secretary of State for External Affairs, he said:
In light of the full circumstances, therefore, as we see them, we are prepared to contest the U.S. policy of military aid but not to protest it; we are prepared to pronounce on it but not to denouce it; we are prepared to criticize it but not to condemn it.
A senior Canadian diplomat abroad reported to me during that period that it was extremely difficult to be a diplomat and had been for some time. The reason for this is that there is no clear foreign policy direction coming from Ottawa with no clear goals and objectives to our foreign policy. There is no leadership within the foreign policy sector in Canada and no leadership displayed by Canada in the international community.
Canada could even have played a role in the Anglo-Argen-tinian dispute, a role which it has often played in the past, that of mediator. I was interested to read in the Toronto Star that Ottawa declined an opportunity to mediate in the crisis and kept quiet about that opportunity. The Toronto Star report, dated April 18, 1982, stated that it emerged from Washington last week, though it went unnoticed and apparently unrecorded, that Ottawa ignored a United States request to help in the mediation. Right at the start of the crisis, according to reports from Washington, U.S. officials had asked Canada to consider how it might serve an intermediary role. Canada apparently refused this request.
Another area where we thought Canada wished to play a creative role involving taking strong diplomatic stands on some occasions and playing the more traditional mediating role on others, concerns the matter of foreign aid and development programs. Aside from the fact that the amount of Canadian aid is less than 0.5 per cent of our gross national product, the quality and direction of aid must be seriously examined. A proposition of our aid which is tied to Canadian goods and services is still too high. Some 80 per cent of all CIDA bilateral dispersements are tied. In other words, 80 per cent of the money spent on bilateral aid never goes overseas. It is spent
here in Canada for Canadian aid to Canadian industry. I admit that Canadian industry does need help during these times, but why is it budgeted as foreign aid? Furthermore, the goods and services provided are often of questionable value to the cultures and economies of developing countries. If these goods and services are useful, they could often be purchased much cheaper from other developing countries.
I could proceed to question the government's policies on the voting of aid funds through multilateral development banks to regimes with the most serious human rights violations. What I want to stress is that the House has never had the opportunity to discuss the terms of reference for CIDA. It is questionable whether or not CIDA has any clear terms of reference regarding development assistance, other than those set by itself or the minister. It needs a very thorough review. This should be embraced in an important aspect of the total parliamentary review which I am requesting and that many of Canada's senior officials in the various departments we are talking about are quietly requesting. This was revealed in Miss McDougall's report.
I will conclude by pleading with other members in the House that in the absence of clear direction from the government in the presence of a multitude of contradictions, some of which I have illustrated, we must have a comprehensive study by a special committee of the Standing Committee on External Affairs and National Defence, which would have the authority to travel throughout Canada and have the time required to conduct a thorough investigation, in order to delineate more effectively where Canada's obligations now lie, what foreign policy interests are vital and what Canada's role in the international community should be.


