1982-05-12

ROUTINE PROCEEDINGS


Mr. Dave Nickerson (Western Arctic):: Madam Speaker, 1 rise to move a motion under the provisions of Standing Order 43. In order to dispel the uncertainty generated by the public dispute between various Liberal cabinet factions over economic policy, I move, seconded by the hon. member for Cambridge (Mr. Speyer):
That the Government of Canada make a clear statement as to whether it plans to impose any form of wage or price controls, whether it intends to devalue the dollar, and whether it intends to fix interest rates.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


VETERANS AFFAIRS
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam
Speaker, I rise to move a motion under the provisions of Standing Order 43. In 1919, and again in 1972, Canadian veterans were led to believe that their government would tie their pensions to the average wage of five specific categories of unskilled workers in the public service. Since veterans pensions lag a full $900 behind that average wage adjustment despite adjustments in response to increases in the Consumer Price Index, I move, seconded by the hon. member for Esquimalt-Saanich (Mr. Munro):
That the government introduce, without further delay, amendments to the Pensions Act which would grant war veterans a pension adjusted either to the average wage of those five categories of public servants or by the Consumer Price Index, whichever happens to be more advantageous to those Canadians who were prepared to offer their lives for their country.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


UNEMPLOYMENT INSURANCE
Mr. Cyril Keeper (Winnipeg-St. James):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Massive lay-offs have taken place at the Sydney Steel Corporation. These lay-offs are the severe blow, not only to the workers and their families but to the whole community of Sydney. These workers' applications for unemployment insurance are being investigated on the question of whether or not the lay-offs were caused by the labour-management dispute or by a lack of orders. While the president of SYSCO, Jack McCarthy, has already testified before a Nova Scotia legislative committee that the lay-offs are due to a lack of orders, I move, seconded by the hon. member for Dauphin (Mr. Lewycky):
That the Minister of Employment and Immigration direct his officials to pay immediately those unemployment benefits to which these workers are entitled.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


FINANCE
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. Last evening the hon. member for Thunder Bay-Atikokan (Mr. McRae) advised this House that if the government would only allow the exchange rate of the Canadian dollar to drop to 75 cents, interest rates would drop to 12 per cent. Presumably by following this theory, if the rate dropped to 60 cents, interest rates would drop to 8 per cent, and if the exchange rate dropped to 20 cents, interest rates would drop to 4 per cent, and if the exchange rate dropped to zero, money would

May 12, 1982
5.0.	43
be valueless and so no interest whatsoever would be charged. Therefore I move, seconded by the hon. member for Western Arctic (Mr. Nickerson):
That this House deplores any diminution in the exchange value of the Canadian dollar as any devaluation will only certify to the world the disaster in the Canadian economy brought about by this government.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


UNEMPLOYMENT INSURANCE
[Stage Direction]
5.0.	43
Mr. Albert Cooper (Peace River):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. The number of people applying for unemployment insurance benefits across Canada is increasing at alarming rates, resulting in increased workloads on staff in Manpower offices. This increased pressure is resulting in increased sick leave, delayed payments because of error, and a declining morale in the Manpower field offices. Therefore I move, seconded by the hon. member for St. John's East (Mr. McGrath):
That the minister responsible for Manpower make an "on-line" computer system for UIC application processing a first priority of his department.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
V *	*


THE ECONOMY
Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. Considering that the Minister of Finance (Mr. Mac-Eachen) failed to convince his U.S. counterparts to relax their high interest rate policies at recent OECD meetings in Paris, and that the Economic Council of Canada, the Conference Boards, and the Housing and Urban Development Association yesterday joined millions of other Canadians in calling on the government to take independent action finally, to lower interest rates, I move, seconded by the hon. member for Beaches (Mr. Young):
That this House call on the government to abandon its high interest rate policy, a policy which destroyed almost 4,000 jobs every working day last month, and immediately initiate a made-in-Canada interest rate policy designed to put
Canadians back to work rather than in the unemployment insurance and welfare line ups.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


STATEMENTS MADE BY MEMBER FOR SKEENA-MOTION UNDER
Mr. Benno Friesen (Surrey-White Rock-North Delta):: Madam Speaker, I rise under the provisions of Standing Order 43. Socialist standards of civil liberties, fair opportunity for self defence and just plain decency were again demonstrated in the House on April 27. Although the College of Physicians and Surgeons of British Columbia requested on January 20 and on March 3 that the hon. member for Skeena (Mr. Fulton) put his complaints regarding Dr. William Jory in writing, he chose to ignore those requests and to use the sanctuary the House provides to attack the professional ethics of a medical specialist. Therefore I move, seconded by the hon. member for Peace River (Mr. Cooper):
That the hon. member for Skeena display his bravery by making a statement outside the House and declare to what degree he had a personal concern for health care or whether, since his father is a physician and was a member of the BCMA Hospital Committee, the hon. member was trying to influence the BCMA elections which were being held at that time.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NUCLEAR ENERGY
Mr. Gordon Taylor (Bow River):: Madam Speaker, whereas Candus can be converted into instruments of war, I move, seconded by the hon. member for Simcoe South (Mr. Stewart):
That this House urges the Government of Canada to recall immediately the Canadian technicians who are working on the Candu in Argentina and thus show that Canada is 100 per cent behind Britain in the current conflict.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
May 12, 1982


AGRICULTURE
Mr. Doug Anguish (The Battlefords-Meadow Lake):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Since November, 1981, when the Minister of Finance (Mr. MacEachen) extended the provisions of the Small Business Development Bond to include unincorporated farmers, there have been some 2,424 bonds approved, but by the government's own figures only 185 in all Canada have been given to unincorporated farmers in financial difficulty. Therefore I move, seconded by the hon. member for Yorkton-Melville (Mr. Nystrom):
That the Minister of Agriculture and the Minister of Finance re-evaluate the government's position and attitude toward the financial needs of farmers and come up with a real program which will actually help Canada's primary producers get low interest loans.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


FITNESS AND AMATEUR SPORT
Mr. Stan J. Hovdebo (Prince Albert):: Madam Speaker, I rise under the provisions of Standing Order 43. Given that the Prince Albert Raiders hockey team has set a continuing standard of excellence in Centennial Cup junior hockey and that it has again won the cup this year for the fourth time in the last six years, I move, seconded by the hon. member for The Battlefords-Meadow Lake (Mr. Anguish):
That this House congratulate the Prince Albert Raiders for their outstanding contribution to junior hockey in Canada.


Madam Speaker:: This being a congratulatory motion, the House may applaud it.


Some hon. Members:: Hear, hear!


FEDERAL SUPPORT URGED FOR PORT OF CHURCHILL-MOTION UNDER S.O. 43
Mr. Rod Murphy (Churchill):: Madam Speaker, whereas the proposed ports bill legislation stresses economic viability for federally-owned ports moving toward greater autonomy, and whereas the Churchill port could be economically viable if icebreakers were employed to lengthen the shipping season and if the Canadian Wheat Board would route more grain through
Oral Questions
Churchill, I move, seconded by the hon. member for Dauphin (Mr. Lewycky):
That the federal government demonstrate a firm commitment to Churchill by doing the following: employ icebreakers for an earlier and longer shipping season, channel more grain through the port, upgrade rail lines, and basically get off its ass and do something.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


IMMIGRATION
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, I rise under the provisions of Standing Order 43. In view of the fact that Salvadoran journalist Victor Regalado has been ordered deported from Canada based upon a security certificate signed by the Solicitor General (Mr. Kaplan) and the Minister of Employment and Immigration (Mr. Axworthy), which certificate contains information that Mr. Regalado has no opportunity to rebut, and in view of the fact that both ministers have refused to appear before a hearing of the Immigration Appeal Board to explain their reasons for this travesty of justice, I move, seconded by the hon. member for Spadina (Mr. Heap):
That this House condemn the refusal of the Solicitor General and the Minister of Employment and Immigration to appear before the Immigration Appeal Board, that it order them to appear forthwith before that board, and further that Victor Regalado be granted landed immigrant status in Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Hon. Erik Nielsen (Yukon):: Madam Speaker, in the absence of the Prime Minister my question is for the Acting Prime Minister, as the head of government. Is the government giving consideration now, or at all, to the imposition in any form of wage or price controls?

May 12, 1982
Oral Questions


Hon. Pierre Bussieres (Minister of State (Finance)):: Madam Speaker, I would ask the hon. member to read the comments made by the Minister of Finance before a standing committee of the House last week, if I remember correctly. In answer to a question from one of the members during consideration in committee, the Minister of Finance clearly and unequivocally indicated that he had no intention of imposing such controls.


GOVERNMENT POLICY ON INTEREST RATES
Erik Nielsen: Madam Speaker, I would ask the Acting Prime Minister a second question. Is the government giving any consideration now, or at all, to pegging interest rates in this country in any way?
[ Translation]


Pierre Bussières: Madam Speaker, the hon. member would do well to refer to the speech made by the Minister of Finance yesterday to his counterparts at the OECD in Paris. He would realize that the Minister of Finance, on that occasion, reiterated the Canadian government's intention of carrying on with its fight against inflation and invited his OECD counterparts to do the same, in order to provide for a steady and gradual recovery of the economy. In this context, he also said that if the nominal interest rates prevailing in the United States are compared with the real rates, there is a very substantial margin, which could be used by American financial authorities to relieve the pressure of current high interest rates on all industrialized countries.


Erik Nielsen: The Acting Prime Minister seems to be struck dumb. I will try once again.


EXCHANGE RATE OF DOLLAR-GOVERNMENT POLICY
Erik Nielsen: Madam Speaker, is the government giving any consideration now, or at all, to the devaluation of the Canadian dollar?


Pierre Bussières: Madam Speaker, it is clear from the hon. member's question that he reads the papers and has an ear for rumours.
However, speaking for the government, I can inform the hon. member straight away that the government has no intention, and that it has never been the intention of the Minister of Finance, to whom I was talking a few minutes ago, of devaluating the dollar.
The House will recall that at the First Ministers' Conference held last February, some of the provincial premiers had suggested this course of action. At the end of the conference
the Prime Minister made it clear that a decision to devaluate would have a disastrous effect, and the government's policy has not changed in this respect.


FOREIGN EXCHANGE CONTROLS-GOVERNMENT POLICY
Erik Nielsen: Madam Speaker, I have one last brief supplementary question for the dumb Acting Prime Minister. Is the government giving any consideration now, or at all, to the imposition of foreign exchange controls in any form?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I think I should answer that question.


Some hon. Members:: Hear, hear!


Jean-Luc Pepin: The reason I did not answer the previous questions is that the Minister of State for Finance is obviously much more informed about the thinking of the Minister of Finance and follows these matters much more closely than I. For example, I spent a good part of the morning with the Premier of Nova Scotia, which the Minister of State for Finance was not required to do.
However, to answer the question, I would like to state, as the Minister of State for Finance did, that nothing the Minister of Finance has said can be taken to mean that there is any shift in the government's anti-inflationary policy.


Erik Nielsen: What about foreign exchange controls?


Jean-Luc Pepin: Furthermore, our policy with respect to the Canadian dollar remains the same. No devaluation of the dollar is being contemplated. I am obviously reading from a document which I received from the Minister of Finance. He has confirmed this to us today from Helsinki where, 1 am sure everyone knows, he is attending the International Monetary Fund meeting.


QUERY RESPECTING GOVERNMENT POLICIES ON INFLATION AND UNEMPLOYMENT
Hon. Sinclair Stevens (York-Peel):: Madam Speaker, now that we have the Acting Prime Minister talking, perhaps he could answer a further question from myself. The Minister of State for Finance has indicated-


Some hon. Members:: Oh, oh!


Mr. Chretien:: Who is "myself'?


Sinclair McKnight Stevens: Madam Speaker, the Minister of State for Finance has indicated that the government's priority is still to fight inflation. Would the Acting Prime Minister reconcile that statement with the statement made by the Minister of State for Economic Development only yesterday in the other place, where he said that there will be "a higher level of

May 12, 1982

emphasis on the unemployed than has been the case in dealing with inflation"? What is the government's chief emphasis? Is it to fight inflation or to relieve unemployment?


Some hon. Members:: Both.


Some hon. Members:: Oh, oh!


Pierre Bussières: Madam Speaker, the hon. member should look up the basic principles of economics. He ought to know that as soon as we are able to eliminate the climate of uncertainty in our economy by reducing inflationary expectations and reducing inflation rates, the resulting economic climate will favour increased investment and economic recovery, not only on a short term but on a sustained basis. Therefore, by fighting inflation, we are pursuing a policy of economic growth.


RATE OF INFLATION
Sinclair McKnight Stevens: Madam Speaker, almost in exasperation, may I ask a question of the Minister of Industry, Trade and Commerce, who perhaps has a better grasp of the stark facts which describe the existing situation in Canada. As inflation, contrary to what the Minister of State for Finance has been saying, was 11.4 per cent in January,
11.6 per cent in February, and 11.6 per cent in March, would the Minister of Industry, Trade and Commerce indicate why we are continuing, notwithstanding the high unemployment in this country, to have such inflation at a time when the Americans have at least brought their inflation to a negative level in the month of March?


Hon. Herb Gray (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: Madam Speaker, I think that instead of the hon. member asking me his fatuous question, he might try to explain why, in spite of the supposed reduction in inflation in the United States, its interest rates remain so high, to the extent that all the western countries are very concerned about the impact of those policies on our economy and the economies of the other western countries.


OIL AND GAS DRILLING IN OFFSHORE AREAS-PUBLICATION OF MEMORANDUM OF UNDERSTANDING ON ENVIRONMENT
Mr. Jim Fulton (Skeena):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. Two years ago, I believe, as the minister knows, the Ixtoc well in the Gulf of Mexico blew over three million barrels of oil into environment. Despite the best technology in the world, it took seven months to cap it. On Monday, outside the House, the minister announced a five-year, $600 million gas and oil exploration program in the Mackenzie Delta and in the Beaufort Sea, two thirds of the costs of which will be carried
Oral Questions
by the Canadian taxpayers. The majority of that drilling will be in extremely sensitive offshore areas where it will, without question, disrupt wildlife and fisheries. According to the government's own sources, should there be a spill or blowout there is not the technology in Canada to deal with such a disaster.
Since the minister promised on June 18 to make public an environmental memorandum of understanding on the offshore, why has it never been made public?


Hon. Marc Lalonde (Minister of Energy, Mines and Resources):: Madam Speaker, would the hon. member specify the memorandum of understanding to which he is referring? If he is referring to a specific agreement which has been signed, I will certainly be very happy to make it available. I am sorry I do not have the exact reference.


James Ross Fulton: The memorandum of understanding is the understanding between EMR, DIAND, the Department of the Environment all the different departments which are responsible for monitoring the environment. Perhaps the minister could respond to that.


ESTABLISHMENT OF ADVISORY COMMITTEES
James Ross Fulton: My supplementary question is directed to the minister. As the minister knows, the taxpayers will carry two thirds of the costs of this five-year drilling program, and the public has a right to know that thorough, scientifically sound steps are being taken to protect the environment. These steps are not being taken now, as the minister knows, and provisions of Bill C-48 are being mobilized for the oil industry to get the rigs out there and to get the drilling going, but concerning protection for the environment, the baseline studies and so on have not been done and are not being done. I wonder if the minister would explain why the advisory committees provided for in Bill C-48, of which he is very well aware, have not been set up.


Marc Lalonde: I would be very happy to make available the documents to which the hon. member refers. 1 think they may take the form of an exchange of letters between the ministers, if what he was referring to was an understanding between the departments.
As far as the latter point is concerned, I want to draw to his attention that the Government of Canada has the highest standard in terms of environmental protection offshore and in the Arctic. The fact is that for several years there has been exploration in the Arctic and offshore in Canada, and there has not been a single incident in terms of environmental hazard or accident-not one. This is testimony to the quality of the environmental concerns, the inspection, and the high standards that have been set by the Government of Canada to protect that very fragile environment. It is a concern that this

May 12, 1982
Presence in Gallery
government has very much at heart. The companies are required to take a number of steps with regard to the environment.
In addition, as late as Monday of this week, the Government of Canada released a study by the environmental assessment review panel dealing with the Beaufort Sea situation. All the information we have is made public as soon as it becomes available. I can tell the hon. member that we have been exploring for over ten years and there has not been a single incident or accident. We have been able to ensure that the environment is protected. That is testimony to the quality of the work being done by the officials in the government in that regard.


ACCESS TO FUNDS FOR ENVIRONMENTAL STUDIES
James Ross Fulton: Madam Speaker, it is nice to know that there are a lot of words in Bill C-48 and that all these things are being done, but the memorandum of understanding on environmental matters has not been made public. The minister promised that last June. No advisory committees have been set up to look into environmental matters in the Mackenzie Delta or the Beaufort. The minister sent me a letter last week, in which he said the following:
The environmental studies revolving fund is an integral part of the Canada Oil and Gas Act. Its purpose is to provide the regulatory agency, the Canada Oil Gas Lands Administration (COGLA), with the information base for its decisions regarding hydrocarbon exploration and development.
I see the Minister of Indian Affairs and Northern Development is here now. However, perhaps the minister can tell us why it is the $15 million revolving fund for environmental studies is inaccessible to native groups, concerned scientists and the public. They cannot get at those moneys. Would he tell us today how groups can get hold of that money and where they go to get it, because those studies should be under way now, not two or three years after the drilling?
Hon. Marc Lalonde (Minister of Energy, Mines and
Resources): Madam Speaker, the hon. member made a number of statements in his question. I will take the time to answer only some of them. He says no advisory body has been set up. I just told him that on Monday of this week a report by the environmental assessment review panel on environmental protection in the Beaufort Sea area was made public. Therefore, there are things taking place. Documents are being made public. I suggest to my friend that he is wrong in some of the assertions he is making.


PRESENCE IN SPEAKER'S GALLERY OF PRIME MINISTER AND MINISTER OF FINANCE OF BARBADOS
Madam Speaker:: May I draw attention to the distinguished presence in our gallery of the Right Hon. John Michael
Geoffrey Manningham Adams, the Prime Minister and Minister of Finance of Barbados.


Some hon. Members:: Hear, hear!


HOUSING
Hon. James A. McGrath (St. John's East):: Madam Speaker, my question is for the minister responsible for housing. The minister will know that the executive of the Housing and Urban Development Association of Canada is currently meeting in Ottawa. In a number of meetings with the various regional caucuses of this House they have made the case that the funding available under the Canada Rental Supply Plan, the $7,500 interest-free loan, is not being taken up by builders because it is not enough to close the gap between the economic rent for an apartment unit and the market rent. Consequently the proposition cannot be a viable one. Does the minister intend to make any changes to the regulations regarding the administration of the Canada Rental Supply Plan?


Hon. Paul J. Cosgrove (Minister of Public Works):: Madam Speaker, I thank the hon. member for the question. It gives me the opportunity of saying that 1 have, on two occasions this week, met with representatives of HUDAC and their executive.
I also take the opportunity to indicate to the hon. member that the Canada Rental Supply Plan which speaks of the $7,500 per unit grant is advertised as a target mark. In the program which has been distributed and made available to interested developers across the country, we have said to them that we will not turn these down, that in any application which requests a grant larger than $7,500 the developer will have to indicate what the cost factors are that require a grant for a higher amount. Madam Speaker, I would like to indicate as well at this time that since the program has been advertised, which was roughly three weeks ago, the corporation has received approximately 2,000 inquiries, and we are now in the process of dealing with individual applicants to see if some of those projects will get started.


