1982-03-24

ROUTINE PROCEEDINGS


Mr. Peter Elzinga (Pembina):: Madam Speaker, in view of the fact that the skilled labour shortage is a prime concern facing many in the small business community throughout Canada, I move, seconded by the hon. member for Bow River (Mr. Taylor):
That the federal Minister of Employment initiate discussions with his provincial counterparts so that apprentices could take part of their training in other provinces, and develop laws and programs for licensing apprentices that are consistent throughout Canada in providing for a continuing program in the event of lay-off, closing of the sponsoring firm, or a move to another province by the apprentice's family.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


POLITICAL PARTIES
Mr. John Bosley (Don Valley West):: Madam Speaker, given the news and how quickly events move in the riding of Spadina, I move, seconded by the hon. member for Simcoe North (Mr. Lewis):
That the House today congratulate the pro tern member for Spadina on his impending elevation to the Senate, as tomorrow may be too late; and that the House, given that there are 14 vacancies in the Senate, congratulate the other 13 members who presumably will be similarly elevated before the Liberal Party gives up on its attempts to ram its PET clone, Jim Coutts, down the throats of Canadians.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


INDIAN AFFAIRS
Mr. Jack Shields (Athabasca):: Madam Speaker, whereas the government has stated as policy that it encourages Indian Bands toward self-government and control of their resources and destiny, and whereas a government directive to take effect on April 1, will severely restrict bands in determining their own future by requiring government approval for the spending of their own funds on projects of their own choice, and whereas this regressive policy contradicts commitments made by the minister to the native people of Canada, I therefore move, seconded by the hon. member for Yukon (Mr. Nielsen):
That this House direct the Minister of Indian Affairs and Northern Development to withdraw immediately this harmful, backward and unilateral directive and resolve to consult more fully with the native peoples of Canada before seeking to adopt measures of this nature.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE LATE MR. ROBY KIDD EXPRESSION OF SYMPATHY TO BEREAVED FAMILY-MOTION UNDER S.O. 43
Mr. Norman Kelly (Scarborough Centre):: Madam Speaker, on Sunday, March 21, Canada lost one of her most prominent and distinguished educators with the death of Mr. Roby Kidd. Mr. Kidd was one of the world's most renowned authorities on adult education, believing that learning is a lifelong process. He was a great promoter of Canada and encouraged the study of our Canadian heritage in our school system. I therefore move, seconded by the hon. member for Parkdale-High Park (Mr. Flis):
That this House extend its deep-felt sympathies to his wife, Margaret, and their family.


Madam Speaker:: I am sure the House will want to show its sentiments appropriately.

March 24, 1982


NORTHWEST TERRITORIES
Mr. Peter Ittinuar (Nunatsiaq):: Madam Speaker, I rise under the provisions of Standing Order 43. On April 14, 1982, the government of the Northwest Territories will be conducting a plebiscite on whether or not to divide the territories into two separate regions. I therefore move, seconded by the hon. member for Hamilton Mountain (Mr. Deans):
That this House express its support for the initiative taken by the government of the Northwest Territories, the Inuit Tapirisat of Canada and the Dene, and urge the Government of Canada to pay close attention to the aspirations of northerners as expressed through this most democratic of forums.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Walter McLean (Waterloo):: Madam Speaker, two years ago today a sniper assassinated Salvadoran Archbishop Oscar Romero as he was saying mass at the altar of a hospital chapel. Moments before that he had called on the Salvadoran officials, "In the name of God I implore you, I beg you, I order you: stop the repression."
In memory of this tragic anniversary, and in light of yesterday's expression of dissatisfaction with Canadian government policy toward the whole of Central America by representatives of major Canadian churches and religious orders, I move, seconded by the hon. member for Lisgar (Mr. Murta):
That this House urge the government-in particular our Prime Minister who refuses to meet with Canada's church leaders-to change Canadian government policy in Central America in order to take an active and courageous role in the search for a negotiated non-military solution to the conflicts which result in so much bloodshed so close to our borders.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


FITNESS AND AMATEUR SPORT
Mr. Bill Yurko (Edmonton East):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of
considerable import. Today we have in Ottawa many Canadians who were instrumental in the successful effort to have the World University Games staged in Edmonton in 1983. They are in the city and their task is to inform the MPs and to increase the general awareness of the public in connection with these games. Therefore I move, seconded by the hon. member for Sherbrooke (Mr. Pelletier):
That the House congratulate and welcome these western Canadian visitors who were instrumental in bringing the games to Canada, commend the federal government for actively supporting the games, and recommend that the government undertake to finance an appropriate share of the costs of the games.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


FINANCE
Mr. Gordon Taylor (Bow River):: Madam Speaker, the November 12 budget of the hon. Allan MacEachen is a disaster-


Some hon. Members:: Order, order!


Gordon Edward Taylor: -as the hon. Bob Kaplan said.


Mr. Smith:: Sit down!


Madam Speaker:: Order. Would the hon. member please refer to the hon. Minister of Finance rather than to his name?


Mr. Nielsen:: I would like to call him something else.


Gordon Edward Taylor: Thank you, Madam Speaker. The November 12 budget of the hon. Minister of Finance-


An hon. Member:: That's it!


Gordon Edward Taylor: -is a disaster-


Some hon. Members:: Hear, hear!


Gordon Edward Taylor: -as the hon. Solicitor General (Mr. Kaplan) said. In addition, it is deceitful, as the people are saying: instead of hitting the wealthy as the minister said, it strikes at the poor and the middle class and at all who would invest their money in this country. Instead of introducing a budget which would fight inflation and high interest rates, it is a brand new system of taxation which is increasing inflation and unemployment. Therefore I move, seconded by the hon. member for Pembina (Mr. Elzinga):
That the people of Canada start ringing bells that will force the Liberals to withdraw the budget, just as the Tories forced them to split the energy bill.
March 24, 1982

Will the Liberals again wait until they are forced to do this or withdraw the damaging thing now?