Mr. Ron Irwin (Parliamentary Secretary to Secretary of State for External Affairs):: Mr. Speaker, I would like to take this opportunity to review some of the current policies which are of importance to Canadians. Some of these issues have been touched, others have not. Canada's foreign policy has been relatively constant. The goals set out in the foreign policy review of 1970 continue to reflect the aspirations of Canadians. Those goals are the fostering of economic growth, safeguarding sovereignty and independence, working for peace and security, promoting social justice, enhancing the quality of life, and ensuring harmonious natural environment. These goals present continuity in Canadian foreign policy.
While the strategies of attaining these goals may change according to the environment, these goals themselves remain unchanged. There must be a constant process of foreign policy adjustment to meet changing conditions in the world, but this does not require an ad hoc, fundamental review from time to time of foreign policy goals or objectives.
Canada's foreign policy has been characterized by promotion of international co-operation and the building of international institutions. We are a middle power, not a major power, and we can only operate by co-operation. This has been the
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hallmark of Canadian foreign policy since the Second World War.
Canada is dependent on a world of co-operation and openness. The fact is that without this international co-operation and stability, Canada's options for a diversified set of relationships and the ability to conduct a global foreign policy become very narrow, if not so minimal as to be almost non-existent. I would like to deal with some of these current foreign policy issues, and I would say that none of these issues can be resolved without international co-operation.
I would first like to refer to the disarmament and arms control, because this is an issue of vital importance to all Canadians. 1 would like to begin by reminding the House that Canada's security policy has three complementary thrusts. First, we seek deterrence of war through collective security arrangements of NATO and NORAD. Second, Canada is involved in promoting efforts to achieve equitable and verifiable arms control and disarmament agreements. Third, Canada seeks to support the peaceful settlement of disputes and collective efforts to resolve underlying economic and social issues of international attention. These three goals are clear and unequivocal.
The government remains fully committed to the pursuit of equitable arms control and disarmament measures. The government has advocated and will continue to advocate the negotiation of agreements between the two major nuclear powers to achieve balanced limitations and the reduction of nuclear weapons consistent with common security. This would include binding and verifiable agreements in accordance with the strategy of suffocation put forward by the Prime Minister (Mr. Trudeau) at the United Nations' First Special Session on Disarmament in 1978. The government does not favour a policy of unilateral restraints on the development and deployment of the weaponry of our allies. The strategy of suffocation was never intended to promote self-strangulation.
We attach a great deal of importance to disarmanent and arms control measures. The arms spiral must be broken, and this must begin by meaningful negotiations between the U.S.A. and the U.S.S.R. The government will take every opportunity to reaffirm the importance it attaches to the continuation of the negotiation process between the U.S.A. and the U.S.S.R.-


Ian Deans: Do you feel abandoned?


Ron Irwin: -and to the realization of a verifiable, comprehensive test-ban treaty. These priorities, together with assisting in the preparation of a conventional ban on chemical weapons and the promotion of the evolution of an effective non-proliferation regime, will guide Canadian preparations for the second United Nations Special Session on Disarmament in which Canada intends to take an active part.
In the 1980s, we must look for new ways of dealing with tension and threats to peace through new forms of consultation and crisis management, including ways of dealing with regional crises.
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Mr. Speaker, it is Friday afternoon, and most hon. members have gone home. It is unfortunate.


Pauline Jewett: You are all alone, Ron.


Ron Irwin: What has happened in the world in the last ten years has been a tragedy of the first order. We can be proud of certain things. Barney Danson, a former minister of national defence, pointed them out in an article in Maclean's magazine. He said that Canada was the first NATO country to relinquish its nuclear capability. He said that we virtually invented peacekeeping, we have contributed heavily to it, and that we spend less of our GNP, 1.7 per cent, on defence than any western alliance except for Luxembourg. We have the most stringent safeguards on the export of armaments and on nuclear power plants, and we have the safest nuclear power plants. But what has happened in this decade? One cannot turn one's eyes away from it. I notice that the NDP is renowned for turning its eyes away and taking specific positions. I do not know if it is for NATO or against NATO, or whether it changes from Wednesday to Wednesday. I really do not know. I hear their party leader saying one thing and I hear their members saying another thing, much like during the debate on the Constitution. I remember they had one seat and the issue was God. They sent one hon. member to support God, one hon. member to speak against God, and the third hon. member to vote on the same issue. It is much the same as what has happened here.
The reality of the world in the last decade is that there has been a Soviet arms buildup. The situation in Afghanistan has occurred. The situation in Poland has occurred. SALT II is now ratified. Our armed forces had been drastically reduced. The situation in Iraq has occurred. Why do we get into nuclear arms? It is because it is cheaper to get into nuclear than conventional arms. Since 1945, there have been 130 wars and 25 million people have died. Isn't that something? We have spoken about World War II and World War I, but there have been 130 wars and 25 million dead. I just recently saw the results of evidence which came from the parliamentary committee mentioned by the hon. member. Even though there are now six countries in the world which have the capability of making a nuclear device, within a decade there will be 44 countries which have that ability. It staggers the imagination. The parliamentary committee did a great service. I think most of its members were more active than I was on that committee, but I must say that the committee did a great service in hearing the evidence, the pros and the cons, and in coming out with balanced and reasonable suggestions. I really do not argue with the suggestions in the minority report because I know that they came from the heart. None of us want what is happening in this world to continue. In the past decade, we have spent $4 million millions on the military. When my secretary typed out my notes, she thought it was a misspelling and only typed in the First million. No one had ever seen $4 million millions, but that is how much we have spent. What are 500,000 of our scientists, 40 per cent of our scientists in the world, doing? They are carrying out R and D for the military.