CONSTRUCTION OF SINGLE FAMILY UNITS
James Aloysius McGrath: Madam Speaker, the minister keeps referring to this as a grant, which I think is part of the problem, because it is not a grant. He knows full well it is a loan that has to be amortized by the builder and consequently adds to his cost of financing.
I would like to change the subject, Madam Speaker, and ask the minister what the government intends to do with respect to the disastrous situation prevailing in the housing industry with regard to single family units. The minister knows that the
May 12, 1982

seasonably adjusted rate right now is 146,000, and that appears to be seriously inflated. The projections for the year, by all the forecasts, including CMHC, show there is going to be a disastrous situation of only 135,000 starts. There is going to be a shortfall, taking into account the shortfall for the last three years, of 211,000 units. That will drive up the cost of housing even more because it will reduce the supply of housing.
The minister knows that housing is the most labour-intensive industry in the country. I would ask the minister what recommendation he has for the government or for the House, what advice he has for the building industry in Canada, which is on the verge of collapse unless the minister is prepared to act.


Paul James Cosgrove: Madam Speaker, the hon. member's question gives me an opportunity of pointing out that the $7,500 per unit interest-free loan under the grant program is just that, it is an interest-free loan repayable at the end of 15 years. So he is correct, it is not a grant; but it is of economic value to the developer in making a proposal.
In terms of the support of this government to the single family sector, Madam Speaker, I would draw the hon. member's attention to the fact that Bill C-89, passed approximately a month ago by this Parliament, made it possible for innovations in terms of new mortgage instruments with insurance for those instruments by the Canada Mortgage and Housing Corporation mortgage insurance fund. 1 understand, for example, that a presentation was made to all caucuses, including the Conservative caucus, for a shared equity mortgage proposal. That is a very interesting and innovative mortgage proposal which I think will have an important effect on the market.
Finally, Madam Speaker, we believe that inasmuch as this government put forward, for example, $350 million towards supporting rental construction, inasmuch as we have put $30 million within the last few weeks towards rehabilitation, there is a role for the provinces to play. We must not forget that the provinces and the federal government traditionally and jointly have shared the support for stimulus to the industry. I would be very interested to see how those governments, such as the government of the province from which the hon. member comes, faced with its new budget, are going to assist the industry; and what, for example, the government of the province of Ontario, of which I am a resident, will do in its budget tomorrow to assist supplementing housing.


VETERANS AFFAIRS
A. Daniel McKenzie: Madam
Speaker, my question is for the Minister of Veterans Affairs. The minister will know that some 130,000 veterans who are receiving war pensions find themselves $900 behind the
Oral Questions
composite group of the lowest five categories of civil servants in terms of pension payments. How can the minister justify allowing veterans to fall so far behind? Will he immediately introduce amendments to Section 58 of the Pension Act to provide that pension increases reflect the principle of parity with the average wage of five unskilled categories of public servants, or the increase in the CPI, whichever is the greater, and that this principle be entrenched in the Pension Act?


Some hon. Members:: Hear, hear!


Hon. W. Bennett Campbell (Minister of Veterans Affairs):: Madam Speaker, the hon. member is in fact asking two questions in one. It is true that as a result of the latest adjustment in the five categories beginning April 1, in fact the basic rate of pension has fallen behind. Over the last three years the cost of living adjustment has enabled the basic rate of pension not only to remain equal to the five categories but in fact to run slightly ahead of the five categories. As a result of the latest round of negotiations and the new contract which began on April 1, the basic rate of pay has in fact fallen behind. We are looking at that at the moment.
In relation to incorporating the suggestion brought forward by the veterans' association and presented to the standing committee last night, I have a copy of the brief and I am certainly prepared to consider that amendment.


INQUIRY RESPECTING DATE OF PRESENTATION OF LEGISLATIVE AMENDMENTS
A. Daniel McKenzie: Madam
Speaker, the minister knows that Bill C-202 incorporating a one time only increase in the basic pension rate, was passed in 1973. The matter of entrenching yearly increases has been under review ever since then. Veterans are forced to petition the minister cap in hand on a yearly basis. There is no need to make veterans grovel for increases which should be given automatically. Will the minister give the House a firm date on when such amendments will be presented to the House for debate?


W. Bennett Campbell: Madam Speaker, I am not in a position to say now. I received the brief only last night from the veterans association. I certainly will be prepared to indicate to the House as quickly as possible, upon consideration of that brief, when the amendments might be considered.


EXPLORATION FOR OIL AND GAS IN BEAUFORT SEA
Mr. Robert Bockstael (St. Boniface):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. On Monday, May 10, the Government of Canada announced a $600 million oil and gas exploration program in the Beaufort Sea region. Could the minister inform this House

May 12, 1982
Oral Questions
when the project is likely to get under way? Could he tell the Canadian people when they can expect jobs to be created from this new project?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, as the hon. member may know, $600 million is involved in this particular project.


An hon. Member:: Over 50 years?


John Carr Munro: The money is expected to the spent over a five-year period.
The company has filed what we consider an excellent Canada benefits program in terms of millions of dollars going into supply of goods and services by Canadians, and employment generation for hundreds of Canadians, starting very soon and stretching over this particular period of time. Details of the Canada benefits program, in terms of job opportunities and training, we can make available to the hon. member through the standing committee any time they wish to look at it.
May I say, Madam Speaker, that I would see this package of $600 million as a very great stimulus indeed to the entire economy.


Some hon. Members:: Hear, hear!


John Carr Munro: Certainly it is a stimulus to the industrial sector which is so important. May 1 conclude by saying that, for all the doom and gloom that the official opposition has been talking about, why don't they start talking in an upbeat fashion about Esso Resources agreeing to $600 million in development in Canada.


Erik Nielsen: It is a dead beat government.


STATUS OF WOMEN
Mrs. Margaret Mitchell (Vancouver East):: Madam Speaker, I have an upbeat question for the minister responsible for the Status of Women. The minister knows that the parliamentary report on battered wives was tabled in the House yesterday. It states that one in ten husbands beat their wives regularly.


Some hon. Members:: Oh, oh!


Margaret Anne Mitchell: These women-


Some hon. Members:: Oh, oh!


Margaret Anne Mitchell: I do not think it is very much of a laughing matter, Madam Speaker.


An hon. Member:: I don't beat my wife.


Margaret Anne Mitchell: Madam Speaker, I do not think it is a laughing matter. I would like to say that the battered wives in
these cases rarely have any refuge. They have no safe place to go with their children. Police who are called on an emergency basis rarely respond to domestic calls. Charges are not laid in the courts, and there are very few instances of prosecutions in our judicial system.
I want to ask the minister responsible for the status of women what she intends to do immediately in a major way- we do not want just reports, research and conferences-at the federal level to protect battered women.


Some hon. Members:: Hear, hear!


Hon. Judy Erola (Minister of State (Mines)):: Madam Speaker, I too am not amused by the derision which greeted the statement that one in ten women is beaten. I do not find that amusing, and neither do the women of Canada.


Some hon. Members:: Hear, hear!


Judith A. Erola: The hon. member is quite right in asking what can be done at the federal level. I intend to pursue with my colleague, the Minister of National Health and Welfare, procedures which we think the federal government can take to offer the kind of leadership which will lead to an increase in the number of transition homes. Currently this matter comes under the Canada Assistance Plan, and we will review that program to see how we can open it up to provide some sort of leadership. There certainly are not enough homes in this country. I have taken that up with the people who attended the conference with me during the past day and a half. It is one of the recommendations I intend to pursue.


Margaret Anne Mitchell: Madam Speaker, I note that the minister is again passing the buck to the provinces and not getting at the federal responsibility.


CRIMINAL CODE
Margaret Anne Mitchell: Madam Speaker, my supplementary is on the same subject and is directed to the Solicitor General. In view of the fact that witnesses told us there are only two convictions in every 10,000 incidents of violence, will the minister take action to require that the federal courts and law enforcement agencies treat wife assault as a criminal offence? Will he also intensify training programs for the RCMP and other police so that they will enforce the law to protect battered women?


Hon. Bob Kaplan (Solicitor General):: Madam Speaker, I will do so, but I can inform the House that I already have done so. The RCMP recently introduced a training program, at the
May 12, 1982

depot, on family violence. Young cadets are being trained to deal with family violence problems. I can point to the positive side of the alarming statistics about family violence because, while those statistics are alarming, they indicate that more and more cases are coming to the attention of police and are being dealt with in the criminal justice system in a way that they were not before.


PUBLIC WORKS
Hon. John C. Crosbie (St. John's West):: Madam Speaker, my question is for the Minister of Public Works. The president of the Royal Architectural Institute has called the selection process used recently for the Washington embassy a political sham. He wrote to the minister, the Secretary of State for External Affairs, and the Prime Minister about that matter. Only the Secretary of State for External Affairs has replied. He says he will sit down with him and check the barn after the horse has gone. However, the Minister of Public Works, who is responsible for these matters in the government, has not replied.
It is the usual practice that the Minister of Public Works makes a decision when his selection team reports to him on whom it recommends. In this particular case, did the minister make the decision that Mr. Erickson be appointed, despite the fact that four others were recommended? How did the matter get before the cabinet, and did the Prime Minister ever speak to the minister about the selection?


Paul James Cosgrove: Madam Speaker, I do not know where the hon. member gets his information that I have not replied to the president of the architectural society. As a matter of fact, on Monday of this week I spent approximately an hour meeting with the president of that society as well as the head of the engineering society of Canada. We discussed the letter. I gave a response. 1 indicated what the practices of the Department of Public Works are. Quite frankly, I am quite surprised that there would be that kind of misinformation, even in the media, in view of the fact that I personally had spoken with the person referred to by the hon. member.


John Carnell Crosbie: Madam Speaker, perhaps the minister has a hearing problem. I asked him if he made the decision, whether the Prime Minister spoke to him, and how this decision got to the cabinet. My information comes from Mr. Miller, who spoke on CTV this morning and said that he has not heard from the minister and has had no reply to his letter. The minister makes Tammany Hall smell like a rose garden.
Oral Questions


REQUEST THAT OFFICIALS APPEAR BEFORE PARLIAMENTARY COMMITTEE
John Carnell Crosbie: Madam Speaker, is the minister prepared to promise that there will be no further prostitution of this process in the future, and is he prepared to make available to the House of Commons Standing Committee on External Affairs and National Defence his assistant deputy minister, Mr. Desbarats, and other people involved in this decision, so that we can get first-hand from them just what happened in this particular instance? Would the minister answer some of those questions?


Paul James Cosgrove: Madam Speaker, if anyone has a hearing problem I respectfully suggest it is the hon. member who has asked the question. Indeed, his question was a repetition of questions asked of the Prime Minister in the House. I, of course, adopt the Prime Minister's answers, and I indicate further that cabinet discussions and procedures are matters for the cabinet. Because he at one time enjoyed those responsibilities, the hon. member must know that.


John Carnell Crosbie: What a hopeless turkey. It is your department.


ROYAL CANADIAN MOUNTED POLICE
Mr. David Kilgour (Edmonton-Strathcona):: Madam
Speaker, my question is directed to the Solicitor General, and it is about the McDonald commission. In the light of Robert Winters' story in this morning's Le Droit I wonder if the minister would be prepared to tell the House what was the distribution of the unpublished six secret chapters of the McDonald commission report.


Robert Phillip Kaplan: Madam Speaker, the chapters to which the hon. member is referring are those which I withheld when the rest of the report was made public. I withheld them in order to give attorneys general, both provincial and federal, a chance to consider whether they should exercise their discretion to lay charges against any of the individuals named by McDonald in that section. I wanted to withhold them simply to avoid sensational publicity which might prevent a fair trial from being held in any particular case. When charges were laid against individuals, the withheld portion of the McDonald commission report was made available to those individuals or to their counsel.


David Kilgour: Madam Speaker, it seems to me that large portions of the secret chapters and transcripts might, in the present circumstances, be made available to the Canadian public.

May 12, 1982
17336_______________________________________
Oral Questions


MANDATE OF SECURITY SERVICE
David Kilgour: Madam
Speaker, my supplementary question is to the same minister. On October 28, 1977, the solicitor general of the day, now the Minister of Communications, said in this House:
On March 27,1975, the cabinet defined the mandate of the security service of the RCMP-
If that mandate is new, it has not been explained to anyone. Will the Solicitor General tell us whether that mandate is still in force now and what in general terms is the difference between that mandate and the mandate in force prior to March of 1975?


Robert Phillip Kaplan: Madam Speaker, as to the request of the hon. membler that the withheld portions of the McDonald report be made public, I agree that they should be made public, but I do not think they should until prosecutorial decisions are made by the attorneys general concerned as to whether they intend to lay charges, and until trials which might result from those decisions have been completed. However, it certainly is my intention that Part V and Part VI of the McDonald commission report eventually be made public.
As to the second part of the hon. member's question, the mandate which preceded the present mandate was not in writing and was subject to interpretation and reinterpretation. The published report of the McDonald commission describes completely the basis on which the security service operated before that mandate was made a cabinet directive and tabled in this House. 1 might add that that directive, which was tabled in the House, is still the mandate of the security service and is respected by the security service.


AGRICULTURE
Mr. G. M. Gurbin (Bruce-Grey):: 
Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, I am very aware of it because a constituent of mine
lost about $160,000 on the sale of his fed cattle. That marketing system is what 1 call antiquated, and it has been used in Ontario, as the hon. member knows, for many years. I am told the Ontario government was aware of some of these things taking place more than two weeks before this person was actually put into bankruptcy and the bank seized all his accounts. Again the farmers end up losing, and I am sure the hon. member agrees with me that they should not be the ones to lose because they sold their cattle through an auction mart in good faith, but the cheques they were given in payment were returned marked "insufficient funds".


Mr. Mayer:: Sit down.


Eugene Whelan: The person who sold the cattle had a very good record in the community, but the one he sold them to had a very bad record.


Gary Michael Gurbin: Madam Speaker, there is something antiquated in the House but I am not really sure how to describe it. I think it has more to do with the minister's responses to questions.


Some hon. Members:: Hear, hear!


POSITION OF UNSECURED CATTLE SELLERS
Gary Michael Gurbin: Madam Speaker, the reason this could happen is because of a major flaw in the Bank Act. Section 178(6)(b) gives the bank legal entitlement to the assets of those unsecured cattle producers.
Is the minister prepared to sit down with his cabinet colleagues and arrive at some amendment to the Bank Act so this will not be possible in the future, because there are a number of other livestock producers in a similarly vulnerable position. Secondly, will he or a representative from his department sit down with the Royal Bank, and representatives of the auction barns, and the cattle producers, to work out some equitable compensation for the affected producers?


Eugene Whelan: Madam Speaker, the hon. member knows full well that this is a free-market system working to its fullest.


Some hon. Members:: Oh, oh!


Eugene Whelan: It is his party which wants to deregulate everything. The first private member's bill amending the Bank Act ever to become law was one which I sponsored many years ago to protect primary producers against that kind of thing. The banking interest have since found ways to get around that. We have already met the bank officials, and our officials have been in contact with some of the cattle producers who have lost money. The hon. member for Lambton-Middlesex has made representations because he has cattle producers in his constituency who have already been in touch with him. We are assisting them in hiring solicitors, etc., because it was referred to by-[DOT]


Some hon. Members:: Order.
May 12, 1982


Eugene Whelan: -a farm broadcaster in our area as modern day bank robbery, and I agree with him.


Some hon. Members:: Hear, hear!


AIRPORTS
Mr. Ian Watson (Chateauguay):: Madam Speaker, my question is for the Minister of Tranport and is with regard to the possible change of the status quo in the use of Dorval and Mirabel airports. Because such a change could involve government expenditure in excess of $200 million, and industry expenditure in excess of $175 million, can the minister assure this House that before any decision is made he will seek the advice of independent experts unconnected to the original Mirabel decision?


Some hon. Members:: Hear, hear!


Ian Watson: Can he also assure the people of Montreal and the Canadian public generally that there will be a genuine public process of consultation before he submits this matter to cabinet?


Some hon. Members:: Hear, hear!
[ Translation]


Jean-Luc Pepin: Madam Speaker, how I wish we had an expert in Canada or elsewhere who would be capable of ruling on this complex issue with all its economic and psychological factors, an expert to whom everyone would listen and who would make everyone respect our decisions. However, my hon. friend is surely aware that this area requires wide-ranging expertise, and that no one expert has all the answers. I have consulted a number of people who can claim to be experts, but opinions vary, even in my own department. I have also met with community leaders, who very often gave me contradictory advice within one and the same repre-entation. These meetings are continuing, and it may well be that we shall have a public process of consultation on the decision I shall recommend to cabinet, but the decision has not yet been made.


CANADIAN NATIONAL RAILWAYS
Mr. Les Benjamin (Regina West):: Madam Speaker, the only legal battering which should be allowed in this country is the battering of cabinet ministers, particularly the Minister of Transport.
Yesterday, Madam Speaker, one Jack Horner, ex-MP, exConservative, lost Liberal in the wilderness, said he saw little
Oral Questions
future for passenger trains, branch lines, and the Crow rate. Since the minister is considering appointing this gentleman as chairman of Canadian National Railways, and the policies he talks about are opposed by most Canadians, is the minister still keeping this gentleman's name on his list for appointment as chairman of the CNR? Is he still considering putting a coyote in charge of the chicken coop?


Jean-Luc Pepin: Madam Speaker, I have already said, on being questioned by the press, that Mr. Horner's name was on the list of those who might be appointed as chairman of the CNR.


John Carnell Crosbie: Another Erickson.


Jean-Luc Pepin: I am surprised by the question, particularly its nasty implication, because Mr. Horner was for a good number of years a distinguished member of the House committee on transport, and even its chairman. I think he did remarkable work, and I thought that was generally recognized by those of us who give ourselves the title of politician and claim at times to have a bit of expertise in matters like transportation. The hon. member who asked the question is a good example of those who claim a lot of expertise in matters of transportation.


MINISTER'S POSITION ON APPOINTMENT OF NEW CHAIRMAN
Leslie Gordon Benjamin: Madam Speaker, the minister lauds that gentleman's experience in transport matters. That was when he was a Tory. It was this same gentleman who, in 1976, on behalf of the Progressive Conservative Party, said to a CTC hearing that the Super Continental passenger train should be abandoned. By the way, it runs through the-


Madam Speaker:: Order, please. The hon. member is an expert in long questions.


Leslie Gordon Benjamin: Madam Speaker, does the minister think it is appropriate to consider appointing as chairman of the CNR a person who wants to implement the Conservative user-pay policy?


Jean-Luc Pepin: Madam Speaker, 1 do not know what to say because there are so many implications in the question. However, my hon. friend, who claims the title of expert and most probably deserves it, should not postulate that anyone who disagrees with him loses the title of expert.


THE ECONOMY
Hon. Don Mazankowski (Vegreville):: Madam Speaker, my question is to the President of the Treasury Board who made a speech to the Conference Board of Canada in Toronto last

May 12, 1982
Privilege-Mr. Kaplan
night, when he stated that controls have more to commend them than fiscal and monetary expansion. Does the minister imply that controls are under consideration by him and his cabinet colleagues at the present time?


Hon. Donald J. Johnston (President of the Treasury Board):: Madam Speaker, the particular reference has to be taken in the context of the whole sentence, which I would invite the hon. member to read.


John Carnell Crosbie: Give an honest answer for a change.


Donald James Johnston: That is a very honest and straight-up answer. The issue of wage and price controls was touched upon in the course of the text and rejected as not being an appetizing alternative, as the Minister of Finance has already done before a committee of this House.


QUERY RESPECTING POSSIBLE IMPLEMENTATION OF GUIDELINES
Donald Frank Mazankowski: Madam Speaker, the minister also pointed out that he was disturbed by the fact that Canadian unions were not acting as good citizens, compared to their American counterparts, and he indicated that he would be taking a tough line on further salary negotiations in so far as the unions that come under his jurisdiction are concerned. Can the minister indicate whether he is advocating some form of guidelines as a means of implementing that so-called tough line?


Donald James Johnston: Madam Speaker, it is interesting that the hon. member for Vegreville should ask that question. I was just looking at the numbers and I see that in 1981 the federal civil service salary increases were less than all other sectors. In the first quarter of 1982 the percentage is 11.5 per cent, which is lower than all other sectors, private and public. 1 would suggest that we have always taken a fairly tough line, but a very fair position as well.