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


UNEMPLOYMENT INSURANCE
Mr. Lyle S. Kristiansen (Kootenay West):: Madam Speaker, I rise under the provisions of Standing Order 43 on a timely matter of urgent and very pressing necessity. In these hard times of high unemployment, recent rigid UIC interpretations and definitions of lay-off are just plain stupid and counterproductive to any rational employment or social policy and, further, are contrary to the spirit of recently adopted legislation, such as Bill C-78. I therefore move, seconded by the hon. member for Winnipeg-St. James (Mr. Keeper):
That this House urge the government and the Minister of Employment and Immigration to revise immediately unemployment insurance policy to allow senior employees, many in their fifties and sixties, to receive unemployment insurance benefits during voluntary lay-offs in favour of junior employees, thus enabling many younger, healthy workers with families and mortgages to continue working during periods of dislocation at no additional cost to the system.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



FINANCE


Mr. Charles Mayer (Portage-Marquette):: Madam Speaker, farmers and small business-men across the country are experiencing severe financial difficulties with absolutely no relief in sight. The small business bond that the Minister of Finance (Mr. MacEachen) introduced in his November budget is not working the way it was intended. I therefore move, under the provisions of Standing Order 43, seconded by the hon. member for Calgary East (Mr. Kushner):
That the government restore the original provisions of the small business development bond so that the banks can proceed with issuing these bonds to help farmers and small-business men who desperately need this mechanism in order to
survive.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



COMMUNICATIONS


Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, I rise under the provisions of Standing Order 43. The Minister of Communications (Mr. Fox) stated yesterday that "as far as the federal government is concerned, there is no jurisdictional question" surrounding Canadian Pay-TV. In view of the fact that Saskatchewan already has its own system, two other provinces are contesting the federal jurisdiction, and the Supreme Court of Newfoundland has ruled that the CRTC never had the jurisdiction in the first place, it would appear that the minister is lost in outer space.
The minister's claim of exclusive jurisdiction over any TV signal bounced off one of our orbiting satellites as one step in its delivery system is naive, impractical, and possibly even without legal foundation. Therefore I move, seconded by the hon. member for Kootenay West (Mr. Kristiansen):
That the minister come down to earth and at the earliest possible time reorient himself at a session of the federal and provincial ministers' bargaining table.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. John McDermid (Brampton-Georgetown):: Madam Speaker, my question is to the right hon. Prime Minister. Last night the minister responsible for Canada Mortgage and Housing Corporation completely divorced himself from any interest in the urea formaldehyde foam insulation problem, saying that the only individual who could deal with that was the Minister of Consumer and Corporate Affairs. In his absence, I would like to ask the Prime Minister if he would urge his government to allow CMHC to make direct loans to those people who are in financial difficulties because they cannot refinance their homes due to the presence of urea formaldehyde foam insulation.

March 24, 1982
Oral Questions


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the Minister of Public Works was quite correct in stating that in the cabinet it is the Minister of Consumer and Corporate Affairs who deals with this subject, and he has made reports to the House in answer to questions in that regard.


REFINANCING OF HOMES
John Horton McDermid: Madam Speaker, the interest of the Prime Minister is heartwarming, to say the least. Jim Rogers of Norval, Ontario, has lost his business because of urea formaldehyde foam insulation. He has lost his family, and now he stands to lose his house because nobody will refinance it. What will the Prime Minister do to assure Jim Rogers, and all the Jim Rogers of Canada who, in spite of CMHC insurance being offered, cannot refinance their homes? What is he going to do to take care of these people?


Pierre Elliott Trudeau: Madam Speaker, I do not think I could be expected to know this particular case, but if the hon. member wants to refer the case to me I would see in what way this gentleman could be helped by the policy announced by the minister.


USE OF FUNDS ALLOCATED FOR HOME RENOVATION PROGRAM
John Horton McDermid: Let me try
something else on the Prime Minister, who seems to be so interested in this. Yesterday the minister of housing announced that $30 million would be allocated for home renovation as a job-creation program. Would the Prime Minister recommend that these moneys be targeted to home owners who want to remove the UFFI and who would not otherwise qualify for assistance? This would not only create more jobs than were announced by the minister but would also help those who, through no fault of their own, are so adversely affected.


Pierre Elliott Trudeau: Madam Speaker, the hon. member seems to forget that a sum considerably in excess of that which he just mentioned has been devoted to the solution of the UFFI problem. If the hon. member says no, then he certainly should read the statement that the minister made in the House; he would find that the amount is considerably in excess of that.


Jack Wendele Shields: Madam Speaker, I have a question for the Minister of Energy, Mines and Resources. As he is not in the House, I would like to defer it until he does come in.


AIRPORTS
Mr. Mel Gass (Malpeque):: Madam Speaker, my question is to the Minister of Transport. Last week we were advised that the proposal for the Charlottetown airport expansion was to go
to Treasury Board tomorrow, March 25. 1 understand now that it is not going to Treasury Board tomorrow. Is it going to the Treasury Board tomorrow; if not, why not; and if it is not going, when is it going?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, the other day when I was asked the same question I gave the member a full report, with a timetable and agenda and so on. If this has not materialized exactly on the hour that I indicated it would, I will find out and report as precisely as I did the last time.


EMERGENCY MEASURES
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, my question is directed to the right hon. Prime Minister in the absence of the President of the Privy Council. It is in relation to the emergency planning order. The President of the Privy Council has publicly stated and recognized that Canadian emergency legislation-in fact, the only legislation we now have, that is, the War Measures Act-does not embody Article IV of the International Covenant on Civil and Political Rights. He further acknowledged that the Charter of Rights is of no protection to Canadians in a time of emergency.
When may we expect the tabling of any new emergency legislation, having regard to the fact that we now have in place the emergency planning order, which is planning for peacetime and wartime emergencies?


Pierre Elliott Trudeau: Madam Speaker, I have the impression that the hon. member completely misstates the position taken by the minister and the government. It is on the contrary, that the Charter of Human Rights does afford protection for anyone who would be the victim of an abuse of his rights, whether under the War Measures Act, any emergency order or anything else. The hon. member shakes his head no, but I say to him that he should study the law and the Charter which this party put before the House and which the members of that party supported.


REQUEST THAT ORDER IN COUNCIL BE RESCINDED
Ramon John Hnatyshyn: Madam Speaker, obviously the Prime Minister is again chastising the President of the Privy Council for misstating the situation. The President of the Privy Council clearly stated the charter of rights would have no application in an emergency situation. He has further stated that the government will use the Royal or Crown prerogative if a peacetime emergency arises and Parliament is dissolved or cannot otherwise be quickly assembled.
March 24, 1982

Since we live in a country under a system of a constitutional monarchy where Parliament is supreme, and since the McDonald commission specifically recommended that all regulations dealing with emergency circumstances be approved by Parliament prior to implementation, will the Prime Minister at least agree to rescind the emergency planning order at this time and bring in emergency legislation at an early date so that we in the House of Commons can look at it in a cool and dispassionate manner and protect the civil liberties of Canadians?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, I must again point out to the hon. member that I am not chastising the President of the Privy Council. I am perhaps reproaching the hon. member for closing his mind to what the President of the Privy Council said very clearly, that there is a redress under the charter. 1 remember the minister saying explicitly that there is a redress either by way of prerogative brief or by compensation. That is spelled out in the charter. I wish the hon. member would put his head together, look at the charter and see the value of that charter which this party brought into the Constitution.