April 23, 1982
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In 1980, the U.S.A. launched 14 satellites and 89 were launched by the Soviets. What are they doing up there? Forty per cent of these satellites are taking reconnaissance photography. That is ridiculous in the world that we live in. Since 1945, there have been 1,271 nuclear explosions. Who uses up most of the metals and oils in the world? It is the military. Current military spending in the world is $500 million. Anyone who knows anything about spending knows how much is being spent in the world by the military. At the same time we have this going on, 154 countries cannot grow enough food to feed their people. There are 9 million people in the world who cannot buy firewood. The trees we have now are scarce. By the year 2000, half of those will be gone.
In Haiti, one in four children dies before the age of four. This U.N. definition of "absolute poverty" blows the mind. According to that definition, 800 million people in this world live in absolute poverty. Four out of ten children complete more than three years of primary school. Of each ten children born, two die within a year, another dies before five and only five survive to 40, yet around the world we continue to spend $500 million per decade, and that is rising.
I was preparing my notes because I did not know the approach which the hon. member would take. I got to the end of one report, which I think most members have read, and it gives some comparison. Numbers do not mean much if you are not in the military. Megatons or warheads do not mean much, but Hiroshima has some meaning. We have some idea of the size of Hiroshima.
John Gellner, the editor of Canadian Defence Quarterly, estimates that the United States now has 9,500 warheads, which means nothing, equal to 3,500 megatons, which means nothing, which is equal to 200,000 Hiroshima bombs. I repeat that, 200,000 Hiroshima bombs. The U.S.S.R. has 8,000 warheads, which means nothing, equal to 7,800 megatons, which means nothing, equal to 430,000 Hiroshima bombs. Even France, which I had not thought of as a major nuclear power, has 4,700 Hiroshima bombs.


Ian Deans: It's scary. When you stop to think about it, it is stupid, isn't it?


Ron Irwin: I agree with the hon. member. It is scary and stupid. I agree with what Mr. Danson says. He says we have much to be proud of as Canadians. I apologize for nothing, as far as our aims are concerned. But the hon. member is absolutely right. This debate, this House and this country mean nothing unless we come to grips with the problem of disarmament in this world.
I will end with this bulletin. It was very significant to me. I will not change a word. It is from the February 1980 Disarmament Bulletin. It reads:
The world's military budget equals the annual income of 1,800,000,000 people in the 36 poorest nations.
In two days the world spends on arms the equivalent of a year's budget for the United Nations and its specialized agencies.
The developed nations spend 20 times more for their military programs than for economic assistance to the poorer countries.
The developing nations import arms at the rate of more than $6 billion a year.
The U.S. and U.S.S.R. together account for 60 per cent of the world's military expenditures and for 75 per cent of the world's arms trade; they have more military force than all other nations combined.
Although first in military strength, the superpowers rank lower than many other nations in indicators of social well-being.
World military expenditures average $14,800 per soldier; public expenditures for education $230 per school-age child.
The cost of one Trident submarine equals the cost of a year's schooling for 16,000,000 children in developing countries.
The $80 billion a year spent on arms procurement makes munitions one of the largest industries in the world.
I have to laugh when I see what is coming out of Sweden. At one time they were making grandiose statements. I had no idea of the great arms dealer Sweden has become.


Ian Deans: Since the Tories took over.