PRIVILEGE
Robert Phillip Kaplan: Madam Speaker, 1 wanted to raise a question of privilege on a matter which was raised by the hon. member for Burnaby (Mr. Robinson) under the provisions of Standing Order 43 before question period today.
I gave short notice to him, and he is not in the House. I would be prepared if you would agree-


An hon. Member:: He has come back.


Robert Phillip Kaplan: Madam Speaker, at two o'clock today, the hon. member for Burnaby stated that the Minister for Employment and Immigration and I had refused to appear on subpoenas issued by the Immigration Appeal Board in the Regalado matter being heard now in Montreal.


John Carnell Crosbie: Exactly.


Robert Phillip Kaplan: I am rising because, in fact, we have not refused to appear on those subpoenas. When we received them-I will speak for myself-we both took the same course. I sought advice from the Department of Justice. The department suggested that if I had information to give-


Erik Nielsen: That is debate.


Madam Speaker:: I am very sorry. I recognize the minister's frustration but he is obviously continuing the debate and he may not do that under the guise of a question of privilege.


NOTICE OF QUESTION TO BE RAISED
James Ross Fulton: Madam Speaker, I would like to reserve my right to raise a question of privilege at a later date once I have had the opportunity to look at the record to see what the hon. member for Surrey-White Rock-North Delta (Mr. Friesen) said. It seems to me that he was twisting the truth.


Madam Speaker:: I do not know how many times I have to repeat to hon. members that they need not give notice in the House. They should give me notice in writing if they have a question of privilege. If there is a question of privilege, the hon. member should know it immediately. If he feels his privileges are affected, he should know that right away. At any rate, after the hon. member has looked at the "blues" and if he thinks he has a question of privilege, I will see his notice.



ROUTINE PROCEEDINGS


Mr. D. M. Collenette (York East):: Madam Speaker, I have the honour of tabling, in both official languages, the fourth report of the Standing Committee on Energy Legislation.
[Editor's Note: For above report, see today's Votes and Proceedings.]
May 12, 1982


PETITION
Mr. Dan Heap (Spadina):: Madam Speaker, I have the honour to present a petition from some residents in the city of Toronto calling upon Parliament to request the Prime Minister (Mr. Trudeau) to refuse to allow testing on Canadian soil of this generation of weapons, namely, the Cruise missile.
* *
*


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. 2,816, 2,821, 2,841, 2,855, 2,874, 2,885, 2,891, 2,916, 2,924, 2,928, 2,934, 2,944, 2,973, 3,589 and 3,590.


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Department of the Environment at page 13.6, volume 1 of the 1979-80 Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $445,619 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the public service?


Hon. John Roberts (Minister of the Environment and Minister of State for Science and Technology):: 1. (a) and (b)
The department has developed a set of guidelines regarding educational leave which are in accordance with Treasury Board Policy, chapter 110 sub-chapter 5 of the Personnel Management Manual-Conditions Governng Education, Training and Development, including Subsidization, and which are described in the Department Personnel Policy and Procedures Manual.
2.	Approximately 4 per cent of the $445,619 was necessitated because of the acquisition of new equipment.
3.	Nil.
4.	Our records indicate that between 12 and 15 per cent have permanently left the public service.


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Department of Indian Affairs and Northern Development at page 13.6, volume I of the 1979-80
Order Paper Questions
Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $379,275 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the public service?


John Carr Munro: 1. (a) and (b) Education Leave is based on Treasury Board guidelines, Personnel Management 110-5, Human Resources-Education, Training and Development and Personnel Management Manual 525-2. In addition, employees in the education group, e.g., teachers, principals, are considered according to the criteria set out in Sections 19.01 to 19.10 of the group's contract.
2.	Nil.
3.	One hundred per cent of the education leave was necessitated by the department's requirement for improved management and policy making capability.
4.	All employees granted education leave in the past three years are still employed in the public service.


Mr. Clarke: 1.	With reference to the education leave costs recorded by the Treasury Board for Statistics Canada at page 13.6, volume I of the 1979-80 Public Accounts of Canada, what guidelines were used to determine (a) which employees should obtain educational leave and whether such employees should be granted (i) leave with pay (ii) travel expenses (iii) payment for tuition (b) whether the skills to be acquired were needed on a permanent basis?
2.	What percentage of the education leave cost of $22,331 was necessitated by the acquisition of new equipment and by the need to have new skills in order to use the equipment?
3.	What percentage of the education leave was necessitated by reason of job redundancy because of the (a) acquisition of equipment (b) change in the role of the employing agency (c) change in the capabilities of employees?
4.	What percentage of employees granted such leave in the past three years have subsequently left the public service?


Hon.   J.-J. Blais@Minister of Supply and Services: 1. On
the basis of Statistics Canada's 1979-80 Public Accounts submission for education leave, volume I, page 13.6:
(a)	The guidelines used to assist management in determining the educational leave status, both the Terms and Conditions for departmental personnel are "Educational Leave Policy and Procedures", chapter 7, section 3, Statistics Canada's Personnel Manual.
Education leave authority is exercised personally by the Chief Statistician of Canada or his designate. Educational

May 12, 1982
Order Paper Questions
leave proposals are supported by senior management within the area where the individual is employed.
The granting of education leave and the scale of assistance are determined in light of the following criteria: level of university degree sought; necessity-usefulness of studies both to employee and employer; employee's capacity, potential, past work and scholastic performance; commitment to return to Public Service employment; cost.
(b)	All skills acquired were needed by Statistics Canada on a permanent basis.
2.	The $22,331 reported in Statistics Canada's 1979-80 public accounts for educational leave was not necessitated by the acquisition of new equipment nor the need to have new skills in order to use equipment.
3.	There was no education leave approved by reason of job redundancy.
4.	Fifteen per cent, two of the 13 people granted educational leave in the past three years have subsequently left the public
service.


Mr. Clarke: With reference to the professional and special services recorded by the Department of Labour at page 32.18, volume II of the 1979-80 Public Accounts of Canada, with particular reference to hospitality services (a) what is a list of each contract of a value more than $2,000 (b) are guidelines used to determine when the department will pay for hospitality and, if so, what are they (c) of the $27,596 paid for hospitality, what percentage was principally used to entertain (i) foreign visitors (ii) Canadian businessmen (iii) provincial public servants (iv) federal public servants (v) ministerial exempt staff (vi) Members of Parliament (vii) Members of Provincial Parliaments, Legislative Assemblies and the National Assembly (viii) Canadian dignitaries, such as the Governor General and Lieutenant Governors General (ix) federal Crown corporation executives (x) provincial Crown corporation executives (xi) members of federal commissions, boards and councils (xii) any other categories?


Hon.   Chas. L. Caccia@Minister of Labour: (a) Nil.
(b)	Treasury Board Administrative Policy Manual, Chapter 360-Hospitality.
(c)	The information on hospitality requested in this question is not readily available. We do not maintain records of hospitality payments by nature or by class of recipients. There are approximately 1,000 travel claims on file for FY 1979-80 plus a number of petty cash payments. To assemble payments by recipients would mean a search of each individual travel file plus a review of all petty cash claims.


Mr. Clarke: With reference to the professional and special services recorded by the Department of National Health and Welfare under the health and social services program at page 32.23, volume II of the 1979-80 Public Accounts of Canada, with particular reference to hospitality services (a) what services does this entail (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid (d) are guidelines used to determine when the department will pay for hospitality and, if so, what are they (e) of the $9,867 paid for hospitality, what percentage was
principally used to entertain (i) foreign visitors (ii) Canadian businessmen (iii) provincial public servants (iv) federal public servants (v) ministerial exempt staff (vi) Members of Parliament (vii) Members of Provincial Parliaments, Legislative Assemblies and the National Assembly (viii) Canadian dignitaries, such as the Governor General and Lieutenant Governors General (ix) federal Crown corporation executives (x) provincial Crown corporation executives (xi) members of federal commissions, boards and councils (xii) any other categories?


Mr. Doug Frith (Parliamentary Secretary to Minister of National Health and Welfare):: (a) The services referred to involve the extension of hospitality at federal/provincial or federally sponsored meetings.
(b)	Hospitality was extended in the form of formal meals, food and drink at official receptions and light refreshments during meetings.
(c)	The department made only one payment in excess of $2,000. This payment, totalling $2,469, was made to the Department of Public Works for refreshments, meals and services provided on behalf of the department at government conference facilities. The balance of expenditures were paid to hotels, restaurants, lodges and other such organizations for similar services.
(d)	The department is subject to the policy on hospitality found in chapter 360 of the Treasury Board Administrative Policy Manual.
(e)	The amount of $9,867 is broken down on a percentage basis as follows:
(i) Foreign visitors	5 per cent
(iii)	Provincial public servants	50 per cent(iv)	Federal public servants	20 per cent(xii) Canadian health professionals	25 per cent


Mr. Clarke: With reference to the professional and special services recorded by the Department of Public Works under the accommodation program-capital at page 32.29, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) how does the department explain the 909 per cent increase in expenditure for the item over that for 1978-79 (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid?


Paul James Cosgrove: (a) and
(b)	The increase in other types of services in 1979-80 is a result of different reporting methods.
Reported in Public Accounts	1978-79	1979-80Other types of services	$ 2,621	$26,452Catering	1,130*	Hospitality	781*	1,207*Snow and garbage removal	677*	1,626*Sundries	33*	161*Fees to Public Service Commission	1,200*Training educational services	-	17,796*Membership fees	-	680*Other real estate fees	9.628	3.782*$12,249	$26,452
* Included above in other types of services
May 12, 1982

The comparable figure for 1978-79 is $12,249 which reflects an increase in 1979-80 of $14,203. This can be attributed to the training services carried out in 1979-80 related to the solar design course.
(c)	Payments over $2,000 were all in the training educational services category and were as follows:
Dr. S. Karaki-Fort Collins, Colorado, $ 5,733; Multiple Access Computer Group Don Mills, Ontario, $ 7,200; I.P. Sharp Associates Ltd. Ottawa, Ontario $ 3,663.


Mr. Clarke: With reference to the professional and special services recorded by the Department of Public Works under the land management and development program at page 32.29, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other real estate services (a) how does the department explain the 5,750 per cent increase in expenditure for the item over that for 1978-79 (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid?


Paul James Cosgrove: Land Management and Development-Vote 40, standard object 04, other real estate services
Expenditures	1978-79	$ 10,205
1979-80	597,005
Increase	$586,800
Order Paper Questions
Faguy, Gosselin & Associes	Quebec	Quebec	4,500Harrington, Pearl-Helen	Lachine	Quebec	3,701Huot, Guy & Associes	Montreal	Quebec	2,290Ladouceur, Fernand	Ste-Scholastique	Quebec	3,004Ladouceur, Lucien	St-Augustin	Quebec	2,625Marois, J. Arthur	Montreal	Quebec	6,430Parcs Industrie^ des Laurentides	St-Colomban	Quebec	2,141Promanac Limited	Westmount	Quebec	8,084Racine, Larochelle & Associes	Montreal	Quebec	2,400Raymond, Joyal, Sabourin, Theaudiere et Roy	Montreal	Quebec	5,949Surveyer, Nenniger et Chenevert Inc.	Montreal	Quebec	7,837Therrien, Dansereau, Courcelles & Associes	Montreal	Quebec	2,000Therien Dansereau	Ottawa	Ontario	10,000Lemay Lemay, Begis	Laval	Quebec	4,999Yves Simard	Ottawa	Ontario	9,000Mashke, Robson	Toronto	Ontario	4,605
Ltd.
(a)	The increase in expenditures over 1978-79 can be attributed to a special program which was carried out at Mirabel for the peripheral lands. This program included the surveying, measurement and registry of each of the lots held by PWC at Mirabel. It was undertaken to ensure that the number and size of each lot agreed with the records held by the city of Mirabel.
(b)	The types of services included under other real estate services include surveying, measurement and land registry although the costs are reported in total.
(c)	Individual payments over $2,000 are as follows:
Payee	City	Prov.	ExpenditureAlain, Rene & Associes Inc.	St-Lambert	Quebec	$16,391Cadieux, Charette, Meloche & Associes	Montreal	Quebec	2,545Carriere, Clement, J.	Ste-Thcrese	Quebec	4,025Cote, Duvicusart & Associes	Ste-Foy	Quebec	18,777Evaluateurs BDG Inc.	Mirabel	Quebec	4,283Evaluation Metropolitaine Cic Ltee	Montreal	Quebec	2,711


Mr. Clarke: With reference to the professional and special services recorded by the Department of Finance for the Department of Insurance at page 32.13, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) what was the name of each type of service (b) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid?


Pierre Bussières: 
Mr. Clarke: With reference to the professional and special services recorded by the Department of Indian Affairs and Northern Development under the northern affairs program at page 32.16, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) how does the department account for the 1,605 per cent increase in expenditure for the item over that for 1978-79 (b) what services does this entail (c) what is a list of each contract of a value more than $2,000?


John Carr Munro: (a) The expenditures under the "Other Services" classification increased because of the amendments to the reporting requirements for professional and special services as specified by the Public Accounts Instruments Manual. Previously, aggregate payments for a particular service classification equal to or exceeding $2,000 were listed separately. The Public Accounts Instruction Manual now requires that if the aggregate payments for a particular service classification are not equal to or more than $25,000, the payments will be included in the "Other Services" classification. Also, under the "Other Services" classification, only recipients of payments equal to or exceeding $25,000 are now listed, whereas previously, this was required for recipients of $2,000 or more.
(b)	Other services include expenditures for the following: accounting services $1,336, hospital services $71, other health services $19,508, welfare services $324, laundry dry cleaning and related services $6,836, other real estate services $4,923, storage and warehousing $7,384 and membership fees $1,666.
(c)	Since the Public Accounts Instruction Manual requires that a list be maintained of all individuals or organizations whose aggregate payments meet or exceed $25,000, a list of each contract of value more than $2,000 is not readily available. This information would have to be requested from our regional offices and the cost in time and money does not warrant it, in light of the specified requirements for public accounts.


Mr. Clarke: With reference to the professional and special services recorded by the Department of Indian Affairs and Northern Development at page 32.15, volume II of the 1979-80 Public Accounts of Canada, with particular reference to training of public servants (a) how does the department explain the 37 per cent increase in expenditure for the item over that for 1978-79 (b) what services does this entail (c) what is a list of each contract of a value more than $2,000?


John Carr Munro: (a) The 37 per cent increase in training costs is attributable to the department's efforts to support improved financial accountability and to train employees in native culture. In order to improve financial accountability, managers and financial staff were trained in the new budgetary control and expenditure accounting systems across the department. In addition, the procedures relating to the structure of contribution arrangements to bands were
strengthened and made more precise; this also involved training of regional and district staff. In terms of cultural awareness, new native awareness workshops were offered throughout the department.
(b)	As a result of the training, more effective financial systems and procedures are in use. Employees in the department have a better appreciation of the culture and aspirations of the client groups. Both of these contribute to improved program delivery in the department.
(c)	The requirement for public accounts was amended to keep only records of individuals or organizations who were in receipt of payments of $25,000 or more, instead of $2,000 or more. The requested information would have to be obtained from our regional offices, and the cost in time and money is not warranted in light of the specified requirements in the Public Accounts Instruction Manual.


Mr. Clarke: With reference to the professional and special services recorded by the Ministry of State for Science and Technology for the Natural Sciences and Engineering Research Council at page 32.31, volume II of the 1979-80 Public Accounts of Canada, with particular reference to catering and quartering services (a) how does the council account for the 44 per cent increase in expenditure for the item over that for 1978-79 (b) what was the name of each type of service (c) what was the amount paid for each service and, for contracts over $2,000, to whom was it paid (d) for what reason did the council require these services?


John (Moody) Roberts: In so far as
the Natural Sciences and Engineering Research Council is concerned, the answers are provided below.
(a)	The 44 per cent increase in expenditure incurred over that in 1978-79 is accounted for in three ways:
(1)	An additional cost over 1978 was incurred when a reception and dinner were hosted by the president for university officials and the members of the council.
(2)	The increases in cost for the grants and scholarships selection committees were a result of inflation and represented an additional cost of 26 per cent over 1978.
(3)	An over-all increase in hospitality was a result of inflation and additional committee meetings and represented an additional cost of 12 per cent over 1978.
(b)	Type of service: (1) luncheons, food services for working groups; (2) luncheons, food services-hospitality.
(c)	Amount paid for each service: (1) luncheons, food services for working groups, $13,550.21; (2) luncheons, food services-hospitality, $8,445.45. Contracts over $2,000 and to whom it was paid, Public Works Canada (Government Conference Centre): $6,722.75.
(d)	These services were required for food services and hospitality to committee members and other officials.
May 12, 1982


Mr. Clarke: With reference to the professional and special services recorded by the Department of Finance for the Auditor General at page 32.13, volume II of the 1979-80 Public Accounts of Canada, with particular reference to other types of services (a) what services does this entail (b) what is a list of each contract of a value more than $2,000?


Pierre Bussières: Other
types of services, $78,196.
(a)	Services entailed are as follows:
(i) Building Security Services; (ii) Preparation of course material for comprehensive auditing training program; (iii) Department of Supply and Services contract administration service fees (e.g. printing, supplies); (iv) membership fees of Professional staff to accredited Associations; (v) exchange under Career Assignment Program.
(b)	Contracts over $2,000:
(i) Canadian Corps of Commissionaires, Ottawa, Ontario, $44,871; (ii) Carleton Productions, Ottawa, Ontario, $6,530; (iii) Department of Supply and Services, Hull, Quebec, $5,821; (iv) nil; (v) Simon Fraser University, Burnaby, B.C., $7,515.


Mr. Clarke: 1.	With reference to the uninsured losses of more than $1,000 of equipment recorded by the Department of Public Works at page 13.4, volume 1 of the 197980 Public Accounts of Canada, how does the department explain the loss of
$2,314,953?
2.	Under what circumstances was the equipment lost and (a) who was culpable (b) were any convictions made and, if so, what sentences were imposed (c) are any trials or appeals pending (d) was the equipment replaced (e) did the department undertake steps to ensure that such losses did not recur and, if so, what were they?
3.	What use does the department make of the equipment?


Paul James Cosgrove: 1. Of
the loss of $2,314,953 reported, $298,349 was for salvage and repair costs for Dredge, DPW No. 31, which sank off the coast of P.E.I. in October, 1978, and $2 million was attributed to the loss of Dredge, DPW No. 422, which sank off the coast of Newfoundland in June, 1979. The balance of $16,604 covered other miscellaneous losses, each of which was less than $1,000.
2. (i) Dredge-DPW No. 31 (a, b and c). The Transport Canada casualty investigation has determined that the sinking was attributable to three causes: (1) The dredge was not properly designed for towing, (2) The dredge was not properly ballasted while under tow, (3) The dredge was being towed too fast. The Tugmaster and mate of the tug towing the dredge were held responsible and the department suspended them for two and one months respectively.
(d)	The dredge was raised and the hull was rebuilt to make it suitable for coastal towing.
(e)	A book of "Master's Standing Orders" is being prepared which will, among others, contain instructions on how to reduce the risk of recurrence of this type of losses.
Order Paper Questions
(ii) Dredge-DPW No. 422 (a, b and c). The cause of this sinking cannot be established definitely since the vessel is on the sea bottom in deep water. The Transport Canada casualty investigation report speculates that a fracture may have been experienced in the way of a spud or the new crane platform, the latter being, in their opinion, the most likely.
(d)	The dredge was replaced by converting a surplus drill boat into a dredge with a reduced capacity at a cost of $44,980.
(e)	See under 2(i)(e) above.
3. The dredges lost form part of Public Works' Atlantic Region's fleet and carry out dredging operations mainly in support of the fishing industry.