INDIAN AFFAIRS
Mr. Jim Manly (Cowichan-Malahat-The Islands):: Madam Speaker, my question is for the Minister of Indian Affairs and Northern Development. For many years the government has agreed that Indian people should have greater control over their own affairs. Can the minister say how this policy fits with the fact that the estimates for Indian band administration have remained constant this year with no allowance for inflation, funding for Indian associations for policy development and consultation is being slashed by 9 per cent, while at the same time a 25 per cent increase has been given to the executive in the administration of his department?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, I have been informed that I will be appearing before the standing committee next week. I will be more than happy to go into all the figures and financial implications of the department's budget for next year or any other year that the hon. member wishes to examine. Suffice it to say that this department has received, and it is indicative of the commitment of the government, substantial new moneys which the hon. member is well aware of because I identified them to him in this House of Commons.
There has been substantial new money for housing in particular that will result in a doubling of the total amount for Indian housing, and this is just one area, and hopefully a tripling of the total amount within a three-year period. That gives some indication of the commitment of this government to do something substantial about the poverty situation of the Indian people. It is hardly indicative that we are transferring
Oral Questions
our priorities in terms of funds from needed areas just to administration.


TREASURY BOARD APPROVAL
James Douglas Manly: Madam Speaker, I think that the minister owes this House a better explanation than that, and not just in committee. Last year Indian bands had to get Treasury Board approval for all aggregate budgets over $4 million. For the coming fiscal year this has been changed and they now have to get Treasury Board approval for all aggregate budgets over $3 million. Does this mean that the policy of Indians' control over their own affairs is working in reverse, or is it simply a reflection of the fact that Treasury Board has lost confidence in the increasingly expensive Department of Indian Affairs?


John Carr Munro: Madam Speaker, I do not think that it is indicative of either one of the conclusions that the hon. member has reached. The fact of the matter is that, as the hon. member is aware, the Auditor General came to certain conclusions with respect to the appropriateness of the way in which the department was handling funds, and the Indian leadership is well aware of that. These are not unusual safeguards in response to those criticisms by the Auditor General.
May I point out that many opposition spokesmen are constantly making statements implying severe criticism of the department when we do not positively respond to observations in the Auditor's report. When we do, they seem to take the other tack, which is somewhat contradictory.


EMERGENCY MEASURES
Hon. Allan Lawrence (Durham-Northumberland):: Madam Speaker, with respect to the emergency planning order that has been referred to earlier, my question to the Solicitor General, who has the responsibility under that order to plan for and set up civilian internment camps in this country, is that fundamental to that planning there obviously must be a decision, which must have been made by now, as to who would provide the staff for those internment camps. Would it be members of the RCMP, members of the Armed Forces, members of the correctional service, or some special force being planned by the minister?


Hon. Bob Kaplan (Solicitor General):: Madam Speaker, as I indicated when the member asked questions in a similar vein before, no planning and details of that level have as yet been given any consideration at all in my ministry. We have been assigned the responsibility, in the event of a war emergency, of preparing for a regime of civilian internment camps, but no work has been done on it in my ministry yet. I am not in a position to answer that question.

March 24, 1982
Oral Questions


ESTIMATED NUMBER OF POTENTIAL INTERNEES
Allan Frederick Lawrence: Madam Speaker, again one has to question why the emergency planning order was brought forward in the secretive way it was, and why we are getting these day after day evasions on the part of the minister and the Prime Minister. Certainly very basic to the whole question of internment camps has to be how many people the government is planning would eventually be the potential maximum. I ask the minister and if not him, the President of the Privy Council, would it be five hundred, five million, five thousand or how many?


Robert Phillip Kaplan: Madam Speaker, when answers are available to questions like that they certainly will be made available. As 1 indicated, they are not available. All we have now are regulations that were implemented to establish internment camps during World War II. Many Canadians remember that. They remember the grave injustices that were done under that system. A responsible government ought to look at those regulations and ensure that if an emergency of that sort ever develops in Canada again, especially given the overriding position of the Charter of Rights and Freedoms which would take precedence over any emergency regulations, regulations are available which would comply with the charter of rights and would permit the government to deal responsibly with a war emergency if one should ever arise.


CRITERIA FOR RELEASE OF CRIMINALS
Mr. Benno Friesen (Surrey-White Rock-North Delta):: Madam Speaker, my question is to the same minister. That same authority enables the Solicitor General to discharge people selectively who have been convicted of a criminal offence from penitentiaries in order to make room for those who are supposed to be interned in the new internment camps. What will the criteria be to release convicted criminals in order to make room for people who have not been convicted of a crime?


Robert Phillip Kaplan: Madam Speaker, the member can see from the question he has asked what difficult issues arise.


Mr. Epp:: You had better believe it.
[DOT] (U30)


Robert Phillip Kaplan: He should not be surprised to hear that no work has been done in implementing that particular policy directive or in the preparation of plans in that regard.


Mr. Clark:: You had better write another letter.


Robert Phillip Kaplan: On the other hand, if that hon. member or other hon. members opposite are prepared to agree that this type of emergency is one worth considering and one for which there ought to be a plan, I would be very happy to have the hon. member's views on how those problems should be dealt with.


EXTERNAL AFFAIRS
Mr. Bob Ogle (Saskatoon East):: Madam Speaker, I direct my question to the right hon. Prime Minister. As was mentioned earlier in the question period, two years ago today Archbishop Oscar Romero was assassinated in San Salvador. Since last November the Canadian churches have attempted to meet the Prime Minister to discuss this very serious crisis with him, and to this time they have not been able to make that appointment. Would the Prime Minister please tell the House if there is a special reason why he cannot meet them and, if there is not, when he will see them?


Pierre Elliott Trudeau: Madam Speaker, I want to point out that 1 answered the communication addressed to me by the church ministers in November with, I think, a somewhat lengthy and substantial letter. I conveyed my views there, so it is not a matter of refusing to hear their representations or, for that matter, of disagreeing with many of them. It is a matter 1 thought 1 had settled; 1 felt I had at least dealt with their concerns in my answer to their letter. I see now that they still want to meet with me. I will consider that request along with those of the very large number of other groups which are constantly asking to meet with me, including Members of Parliament.


Robert Joseph Ogle: Madam Speaker, I appreciate the indication of the Prime Minister of his willingness to meet with the group. I am sure that will be arranged as soon as possible.