Ron Irwin: I say to the hon. member, it has nothing to do with socialism. It has much to do with profit and greed. I continue the quote:
Military and space research together get more public research funds than all social needs combined.
The cost of the existing stockpile of weapons in the world is estimated at more than twice the value of the capital stock of all manufacturing industry in the United States.
Quite frankly, I do not accept what the hon. member says about laying down everything we have because there is not much more we can lay down in Canada. The last I saw, the natural resources of Ontario involved a larger amount than the budget of the navy and air force of Canada. We do not have that much left to lay down, but I accept the hon. member's sentiment. Her sentiment is one that has to prevail in the world or there will be no more world. We cannot talk of nations anymore. With all that devastating fire power, it cannot be nation A against nation B or nations A and B against nation C. Dag Hammarskjold said correctly in 1955 at Stanford University:
The question is not either the nation or the world it is, rather, how to serve the world by service to our nation and how to serve the nation by service to the world.


Donald W. Munro: Mr. Speaker, the parliamentary secretary started off well. However, he got lost in the field of nuclear or molecular and came up with all sorts of horror stories. I did not quite know where he was going. Perhaps he was just filling in time.
I take seriously the proposition put forward by the hon. member for New Westminster-Coquitlam (Miss Jewett). As she said, the motion has been on the Order Paper for almost two years. I am not clear in my mind, but I think she leaned toward the notion of a special subcommittee of the Standing Committee on External Affairs and National Defence or perhaps a special committee, maybe joint with the other place, although probably not, coming as it did from her. I suppose she may want a travelling circus driving across Canada.
April 23, 1982

She has not given full credit to some of the institutions in Canada which provide a forum for the discussion of matters of foreign policy, defence and foreign aid policies, mainly the Canadian Institute of International Affairs from which we hear from time to time. I hope all members of the standing committee are members of that institute.
Parliamentary debate would not do. I suspect there would be barely time in the period allotted to an opposition party to have a parliamentary debate on the matter in one day. Even a long day is not enough. My impression is that the Prime Minister (Mr. Trudeau) would be rather opposed to this because it encroaches upon the area in which he feels he is the expert. He claims to have been the expert for the 14 years plus a few days.
I recall vividly the creation of a special foreign policy division within the prime ministerial office very shortly after he assumed that office. It gradually destroyed any creative initiative. It adversely affected the creative initiative of the foreign service then in place. It was not only on foreign policy matters. He cast off the members of the Department of External Affairs by saying "I can read a much better account in The New York Times the next day. Why do we send these people abroad?" I think he was doing one of the great members of the Canadian Public Service a great disservice. This also happened in CIDA. I could tell some horror stories of CIDA when it set out to operate on its own in complete disregard of the local representatives of Canada. It was in my experience, and I am sure it happened in the experience of others.
We now get into the other areas mentioned by the hon. member for New Westminster-Coquitlam. She got into the area of disarmament and security. She avoided the term "security" and insisted on the word "disarmament".


Pauline Jewett: No, I mentioned security, too, in the minority report.


Donald W. Munro: The minority report which she and a number of others decided to issue was admittedly given greater attention in the press than the principal report. But that was simply because it was a minority report, not because of its content but because some members ventured to differ from the majority. That was a report on disarmament and security, with a certain amount of emphasis on security.
We were talking about the cost of a Trident submarine perhaps enabling 16 million children to be educated in a year. Has it ever occurred to you that perhaps a Trident submarine is just making it possible for 16 million children to be educated? It is just possible that in the absence of that submarine these 16 million children would not be educated in the manner in which we would like.
Let us balance this. I am glad the parliamentary secretary mentioned that we are a middle power. Some of us develop grandiose notions about the influence we as Canadians have on
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the international scene. When we go abroad on holidays or on missions and are greeted as great Canadians, that is because we do not have an axe to grind. We interpret that as meaning that they think we are great, influential people who can help them. That is a misleading interpretation of the obvious welcome which foreigners have for us. We do not have the clout. Let us face it and be modest about it. Let us not get a swelled head about our influence in the foreign field. With a good foreign service we should be in a position to inform the government as to what is developing in foreign countries. It has been asked why Canada did not engage in an intermediary role. How do you "intermediarize" in a situation where there is a declared aggressor who takes over someone else's territory? It is difficult to take part, because they end up in positions from which it is difficult to back down, particularly when they are in a rather delicate position at home as the Argentinians are.
Canada may have some influence in certain areas, due to the impact which certain indviduals have in particular areas such as in the Law of the Sea discussions through the influence of the Canadian delegation there. However, that should not be carried over into the whole international community with the notion that Canada is the great middleman, the fixer for all international crises. We were not very effective in doing anything about Afghanistan and we have not been able to do much about the Argentine, either.
We should have a more thorough examination than the estimates permit, in the field of external affairs, in these particular matters. For example, I tried to get the McDougall report referred to that committee so that we might examine it. The aid program is another subject which could be looked at carefully in that standing committee. We have already looked at the reserve situation on the defence side and on disrmament and security.
On external affairs generally, I feel the committee as it exists today is useless. No one even listens. We take the opportunity to ask questions of the minister in a very scattered fashion. The committee needs to be restructured, and that may be what is at the back of the hon. member's suggestion. Then what they decide will have a bearing on government policy. As committees are structured now, they have none. I can testify to that over ten years of experience in this House.