Mr. Cossitt: 1.	Does page 13 of chapter 370 of the Administrative Policy Manual issued by the Treasury Board, dealing with travel, state in part that: "long journeys shall not be considered justification for authorizing a higher standard of air travel. The comfort and speed of modern aircraft and cost considerations dictate that the most economical means available shall be used, e.g. economy class ... "?
2.	Did the Clerk of the Privy Council, Mr. Michael Pitfield, write a letter marked "Confidential" dated November 18, 1981 to Mr. A. E. Gotlieb, Under Secretary of State for External Affairs, stating in part: "However, review of the policy indicates that it would be appropriate within its expressed parameters for the ambassadors to Paris and Washington and High Commissioner to London to use first class air transportation on official business within the limitations set in the Treasury Board directive ..." and, if so, how does the government justify this statement with the directive on air travel issued by the Treasury Board dated September, 1980?
3.	Did Mr. Pitfield authorize first class travel to Paris, Washington and London for those of ambassadorial class but not to Bonn and Tokyo and, if so (a) for what reason (b) was Mr. Pitfield enunciating a government policy that (i) Bonn and Tokyo are not as important as Paris, Washington and London (ii) the ambassadors to Bonn and Tokyo are not as important as Canada's representatives in Paris, Washington and London?


Hon. Yvon Pinard (President of the Privy Council):: 1. Yes.
2.	Yes. Section 3.2.3. of chapter 370 of the Administrative Policy Manual, based on a December, 1975, Treasury Board decision, relates to the comfort of employees on travel status and considerations of cost. The authority, issued in January, 1981, to utilize first class travel contained in Treasury Board Circular No. 1981-8 (T.B. 775270) is based on the recognition that the inherent workload of certain senior public service positions is such that incumbents might reasonably be expected to have to work while on travel status. The facilities in first class, both on the ground and in the air, are clearly more conducive to effective work resulting in cost effective travel time and have been authorized on that basis.
3.	Following discussions between the Undersecretary of State for External Affairs, the Secretary of the Treasury Board, and the Clerk of the Privy Council, it was agreed that within the expressed parameters of the first class travel policy, it was appropriate for the Ambassadors to Washington and Paris and the High Commissioner to London to use first-class air transport.

May 12, 1982
Order Paper Questions
(a)	The special work requirements involved in the positions of Heads of Mission in Paris, Washington and London, as reflected in the fact that persons assigned to those positions have generally been of former ministerial or deputy ministerial rank, led to the judgment that first class travel was appropriate in their case.
(b)	(i) No, (ii) no.


Mr. Cossitt: 1.	Was Mr. A. E. Gotlieb officially appointed Ambassador to Washington on December 1, 1981 and, if so, on what date was (a) his name unofficially submitted to Washington for approval (b) he first made aware that he was being considered for the position and asked if he was interested?
2.	Did Mr. Gotlieb discuss use of first class air transportation with the Clerk of the Privy Council, Mr. Michael Pitfield, and, if so (a) on what date (b) was it discussed after he was aware of his pending posting to Washington and/or after reports of his possible appointment to Washington appeared in the news media (c) for what reason?


Yvon Pinard: 1. Yes. (a) September 29, 1981. (b) In the case of potential appointments as Head of Post, the initial sounding out of candidates is done orally on a most informal basis. Because of the foregoing, the exact date on which Mr. Gotlieb was first made aware he was being considered for the Washington appointment is not known.
2. Yes. (a), (b) and (c) As Undersecretary of State for External Affairs, Mr. Gotlieb raised the question of first-class air transportation with the Clerk of the Privy Council on many occasions, some long antecedent to his selection as Ambassador to the U.S.A., as part of his concern as Undersecretary for the terms and conditions of service of officers assigned to particularly demanding positions.


Madam Speaker:: The questions enumerated by the parliamentary secretary have been answered. Is it the pleasure of the House that question No. 3,233 be deemed to have been made an order for return?


Some hon. Members:: Agreed.


David P. Smith: Madam Speaker, if question No. 3,233 could be made an order for return, this return would be tabled immediately.


Madam Speaker:: Is that agreed?


Some hon. Members:: Agreed.


Mr. Cossitt: What is the name and job designation of each staff member in the office of each deputy minister and what is his/her annual salary as of the date this question is answered?
Return tabled.


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


Some hon. Members:: Agreed.


David P. Smith: Madam Speaker, I ask that all Notices of Motions for the Production of Papers be allowed to stand.


Madam Speaker:: Shall all Notices of Motions for the Production of Papers be allowed to stand?


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


Pierre Bussières: that Bill C-l 11, to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Madam Speaker, the members of this House are probably wondering why, since we have already had an opportunity to consider a borrowing authority bill at second reading, we are coming back today with another borrowing authority bill for second reading.
Mr. Speaker, we are resuming second reading of the borrowing authority bill because during the debate on the previous bill, some hon. members expressed their concern that the bill contained three parts, namely, borrowing authority for the government, a number of amendments to the Excise Tax Act and the third part, a number of revenue tax measures relating to petroleum and natural gas.
As usual, the President of the Privy Council (Mr. Pinard) gave careful consideration to the representations made by hon.
May 12, 1982

members. There were meetings of the various party critics and myself and also meetings of the government, official opposition and New Democratic House leaders, and we finally agreed to split Bill C-93, so that the House could consider a separate bill on borrowing authority and another bill that would relate to the taxation aspect, namely, the amendments to the Excise Tax Act and the series of amendments regarding petroleum and natural gas revenue taxes. These negotiations also resulted in an agreement on the period of time the House would allocate to consideration of the respective bills, at all stages, including, second reading, with consideration in the standing committee as far as borrowing authority is concerned, and consideration in Committee of the Whole of the bill providing for amendments to the Excise Tax Act and petroleum and natural gas revenue taxes, and finally, approval in the House of these bills. Mr. Speaker, I would like to recall briefly what I said on second reading of Bill C-93. The purpose of this bill is to provide for supplementary borrowing authority for the government to cover the financial year 1982-83.
The highlights of Bill C-93 now Bill C- 111 which we are considering today, have already been discussed. It is perhaps useful to recall that the bill is seeking borrowing authority for $6.6 billion, and that all unused borrowing authority granted under the Borrowing Authority Act, 1981-82, and in excess of $3 billion has expired. This means that the balance of less than $3 billion will be carried over to the new fiscal year. The new borrowing authority of $6.6 billion being sought corresponds to budgetary and non-budgetary requirements for 1982-83 as set forth in the budget brought down in the House last November by the Minister of Finance (Mr. MacEachen).
In addition to covering requirements set forth in the budget speech, as is customary, we shall require some room to mano-euver in order to deal with any contingencies that may arise as a result of exchange transactions or other eventualities. In past years, this contingency fund has remained at about $3 billion and has usually been added to the total borrowing requirements presented by the government. This year, however, the $3 billion or what will be left of the 1981-82 borrowing authority if the balance is less than $3 billion, as I said earlier, will not automatically lapse at the end of the financial year, and thus this remainder which is less than $3 billion can then be carried over. Consequently, that amount will be the government's contingency fund for 1982-83. The provision referring to the government's authority to contract and reimburse loans in foreign currency is a technical one, and the House will recall that this provision was also included, and I said earlier, in previous borrowing authority bills, and more specifically in the last four.
I would like to give an overview of the government's borrowing transactions since the beginning of the current financial year, and of the amount of borrowing authority used. As for the Borrowing Authority Act for 1981-82, which provided a
Borrowing Authority Act
new borrowing authority of $14 billion, the House will recall that this legislation received royal assent on April 8, 1981. Consequently, the debt program covered by this borrowing authority started at that time. From April 8, 1981 to March 31, 1982, the government borrowed a total of $9.9 billion in new funds on domestic markets. Of that amount, $9.3 billion was obtained through Canada Savings Bonds, $3.1 billion through marketable bonds, while net Treasury bill redemptions reduced the amount borrowed by $2.5 billion. As far as the marketable bond program is concerned, $0.1 billion is tied to foreign markets. These markets have provided the government with $300 million, thanks to the private sale of an issue to the central banks of Saudi Arabia. There was also a partial repayment on a loan of $700 million, which was due on March 8, 1982. Considering the spirit of co-operation existing on all sides with a view to limiting the debate on this new bill, I would rather not impose any further on the time of the House, and I would give other members an opportunity to take part in this debate. However, I would just like to refer to some of the points made in the previous debate on Bill C-93 and comment briefly, while further details could be given when the bill is considered in Committee of the Whole.
During the previous debate, one hon. member remarked that the petroleum revenue tax was supposed to increase federal revenues by several billion dollars. If I remember correctly, two different figures appeared in the English and French versions of Hansard. I would like to give the exact figure for federal revenues collected in the form of petroleum and gas revenue taxes and tax on additional oil revenues, namely, $23.2 billion for the period from 1981-82 to 1985-86. I am giving this figure to remove any misunderstanding that might have been caused by the fact that two different figures were printed in the respective versions of Hansard.
One of the points raised concerned the figure quoted in the estimates for the percentage of increase in government expenditures. I may inform the member for Etobicoke Centre (Mr. Wilson) that his explanation was not quite accurate. Expenditures in 1981-82 increased by 16.3 per cent, and not 22.3 per cent, as the hon. member stated. In 1980-81, petroleum compensation payments exceeded revenues by $2.7 billion. In 1981-82, payments more or less balanced revenues, which explains why there is no negative balance here. It is always possible to juggle figures and delete an item that is decreasing in order to get an expenditure total to increase more rapidly. It is also possible to delete an item that is increasing faster than total expenditures, for instance, debt servicing, in order to slow down the rate of increase of the total amount. But this is mere juggling with figures and actually does not prove anything. In any case, the real increase in total expenditures is, officially, 16.3 per cent.
During the previous debate, it was observed that expenditure increases should be brought back to the rate mentioned by the Minister of Finance in his budget speech, namely, they should

May 12, 1982
Borrowing Authority Act
be kept at a level below the growth rate of the national economy. I may point out that the government is maintaining its objective to keep the growth rate of its expenditures below that of our economy. This is reflected in the lower ratio of budgetary expenditures to gross national product, which dropped from 21.2 per cent in 1975-76 to 20 per cent in 1980-81. During that period, government expenditure objectives were set according to a broader concept, namely, that of total expenditures, in other words, the sum of budgetary expenditures and capital loans and non-budgetary advances. So, from 1976 to 1980, total expenditures increased at a slower rate than the nominal gross national product. During that period, the gross national product increased, respectively, by 9.3 per cent, 10.3 per cent, 13.7 per cent and 10.7 per cent, while total expenditures increased by 6.6 per cent, 9.3 per cent, 7.9 per cent and 8.8 per cent. During the debate, there were also some comments on the government's justification for its borrowing authority request. Mr. Speaker, I should like very briefly to remind the House of the government's commitment to take a far more rigorous approach to the management of public funds and thus bring about a reduction in the deficit. These objectives involve a policy of restraint that should help relieve inflationary pressures and promote the development of a better climate for economic recovery in our country.
As a result of the debt program, $9.9 billion of the borrowing authority of $14 billion approved for 1981-82 was used, as I said earlier, while $1.1 billion lapsed on March 31, 1982, and $3 billion was carried over to 1982-83, to be used for contingencies, as I explained a moment ago. Mr. Speaker, I should like to comment on further questions raised by hon. members. It was asked, for instance, why the government needed new borrowing authority for $6.6 billion at this time, when, and I believe it was the hon. member for Mississauga South (Mr. Blenkarn) who made this comment, when the government's cash balance is high and it has already received $12 billion for 1980-81 and $14 billion for 1981-82.
In answer to the last part of the question, I would like to point out that the entire unused borrowing authority for 198081 lapsed on March 31, 1981, and the entire unused borrowing authority for 1981-82, in excess of the $3 billion to which I am constantly referring, also lapsed on March 31, 1982, and consequently, the only borrowing authority available to the government for 1982-83 is this sum of $3 billion which has not expired and which represents the government's contingency fund for 1982-83. Mr. Speaker, I would now like to answer that part of the question dealing with cash balances which at the beginning of the new financial year amounted to $6.6 billion. At the end of the financial year, a reasonably high level of deposits is necessary in order to cope with strong seasonal demand during the first quarter of each new financial year.
In addition, the government cannot let its deposits drop to zero, that is quite obvious. We have deposits for our daily transactions and also for contingencies, for instance, to respond to demand created by foreign exchange markets. In addition, let us not forget that deposits give the government some room for manoeuvring in managing its debt program, a fact that is particularly important in periods where interest rates are very volatile. I may add that the deposit amount in excess of $100 million produces 90 per cent of the interest of 91-day Treasury bills.
Mr. Speaker, several hon. members also criticized the government with respect to the 19.5 per cent interest paid on Canada Savings Bonds. One hon. member alleged that the government was paying 19.5 per cent on Canada Savings Bonds at a time when all indicators showed that rates were declining and that sales of Canada Savings Bonds would add $1 billion to the national debt and to the burden of Canadian taxpayers. Mr. Speaker, here I would like to point out that the government cannot plan its debt program according to the forecast for interest rate trends, and that it must take into account the situation existing at the time the bonds are put on the market to compete with other savings instruments. The cost of the 1981-82 issue of Canada Savings Bonds was much closer than usual to competitive interest rates. Over one million people purchased Canada Savings Bonds and it takes at least five weeks before paycheck deductions can begin. All these sales take some time.
During the campaign, interest rates fluctuated, and this made the yield of Canada Savings Bonds very attractive, since all interest rates on the market on other savings instruments were on a downward trend. With hindsight, it is easy to claim, this volatility having taken its toll, that the rate on Canada Savings Bonds was too high. However, this was not obvious when the rate was set for the marketing of Canada Savings Bonds. It is important for the government to set an equitable rate as well as a competitive rate for this instrument, which must compete with other savings instruments on the market. The sales of Canada Savings Bonds will not add one billion dollars to the cost of the debt since the product of the sales was used to pay the negotiable debt which was falling due and would have had to be renewed otherwise. Until November 1981, for the previous 18 months, Canada Savings Bonds were, all in all, the least costly source of funds for the government.
As a final point, I would like to refer to another aspect of debt management which was raised during the debate on Bill C-93. Based on the different percentages of the various borrowing instruments of the government, some members wondered whether the government had changed its policy of using short-term instruments rather than medium or long-term instruments to finance its debt. I believe, Mr. Speaker, that the diversity of the borrowing instruments available to the government to manage its debt can be explained by the fact that this allows the government to use some flexibility in adjusting to
May 12, 1982

existing conditions on the market when it needs to borrow. That is the reason why there have been a number of variations over these last few months, for instance, a larger rate of financing through Canada Savings Bonds. This signals no basic change in the government policy of debt management. Simply, the government used the tools at its disposal and the flexibility needed to adapt to the extremely volatile conditions it was facing on the marketplace.
Mr. Speaker, I indicated at the beginning of my remarks that under the agreement reached by all parties in this House on this legislation and the one that is to follow tomorrow, there is a time limitation. Therefore, I will not take too much of the time of the House, but I simply wanted to give a few explanations following some remarks that were made in the preceding debate, and 1 am sure we will have an opportunity for a very fruitful debate at the committee stage, to further the consideration of this legislation. I would like to thank the House leaders of the government, of the Official Opposition and of the New Democratic Party as well as the party spokesmen since we have agreed to a much more expeditious consideration of these two bills.


Donald Alex Blenkarn: Mr. Speaker, I will speak very briefly on this bill at this stage because I spoke at length on second reading. I want to point out to the House and to the country in general that Bill C-93 was opposed by this party on the same basis as Bill C-94, on which bells rang on an adjournment motion for over 15 or 16 days. If the government had any sense, it would never have introduced Bill C-93 in the way in which it was introduced. 1 compliment the government on finally coming to reason. This bill is a bad bill and so are the tax provisions contained in the balance of Bill C-93, which will be debated under Bill C-112 tomorrow. However, if it were not for this party putting extreme pressure on the government, this bill would not have been divided. We would not be debating Bill C- 111 today. 1 say to Your Honour and to the country that we are at last seeing some democracy around here. At least the people have an opportunity for input. At least we are reaching a situation where, under the terms of reference of this bill, even though debate will be somewhat limited, the Minister of Finance (Mr. MacEachen) will be required to come before the Standing Committee on Finance, Trade and Economic Affairs to explain the financial policies of the government. Your Honour knows that the minister always tries to avoid coming before the standing committee, so for the first time, we will be able to have the minister before us again for two full sessions to explain why he needs to borrow $6.6 billion.
The question of $6.6 billion came out of the air. It was a figure in the budget. But we all know, and the country knows, that the budget of the Minister of Finance is just so much air, smoke and feathers. It is really not a budget at all. It has no particular approaches in it which make sense. The country cannot go along with it. The minister made at least changes to
Borrowing Authority Act
it, and there are still more changes coming up. So we expect the minister, either in the House or before the committee, to explain to us and to the country in general a new financial policy which must be proposed by this government.
Speaking to the question of the Canada Savings Bonds issue, it clearly costs the country at least $1 billion. It was clear to any intelligent person in the financial market, in August, that 19.5 per cent was too much money to pay for interest. It became clearer in September and even more clear in October. It became an absolute certainty in November, yet the bond sale was held open until November 6. If there was ever a government incompetent at borrowing money, it is this government, and for that reason alone this bill must be opposed.


Some hon. Members:: Hear, hear!