REQUEST FOR STATEMENT OF POLICY ON CANADIAN POSITION
Robert Joseph Ogle: Madam Speaker, the Archbishop of San Salvador was very vocal about many things. Shortly before his death he said, "Me they can kill, but the clamour for justice among the people they cannot silence". Since his death the situation in Central America has deteriorated. The level of violence has risen. This is not an East-West confrontation but a legitimate clamour for justice among the people.
When will Canada make a clear statement of policy which is distinct from that of the United States administration, and make it clear that we do not support the repression which is going on under United States approval and aid?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, I am somewhat surprised that the hon. member, who follows this matter with great attention, should be so erroneous and mistaken in stating that the position of the government has been the same as that of the United States. He knows that on the matter of supply of arms and on the precise matter of not seeing the issue he raises as merely a matter of East-West but of justice and social peace in those countries, our policy is quite different from that of the United States.
March 24, 1982

I want to point out to the hon. member that there is far from any kind of consensus existing on the best way to deal with the problem in Central America, even amongst church members and church authorities. We all regretted the tragic death of the Archbishop last year, and our representatives at the United Nations have repeatedly made protests before the Human Rights Commission about the abuse of human rights in that part of the world. However, it is incorrect to say that there is some clear solution which perhaps the hon. member's party has or perhaps even church representatives have. On the contrary, as we know, most South American countries, with the exception of a few which are not very democratic, for the most part support the position the Canadian government is taking, to wit, that there should be an election and that we should seek an end to this civil war by that electoral process.
We will know soon whether this policy is successful or not, but it is hardly fair for the hon. member to suggest that the Canadian government is alone and erring in this matter when the overwhelming majority, not only of the Latin American countries but also, I dare say, of many of the church authorities including, if my memory serves me correctly, the Pope, support the position we have taken in the case of El Salvador.


Miss Jewett:: Quiet acquiescence.


REQUEST THAT CANADA SUPPORT PEACE NEGOTIATIONS
Robert Joseph Ogle: Madam Speaker, as we all know, the election in El Salvador will be held this coming Sunday, and many observers feel there is no solution. I will ask the Prime Minister a final question. Would he be willing, even at this late date, to continue to support negotiations, with the help of Mexico and other countries, in El Salvador following the election, and clearly oppose all interference to destabilize Nicaragua by any outside force?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: Madam Speaker, I discussed this very question with the foreign minister of Mexico a week ago, and we agreed that we would consult shortly after the election in El Salvador as to what steps could be taken toward the goal we both have of bringing about a peaceful and political settlement in El Salvador.


CANADIAN ABSTENTION FROM UNITED NATIONS HUMAN RIGHTS COMMISSION VOTE
Hon. Flora MacDonald (Kingston and the Islands):: Madam Speaker, the Prime Minister stated that Canada has protested human rights violations in El Salvador, and he referred to one case in particular. 1 would like to ask him specifically why Canada abstained from condemning human rights violations in El Salvador at the recent meeting of the United Nations Human Rights Commission in Geneva.


Mark R. MacGuigan: Madam Speaker, the United Nations Human Rights Commission is not a political forum. Despite that, there was a
Oral Questions
political part of that resolution, a part we attempted to negotiate out but were not successful in doing so. Because of the political portion we therefore, along with Britain, West Germany, Japan, Australia and many other countries, decided to abstain from that resolution. However, we gave an explanation of our vote at that time in which we stated that had the resolution included only the human rights portions, we would have supported it, and that we felt very strongly about the human rights violations in that country.


REASONS FOR CANADIAN ABSTENTION
Flora Isabel MacDonald: Madam speaker, I will put my supplementary question to the Secretary of State for External Affairs. He mentions that there were certain other countries which abstained. I did not realize we took our positions before international bodies on the basis of what other countries did. I thought Canada was a free, independent and sovereign country and could take its own position.
Since Canada has condemned human rights violations in Poland-and rightly so-and since Canada has condemned human rights violations in Guatemala-and rightly so-what is the difference in political considerations that he orders his ambassador to abstain from condemning human rights violations in El Salvador?


Mark R. MacGuigan: Madam Speaker, obviously the hon. member was not listening to my answer. We did condemn human rights violations. We did not vote on that resolution. We abstained because of the political portion of the resolution. However, at the same time we did that we also condemned the human rights violations in that country.
I want to state unequivocally that we are prepared to take issue with human rights violations wherever they occur in the world because for us they are not part of domestic jurisdiction; they are a matter of international law on which we are entitled to express opinions regardless of the domestic jurisdiction of the country involved.


AFGHANISTAN-CANADIAN ASSESSMENT OF SITUATION
Mr. Maurice Harquail (Restigouche):: Madam Speaker, my question is also directed to the Secretary of State for External Affairs. We have had a great discussion of many problems in troubled spots in the world, not the least of which is El Salvador, and problems of repression in Poland and other countries. Could the minister inform the House of his assessment of the situation in Afghanistan?


Mark R. MacGuigan: Madam Speaker, the situation in Afghanistan has, lamentably, not shown any improvement in recent weeks nor, indeed, in recent months. In fact there are now allegations, which we have to investigate, that the Soviet Union is using chemical means of warfare in that country. I want to tell the

March 24, 1982
Oral Questions
hon. member that we were pleased to join in the Afghanistan day of protest across much of the world in the last week. I issued a statement on that event. We do not want the world to forget about Afghanistan, where violations of human rights are being committed daily.


POLAND-REQUEST THAT CANADA EXERT PRESSURE IN RESPONSE TO IMPOSITION OF MARTIAL LAW
Hon. John C. Crosbie (St. John's West):: Madam Speaker, my question is directed to the Secretary of State for External Affairs. I want to ask the minister about the situation in Poland. It is a month since the government gave its response to the imposition of martial law and the question of human rights in Poland. In that statement of a month ago the Secretary of State for External Affairs repudiated the Prime Minister's position on interference by the U.S.S.R. and concluded that the U.S.S.R. had interfered in the Polish situation.
As the minister knows, there has been no change in the Polish situation since his statement of February 23 when he announced these very weak measures. Is the government now prepared-


Pierre Elliott Trudeau: Tell us about the monkeys in Gabon!


John Carnell Crosbie: The Prime Minister is extremely agressive as we note from his interjections. I wish he would not interfere with my questions like this, Madam Speaker.


Pierre Elliott Trudeau: Are you sensitive about the monkeys?


John Carnell Crosbie: Poland has not quailed at the minister's statement. Are the minister and the government now prepared to bring in some real measures that will indicate our concern to the Polish government and the U.S.S.R., and is he prepared to exert some pressure on those governments to change the situation that is now in effect in Poland? It is three and a half months since the oppression occurred that the Prime Minister so favoured back in December.