Some hon. Members:: Hear, hear!


Pauline Jewett: That is not true of the Latin-American subcommittee.


Ian Deans: More parliamentary reform!


Mr. Leonard Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, it is important to inject into this debate some real facts of life about NATO and the very difficult international circumstances with which NATO is faced at the present time. The members of NATO have their own internal problems as well.

April 23, 1982
External, Defence and Aid Policies
It is fair to say that in spite of all the talk, nothing has been done. Every effort has been made by the North Atlantic Assembly, the members of parliament from 15 countries who meet twice a year to try to promote disarmament and at the same time maintain security. That may seem like a two-edged sword, but it really is not. If you do not maintain security you have absolutely no bargaining power to carry out disarmanent. That is a key point which must be remembered in this debate.
With regard to nuclear force, modernization and arms control, the issue in 1979 was simply to meet the Soviet threats which had then emerged. NATO embarked on a program to modernize the nuclear forces assigned to the alliance in Europe. We have heard a lot about those forces in Europe and the forces among the population that have been opposing nuclear force.
I heard an excellent speaker on the podium in an address in Munich. It was a military person who said that many people think that the military are out to kill, to create war. He said that is absolutely not the intention of the military, because they would be the first persons in the firing line. He said he was wearing that uniform in order to retain peace in the world through a balance of power, so that foreign relations in various countries would have some bargaining power. He said that the military community was the last one that would want to go to war. He did not like being called a warmonger.
I think it is very important that the views of Canadian armed forces personnel or personnel of any other force within the NATO alliance be represented clearly in this debate. They are peacemakers. The Parliamentary Secretary to the Secretary of State for External Affairs (Mr. Irwin) has just stated that there has been a number of skirmishes since 1945, but in all fairness I think it must also be said that major forces to retain peace in the world since 1945 have been the United Nations and, certainly, NATO.
After two years of study of nuclear rearmament in Europe, on December 12, 1979, NATO decided to proceed with a program to modernize the United States theatre nuclear forces assigned to the alliance in Europe, in part to counter the massive and continuing build-up of new Soviet theatre nuclear forces. The Soviet program involves principally the mobile, triple-warhead SS-20 missile of which at least 250-with a total of 750 warheads-are now operationally deployed. There have been many more since the paper to which I am referring was written. The Russian program is continuing at the rate of more than one new missile each week. The NATO program envisages the deployment, beginning in late 1983 at the earliest, of 108 Pershing 2 missiles, replacing-not adding to- an equal number of old Pershing 1 missiles now deployed in Germany, and the introduction of 464 ground-launched Cruise missiles in Britain, Germany, Belgium, the Netherlands and Italy. For each new nuclear warhead thus introduced an old one will be withdrawn, so that there will be no increase in the NATO stockpile. This is contrary to much of the thinking today.
When deciding to proceed with this program, NATO simultaneously decided to offer to engage the Soviet Union in
arms control negotiations to limit the number of these new weapons on both sides. Here again I want to emphasize the role of NATO in pursuing the aim of getting the major nuclear powers in the world to sit down and talk common sense about the future of humanity, therefore playing a peaceful role rather than that of some great enemy to the public out there trying to create military problems in the world. NATO is there to solve those problems. This was a sincere and reasonable proposal NATO put forward, particularly given the fact that none of the projected new NATO weapons would become available for at least three years. Nevertheless, what did the Soviet Union say? The Soviet Union rejected the offer to sit down for consultations, maintaining that the NATO decision had "destroyed the basis for negotiations". NATO was not going to start replacing its old nuclear weapons until 1983, but the Soviets are going ahead with more than one new SS-20 triple-warhead missile per week. The Russians were saying that they would negotiate if NATO cancelled, or at least suspended, its program. Where would it place NATO if it suspended its program or delayed it altogether for five years or so while at the same time the Warsaw Pact is going ahead and continuing to rearm every week which goes by? NATO would be losing negotiating power because there would no longer be a balance of power to carry on any sensible discussions.
The final result of it all was an announcement following in Haig-Gromyko meeting in New York in September of 1981 which confirmed that the U.S.A. and the Soviet Union agreed to begin theatre nuclear force arms control talks on November 30 last year in Geneva. We now hope those talks will get underway again and continue.
In the few minutes remaining I want to say a few words about our Canadian Department of National Defence. The motion before the House calls for a full parliamentary review of Canada's external, defence and aid policies to redefine Canada's objectives in these areas. I will speak about the defence aspects of the motion.
Canada's defence objectives, like its foreign policy objectives, have been remarkably constant over the past several decades. The principal defence objectives can be simply stated as, first, the prevention of nuclear war; second, the deterring of any conflict which might lead to nuclear war; and, third, the protection of Canadian national interests.
These objectives are as valid today as they were ten years ago, and the government sees no need to review or redefine them at this time. While these objectives have not changed and are unlikely to need change in the foreseeable future, the policies adopted by the government to meet these objectives have been, and must continue to be, dynamic in nature to respond to changing threats, circumstances and priorities.
The protection of Canadian interests and all that implies for the safeguarding of our constitutional process, the protection of our territory and our right to exercise jurisdiction and our ability to enforce our laws is an objective which must be met by Canada alone. We cannot, however-nor can any other
April 23, 1982