Mr. Bob Wenman (Fraser Valley West):: Mr. Speaker, there was a time, not too long ago, maybe as recently as the last year or so, when I looked forward to getting on a plane, travelling back to my constituency, meeting with my people and trying to hear and solve their problems. I must say that as I think about that prospect for this week and next week, I do not feel good about it because I know that when I walk down the street or go to my office, I will meet a group of young people who will be looking for jobs which I cannot help them to find.
The community in which I live was once a progressive, growing community of Fraser Valley West. At one time, if the people of Langley and Surrey who came to my office really wanted a job, I could find places for them. I could send them here or there. But now, all of a sudden, for the first time in some time I send them on the circuit, and they come back empty-handed. Instead of simply finding no jobs, they are unfortunately finding, again and again, that businesses have gone bankrupt. So it is not only those seeking jobs in the business community who are suffering, but it is also the business community which is suffering to a very great extent these days. This hurts. It hurts when I see these massive cutoffs. I see professional people and small business people who have always had jobs in the last 15 or 20 years but now, not only have their jobs run out, but their unemployment insurance has run out as well. As the unemployment insurance runs out, they fall on to the welfare system, which makes them lose their confidence and self-respect. We see a new kind of depression, which is indeed disgusting and discouraging in this great country.
It is not that the potential is any less this year than it was last year, or five years ago; rather, it is that something has gone wrong with the direction of our economy. That direction has been consistently pursued by the Liberal government which has its mind set or a set attitude toward possible solutions. We find that every time the government comes forward with a solution, it is an obsession. It is obsessed with overtaxing, over-borrowing or government intervention. It constantly seems to want the people to give to the government so that the government may redistribute and thus somehow solve the problem. If the government does not have sufficient money

May 12, 1982
Borrowing Authority Act
from taxes, it then goes out and borrows it, regardless of the cost. The government has the attitude that it somehow has the answer.
Our society has followed a long trend, one in which we had a great deal of confidence in professionals and in an elitist, intellectual policy. We have stopped looking to ourselve and have started looking toward others. We have cast responsibility on to governments. Of course, the government assumes the responsibility, and to pay for it, collects taxes. The government taxes to a certain point, and when it can tax no more, it begins to borrow, and here we are.
It is pretty hard for me to tell the unemployed persons from Langley or Surrey that we will go out and borrow billions more dollars on their behalf and that somehow we will get the economy going through government intervention, government bureaucracy, government regulations, and that the government will create jobs. That confidence, that mind-set, must change.
I am not saying to the minister who just spoke that the government which sits opposite is morally wrong or that it is trying to do the wrong thing morally. It is not trying to drive the country into bankruptcy. It is not trying to drive the people along. Maybe it is trying to drive the people to unemployment to cure inflation, because that is the solution it sees: more unemployment to cure inflation. But, instead, we get more unemployment and more inflation. The solutions are not working. Although the idea is right, the solution to implement the idea is wrong. Morally, we all want the same thing, a stronger, better Canada, full of opportunity for all our citizens, but we need to change the idea of solutions. The solutions lie in ridding the economy of unwarranted and unneeded regulations, simply the factor of regulation, the restriction of regulations, the requirements.
I wonder how many members opposite, instead of simply buying a house, have gone through the process of trying to build a house, the process of regulation, the process of requirement. Last week I attended the Surrey Volunteers dinner, and Ivy Adamson, an old pioneer of Surrey, the first alder-woman in Surrey, said, "When I first came on council here, there were a bunch of tarpaper shacks. People started with little shacks and they started building houses for themselves. What a shame it is that in today's society we cannot start to build again modestly, what a shame that this opportunity has been taken away from us, because we now require a $150,000 house instead of providing for our basic needs." It is overregulation and overrequirement.
We must also try to develop a freer trade policy. We keep thinking and teaching others as though we were an island unto ourselves and as though somehow Canada, by putting up higher and higher tariffs, will create more and more jobs here.
I think history shows that creating more and more tariffs might create a job for a day or even a decade. All too often those tariffs turn into subsidies. In fact, they become counterproductive to the point that the whole economic system begins to break down and we lose our capacity to compete in international markets. We must have policies and solutions that work toward freer trade. The only way to create a stronger economic
lifestyle is to sell what we produce. Everything we now produce in Canada we can use. This is a small market, so it does not do any good just to produce those things that wear out and need to be replaced. That is not good enough. We have to look to the great markets of the world. If we place tariff upon tariff upon tariff and exclude trade from other markets, they will excude us from their markets. There will be no jobs in Ontario, British Columbia or anywhere else in Canada. Free trade relations in the world need to be expanded by reducing tariff barriers, thus working toward freer trade.
We need to cut government spending. We are not doing that with this provision. What we are doing is borrowing more money. How many people want the government to borrow more? Do they want their government to spend $6 billion today? At 20 per cent interest, who is going to pay? It will be our children. They will pay and pay the deficit created by this bill.
That is not what Canadians want. They want government spending cut back. They want less government not more government and more regulation. Canadians want that, as was demonstrated in Saskatchewan.
Does this bill give us more? No, it gives us less and less because we are getting more and more government. There is less and less responsibility for the individual and more and more for the government. You cannot cut government spending by borrowing more. The more the government spends, the more we need to borrow on their behalf; the more taxes we pay, the more they spend.
Let us talk about government cutting spending, not expanding it. However, that is what is being done today, creating more government and more tax burden, and we will have to pay for this at 19 or 20 per cent.
In addition to cutting spending, we must restore incentives. I talked with workers in the housing industry. I asked them why they did not stay an extra couple of hours to complete a job rather than putting all their tools away and having to come back the next morning. They replied that they would get overtime, but the government would just take it away in taxes. How many times do we hear people ask, "Why work longer, why produce more?" There is no incentive left in our society.
It is time to rebuild the incentive society. It is the motive of profit and the individual getting ahead that created the wealth of this nation and of the rest of this world. It worked before, so why not give it a chance to work again?
We must cut government spending and cut taxes. Everyone says that is a dream; whoever heard of a government cutting taxes, it just does not happen. It does happen and it is happening. It is happening right here on our continent. Not only is it happening, but it is working again. This is not the first time.
Our biggest problem is inflation. We will not solve that problem by borrowing more or by increasing interest rates, which is what we are doing today. Instead, we should be
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working for a tax cut. That is what President Reagan did in the United States. He implemented a 30 per cent across-the-board tax cut. It was not just for the big guys, but also for the little guys, the middle guys and everyone in between.
Is there a Canadian today who does not want a tax cut? Some may say it would not be good, but maybe at this time it would be. What did the tax cut and control of government spending do in the United States? It cut the inflation rate to zero.


Mr. Kelly:: Come on.


Svend Johannes Robinson: You know that's not true.


Robert Lloyd Wenman: It may be 4 per cent this year. Mr. Socialist to my left and Liberal socialists across the way, would you like to have the American inflation rate today? Would you trade it for Canada's? Would you trade ours for the 4 per cent projection this year? It reached zero in one quarter. These members know it worked. It is the truth.


Norman Kelly: What is their unemployment record?


Mr. McRae:: And a world depressions was caused by it.


Robert Lloyd Wenman: Where will you be on the recovery? When the American recovery comes because they cut their taxes, inflation rate and government spending, we will be seeing the opposite. Have we cured inflation or unemployment? No. We have high inflation and high unemployment.


Svend Johannes Robinson: Mr. Speaker, I wonder whether the hon. member would permit a brief question?


Robert Lloyd Wenman: Certainly.


Svend Johannes Robinson: Mr. Speaker, I know the finance critic for the Progressive Conservative Party indicated he would advocate that the policies of Ronald Reagan be applied in Canada. He, of course, is praying that they are successful. Will the hon. member indicate whether he too is an advocate of the economic policies of Ronald Reagan and whether, in his view, they should be applied in Canada today?


Robert Lloyd Wenman: Mr. Speaker, if the hon. member will listen to my speech, I will tell him about supply-side economics. That is the basic text of my speech today. I support those points and I will tell him why. I support them, Mr. Socialist, because they work, and I will give an example of how they work.
The brother of the late President Kennedy is now promoting the same policies as our Liberal government. Let us see what President Kennedy did. In 1961 when John F. Kennedy took office, the unemployment rate stood at 6% per cent and the budget was in deficit by almost $4 billion. Between 1961 and 1966 real output as measured by constant dollar GNP grew at a 516 per cent annual rate. It grew. Our growth rate is going in the other direction. It is going down.


Paul Edmund McRae: What is happening to the American growth rate?


Robert Lloyd Wenman: It is going up, my friend, you just wait. The unemployment rate fell to less than 4 per cent and the federal
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budget moved to a roughly balanced position. That is what happened when President Kennedy applied a 30 per cent tax cut across the board. Inflation throughout the era averaged between 1 and 2 per cent annually, not 1 and 2 per cent a month as it is in Canada.
Surprising as it may seem, given the mythology surrounding Jack Kennedy, government spending as it relates to total output actually declined during the Kennedy era. Government spending declined. Some may say that is not the right medicine today, that it was the right medicine a decade and a half ago. President Reagan has begun to apply it, and it would be more effective if he did not have the brakes on him. It is working. Would anyone deny that it is working in the United States? Then, by a spillover-unfortunately by a spillover, not because of anything members opposite are going to do over there-we may benefit somewhat. But they should be prepared now for the recovery, not dragging deeper and deeper into recession and depression, and that depression is as bad as the recession.
The depression that I feel about the economy, the fear that I have to invest, the fear that I have to go out and create something new, that fear is real in my constituency. It is real amongst my people. We need a reinstall a new, strong attitude amongst those people. We have to recognize it. I hope it is the bottom. We might have to wait until 1985 for the turnaround in Canada, as they are experiencing it in the United States this year. We might have to wait a little longer. We might have to wait until we get rid of this government, because we cannot change their attitude. This borrowing bill is a perfect example. I hope the Canadian people will see it. Do you understand? Do you understand what 1 am saying? I hope so. Well, if you do not come and see me afterwards and we will talk about it.
We will get into the subject of supply now. Let us consider a little what these tax cuts are. In our society there is something called a resistance theory, not an astounding theory but a very interesting one. It was evolved by Professor Arthur Laffer. The professor made a statement saying that you can tax people and then you can tax them more and the government gets more money; you can tax people still more, and you get more money; you can tax more and more and more, until people get to the point where they say: "Just a minute, I am not paying any more tax, that is too much, I am not working any more because I am only working for the government, the government is taking more of my money than I get myself." We then find this resistance to taxation. So the more you tax, actually at that point the curve goes the other way and you start getting less revenue. This has proven to be true, the more you tax at a certain point, the less revenue you get. In order to get more revenue at that point you have to cut taxes. The main game in Canada right now amongst businessmen-it is survival, at the moment-generally, amongst those who are surviving, is to figure out how to get more disposable income, how to beat

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income tax, how to establish income tax shelters. The avoidance of income tax is the biggest game in town. Why? Because we have reached that peak where taxation becomes regressive, and to get more tax revenue we have in fact to cut taxes. That is what John F. Kennedy found in 1961 when he started his program. He cut the taxes by 30 per cent, and in the end he got more tax revenue. He got more tax revenue because by cutting taxes 30 per cent more people went to work. As more people went to work less people were being paid unemployment and welfare. Those people soon began paying unemployment insurance. They were producing some real goods that could be exchanged domestically and internationally. They could exchange those goods for real hard currency, for real money. In so doing the United States stabilized the dollar. The American dollar became so stabilized that they could in fact afford to go off the gold standard.
Unfortunately, through these heavy liberalized programs that we have experienced in the past 15 years, we have moved in the other direction, and the American dollar now is less stabilized. Perhaps the Americans need to do something as President Reagan said, to make the American dollar as good as gold. A lot of people are saying the U.S. is going in that direction. It may be that they will bring the gold standard back again, and make the American dollar good in that way. It is an interesting idea. If that happens, Canada must be ready. We may have to reconsider pegging our dollar.
What is happening to our dollar today while we are sitting here? It is dropping, and dropping very fast. It is at 80 cents, or 80.1. It is falling fast. I heard on the radio that it may drop to 77 cents. Some analysts are saying it will drop to 77 cents. It may be that we should think about pegging our dollar and making it good, too. It may be that we need to peg it at about 70 cents, but perhaps we should peg it at 75, 76, 77, 78, or 80 cents. I do not know what you are going to peg it at, but perhaps you had better peg it at some point and guarantee it. Let the Canadian government guarantee that dollar because if it guarantees that dollar, we can start controlling the interest rate a little better and we would not have our interest rates fluctuating up and down and being influenced so much by international markets. To stabilize that dollar, we would have to put some money again today into the money markets. If it were pegged, it could be stabilized and that stabilization of the dollar would mean we could then work on the interest rates. That is what we have to do now.
I would be happy if the Liberal government would wake up to supply side economics, if they would swallow their pride and look at the way it works. Then we could control inflation rates better, interest rates would begin to drop, and the unemployment rate would follow suit as sure as can be. That will drop as well. Why not take those good ideas and apply them? Some people say that that is fine for the Americans but that ours is a different stituation. That is a large model, they say, there are 250 million people there, that situation does not apply here.
Very well, let us take the other side and see if it has worked anywhere else. Let us go to a smaller model, let us go to Puerto Rico and see what has happened there. Under Governor Romero's leadership, income tax in Puerto Rico has been
reduced by 5 per cent per year since 1977. Can you imagine, our starting a program this year and saying that for every year we are going to reduce taxes by 5 per cent? What if we had done it for five years, since 1977? It would be 25 per cent, 30 per cent next year. If people had that kind of confidence that the government was going to do that, what would happen? In Puerto Rico the additional 5 per cent reductions have been legislated since 1982, tax rebates have increased each year, employment has soared, and the Puerto Rican government has gone from deficit to surplus. That is what happened there, with tax cuts.
Let me say that again. That is the message I am trying to leave with you today, Mr. Socialist over there. I say, listen, here it is. Tax rebates have increased each year. In other words, in Puerto Rico they cut the taxes every year by 5 per cent and they got more money than the year before because they increased productivity and people were working at real jobs. Employment soared. We used to talk about Puerto Rico and the unemployed, that they all had to come to New York, to the United States. Now the Puerto Ricans are employed on their own merit, on their own quality and on the ability of their own government to design an economy. The Puerto Rican budget, which was hopeless, which was blocked into deficit, in fact went from deficit to surplus.
We have a long way to go in this government to get from deficit to surplus. The government opposite have been borrowing, as they are doing today, spending and wasting. There is not one Canadian who does not know about that wasting and is not concerned about it. The government opposite suddenly has adopted the attitude that it can do better than the individual Canadian can.


Some hon. Members:: Hear, hear!


Robert Lloyd Wenman: I can tell you, Mr. Speaker, that the government opposite cannot do it better than the individual can. You cannot beat individual initiative, individual incentive and free enterprise. For too long free enterprise has been a dirty word. People kept talking about free enterprise and thinking that somehow all the wealth would come into one hand. It does not work that way, it has not worked that way.
We keep talking about how the other system, the socialist system, would redistribute the wealth, in other words, take it from everywhere and give it back, redistribute it. We have had great faith in that redistribution. What we have lacked faith in is the goal. It is not a redistributed profit that we need; it is the creation of new wealth. That is what we need. We have to say that there is a certain amount of dollars in our society. We do not need to take them and squash them down into a little thin line. No, we do not have to do that. We have to take this little line of wealth that is here and note that above it is another pile of wealth and power that has not even been tapped. That is the wealth and power of the Canadian people themselves. They can produce more, if they are given the opportunity and incentive to do so. That is the great wealth of this nation, the great resources of this nation, that the government over there is bungling.
May 12, 1982

What is happening to the potential of the west? I spoke here last year about the potential in the west. I spoke excitedly about the Alsands project and the pipeline and coal development in British Columbia. I said that if the Government of Canada could just see our potential and let us grow and develop, by our growth and development all of Canada would rise with us.


Mr. Parker:: Grants.


Robert Lloyd Wenman: We should not give money out in grants. It should be given back to the people through tax cuts. If we gave people their money back, they would know how to spend it. They would buy things and create incentives. That is how to create a new and strong society. That is the new Conservative supply side economics.


Svend Johannes Robinson: Reaganomics.


Robert Lloyd Wenman: Why are hon. members on my left so afraid of what works? Why are they so afraid of success? I do not understand it. I know that what the socialists to my left and the socialists across the way want is morally right. I see their good and shining faces here. I see their halos. I know that they, like I, want a better way for all Canadians. We all want the same thing. It is just that they are naive.


Sidney James Parker: You want the multinationals to take it all.


Robert Lloyd Wenman: That line is so sick and old that it went out 30 years ago. Even socialists do not pump that one any more.
This is a great nation with great potential. That potential is in the east and the west. There is a potential inside me and inside everyone here. It can be developed, but it will never be developed properly by the government's taxing more and borrowing more. It will only be developed if we rid the economy of unwarranted and unneeded regulations, restrictions and requirements.
There are six things which need to be done to bring a new economic order to Canada. First we have to rid the economy of unwarranted and unneeded regulations, restrictions and requirements.
Second, we have to maintain the integrity of the Canadian dollar. That may mean pegging the Canadian dollar and making sure it retains its value, because when the dollar retains its value we will not have to worry about interest rates bounding up and down. We can lower interest rates. We need lower interest rates, and I am telling hon. members opposite how to do that. Another thing we could do is to get involved in forward markets. Instead of going day to day and buying the dollar day to day, perhaps we should buy it for a year from now so that we will guarantee its value a year from now. Then there would be stability in relation to interest rates. We should get involved in forward markets. That is an alternative which is worth looking at. It would stabilize the dollar and perhaps make it as good as gold. We can make the dollar good by pegging it to the American dollar, if we want to.
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Third, we should develop freer trade. We should take away trade restrictions. We should go into the Pacific Rim. I could talk about other examples. I have talked about Puerto Rico and the United States. What about Japan? What is the unemployment rate in Japan? What is the inflation rate? What is the interest rate? It is about 5 per cent across the board. It could vary a couple of percentage points either way. What about Malaysia? What about Thailand? What about those upward real growth economies? Real growth can be shared, whether under the trickle-down theory or whatever. It is like the tide coming in. If there is a tide of wealth, power and opportunity coming in, everyone rides on that tide. All the people are lifted by the tide in proportion equally.


Svend Johannes Robinson: Or they can be washed up.


Robert Lloyd Wenman: They could be if there is not social justice. I agree there must be social justice, but that does not necessarily mean redistribution or lack of incentive.
Fourth, we should cut government spending. We should make government a smaller part of our lives.
Fifth, we should restore incentives in society. We should restore the old profit and free enterprise motive. It works. Why should we not do it? It has worked.


Svend Johannes Robinson: Rubbish.


Robert Lloyd Wenman: It is not rubbish. It has worked. It has not had an opportunity to work in the Soviet Union. It has not had an opportunity to work in the socialist countries of the world, although I notice the Chinese are starting to come along. They are beginning to look positively at motive, incentive and profit. I have been to many Third World countries, and some of them are turning around. Peru is one example. Others have turned around on the basis of a free enterprise model, but they have not done so on the basis of a socialist model. Socialism does not work. That is an outdated, dead philosophy of many years ago, and its time is passing fast.


A. Daniel McKenzie: Sweden saw the light.


Robert Lloyd Wenman: Finally, we need tax cuts. I do not mean little tax cuts; I mean a big one. A little one will not make any difference. We need a big one to provide real incentive.


Svend Johannes Robinson: What if you don't pay taxes? What about the poor and the elderly?


Robert Lloyd Wenman: Mr. Speaker, I have been speaking for almost 40 minutes. I have given the hon. member the answers. As I said, he has the right idea; he just has the wrong solution. He means well; it is just that he is somewhat naive economically. For that I forgive him. I encourage him in the other things he speaks about in this House, and I support him, but on economic matters he should listen to me because we in the neoconservative movement of North America and the world have the answers. The answers are not in the hands of professionals, socialists and intellectual elitists. The answers lie in basic

May 12, 1982
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common sense and in basic humanity. We in this House of Commons have the answers. Let us give power back to the House of Commons. Let us have the authority. Let the government listen to us, and we will provide the answers for the Canadian people. It is too bad Parliament is being destroyed.
I could go on for much longer, but I want my message to come through clearly. We can have lower taxes and lower interest rates. If we did, we would have lower unemployment rates, and that would bring about a better and stronger society. I believe that. I hope someone listening today believes it. I hope everyone listening today will agree that now is the time to move upward. We must always judge where the bottom of the market is, and if we are at the bottom, now is the time to take a chance and invest in this country. Now is the time to show our Canadianism, to demonstrate that we really believe in it and to get in there, work a little harder, and invest a little more. If we did that, we we would be participating in a recovery which would allow this nation to continue to be the best in the world.


The Acting Speaker (Mr. Jarvis):: The hon. member for Burnaby (Mr. Robinson).


Svend Johannes Robinson: Mr. Speaker, we are very pleased to see such a distinguished hon. member occupying the Chair.
I rise this afternoon to say a few words about the bill before us, which asks Parliament to authorize the borrowing by this government of some $6.6 billion.
I view this bill from the perspective of the representative of the people of Burnaby, who have told me in no uncertain terms that the economic and budgetary policies of the Liberal government are a disaster. I intend to touch this afternoon on several areas of concern to my constituents. They are of concern not just to my constituents but, I believe, generally to the working men and women in Canada.
However, before doing so, I cannot resist commenting on the remarks made by the hon. member for Fraser Valley West (Mr. Wenman) on behalf of the Conservative Party. He indicated that the Conservative party is an advocate of Reaganomics and neo-conservativism. On February 15, his colleague and finance critic, the hon. member for Etobicoke Centre (Mr. Wilson), said that the Progressive Conservatives had better pray that Ronald Reagan is successful with his economic policies in the United States, or his party could suffer enormously here in Canada.
The hon. member for Etobicoke Centre said:
It's something that we would be doing if we were a government. Something we will do once we are in power again.
He said this to Conservatives:
You had better pray that the United States is successful in turning around their economy because if they aren't it will be very hard for us as a party to convince people of our policies.
Was he not right? The policies of Ronald Reagan in America are a disaster, and every day it is being shown more and
more clearly what a disaster they are for the people of America. Those are the policies the Conservative party is advocating here in Canada.


Robert Lloyd Wenman: What is their inflation rate? What is their interest rate relative to ours?


Svend Johannes Robinson: Members of the Conservative Party have spoken of interest rates, and I agree we should talk about interest rates and the devastating effects high interest rates are having in our communities, and particularly on small business people. However, I remind the Conservative Party that the person who is responsible for that particular policy is the Governor of the Bank of Canada together with the Minister of Finance (Mr. MacEachen). The governor is a fellow named Gerald Bouey, and he was reappointed as Governor of the Bank of Canada not by a Liberal government, but by the Conservatives.