Mark R. MacGuigan: Madam Speaker, the hon. gentleman well knows that the government has expressed its grave concern over the events in Poland many times. We have announced sanctions which are of a piece with those taken by all the allies, with the exception of the United States. We are continuing to participate actively in the development of NATO policy with respect to Poland. I would inform the House that we are now in a position to announce a further grant to the Canadian National Congress of $200,000 to enable that organization to purchase additional food, medicines and clothing for the suffering people of Poland.


Some hon. Members:: Hear, hear!


REQUEST THAT CANADA-U.S.S.R. TREATIES BE ALLOWED TO EXPIRE
John Carnell Crosbie: Madam Speaker, on February 23 the Secretary of State for External Affairs announced a really ferocious measure with respect to the U.S.S.R. The government is going to limit Aeroflot to its present traffic frequency of two flights per week. It took two and a half months for the minister to get the Prime Minister to agree to that slap on the wrist.
Would the Secretary of State for External Affairs consider really indicating our displeasure to the U.S.S.R. by announcing that the friendship treaties, so called, with the U.S.S.R will be allowed to expire at their expiry date? Could he advise the House whether the government will now stop subsidizing interest rates for the building of gas pipelines in Russia? Could he tell the House whether perhaps the Polish government will be told it can no longer take 12,000 tonnes of fish from within our 200-mile economic limit-


Pierre Elliott Trudeau: And let them starve?


John Carnell Crosbie: -unless they are prepared to change their approach and reverse the measures they instituted on December 13? In other words, when does co-operative east blocism end just as co-operative federalism ended?


Mark R. MacGuigan: Madam Speaker, the only friendship treaty, so called, which exists is so called by the right hon.-by the hon. member-


Some hon. Members:: Oh, oh!


An hon. Member:: Leader John!


Mark R. MacGuigan: -and his right hon. friend. In his question and his recitals the hon. gentleman is not able to distinguish between the interests of the Polish government and the Polish people.
The fish that are being taken from our waters are for the use of the Polish people. This government has taken the position that it will not use sanctions against Poland which hurt the people of that country rather than the government. If the official opposition wants to take a different position-


John Carnell Crosbie: We do.


Mark R. MacGuigan: The hon. gentleman says that they do. I take it then, that the policy of the official opposition is to starve the Polish people.


Some hon. Members:: Shame!


Pierre Elliott Trudeau: Just like the monkeys of Gabon!


Mark R. MacGuigan: I am proud to say that is not our position.


Some hon. Members:: Hear, hear!
March 24, 1982


PENITENTIARIES
Peter Elzinga: Madam Speaker, my question is directed to the Solicitor General. In view of the recent escape of convicted killer Harvey Andres-


Some hon. Members:: Oh, oh!


An hon. Member:: Is he our Andre?


Peter Elzinga: -from the Edmonton maximum security institution, and the many allegations about security measures at the institution itself, made not only by residents of the surrounding area but by staff of the institution, will the minister immediately conduct an inquiry into all aspects of security, to be carried out by personnel other than the personnel employed at the institution?


Robert Phillip Kaplan: Madam Speaker, an investigation is going on at the moment into that particular escape. I would be very glad to know from the hon. member, now or after question period, what he meant by the reference to the possible involvement of other than security personnel at the institution.
I should like hon. members to know that this particular escape took place during one of the worst blizzards that has ever occurred in that area of Alberta-


Mr. Baker (Nepean-Carleton):: Like flooding the rink.


Robert Phillip Kaplan: -under conditions such that visitors and tradesmen at the institution were unable to leave it by normal means-


An hon. Member:: But he was.


Robert Phillip Kaplan: -and had to stay overnight at the institution.


An hon. Member:: He did.


Robert Phillip Kaplan: In the heavy blizzard which occurred at the institution, surveillance, I am told, was impossible. The escape took place under these circumstances. The investigation is under way, and if the hon. member was hinting that he has some evidence or information that ought to be brought to the attention of those conducting the investigation, I hope he will bring it forward.


Ramon John Hnatyshyn: That is what they said about Hal Banks!


REQUEST FOR INDEPENDENT INQUIRY
Peter Elzinga: Madam Speaker, that snow job is almost as bad as the snow job we had on the evening of his escape. Would the minister not concur that the prime concern has to be public safety and that, in order to assure us of that public safety, an inquiry has to be conducted by personnel other than those employed at the prison? The present inquiry is being conducted by individuals at the prison itself.
Oral Questions
The minister asked me to share other information with him. There are allegations such as that he is going to de-man the towers on April 1; there are questions that relate to the security of the electronic fence; there are questions that relate to the patrol units around the perimeter of the fence, and in addition to my request for an inquiry, the Alberta government and the City of Edmonton are requesting one.
Would the minister not concede that the prime concern must be public safety? If he does not grant an independent inquiry he is not guaranteeing the protection of life to the residents and security personnel themselves.


Robert Phillip Kaplan: Madam Speaker, I hasten to give that assurance, that the prime concern is public safety in the area around these institutions, that the investigation is not being conducted by the personnel of the institution but is being conducted by the Inspector General and that when that report is complete and available for me I will be willing to discuss it with the hon. member to see whether any circumstances justify carrying the inquiry any further.
From what I understand in a preliminary way, the circumstances of the blizzard and the degree of surveillance that was being conducted in the prison at the time explain why the escape took place.


RAILWAYS
Mr. Laverne Lewycky (Dauphin):: Madam Speaker, my question is directed to the Minister of Transport. In light of the recurring train derailments that have taken place recently which indicate that train safety is deteriorating, may I ask the minister how he can justify the 33 per cent reduction of staff involved in the inspection and maintenance of rolling stock equipment in places such as Dauphin?


Jean-Luc Pepin: Madam Speaker, we have been in touch with the railways on a number of occasions, inquiring about the lay-offs. We have been assured that these workers were not contributing or were not in the business of providing safety in transportation. On the totality, as the Leader of the Opposition would say, of safety in rail transportation in Canada, there are many proofs to the effect that rail transportation in this country is amongst the safest in the world. CP and CN always place first or second in the North American assessment of safety of rail transportation.


REQUEST FOR HOLDING OF PUBLIC INQUIRY
Laverne Lewycky: Madam Speaker, I have a supplementary question for the same minister who seems to be

March 24, 1982
Oral Questions
ignoring the fact that there has been an increase in derailments. Would he consider setting up immediately a public inquiry into rail safety so that we can uncover some of these facts, and freeze all lay-offs relating to railway workers, pending the outcome of such investigation?