single nation in the world-achieve the objectives of preventing nuclear war and deterring conflicts which might lead to such a war strictly on our own. It has to be in co-operation with others. Nor can Canada, given its geographic position between the United States and the Soviet Union and its external interests, prudently follow a neutral or non-aligned foreign policy. Let us not kid ourselves; if there were a nuclear war between the United States and Russia, where would Canada sit geographically?


Ian Deans: Right where the bombs drop.


Leonard Donald Hopkins: We are right in between, so to worry about trying to persuade one of our neighbours not to test in Canada equipment-which has no nuclear weapons on it at all-is a poor way to carry on the kind of co-operation we must have within NATO and among NATO countries.
It is the view of the government that, given the economic and political constraints on a middle power such as Canada the only prudent course to achieve our defence objectives is to promote political reconciliation to ease the underlying causes of tension. We have done that with our peacekeeping missions, and the Canadian Armed Forces are well known as some of
External, Defence and Aid Policies
the finest diplomats we have sent abroad. We must work for equitable and verifiable arms control agreements. We have done that, we are still doing it and will continue to do it. And we must contribute to collective defence arrangements which will provide a system of stable mutual deterrence. Again 1 must say that without that deterrence we have no bargaining power to bring about any realistic discussions about the reduction of theatre nuclear forces in Warsaw Pact or among NATO nations. We must bargain from a position of strength, and that strength must come from a united group of NATO countries which must retain its strength so that the western powers are in a position to negotiate effectively with the Warsaw Pact to bring about future continued peace in the world.


The Acting Speaker (Mr. Blaker):: The hour provided for the consideration of private members' business has now expired. Accordingly, this House stands adjourned until Monday at two o'clock, pursuant to Standing Order 2(1). Have a good weekend.
At 5 p.m. the House adjourned, without question put, pursuant to Standing Order.

Monday, April 26, 1982