Mr. Nystrom:: Shame!


Svend Johannes Robinson: Gerald Bouey, this great economic guru who is being bitterly attacked by the Conservative Party as the author of high interest rate policies, was reappointed by the Conservative Minister of Finance, the hon. member for St. John's West (Mr. Crosbie). So let us hear no more about the Conservative alternatives.
Some of us, Mr. Speaker, who were Members of Parliament when the Conservatives were in power, remember the telegrams, letters and phone calls we received from our constituents. I am not going to read a lot of them, but I have a telegram sent to Prime Minister Clark from a small businessman in my community of Burnaby. He said this:
Congratulations Mr. Prime Minister Clark. We both are flat broke. You politically, me financially. We all will be out of business very soon. It is impossible for me or anyone to pay 16.5 per cent interest on $2 million on debenture to the Bank of Montreal from business $2.3 million gross take.
Prime Minister Clark, you just didn't have heart to muzzle these interest rate hungry pirates.
P.S. Please don't tell me it is good for Canada and the only way out. I can give you half a dozen ways to keep dollar where it is today without bankrupting Canadians.
That, Mr. Speaker, was one telegram I received in response to the disastrous Conservative economic policies. Now the Conservatives say the NDP was responsible for their being thrown out of office. Mr. Speaker, the only people responsible for the defeat of the Conservative Party were the people of Canada in the election of February, 1980.


Some hon. Members:: Hear, hear!


Svend Johannes Robinson: Let us recognize that fact very clearly. What hypocrisy for the Conservatives on the one hand to call for a speedy election so that the people of Canada can have their say on the Liberal government-and I certainly agree with that and I know they would be turfed out-when on the other hand they were not prepared to accept the verdict of the people of Canada in February, 1980. They say they present
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an economic alternative. I would like to quote the former Conservative Minister of Finance, who has now been shuffled over to being their External Affairs critic speaking on the policy of interest rates as follows:
Yes, I would continue to back Mr. Bouey.
No surprise, Mr. Speaker; he reappointed him. He said:
I agree that our interest rates have to keep track of those in the United States.
That was not a Liberal, that was the Conservative finance critic in the summer of 1981. "I agree with the policies of the Liberal government; interest rates must stay high."
Recently the present Tory finance critic said this:
One after another the premiers proposed reducing interest rates, while accepting the inflationary consequences of a lower Canadain dollar. They were convinced that the benefits of lower interest rates and increased economic activity would offset the negative effects of increased inflation.
Some of us happen to agree with that, but what did the finance critic for the Conservative Party say? He said, "I do not agree with the premiers, I agree with the Liberal Party."


Lorne Edmund Nystrom: Shame!


Svend Johannes Robinson: He said:
It's a quick fix that Mr. MacEachen is against, and I agree with him on that.
I am not quoting a Liberal colleague of the Minister of Finance; I am quoting the finance critic of the Conservative Party.


Donald Frank Mazankowski: That did not work in Saskatchewan and it did not work here.


Svend Johannes Robinson: We know the Conservative Party has suported the policy of hewers of wood and drawers of water. We know that one of the top financial advisers to Prime Minister Clark said:
There's nothing disgraceful about being a hewer of wood and drawer of water if that's where you have your comparative advantage.
That was said by a senior adviser to the Conservative government, Mr. Speaker.
Let us just come right up to date and see what the very distinguished Leader of the Opposition (Mr. Clark), faced with disastrous economic policies, high interest rates, high inflation and a totally unacceptable level of unemployment, said one week ago today. He said:
Wc have looked for a solution other than the government's, but we couldn't come up with an alternative.
What an abdication of responsibility on the part of the Official Opposition. They condemn the government's policies, as we do, but when they are asked to come up with an alternative, what does the Leader of the Conservative Party say? I repeat:
We have looked for a solution other than the government's, but we couldn't come up with an alternative.
He continued:
At this moment I don't have a better solution.
What an admission of the bankruptcy of the policies of the Conservative Party! So much for the so-called alternative offered by the Progressive Conservative Party.
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In the same interview, the former prime minister indicated he was not really a Conservative, he was really a progressive. I think some of us know that particular tendency in the Conservative Party is under bitter attack, and some of us wonder just how long the "progressives" in the Progressive Conservative Party will survive in the fact of that attack.
Enough said, Mr. Speaker, on the absence of any alternative offered by the Conservative Party to the very real economic crisis facing our community. It is clear the government today is prepared to fight inflation on the backs of working men and women, the poor and the elderly. What action has this government taken to close the tax loopholes which so riddle our income tax system? I need only point to a recent issue of Canadian Business with the headline on the cover "Tax avoidance as a way of life. How to turn the toys in your life into income tax deductions". We suggest, Mr. Speaker, that an income tax system so riddled with loopholes which benefit only the well-to-do and wealthy must in fact be radically altered. It is a system in which the rich get richer and the poor get poorer.
We have seen the failure of this government to bring forward any effective competition legislation despite the fact the small business sector is being rapidly driven under by corporate concentration in the Canadian economy. What does the Conservative Party have to say about that? They are silent. In fact, when pressed, they say competition legislation is not a priority at this time. Let the big corporations get even bigger. The government purports to be fighting inflation. We all know the devastating effects this policy is having on unemployment. Almost two million Canadians cannot find work, many of them young people and women, but they say they are fighting inflation.
Well, what are the facts? In the greater Vancouver area, which I am fortunate enough to represent, the percentage increase in inflation year-over-year until March, 1982, was 11.4 per cent. How can they suggest with any credibility that they are in fact fighting inflation in light of that kind of increase in the cost of living?
There are many sectors reeling under the impact of this government's economic policies. I do not intend to cover all of them, but one of the most significant is the impact on the forest industry in British Columbia. Members of the International Woodworkers of America have documented very clearly the devastating impact on their members, and the absence of any sensible alternative. Nothing whatsoever has been done about high interest rates, and we know the effect on the construction industry. Not just the construction workers, but others in the labour movement who are supported by the IWA membership are hurting. We know the high levels of unemployment in the forest industry are directly attributable to the high interest rate policy of the Liberal government. We know as well that the proposal in the budget to tax the reasonable

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benefits, which in particular such people as union business agents and field workers receive, are totally inequitable. The tax, for example, on vehicles used by business agents means an average increase of some $100 a month in their expenses. The company car which is given to the high-priced corporate executive is a perk, but these people of course need these cars to do their jobs. We know as well the impact of this budget and the failure of this government in the bill before us today to come to terms with the serious slump in the plywood industry, particularly in British Columbia. Plywood made in Canada is largely sold in Canada. The slump in construction, particularly in the area of home building, directly affects those in the lumber industry, especially plywood mill workers.
In British Columbia today there are 10,000 unemployed IWA workers. At the peak of unemployment there were some
15,000	people unemployed. In the last six months, over 22,000 IWA members have had a lay-off of six weeks or more. There will be permanent damage to many industries in Canada as a result of this government's high interest rate policy, including the forest and the lumber industry. What must be clearly shown is that it is the same policy which 1 have talked about that put woodworkers out of work and is so profitable for those who are already wealthy, those who have high salaries, such as the Governor of the Bank of Canada and the Prime Minister of Canada (Mr. Trudeau). They have extra money to invest. These high interest rates are beneficial to these people because they can receive a significant return on their investment. Once again, the rich get richer and the poor get poorer. It is the same old story.
We know as well that the decision to tax working people on the benefits they receive from their employers is most discriminatory. Loggers have to go to logging camps in order to work. They have no choice. They are charged a certain amount for room and board. In some cases it is $2.50 a day. But the budget has brought in measures that will see these loggers taxed on a benefit which the government claims is worth as much as $60 a day or more. This could cost IWA members some $3,000 a year or more in additional taxes. While businessmen and women can go and spend a few hundred dollars for their hotel, their meals and their martinis at lunch time and claim these as business expenses, the working men and women in the logging sector of British Columbia are being forced to shoulder a significant increase in their costs as a result of the impact of this budget.
I might add that there are as many as 2,500 or 3,000 IWA members who live in my constituency of Burnaby.
There is one argument that I believe should be laid to rest. It is an argument that has been repeated with increasing frequency by the President of the Treasury Board (Mr. Johnston), The Prime Minister and the Minister of Finance. It is that somehow Canadian workers are the highest paid workers in the western world and that we have to cut back on the salaries of working men and women in Canada. By doing that, all of our problems will be answered.
It may have been at one time that we did well in Canada compared to workers in other countries. In 1970, for example, the hourly compensation of Canadian workers was second only to that of the United States. It is important to note that in 1980 Canada's relative position had slipped. Workers had moved from second position of ten countries in the western world to seventh position. The percentage growth in hourly compensation for the manufacturing workers in U.S. dollars was lowest of any of the ten countries being compared. From 1975 to 1980 working men and women in Canada had a percentage increase of approximately 48 per cent in their hourly compensation. Other countries, such as Belgium, had a 100 per cent increase; France had a 104 per cent increase; Britain had a 116 per cent increase. There were many other countries with much higher increases in their hourly compensation. Therefore, to suggest that working people should be made the victims of this government's economic policy is blaming the wrong people. If anyone should be brought to task for the failure of this government's economic policies, surely it is the members sitting on the government side themselves.
The ultimate insult in this government's economic policies and in the policy which is enunciated in the bill before the House today is suggesting to Canadians through a degrading and an offensive advertising campaign, a campaign which costs some $4.6 million, that it is "Making Canada Work." We all agree that we should be making Canada work. I know the people of Burnaby question the waste of Employment and Immigration Canada spending $4.6 million on an ad campaign which shows a young man standing in front of high tech video screens and a young woman posing in front of construction equipment with a caption "Making Canada Work". In the bottom corner there is a sticker from Employment and Immigration Canada. This amount of $4.6 million is an appalling waste of money on this kind of government advocacy advertising. Its sole objective is to promote the government's corporate image. If this government has $4.6 million to spend, it should not be wasted on this kind of advertising-and we know that millions are wasted on similar advertising by this government. Instead, the government should be spending the money on putting Canadians back to work.
I would like to turn now from some general remarks to the situation which particularly affects my constituents in Burnaby. The unemployment rate in Burnaby at present is officially at 12.5 per cent, but the real rate is at least 15 per cent. The volume of unemployment insurance claims at one Burnaby Employment and Immigration office has been running at almost double the anticipated volume since January. It averages between 45 and 50 claims a day. The normal average is 20 to 25. The vast majority of these claims are generated by lay-offs.
The forestry turndown is showing up on Burnaby unemployment records. Many of the loggers who live in Burnaby who would normally be working in the woods right now are registered already in the employment office. This situation applies also to miners who live in Burnaby.
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Construction activity in Burnaby is minimal. The only major construction at this point is the erection of three high rises. South Burnaby has three work-sharing agreements in effect and even more is going on in North Burnaby.
The B.C. Institute of Technology is laying off 26 faculty members, perhaps more. There have been serious cutbacks at the Burnaby General Hospital. Somewhere between 100 and 150 staff positions have been cut, half of them are nurses. Thirty-six acute care beds are being lost at the Burnaby General Hospital. They are being eliminated. The number of Canada Manpower industrial training programs in Burnaby compared to this time a year ago is exactly one-half. The biggest clerical employer in Burnaby is the B.C. Telephone Company. At the present time it has a hiring freeze in effect. B.C. Tel laid off all its temporary and part-time operators. Simpsons-Sears is the second largest employer in Burnaby. It has been laying off people steadily since last November, to the extent that its staff is now cut in half from 800 to 400.
There are a number of small businesses in Burnaby employing ten people or less. They are very seriously hurting as a result of this government's failure in the economic field. Building permits are down about one third over last year. That is a clear indication that construction is in the doldrums.
Perhaps one of the most significant statistics is the stock of UIC claims with people who are resident in my federal constituency of Burnaby. In July, 1981, there were 1,780 individuals resident in the federal constituency of Burnaby claiming UIC. In October that number had risen to 1,863. In December that number had risen to 2,545. But we come now to the statistics which are most alarming. In the first four months of this year the figures increased as follows. In January, unemployment insurance increased to 3,061, in February, that figure rose to 3,475; in March it rose to 3,796, and in April the figure rose to 4,215. From July, 1981 to April, 1982 the figures rose from 1,780 people claiming unemployment insurance to 4,215, which is an absolute disgrace.
I would also like to comment on the over-all situation in British Columbia. I will quote from a confidential document entitled "Economic	Review-British Columbia-Yukon
Territory Region". It is dated April, 1982. This is the most recent document which summarizes the economic situation in British Columbia and the Yukon. This document is prepared by Employment and Immigration Canada. I will read just a few extracts from it to give the government some indication of the seriousness of the recession facing us in British Columbia. According to this document, the good news is that the recession has hit rock bottom. The bad news is that we are likely to remain at rock bottom for some time to come.
What kind of forecast is that for the people of British Columbia? The document also indicates that lay-offs are continuing throughout the forestry industry. MacMillan-Bloedel expects many of its mills to be shut down for considerable periods during the summer because of the reduced demand for newsprint. In my own constituency two industrial
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mills laid off 15 people two months ago and are placing a further 75 people on a work-sharing contract.
Also the document indicates that the mining industry is following the path of the forest industry into the depths of a recession. For most of the workers in the mining industry the big problem will be getting through the coming summer. Two mining companies with head offices located in Burnaby indicate that they expect very serious difficulties in coming months. In the oil and gas sector exploration activity has dropped significantly over the past year. This confidential document prepared by the department continued:
A victim of continuing high interest rates, many small and some not so small construction companies are facing bankruptcies, receivership or just general hard times.
One construction company in Burnaby is now in receivership.
In the service sector all services are being hurt in the current recession. These include consumer services, business services and government services. As we know, retail sales have been particularly hard hit during the current recession. The current overall picture is of major lay-offs which have caused generally across the board high unemployment. Many other industries, especially service industries, which rely on people who work in sectors such as mining and manufacturing having money to spend are also under restraint.
We know that the hospitals in British Columbia are being attacked, that jobs are being lost in the hospital sector and that schools are being shut down. In my constituency of Burnaby five schools-two senior secondary schools and three elementary schools-have been shut down. I recognize that this bill and its authorization of borrowing will not do anything whatsoever to alleviate that very serious problem and the effects of the economic policies of the government.
There is nothing whatsoever in this bill to deal with the serious housing crisis facing the people of Burnaby. What is in the bill, in particular for young people, who want to buy homes, to deal with astronomical interest rates? There is absolutely nothing but a usurious interest deferral scheme which was recommended to the minister by the banks. Is it any surprise that the policies of government only help the banks? If we look at the most recent disclosure figures for contributions to the Liberal Party and to the Conservative Party, we see the following statistics. In each year each of the major banks gave $50,000 to the Liberal Party and $50,000 to the Conservative party. The banks know very clearly where their interests lie in this particular economy-it is with the Conservatives and the Liberals who regularly receive money from the Canadian banking sector. They do not see any difference, neither do the people of Canada.
I should like to turn to the impact of the economic policies of government on post-secondary education and on young people, particularly post-secondary education students. In my constituency is located Simon Fraser University, the British Columbia Institute of Technology and the Pacific Vocational

May 12, 1982
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Institute, as well as a number of high schools. I will be attending graduation ceremonies this month and next month at the high schools in my constituency-Burnaby North, Burnaby Central, Burnaby South, Cariboo Hill, St. Thomas More and Marian High School. What do I tell the graduating students when they ask what their prospects are for jobs? What do I tell them at the British Columbia Institute of Technology or at Simon Fraser University or at the Pacific Vocational Institute? I can tell them about the bankruptcy of the Conservative economic policies and of the failure of Liberal economic policies. But I can do no better than to quote one of the senior instructors of forestry at the British Columbia Institute of Technology. He said:
I've been involved in forestry for 35 years and the job situation now is the worst since about 1947. There's been ups and downs but never as bad as this year. Maybe 25 per cent of the student body will find jobs ... normally it's 90 per cent at the time of graduation.
Other technical students, including mining students, are experiencing setbacks.
The branch manager of BCIT's Canada Employment Centre said:
Right now, the opportunities are dismal. Usually 90 to 95 per cent find work but it will go a way down this year. They could get work fighting fires-
Even that is no longer present. He went on to say:
-students cannot look to the public service sector for help.
BCIT noted as well that the number of employers recruiting on its campus is significantly less this year. I also point out that the situation at Simon Fraser University for graduates of that university is very much the same. The summer job market is bleak. It is the bleakest it has been for post-secondary students in many, many years. The housing situation facing post-secondary education students is impossible. The Liberal government and the Minister of Public Works (Mr. Cosgrove) has refused to allow CMHC to provide any funding for housing for post-secondary education students.
A young man came to my constituency office a month ago. He told me that he worked for two years to save enough money to study at technical school. He spent two years of his life training to become a wildlife technician. For two years since he graduated he has been looking for a job. What do I tell him? What kind of waste of human resources in the country is that? What kind of waste is that which is being duplicated across the land?
It is young people who are being particularly adversely affected by the economic policies of government and it is also women. I should like to point out the serious impact of government economic policies on women and the failure of this particular piece of legislation to come to terms with that devastating impact. We know that traditionally the unemployment rate for women is higher than it is for men and that in times of economic crises, such as those we face now, this problem is exacerbated by the last-hired-first-fired syndrome. Although the number of women entering the labour force has increased very significantly during the last ten years, basically more women are doing the same kind of work. Sixty per cent of all working women do three kinds of jobs-clerical jobs, sales jobs and service jobs. These are low-paying, dead-end jobs; in effect, they are job ghettos. In many of these areas we
are seeing significant lay-offs which disproportionately affect women and disproportionately affect young women.
Also we know that the wage gap between the wages of women and the wages of men is 60 per cent. For every dollar a man earns, a woman earns 60 cents. For example, in Canada in 1979 the average working woman earned $11,741 compared with the average man's salary of $18,537. Women do not only suffer from this wage gap at the present time, but as well when it comes time for a pension, including the Quebec pension plan and the Canada Pension Plan, their low pay follows them. Low pay means little or no pension benefits on retirement.
Basically the federal government has been providing lip service to remove this disparity. It acknowledges that the problem exists but it refuses to implement effective affirmative action programs to mitigate against this job ghetto and wage gap disparity. It insists upon voluntary affirmative action programs in the private sector, and the result of those has been a dismal failure. The last count shows that some 27 of 750 companies approached have signed such an agreement. Also we know that in this time of economic crisis there have been serious cutbacks in child care facilities which once again discriminate heavily against women. There is still a very small percentage of women in the management category. 1 believe there is some 4.3 per cent in the public service. The government's record on its commitment to equal pay for work of equal value is absolutely vacuous.
We know that there is nothing whatsoever in this budget and the bill which was introduced by the minister to assist the elderly and old age pensioners who are falling further and further behind. In 1980 some three million Canadians lived in poverty. Ten per cent of all Canadian families and 30 per cent of all single people were poor, according to statistics provided by the National Council of Welfare.
Perhaps the most searing indictment of this government's economic policies is the fact that over half of the single persons in Canada over the age of 70 live in poverty. Over two-thirds of the elderly women in Canada live in poverty. In this day and age, that statistic is an absolute disgrace.
There has been virtually no change in the distribution of income from 1951 to 1981. The bottom 20 per cent of families still receive 5.9 per cent and the top 20 per cent still get about 40 per cent, which is almost ten times as much. That figure has not changed over the last 30 years.
We in the New Democratic Party advocate a fundamental approach to the serious economic crisis facing Canadians today. Our first proposal is for a massive injection of funds into the economy in order to create jobs in Canada. We must recognize that at this time in our history there is much work which needs to be done. Jobs could be created if only this government would take the initiative and put Canadians back to work instead of having them collect unemployment insurance and welfare.
We also believe that we must take control of the manufacturing sector in Canada which is now so heavily dominated by
May 12, 1982