Jean-Luc Pepin: Madam Speaker, my hon. friend should be aware that about a year and a half ago this House passed the Transportation of Dangerous Goods Act. Since then-and I will provide the hon. member with all of the information he needs to have-a tremendous effort has been made at both federal and provincial levels with regard to the development of inspection, and what not, to help increase the degree of safety in the transportation of dangerous goods.
A year or so ago the Grange inquiry took place and reported to this House. Some days ago I reported on the progress that has been made since the publication of the Grange report. Therefore I would be very pleased, either in debate or in a personal conversation with the hon. member, to inform him of progress that has been made in this area of safety, both in rail and air transportation. The provinces presumably, are working very hard on highway safety.


FISHERIES
Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, my question is for the Secretary of State for External Affairs. It relates to an answer which the minister gave yesterday concerning the impounding of French trawlers. Aside from the conflict between the evidence put on the record yesterday by the minister about overfishing and the fact that the logs and the contents in the holds did not correspond, which led to the eventual charge of obstructing a fisheries protection officer, would the minister say whether these particular charges were laid because the trawlers were fishing in what we consider to be Canadian waters, but what the French consider to be their waters?


Mark R. MacGuigan: Madam Speaker, I may have left that impression yesterday, and indeed I am not sure that I was entirely clear in my own mind as to whether the occurrence was in disputed waters or undisputed waters, but I have since been informed that the waters in which the ships were stopped were undisputed Canadian waters. Therefore, the boundary dispute involving Canada and France over St. Pierre-Miquelon does not really form part of this particular problem.
The problem discovered by Canadian fishery officials was in the so-called conversion factor converting-


Donald W. Munro: Pounds to kilos.


Mark R. MacGuigan: -not pounds to kilos as the hon. member suggests, but converting the fish into round weight figures. Our fisheries officials were of the opinion that the conversion factor was too low and that the log books of the ships underestimated the weight of the fish taken and therefore were infringing our regulations.


Donald W. Munro: Madam Speaker, that is a very fishy story to me.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


REQUEST FOR PRODUCTION OF CHART SHOWING FRENCH JURISDICTIONAL CLAIMS
Donald W. Munro: Madam Speaker, since this was not a matter of disputed or undisputed waters, would the minister be prepared to produce a chart showing the claims of the French government in the Gulf of St. Lawrence over what we consider to be Canadian waters?


Mark R. MacGuigan: Madam Speaker, I am not sure whether there is a single French claim, in that the 200-mile zone in some directions conflicts with the Newfoundland mainland. 1 think it can take different shapes. However, I will undertake to discuss this matter with the hon. member outside of the House to try to fully acquaint him with the facts.


Donald W. Munro: How about right here?


Mark R. MacGuigan: The hon. member says he would like it right here but I am not sure in what form I would present it to the House. May I discuss this with the hon. member and, if we can agree on a form in which it can be presented to the House, I would be pleased to do that.


GARRISON DIVERSION
Mr. Jack Murta (Lisgar):: I wish to direct my question to the Secretary of State for External Affairs also. On February 24, in discussions between Canadian and American officials over the Garrison diversion project, a proposal was advanced by United States delegates, who basically put forward irrigating lands in South Dakota and limiting the development of the Garrison proposal in North Dakota to areas within the Missouri River basin as a first phase development. What has Canada's reaction been to this proposal? Could the Secretary of State for External Affairs indicate the kind of follow-up that Canada is having with the United State concerning this proposal?


Mark R. MacGuigan: Madam Speaker, I believe the proposals to which the

March 24, 1982
hon. gentleman refers could more accurately be described, if 1 understand the proposals to which he is referring, as being in a preliminary stage. They are ones to which no formal endorsement is given by the United States. Therefore it is really not for us, at a time when the U.S. is merely exploring the idea themselves, to give our reaction or to help in publicizing these proposals. I might say that we are following the unfolding of this project in close collaboration with the government of Manitoba.


QUERY RESPECTING CANADIAN POSITION
Jack Burnett Murta: Madam Speaker, I have a supplementary question for the Secretary of State for External Affairs. I am sure it would be of help to Canadians, certainly to Manitobans, and to United States officials, if there were some indication as to whether a proposal such as this would meet general acceptance not only by the federal government but also by the province of Manitoba. Does the federal government view this kind of a proposal as a representation of a possible new direction to the whole question of the Garrison Diversion Project which, as the minister knows, has been so contentious in the province of Manitoba?


Mark R. MacGuigan: Madam Speaker, the proposals being made can fairly be said to be more limited than some suggestions that have been made by American spokesmen in recent years. The problem we have in assessing them at the present time is that a great deal of engineering detail would be necessary before we could judge their impact. Obviously, we will need that kind of information at some time in order to make an assessment before we would be in a position to respond, even if the proposal were made formally by American authorities.


CANADIAN BROADCASTING CORPORATION
Hon. Ron Huntington (Capilano):: Madam Speaker, my question is for the Minister of Communications. The western region of the Canadian Broadcasting Corporation has been reprimanded by the Supreme Court of British Columbia and it has been found guilty of libel. A CBC reporter has been fired. A producer has resigned. Why has the western regional director not been fired?


Hon. Francis Fox (Minister of Communications):: Madam Speaker, this is obviously a matter for the internal management of the CBC. I would be pleased to bring it up with the management of the CBC. The hon. member may laugh, but of course he laughs in ignorance, which is usually the case.


Some hon. Members:: Oh, oh!
Vacancies


Francis Fox: The present government is not involved in hiring or firing employees of the CBC, and we do not intend to change that practice.


DISCIPLINARY ACTION CRITERIA
Arthur Ronald Huntington: Madam Speaker, the taxpayers will have to pay over $200,000 in fines and costs in this matter which has been labelled as mischievous and irresponsible on the part of the Vancouver office of the CBC. Will the minister tell us that the limit is of licence and behaviour allowed employees of the CBC before fitting disciplinary action is taken?


Francis Fox: Madam Speaker, I believe that the hon. member would probably agree that the type of disciplinary action that was taken in this case was indeed the appropriate one. The CBC actually dismissed the employee in question. Obviously the CBC has a code of conduct for journalists. I understand from discussions that I had, as recently as last night, with the President of the CBC, that the corporation is working on new codes of conduct for its journalists.


VACANCIES
Madam Speaker:: I have the honour to inform the House that I have received a communication notifying me that a vacancy has occurred in the representation, namely, Bruce Lonsdale, Esquire, member for the electoral district of Timis-kaming, by decease. Accordingly, I have addressed my warrant to the Chief Electoral Officer for the issue of a writ of election for the said electoral district.
Also, I have the honour to inform the House that 1 have received a communication notifying me that a vacancy has occurred in the representation, namely, Thomas Cossitt, Esquire, member for the electoral district of Leeds-Grenville, by decease. Accordingly, I have addressed my warrant to the Chief Electoral Officer for the issue of a writ of election for the said electoral district.


Charles Joseph Clark: On a point of order. Madam Speaker, we have just been advised officially of the vacancies in two electoral districts, and there is one other. I wonder if the Prime Minister (Mr. Trudeau) would indicate when the byelections will be held.


Pierre Elliott Trudeau: Yes, Madam Speaker, I will in due course.
15772

March 24, 1982
Order Paper Questions PETITION


MR. GREENAWAY-MOUNT CURRIE, B.C.-REQUIREMENT FOR NEW SCHOOL
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the one hundred and eighty-seventh report of the Clerk of Petitions stating that he has examined the petition presented by the hon. member for Cariboo-Chilcotin (Mr. Greenaway) and finds that it meets the requirements of the Standing Orders as to form.



ROUTINE PROCEEDINGS


[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
David P. Smith: Madam Speaker, the following questions will be answered today: Nos. 2,529, 3,269, 3,319, 3,326, 3,749 and 4,028.


Mr. MacKay: 1.	Does the Department of Transport have a policy with respect to the granting of the concession for advertising at airports and, if so, does the policy include a provision for the concession to be subject to public tenders?
2.	Were tender calls made for the concessions and, if so, how many and on what date was the last one held?
3.	(a) Which companies now hold the concessions and how long was the original term (b) were extensions granted and, if so (i) how many (ii) for what periods (iii) for what reason (c) were new terms negotiated with the contract holder to increase revenue and, if so, what were they?
4.	Does the department plan to re-tender the concessions in the immediate future and, if not, for what reason?


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: 1. Yes.
2.	The major airports (ten) were initially tendered as a single concession in the fall of 1969. In order to develop a national advertising concept, the concessionaire was also permitted to negotiate contracts at smaller airports. The concessionaire subsequently entered into further agreements at 14 additional airports.
3.	(a) Charles Baker Advertising (VIP) Limited holds the concession rights. The original term was for ten years from January 1, 1970.
(b)(i) Two extensions were provided to the original term.
(ii)	The periods of the extensions were from January 1, 1980 to December 31, 1980 and from January 1, 1981 to June 30, 1982.
(iii)	The department had not finalized its policy concerning language requirements for commercial advertising at airports.
(c)	The financial terms of the agreement were not changed as it was considered that the percentage of gross sales had already been maximized for this type of business.
4.	Yes.


Mr. Cossitt: 1.	To the knowledge of the government, did Mr. Rowland Frazee, Chairman of the Royal Bank of Canada, state on October 19, 1981 or thereabouts that Canada's economy will suffer if the government does not relax foreign ownership restrictions and, if so, is the government evaluating the merits of his statement as it formulates future policy concerning the Foreign Investment Review Agency?
2.	Will the government take steps to permit wider legitimate foreign investment in Canada to assist our economy?


Hon. Herb Gray (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: In so
far as the Foreign Investment Review Agency is concerned:
1.	The goverment is aware of a speech by Mr. Frazee on October 19, 1981, in which he emphasized the need for a balanced view by both government and business with respect to the issue of foreign ownership in Canada. The government is not aware of a statement by Mr. Rowland Frazee on or about October 19, 1981, that Canada's economy will suffer if the government does not relax foreign ownership restrictions.
2.	It is the declared policy of the Government of Canada to welcome foreign investment that is likely to be of significant benefit to Canada.


Mr. Deans: 1.	Did the 1980-81 annua] report of the Foreign Investment Review Agency state that it was necessary to renegotiate certain undertakings with companies due to economic circumstances and, if so, which companies renegotiated undertakings in 1980-81?
2.	Did the report state that "continued efforts were also made to achieve the government's objectives with regard to equal opportunity programs" and, if so, what efforts were made and with what results?
3.	Was FIRA unable to comply with equal opportunity program objectives while meeting the government's restraint program of 1979?


Herbert Eser (Herb) Gray: In so
far as the Foreign Investment Review Agency is concerned:
1.	Yes. Westlig Ltd., Ontario Stone Corporation, Dainippon Ink & Chemicals America Inc., Hayes-Dana Inc., Koppers Company, Inc. and Norton Company.
2.	Yes. In 1980-81, the main thrust of the agency's efforts to achieve the government's objectives with regard to equal opportunity programs was in the area of equal opportunity for women. During the year, appointments were made to 29 vacant positions in the agency. A total of 250 applicants applied for these positions of which 73 were women and 177 were men. Of the total female applicants, 42 or 58 per cent were interviewed. Of the total male applicants, 77 or 43 per
March 24, 1982

cent were interviewed. A total of 18 women and 11 men were appointed. At the officer level, eight women and eight men were offered positions and one woman did not accept the offer. No applications were received from persons identified as native or handicapped and, as a result, no such appointments were made.
3.	During the government's restraint program of 1979, all staff reductions were accomplished through normal attrition. The government's equal opportunity objectives were observed in the limited number of selection processes conducted during the year.


Mr. Herbert: For each of the past three years, was any amount of the main estimates not referred to a standing committee of the House for study and review?


Hon. Donald J. Johnston (President of the Treasury Board):: In each of the past three years, all votes in the main estimates requiring approval by Parliament through an appropriation act were referred to a standing committee of the House for study and review. All items of a statutory nature,
i.e., those approved by separate acts of Parliament, were not referred since they emanate from statutes that, in the legislative process, were referred to committees.


Mr. Greenaway: 1.	By constituency, over the past three years, how many applications for CPP disability benefits were made by residents of British Columbia?
2.	By constituency, how many of the applications resulted in benefits being granted?
3.	By constituency, what is the average monthly disability payment made by CPP?


Mr. Doug Frith (Parliamentary Secretary to Minister of National Health and Welfare):: There is no breakdown of this information below provincial level. The figures requested are therefore not available by constituency.
1.	The total number of applications for CPP disability benefits made by residents of British Columbia over the past three years is I 1,991. There were 3.814 applications in 197879; 3,936 in 1979-80; and 4,241 in 1980-81.
2.	Of that number, 8,934 applications resulted in benefits being granted. 2,537 applications were accepted in 1978-79; 3,192 in 1979-80; and 3,205 in 1980-81.
3.	The average monthly disability payments made by CPP were $185.30 in 1978-79; $203.26 in 1979-80; and $230.19 in 1980-81.


Mr. MacKay: 1. Was a Mr. Kenneth Johnson appointed Director of Aviation Safety in the Department of Transport?
Motion for Papers
2.	Was the appointment made by virtue of a normal public service competition and, if so, on what basis was he found to be more highly qualified than the other contenders?
3.	Did Mr. Walter McLeish participate or have any input in this selection process?