foreign interests in general and American multinational corporations in particular. The government should revitalize our manufacturing sector and ensure a far greater proportion of research and development is carried out in Canada. As a result of our branch plant economy, the proportion of our research and development being conducted in Canada is one of the lowest of any western nation.
We must immediately lower interest rates to break their stranglehold, particulary on small businesses on this country. We must eliminate the insidious situation where the only ones who profit from the economic policies of this government are the banks.
As I have said, there is much work to be done and I do not have the time to enumerate the many sectors in which jobs could be created. However, one such sector would be the field of shipbuilding, where literally thousands of jobs could be created if a Canadian shipbuilding sector were developed. This sector would have a significant impact on our balance of payments. Other sectors which could create jobs are energy conservation, reforestation and, most importantly, as I have indicated, the manufacturing and high technology sectors of our economy. All these areas must be stimulated.
The most important step to take is to break the corporate stranglehold on our economy once and for all. This stranglehold on our economy is a result of the dominating pursuit of profit and greed. The pursuit of that profit and greed has led to the poverty we have seen, particularly among the elderly and single parents. Another result of this pursuit has been the destruction of our environment in many parts of Canada because the way to achieve greater profits is to cut corners. Profits will be greater if you do not take precautions to ensure that there is no pollution or that acid rain does not destroy the lakes of northern Ontario, that there is no arsenic poisoning in the Northwest Territories. The pursuit for greater profits means to disregard the question of ensuring that Minamata disease and mercury poisoning does not affect the native people in northwestern Ontario. We should make sure that Amax does not pollute Kitsault Inlet in northern British Columbia.
An economic system based on the pursuit of greed wreaks havoc on the health and safety of workers and, indeed, on the lives of working people. Since it cost money to ensure a safe and healthy working environment which would result in reduced profits, it would be natural for those whose only goal is the pursuit of profit to be unconcerned about injuries to a few workers, or illness or possibly loss of life. Just last month, a company in southern Ontario was fined $4,000 because a worker lost his life. The reason he lost his life was that the company involved had not followed the occupational health and safety regulations of Ontario.
In an economic environment where the pursuit of profit is based upon squeezing as much as possible out of the system, the result is the destruction of the environment and death, maiming and sickness of working people.
Hazardous products are another result of this economic environment. Since companies are primarily concerned about squeezing as much money as possible out of the manufacturing
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process, they will try to manufacture their products as cheaply as possible. If your company builds Pinto automobiles, for example, you will calculate that it will cost more to produce a safe car than to face court costs resulting from litigation. What kind of obscene economic system is it when it is based solely on the pursuit of profit and results in unsafe and hazardous goods? Another example is flammable nightgowns for children which are permitted to be made. This type of system also results in degrading and offensive advertising and the waste which is so prevalent.
Our party envisions an economic system which is fundamentally different from the one advocated by the Liberal and Conservative parties. We seek an economic system in which all people who want to work will have jobs. We seek an economic system based upon serving the needs of people instead of satisfying the greed for profits to the greatest extent possible.
I have received a great deal of correspondence from my constituents in Burnaby concerning the budget and the proposal which is before the House today. These letters from my constituents have urged the government to change fundamentally its economic direction. I have received more letters describing the pain being felt by my constituents as a result of the budget, high interest rates, unemployment and the high cost of living than on any other issue.
Just last week I had a gentleman, Mr. Berkenpas, come into my office. He worked for 18 years as a draftsman in Burnaby and had been laid off due to the effects of this government's economic policies. He is 56 years old and has worked 18 years with this company. What is he to do with his future? He has a family to support.
Pensioners have written me about their anger over the suggestion in the budget that the provision regarding contributions to an RRSP will be changed so that they will no longer be eligible for a $1,000 pension income deduction.
A Mr. Terpening who lives on Southwood Street in Burnaby said:
My wife and I have been married for 27 years, i am a pensioner and the pension I receive from my former place of employment is such that, in the event of death, the pension will, of course, be cut in half with a further reduction due to the fact that my wife is 20 years younger than myself.
He goes on to say:
As you will appreciate, the Government proposal to prevent seniors putting monies into an RRSP without their being penalized will, in our case, cause an unnecessary hardship, as it will no doubt to other senior citizens.
I have some more examples of the economic impact of this government's policies. I had another letter on the question of taxing RRSPs and the taxation of benefits. Many constituents are concerned about the taxation of life insurance and annuities. One constituent will lives on Montecito Drive in Burnaby wrote:
I do not feel it is fair to discriminate against policy owners who choose permanent life insurance to provide long term protection rather than term insurance-
I have taken this opportunity to bring to the attention of the Government of Canada and the people of Canada, through the

May 12, 1982
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vehicle of Parliament, the concerns of my constituents about the economic policies which, in my view, are having a very serious impact not only on my constituents, not only the people of British Columbia, but on all Canadians. We say that there must be a fundamental change in the direction of the policies of the government.


Norman Kelly: Mr. Speaker, I will not present my economic speech in the House today since I attempted to do that yesterday.
I cannot help but feel compelled to comment on the tenor of the speech made by the preceding speaker. I would hope that most politicians in this House would understand that all of us irrespective of political persuasion are trying humanely and intelligently to do our best for the electorate. There is no one in this House who does not come to this chamber sensitive and eager to help seniors, handicapped, businessmen, the young, females; but to hear that type of harangue or diatribe makes me think that the New Democratic Party, which poses as the party of reform, the party of change, the party of the future, in fact has a mind-set which is at least 150 years old. That is the type of social-


An hon. Member:: Think of something!


Norman Kelly: 1 have so many images going through my mind right now that I am finding it difficult to sort them out. But that language is typical of the class warfare which characterized political life a century and a half ago, when the aristocracy was fighting the middle class and there was a growing working class or proletariat. In those days, that language may have been appropriate because life for most people was very difficult. But that is not the case today. I would argue, as my colleague to my left just suggested, that that type of interven- . tion in this debate is not at all profitable. It obscures the real debate. It hinders the efforts by hard working members of this House to make the very real and tough decisions which face us in this chamber, now and in the years ahead. I would almost say that the New Democratic Party is, in its mind-set, a medieval party. For that reason, I would argue that it is a reactionary party.


William Herbert Jarvis: That does not mean shining knights.


Norman Kelly: It really casts this debate in moral terms which come right out of the writings of the medieval clergy, the priestly cast which set itself apart and above the mere mortals who had to work for a living. Those people could make their grand moral pronouncements and feel great satisfaction in having done so. That was one of the functions of the priestly cast in those days. Frankly, I do not think it was a very productive one; and it appears to be the function of the New Democratic Party today, at least as it has been revealed in the rhetoric of the hon. member who spoke earlier. But I am
carrying myself away from the major topic of debate today, which is Bill C- 111.


Mark Willson Rose: You should be carried away, Kelly.


Norman Kelly: I have been following the debate on Bill C- 111, and, from what I have been able to see, there have emerged, in the criticisms of the opposition, three major themes. The three major themes are that government is big and expensive, government is out of control; and, perhaps the most condemning of their criticisms, government today is inept. For those reasons, the opposition argues that government does not deserve to be given the money that it has requested and that the House should therefore vote with a clear conscience against Bill C-93.1 would like to take-


Donald Frank Mazankowski: Bill C-111.


Norman Kelly: I am sorry, I meant Bill C- 111. I would like to take the opportunity to offer my appraisal of those criticisms.
I would like to start with the first one, which is that government is big and expensive. I have to agree; the opposition is right: government is big and government is expensive. But 1 do not think that is really the point that the opposition members make when they argue that it is big and expensive. I think that what they are really saying is that this bigness is, in some way, unnatural, that it should not be big, that there is something artificial about the size of government and that, because it is artificial, because it could not exist naturally, then it must be as quickly as possible contained in its size and reduced.
I would argue, sir, that governments these days cannot be anything else except big and, for that reason, expensive. The public, in its quest for a comfortable existence which is as riskfree as possible, has placed demands on government which have led to the growth of government. As proof of my statement, I would offer not only the fact that the federal government has grown extremely large over the past two or three decades, but the fact that so, too, have the provincial and municipal governments. In the latter there are no party loyalties. Ostensibly, municipal governments are party-free. If one takes a look at the voting records of these governments, one will see that there is a free mix of votes in that forum, so that people do not vote strictly along party lines. But municipal governments have perhaps been the fastest growing level of government in Canada in the last decade and a half. Therefore, I simply cannot accept the arguments of the opposition that this party, this Liberal government which has been in office for so long, has-


Donald Frank Mazankowski: Too long.


Norman Kelly: -of its own volition deliberately and manipulatively expanded the size of government for its own political purposes. This government has been sensitive in listening to the demands of the public and has grown in response to those demands. Rather than being condemned for them, I think this party should be praised.


Donald Frank Mazankowski: A lot of cheering on that one!
May 12, 1982


Norman Kelly: As the hon. member in the opposition said, no one is cheering me on that one. Well, Mr. Speaker, take a look at the provincial governments. Whether the government is Progressive Conservative-


Donald Frank Mazankowski: There are quite a few of them.


Norman Kelly: -whether the government is Social Credit, whether the government is Pequiste, whether the government is New Democrat-


An hon. Member:: No Liberals.


Norman Kelly: -all of the governments of Canada have listened to the demands of the public and, in their responses, have grown proportionately as large as the federal government, if not larger. I do not hear hon. members opposite criticizing those governments, presumably because many of those governments are of the same political persuasion as they are and it would not be fit or seemly to have an interfamily quarrel on the floor of this chamber.


Donald Frank Mazankowski: No, never do that.


Norman Kelly: The point I have been making is that the federal government has grown in a very natural, very humane and therefore very compelling way over the last two decades.


Mr. Munro (Esquimalt-Saanich):: In a very indebted way.


Norman Kelly: I would illustrate my argument by asking the members in the opposition to turn their criticisms around and to ask themselves what they would cut from the present federal budget. If government is too large and too expensive, what would they cut?


Gordon Edward Taylor: Cut out metric.


Donald W. Munro: Purchases of Petrofina.


Norman Kelly: The budget is divided roughly into four parts. Transfer payments account for 51 per cent of government expenditures, the public debt about 23 per cent, government operations about 16 per cent and national defence approximately 9.7 per cent.
If you go through the arguments of the opposition parties as we listen to them in the House or find them in newspapers or magazines, Mr. Speaker, you will find that while each party has a different emphasis on how it should spend money, or a different mix in the programs they project, the size of government and the totality of its budget would be really very little different from what we have today. In fact, I would argue that both would probably be larger then what we have today.
For example, in our transfer payments 51 cents of every dollar is transferred to provincial governments, corporations and individuals. I have not heard any spokesman for the two opposition parties suggest they would make any cuts, let alone sizeable cuts in any transfer payments to the three recipients I just mentioned. In fact, if you look at the rhetoric of the opposition parties, you will find that that portion of the budget would probably increase, and increase dramatically.
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What about the public debt? It was not that long ago when the Leader of the Opposition (Mr. Clark), on the verge of an electoral triumph in 1979, was talking about the need for a stimulative deficit, the need for the Government of Canada to go even deeper into debt in order to make those investments that would be necessary for a greater return, both privately and publicly, later in the decade. In light of that right hon. member's desire for a stimulative deficit, the demands by his colleagues for greater incentives to the business community and their strident demand that we give more to the provincial governments to help them look after education, medicare and social services of various sorts, I do not believe that party is committed to a reduction of the public debt.
If, Mr. Speaker, you have been following the arguments made in this House by members of the New Democratic Party, you will see that they are totally committed to a significant increase in the public debt. I am pleased to hear that at least they are honest enough to commit themselves so openly to increased indebtedness. They at least have the candour of their commitments, something which cannot be said about the party which forms the official opposition.
When we look at the cost of government operations, I doubt that the NDP would give us any reduction in this area. In fact, to deliver the types of programs they anticipate, there would be a significant increase in the size of government operations.
The official opposition party would probably make government operations slightly cheaper than they are right now. I do not know whether they would follow through with the slasher's desire to eliminate 60,000 public servants, but I expect we would see a determined attempt to reduce the size of government operations in the years ahead.
The trouble with cuts in government operations is that this is a minor cost of doing business, a minor cost in the government budget. No matter how rigorously you apply the paring knife to government operations, you will not find a lot of money. I suggest that the official opposition's desire and eagerness aside, any savings that would be found in a reduction of government operations would be minimal at best.
In the last category of budget expenditures, national defence, the New Democratic Party makes no attempt to hide its commitment to a lower defence budget. I believe I can say that without fear of contradiction. However, the official opposition has been equally candid in its projected policies in the area of national defence. If they form the government, the budget of the defence department will be increased dramatically.
In sum, when we look at the four categories of budget expenditures and the policy pronouncements of the opposition parties, we have to conclude that their argument against big expensive government is nothing more than posturing. If they have the opportunity or privilege of forming the government, we would have a government and a budget as big as we now have, with a very good chance of larger ones.

May 12, 1982
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I now want to look at the second criticism, that this government is out of control. I know in saying this in the House, members opposite are reflecting a widely spread feeling among contemporary Canadians. When I go to my constituency, I rarely attend a meeting or a function without someone making the accusation that while the government is asking them to tighten their belts, the government itself is out of control and is spending money as though there were an unlimited supply.
Let us see if in fact this government is out of control, for that is a very serious accusation and has to be met head-on in this House. I will preface my analysis of government by indicating that there are three important players and relationships in government. First, there is the bureaucracy and the relationship between its executive management and labour. Second, there is the cabinet and its relationship with the bureaucracy. Third, there is the cabinet and the bureaucracy and their relationship with Parliament. As well, there are two important concepts: first is value for money; the second is accountability.
Mr. Speaker, in the light of those relationships, from a perspective of those two important concepts, is this government out of control?


An hon. Member:: Yes.


Norman Kelly: From what I can see, and 1 do not claim omniscience though some members opposite do, I would have to argue that no, this government is not out of control. Mr. Speaker, it was not that long ago that the Lambert Commission, the D'Avignon report and a succession of auditors general sounded the warning that this government was on the verge of being out of control. This government listened to those warnings and it acted on them so that we have today in place a very sophisticated and thorough management system which did not exist a few years ago.
I would like to take this opportunity to outline this management system so that all hon. members opposite, and the public with whom they talk, can understand that this government is making a very serious effort to discipline this very large and expensive government that has evolved over the last few decades.
First of all, Mr. Speaker, there is the fiscal plan. That is a five-year projection of the anticipated expenditures of the Government of Canada. Then inside each department, in an effort to create programs that can fit into that five-year plan, there are what are called departmental strategic overviews. These overviews represent an annual review of the objectives of each department, according to the planning guidelines generated by its parent cabinet committee. These reviews examine in detail the objectives of the department. They ask a number of important questions. Do the objectives of the department still make sense? If they make sense, to what extent has the department achieved those objectives, and at what cost? If it has not achieved those objectives, or if the cost is too high, are there reasonable alternatives?
Still within the department, Mr. Speaker, there are multiyear operational plans. These plans indicate the way in which each department attempts to realize the objectives enunciated in the strategic overview. The plans are continually updated and are submitted yearly to Treasury Board and the parent committee of cabinet, with accompanying additional evaluation plans, so that Treasury Board and cabinet have the information necessary to make a wise and prudent judgment of the performance of those departments.
Still within departments, Mr. Speaker, there is something called the budget year operational plan. This is an attempt by the department to establish the relationship between the estimates presented to Parliament and the department's management system.
Now moving on from the departments there is the very real accomplishment of the reform of the estimates. The reform of the estimates has its expression in three separate documents. The first document is the government expenditure plan which outlines the expenditure plans of the government in total and by envelope for a number of years in the future. The second document shows the appropriations necessary to carry out the plans outlined in the preceding document. Thirdly, still under development and not yet submitted, are the program evaluation plans which get down to the nitty-gritty of the expenditure of the dimes and the pennies necessary to carry out the appropriations which themselves flesh out the plans of the first document.
Supplementing all of these plans and estimates is the IMPAC program. This program is three years old. There are 25 plans that have evolved in 31 departments, covering 85 per cent of the expenditures of this government and covering 95 per cent of the government's employees.
Now, Mr. Speaker, if you take all the programs that I have just outlined in boring detail and look at their impact on the system and ask yourself, has the evolution of these programs, has the establishment of all of these planning systems and the recruiting of all of the staff necessary to carry out these evaluations and plans expeditiously and accurately all produced results? Have they managed to discipline the system that Lambert and others suggested was on the verge of uncontrollability?
If you look at the evidence, I think you would have to say that the results have proven the benefits and the wisdom of the system. The growth rate of the government in person-years has been curbed substantially. In 1975 there were 317,184 person-years in government. In 1981 there were 315,680 person-years; that is a decline, Mr. Speaker, an important decline.


An hon. Member:: Not enough.


Norman Kelly: In 1982 the increase in person-years will be less than 1 per cent and we will have a work force measured in person-years lower than the work force similarly measured in 1976. That, Mr. Speaker, is a remarkable accomplishment.
Take a look as well at the total cost of government in Canada. I mentioned earlier that the cost of government is
May 12, 1982

roughly 16 per cent of the total budget. Mr. Speaker, 1 point out that it was not that long ago that the cost of government in Canada was 25 per cent of the budget. So while government is more expensive today, and I would not argue that it is not, as a proportion of the government's budget the cost of government is in fact coming down. I think that is another remarkable and laudable accomplishment of this government.
In the light of those accomplishments and in the light of the fact that the present Auditor General has nothing but muted criticisms and mild commendations to make of the government's performance, why do we not hear more about the successes of this government? Why do we-that is, the public-not have a greater understanding of this government's ability to discipline itself and to control its size and expenditures?
The answer is two-fold. First, good news, frankly, is no news. What does it profit an opposition to praise the government? No one on this side of the House should be waiting with bated breath for opposition members to say anything good about the very real and important steps this government has taken and about the resulting efficiency achieved over the last few years.
The second reason we do not hear much about the gains which have been made in government productivity or efficiency is the fact that, regrettably, most members of this House- certainly the vast bulk of members of the opposition-have never read the documents in which these plans and their successes have been documented. Quite frankly, most members of the opposition do not have the foggiest idea of how the system operates and because they do not have the foggiest idea, they are trapped in the outmoded rhetoric of the mid-1970s when most of their criticisms were beginning to emerge.
Finally, I would like to take this opportunity to assess the third and, as I said, perhaps the most serious criticism which has been made in this particular debate, and that is that this government has so mismanaged the economy that Canada is on the verge of collapse. Rutgers University appeared to document this perspective and to give it some intellectual legitimacy when it revealed in a report several weeks ago that of the executives in the seven industrialized nations it surveyed, the 4,200 Canadian executives were the most pessimistic. It was Canadians who, looking ahead to the future, concluded, unlike their counterparts in other countries, that there was nothing ahead except more doom and more gloom. I would argue that their predictions do not prove mismanagement of the economy. They offer nothing more than soft impressions and a psychological knee-jerk reaction to contemporary difficulties. They reflect the dark cloud syndrome in the Canadian psyche that opposition members-especially of the official opposition-so successfully manipulate in the debates in this House and on the hustings across Canada.
If we have to make a judgment about the economic performance of this government-
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Donald W. Munro: Who is "we"?


Norman Kelly: Anyone. "We" is anyone in this House or outside this House, businessmen, academics, workers, or people who stay at home. It does not matter; it is anyone. If we have to make a judgment about the very serious criticism which has been levelled at this government, let us at least deal with some hard, objective data. When we look around for this hard data, what do we find? There have been two very illuminating, independent and objective studies which have been published recently, in 1981 and 1982. The New York Stock Exchange undertook the study, published in 1981, that examined the performances of the industrialized countries of the world from 1960 to 1979. Its conclusion was that the Canadian economy had the second best record of performance in the industrialized world. When we realize that Japan was number one, second best in that study represents a remarkable achievement by the administrations which were in power during that period.
That is an American perspective, and to some hon. members opposite it may be tainted for that very reason. But there has been another report published more recently, this one in 1982 by the European Management Forum, which decided to research, evaluate and write a report on industrial competitiveness. The Forum evolved 241 criteria and applied them to 21 industrialized nations. As a result of its studies the Forum concluded that the Canadian economy was number five. It was not number 13, not number 20 or not number 21, as one might guess from the rhetoric of hon. members opposite; it was number five. I think that is a respectable placing. Japan was first, Switzerland second, the United States third and West Germany fourth.
As far as I am concerned, those two reports indicate conclusively that this government has had, if not the best record, certainly a fine record of achievement in the last two decades.
I am not ashamed of its performance. I am not prepared to apologize in this House to hon. members opposite for the performance of this government and for the performance of the Prime Minister (Mr. Trudeau).
There is a sub-theme inside this theme of mismanagement, and that is that the Government of Canada interferes so badly in the Canadian economy and that the heavy hand of government is so pronounced-


The Acting Speaker (Mr. Jarvis):: Order, please. I regret to interrupt the hon. member but his time has expired. He may continue, of course, with the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Jarvis):: The hon. member does not have unanimous consent.


Donald Frank Mazankowski: Mr. Speaker, Bill C-111 seeks to provide borrowing authority for $6.6 billion. That is a big item. It is a big ticket item, and the fact is that it is one

May 12, 1982
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in a series. This government will undoubtedly be back for more.
The hon. member who preceded me spoke about the fantastic record of this government over the last two decades. What is staggering is that 20 years ago this $6.6 billion figure represented the total federal government expenditures of Canada. Ten years ago it represented about one-half. Today the $6.6 billion represents roughly 10 per cent of total federal government expenditures. So we can see that the growth has been phenomenal and more Canadians are wondering where this trend will eventually lead us. Our expenditures and deficits are growing. We are spending more to service our debt. Our rate of growth is declining and production is stagnant. Canadians note that the only growth in Canada today is that of government, and that is not productive.
It is clear, Mr. Speaker, that this trend cannot continue. It is obvious that the direction of this country must change. I submit that we must reduce the level of government expenditures as a percentage of the GNP. Secondly, we must stimulate growth in production to generate new wealth. We must do this if we are to sustain the level of government services we have been accustomed to in this country, if we are to provide those less fortunate with the kind of support services we have in the past so they can live in dignity.
Let us briefly look at our current economic setting, Mr. Speaker. We all know our economy is in a shambles. This year, in spite of the Minister of Finance's (Mr. MacEachen) predictions of a $10.5 billion deficit, economists predict it will be in the order of $13 billion plus. Next year it is expected to rise to $14.5 billion as opposed to the budget forecast of $9.6 billion.
Why this trend towards higher deficits? There are a number of reasons. Number one, energy revenues are lower than originally anticipated; some suggest $20 billion or $30 billion less. Second, lower corporate incomes result in reduced income taxes collected. I note with interest, Mr. Speaker, that the CNR has reported the worst quarterly loss in its history, at $67 million for the first quarter of 1982. Compare that to its 1981 first quarter profit of $69.9 million. Other companies have experienced similar cutbacks in their profits. The oil companies are just one example. Banks have registered profit reductions in the order of 25 per cent to 30 per cent. It has been estimated that more than 50 per cent of the Vancouver business community will be applying for tax refunds this year. As of 1981 corporate profits are at their lowest level since 1947, when the national accounts were first published.
Third, there is the fact of escalating interest costs. We are now spending one dollar out of every five to service our debt. Last year there was an increase of 38 per cent in that category alone, and I suspect it will be higher this year.
Fourth, we continue to rely upon oil imports to supply domestic needs. This will not only have a negative effect on our balance of payments and budgetary transactions, but indeed it has a very significant effect on growth, development and job
creation in this country. It certainly has a major effect on the level of the Canadian dollar, which also impacts on interest rates.
Fifth, because of the slowdown and massive unemployment with more people being forced on unemployment insurance, welfare and other government social benefits, those costs will escalate, which will further increase government spending.
We are experiencing a stagnation in growth. It is now estimated that our growth is going to be minus one-half per cent in 1982, compared to a supposed increase of 2.2 per cent projected by the Minister of Finance.
I cite these points because it is clear that the Minister of Finance and his bureaucrats have clearly misread the behaviour of the economy. They have clearly been irresponsible in projecting the effects of the November 12 budget, and to me this kind of gross incompetence should trigger both the minister's and his advisers' resignation, if not that of the whole government. I say to you, Sir, that that would be the best way of improving business confidence in this country. But, of course, that is not about to happen.
The mess we are in is not something which materialized over the last year or so; rather it was over the last 14 years. It is part of a pattern. For example, since this Prime Minister (Mr. Trudeau) took office in 1968 we have only had one balanced budget, which was in 1969. If you look at his record further you will note that during the period 1968-82 we have accumulated budgetary deficits totalling approximately $90 billion. And the hon. member across the way asks, is this government out of control? You are darned right it is out of control, Mr. Speaker. Our national debt now stands at roughly $135 billion, or $14,260 per taxpayer, or $5,560 per capita.


Norman Kelly: What about Japan?


Donald Frank Mazankowski: I am not talking about Japan. This is the House of Commons of Canada, we are dealing with the Canadian economy, and that is what is important.
Interest on our national debt is some $16.6 billion a year. Put another way, it is $1,750 per taxpayer, or $680 per capita.
Looking at inflation, we know that in 1968 it was something in the order of 4 per cent. Today it is hovering around 12 per cent in spite of wage and price controls in 1975 which were supposed to see the rate of inflation drop to 4 per cent. In the day leading up to wage and price controls the Prime Minister said he had wrestled inflation to the ground. Well, it has been some match! The consumer price index has increased by 183 per cent, and the purchasing value of the dollar has fallen by some 70 per cent more or less since that man has taken office. In 1968 unemployment was 4.5 per cent; today it is about 9.6 per cent, or 1.2 million Canadians are unemployed. The bank rate was approximately 7.5 per cent in 1968; today it is around 16 per cent with customers having to pay anywhere from 18 per cent to 20 per cent. The Canadian dollar was worth 93 cents U.S. in 1968; today it is 81 cents and falling.
We have a shameful manufacturing deficit of $21 billion, the result of which has been 133,000 fewer manufacturing jobs
May 12, 1982

in 1982 compared in 1981. We have a current account deficit of $8 billion. Investment capital is flowing out of Canada at unprecedented levels, seven times greater than the average during the 1970s. We have identified some $10.2 billion, of which $5.3 billion is foreign and $4.9 billion is Canadian, plus $8.4 billion worth of unidentifiable capital which has left this country, all for a total of $18.6 billion.
I say to you, Sir, that the major part of this was caused by the Canadianization program, which was itself responsible for the outflow of $6.5 billion in the first six months of 1981. Unfortunately, that outflow is not slowing down. If you look at the outflow in the last quarter of 1981, Mr. Speaker, you will note that capital is flowing out at the same rate it did during the second quarter of 1981.
We have this risk-taking, productive capital leaving the country. It is being replaced by passive money seeking high interest rates in the form of bonds and bank deposits. It has been pointed out that some $5.6 billion in interest is flowing out of the country. It has also been pointed out that the failure of Canadianization is demonstrated by the fact that under the Canadianization program more money is now leaving the country to pay the interest than there was in the form of dividends paid out. This results in higher interest rates, pressure on the Canadian dollar, loss of jobs and a further loss of confidence in the economy.
That is clearly the central problem in Canada's economic woes, but it is clearly within the control and the responsibility of this government. It has not acted, but it must act. This outflow must stop. That is crucial if we are going to restore the kind of economic vitality that we need in this country. We need investment capital to stimulate production, to re-tool and to embark upon the various projects that are proposed but, indeed, at the present time are being stalled, postponed and delayed.
Other members in this House have made the following point: the outlook in this country is bleak. There is no hope. There is no promise. There is doom and gloom which is increasing day by day. There is a sense of despair in the country. Why is that? There are two reasons. First, the government does not appear to be addressing the problem. As a matter of fact, it is obvious the government is not addressing the problem; rather it is adding to the problem.
Second, we go back to the election campaign of 1980. One must go back because at that time there was the creation of false expectation. This government campaigned on a policy that was full of deceitful rhetoric. It promised cheap energy. It promosed lower interest rates. It promised a healthy economy. It promised a vibrant oil industry. The expectations were high. It was "elect us, and we will show you the way".
This goverment has not been able to show the way. This government's simple, slick solution has not worked. They have backfired. What do we have today, sir? We have the cancellation of Alsands, the cancellation of the Cold Lake Project, the
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cancellation of Judy Creek, the delay of the heavy oil upgrader in Saskatchewan and/or Alberta. We have the delay of the Alaska highway pipeline. We have a 40 per cent reduction in exploration and driling activities in western Canada, the result of which has thrown hundreds of thousands of Canadians out of work. Associated industries have gone bankrupt. The whole industry has collapsed. There has been an exodus of men, equipment, expertise and, indeed, capital.
The petrochemical industry is now another entity of the once vibrant petroleum industry that is now suffering. The latest edition of the "Alberta Report" cites "The Petrochemical Calamity; how Alberta's brightest industrial hope vanished overnight." And what are the chief reasons? There has been a slump in demand in global markets, primarily because of increased costs of petrochemical feedstock prices in Canada as a result of taxes and high interest rates. It has been a sobering situation for an industry which held such promise in Alberta. It was to be the star of the economy in 1980. It was to be the stimulus, the catalyst, that was going to diversify the economy of Alberta.
But the negative impacts of the National Energy Program in addition to the high interest rate policy and the very devasting provisions of the budget have thrown 13 out of 15 petrochemical projects into a state of limbo. I shall cite them for the record.
The Alberta Energy Company project of 1.1 billion pounds of benzene located at Bruderheim, worth $350 million, to be completed in 1984, is delayed while new partners are sought. Another Alberta Energy Company project also at Bruderheim, worth $300 million and to be completed in 1984, also delayed while new partners are sought.
AEC and Dupont Canada Inc. project for a low-density polyethylene plant at Redwater, worth $200 million; planned completion date 1984 and delayed six months.
The Alberta Gas Ethylene Co. project for 1.5 billion pounds of ethylene at Joffre, worth $590 million and due for completion in 1985, is delayed one year at least. The CIL and Trimac Ltd. Project worth $128 million is also delayed.
The Celanese Canada project worth $255 million, to be completed in 1982, also is delayed.
A Dow Chemical of Canada Ltd. project, a 180,000 tonne per year polyethylene plant at Fort Saskatchewan and worth $75 million, to be completed in 1984, is also delayed. Another Dow Chemical project worth $135 million, to be located also in Fort Saskatchewan and to be completed in 1984, also is delayed.
Gulf Canada Products Co. project, worth $250 million, is delayed in its early stages.
Enesco Chem Ltd. has two projects. One is worth $250 million and the other $240 million, both delayed, to be announced later.
Union Carbide Canada Ltd. has a $259 million project for ethylene glycol and it is further delayed.

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AEC, Esso Chem. and Hudson's Bay Oil and Gas, which had a $700 million project to be completed in 1986, is delayed indefinitely.
That is what is happening, Mr. Speaker. This government has killed the exploration industry. This government has killed the Canadian component of the industry. Now it is killing the petrochemical industry. The fact is that the National Energy Program has crippled and destroyed a once vibrant industry out there in Alberta. Mr. William Wilder, President of Hiram Walker Resources Ltd. has stated:
The NEP is just part of an approach to the economy of this country on the part of the federal government that is undermining the ability of every industry in Canada to meet the kinds of economic challenges it faces today-
Because federal policies have so eroded the real market attractions of investing in Canada, increasingly the only way we can attract money to keep our currency relatively strong is by paying historically high interest rates.
1 think that sums up the National Energy Program quite well. It has hurt the manufacturing industry, small business, the farmers and the workers.
As a matter of fact, I would like to read a letter that I received from one of my constituents, Mr. Henry C. Wilson, sales manager for Sun Life of Canada. He addressed his letter to the Prime Minister of Canada, a copy of which he forwarded to me. It reads:
As a Canadian of several generations I wish to ask you if you know what you are doing to this great country of ours? I write with respect to the re-election of your government in 1980, the introduction or nationalization of our country through programs such as NEP and thirdly with respect as a life underwriter, in the life insurance industry to the November 1981 budget and change in December 1981.
As in hockey, Sir, usually five players make a mistake before the goal keeper makes his. Canadians were first to make the mistake in re-electing you to govern our country again. You then had your chances and have made your mistakes many times since.
The NEP is a disguise I believe to socialize our country and it appears to be working better than you even planned I am sure. With the number of companies moving out of Canada or going broke, our wonderful Canadian Crown Companies will not even have to pay for some of the assets they will take over, simply pick up the keys. By the way, part of my tax dollar is in that Canadian Crown Company you have been playing with and I don't like it. As a result of NEP unemployment is higher than ever, as are corporate bankruptcy in our area of this country. This was before the budget of November 1981.
The Budget of November 1981 will kill any of the free enterprises or small businesses that were missed by the NEP.
It takes cash flow to purchase life insurance. My business today is 25 to 40 per cent of pre-November 1981. Do you know how many dollars this represents in Canada that are not flowing through the system to provide life insurance protection for families? Do you realize the dollars that life companies do not have today to finance homes, apartments, commercial buildings and finance industry-all these things that put people to work and lastly pay tax dollars to you to keep you flying around the world?
I write to suggest that you do two things very quickly to save our country.
(1)	Scrap the NEP.
(2)	Bring in a new budget that gives reward for work and provides incentive for people to put a dollar away for a rainy day-through life insurance or a deferred annuity as was pre-1981 income.
This gives us an idea of the depth of the feeling and the impact of the National Energy Program and of the budget upon average Canadians.
We know that the government's program for economic development is based upon resource megaprojects. Either
May 12, 1982
deliberately or through stupidity, economic leadership in the country has been such that economic infrastructure has been destroyed. Now we have a large number of potential megaprojects which were once on stream and are now down the tubes. I remind hon. members of the House that back in February, March and April of 1980 the oil industry was humming. At that time Alsands project was proceeding. It had the support of the Alberta government and the approval of the Alberta government and the approval of the Alberta Resources Conservation Board. As a matter of fact, it was working on site. The industry was humming, but it is now down the tubes as are so many others.
What about the alternatives? What will the government do now to pick up the slack? Will it make any fundamental changes to the National Energy program? The National Energy Program was referred to in the Edmonton Journal as "a real life nightmare". It went on to recite the deficiencies in it. The government must do something to refuel the engine for economic development upon which it has relied. If we are to alleviate the unemployment situation, there must be changes to the National Energy Program.
Mr. John D. Porter, management director of the Independent Petroleum Association of Canada, said recently that what was needed were some fundamental changes to the National Energy Program. He indicated the following:
(a)	Reduce the charges under the petroleum gas revenue tax.
(b)	Reduce the level of incremental oil revenue tax.
(c)	Reintroduce tax incentives so Canadians will invest in exploration and development in Canada.
(d)	Establish priority access to Canadian markets for Canadian crude oil production, thereby eliminating imports from foreign sources, thus reducing our balance of payments problem.
(e)	Open new long-term competitively priced natural gas export markets for Canadian producers at the earliest opportunity.
Those are some very logical and common sense recommendations which I suggest the government should consider seriously.
There are other options. We on the opposition side are looking for some answers. With the cancellation of the Alsands project, does it mean that efforts will now be redirected to revitalize the Cold Lake project or something similar to it, even though it would be on a smaller scale? 1 think this requires serious consideration.
Further, what will be the government's policy with respect to encouraging conventional oil drilling and exploration? Given the fact that supplies are dwindling, I believe serious consideration should be given to revitalizing that particular sector. What efforts will be made to commence in earnest a heavy oil upgrader? There are huge amounts of heavy oil shut in which we cannot now use because we do not have the facility to upgrade it to a level where it can be accepted by our conventional refiners. Now that Alsands has been cancelled, surely it is incumbent upon and behooves the government to reconsider and accelerate the establishment of a heavy oil upgrader in Alberta or Saskatchewan or both.
May 12, 1982

What plans does the government have with regard to establishing the kind of necessary initiatives toward enhanced recovery of heavy oil? There are huge deposits of heavy oil in Alberta and Saskatchewan. If we are to work toward achieving energy self-sufficiency, we certainly cannot wait until production is in place as far as the high Arctic, frontier lands and Hibernia are concerned. We have a long time to go before the regulations, the transportation system and all obstacles will be overcome. We must move toward revitalizing this very important sector. Since the announced cancellation of Alsands there has been nothing coming from the government in terms of what it proposes to do alternatively to take up the slack.
Finally, in order to end the uncertainty, the confusion and the devastation, the budget must clearly be withdrawn. I bring these recommendations to the attention of the House at this time in the interests of preserving and enhancing our leadership in technology in oil sands and heavy oil recovery. Also I bring them forth in the interests of ensuring adequate and secure supply, of aiding the restoration of our economic health and of looking at serious problems in regard to interest rates, the current account deficit and the outflow of capital to other countries. I bring forth these recommendations also in the interests of job creation and stimulated economic development and growth.
I believe these alternatives must be actively explored and that industry once again must be the major catalyst. The ground rules must be clearly spelled out. There must be stability and confidence. The government cannot move in and out and change rules in the middle of the night. There must be a clear set of rules, regulations and guidelines within which industry can function. We certainly cannot stand any more destruction and division as has occurred in the country over past years.
It is time to renew our economic and political partnership so that it will encourage production and growth, encourage the Canada first policy, reduce our dependence upon imports, and revitalize the private sector. We must attract new investment and ensure that investment dollars stay in the country. We must restore investor confidence and build upon our natural strengths. We have many natural strengths. 1 have talked mainly about the energy industry, but we also have agriculture, the oil industry and the mining industry. We have much potential in the country.
I should like to quote from a speech by Mr. Jim Gray, executive vice-president of Canadian Hunter Exploration in Calgary. He said:
This country is languishing in a state of economic gloom and political rancour.
Entrepreneurship and free enterprise are out of fashion in the decision-making regions and cities of Canada. The centralization of political decision-making in government offices, especially in Ottawa, is apparently the new process for building one Canada.
Quite obviously it is a process that, because it is designed to centralize power in Ottawa, is in direct conflict with regional decision-making. An inevitable result is serious tension.
Canada today is a game played by and for bureaucrats and government theorists. We were once a great nation of producers and entrepreneurs. The hands that once drove industry and created jobs now spend weeks out of every year in the stroking of politicians.
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The builders that once spent all their time driving production on the drilling rigs, at the mine site or on the factory floor now sit, cap in hand and hour by hour, in the outer offices of the Ottawa bureaucrats. They are waiting for their decisions as to the tax regime and regulations under which the entrepreneur will operate and strive to create jobs and production and make a profit.
This is a very, very sad litany of what has happened. The enterprise spirit in the country has been destroyed. Unless the government fundamentally changes its direction, that spirit will be destroyed to the extent that it will be very difficult for any government, even a Conservative government, to recover and redirect.


The Acting Speaker (Mr. Blaker):: Shall I call it six o'clock?


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Blaker):: It being six o'clock, pursuant to order made Friday, May 7, 1982, it is my duty to interrupt the proceedings and put forthwith, without further debate or amendment, every question necessary to dispose of second reading stage of the bill now before the House.
Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Blaker):: All those in favour of the motion will please say yea.


Some hon. Members:: Yea.


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


Some hon. Members:: Nay.


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


The Acting Speaker (Mr. Blaker):: Call in the members.


Mr. Deputy Speaker:: I declare the motion carried. Accordingly, the bill stands referred to the Standing Committee on Finance, Trade and Economic Affairs.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Deputy Speaker:: It being after six o'clock, this House stands adjourned until tomorrow at two o'clock in the afternoon, pursuant to Standing Order 2(1).
At 6.26 p.m. the House adjourned, without question put, pursuant to Standing Order.

Thursday, May 13, 1982