Jesse Philip Flis: 1. Yes, on November 16, 1981.
2.	Yes. The appointment was made by a normal public service closed competition. Mr. Johnson was found to be the most qualified candidate based on his extensive experience in the civil aviation industry together with his strong and solid management experience at the regional and headquarters levels.
3.	No.


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


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


Some hon. Members:: Agreed.


David P. Smith: Madam Speaker, would you be so kind as to call Notice of Motion for the Production of Papers No. 88.


[Stage Direction]
Motion No. 88-Mr. Herbert:
That an humble address be presented to His Excellency praying that he will cause to be laid before this House copies of all agreements, correspondence, notes and other communications relating to the requirement by the Foreign Investment Review Agency that Tate and Lyall Limited reduce its shareholdings in Redpath Sugar Limited.
Mr. David Berger (Parliamentary Secretary to Minister of State (Small Businesses and Tourism)):: Madam Speaker, under the provisions of Section 14 of the Foreign Investment Review Act, the papers requested by the hon. member are confidential and may not be published. Consequently, 1 would ask the hon. member to withdraw his motion.


Mr. Herbert:: Transfer for debate.


Madam Speaker:: Transferred for debate.

March 24, 1982
Point of Order-Mr. Herbert



POINT OF ORDER


Madam Speaker:: Before I reach orders of the day, I would like to reply to the point of order brought forward by the hon. member for Vaudreuil (Mr. Herbert). If the hon. member feels the documents which were tabled are incomplete, it is not incumbent upon the Speaker to determine whether they are complete. If the hon. member feels there are documents which should have been tabled, he may seek redress by proposing a new notice of motion for those documents.


Harold Thomas Herbert: Madam Speaker, it puts us in some difficulty. The reason I rose on the point of order rather than raising a question of privilege is that I was aware there was at least one document, which I have personally seen, which was not included in the package. The difficulty, of course, is that under other circumstances one can never be sure whether one is receiving the total package. Now, under existing conditions I can produce a document which will illustrate that everything that was supposed to be tabled in this House was not in fact tabled; but I seek your guidance because I find it a most difficult situation. A member might be in the very difficult position of either not knowing everything which is supposed to be in the package, or, because in my case I know there is at least one document not in the package, suspecting that there may be others. If I raise the point again I do not see what it achieves in the final analysis.


Madam Speaker:: Well, the Chair is obviously in the same difficulty as the hon. member. How can the Chair determine if all the documents have been tabled? 1 gave my guidance to the hon. member; he may make a new motion for the tabling of documents in the hope that he will get those documents which he is certain exists and which have not been tabled.


Harold Thomas Herbert: Madam Speaker, I reserve a question of privilege for tomorrow when I will have the document in my hand.


Madam Speaker:: There is no question of privilege. If the hon. member wants to get more documents, the way to proceed is to make a new motion for the tabling of documents.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Tuesday, March 23, consideration of the motion of Mr. MacEachen that Bill C-97, to amend the
Federal-Provincial Fiscal Arrangements and Established Programs Financing Act, 1977, and to provide for payments to certain provinces, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Hon. Michael Wilson (Etobicoke Centre):: Madam Speaker, last night at ten o'clock I indicated that I felt it was a major backward step on the part of the Prime Minister (Mr. Trudeau) to state that co-operative federalism was dead. I said that because I felt it displayed a total lack of sensitivity towards the different regions of this country and a lack of understanding of the problem of increasing regionalism, and not just in Canada, although that is very much a factor in our country. However, it is also a growing phenomenon in many other countries of the world as well. Against this broad background it is no time for unilateral action within Canada and no time for confrontation. It is no time for unilaterally forcing cuts in the established programs funding when we have ten provinces unanimously opposed to this proposal.
Yesterday my colleague, the hon. member for Kingston and the Islands (Miss MacDonald), suggested deferring a decision on the established programs funding cuts for two years, and she will be proposing an amendment to this effect. One good reason for such a proposal is the confusion over the figures we are talking about here. The Minister of Finance (Mr. MacEachen) indicated in the budget that the net cuts for all provinces were of the order of $1.9 billion. About two weeks later he and his officials acknowledged there was a mistake; the net cuts were something of the order of $2.5 billion. About a month after that we heard reports that the net cuts were much larger than that, something like $4.5 billion.
We have been trying to get an answer from the Minister of Finance to a certain question. On budget night, he was prepared to force a cut in financing on the provinces amounting to $1.9 billion net, then, two weeks later, amounting to $2.5 billion, and amounting to $4.5 billion a month later. How can the minister propose continuing on this path when he knows that that substantial increase in cuts was much more than he had previously anticipated and much more than he had made his plans on? That is one of the very key problems which must be reviewed during this two-year period that my colleague has proposed.
There is another factor here. Taking the action of unilaterally cutting the financing, which the government is now proposing, and then having some discussions with the provinces,
March 24, 1982

surely puts the cart before the horse. We should be reversing this procedure. First, we should hold national conferences to discuss the broad objectives and the levels of responsibility and, following that, decide whether the federal government, the provincial governments or the users will pay. That is surely the way we should solve this problem.
Time and time again, in our special committee on the budget, members of the public came to us and said that the budget process was wrong as the minister proposed significant changes in the budget without any provision for recourse or understanding of the effects, which could have been determined through discussions with the people who would be affected. There was no consideration of the impact of those changes. The minister is repeating the same mistakes again. Surely, from the loud outcry from the opposition concerning this disastrous budget which he brought down on November 12, the minister understands that the process was wrong then. He has even indicated that. However, he has not learned, as evidenced by his actions on the established programs financing cuts. The minister is wrong. He has made this same major mistake again. All Canadians will suffer from a cut in services for post-secondary education and health.
The minister is also playing games with figures. We have had a great deal of difficulty in understanding the minister concerning the size of the cuts that we have here. He says there will not be any cuts. However, when we look at the official estimates of government spending, they show that for health and related matters approximately $4 billion will be transferred to the provinces this year. Last year the transfers amounted to $4.3 billion. Therefore, there will be a $300 million loss in health programs. Similarly, using the same source, there will be a $180 million spending cut in the postsecondary education area. Therefore, the spending cuts have increased by $480 million from last year. That is surely proof positive, in black and white terms, that we have a clear spending cut of $500 million. Those amounts should result in an increase in spending of the order of $500 million or $600 million to keep pace with inflation. In effect, the provinces are suffering approximately a $1 billion cut in what they would have received had the program stayed in place. That is the nature of the problem. The provinces cannot afford to take that sort of a cut. I will come back to this in my remarks later this afternoon.
We have a problem here which is partly financial. The government has a major deficit problem. That has been building up over the past ten years and I think the government must deal with the problem. However, there is a very clear question as to how it should be addressing it. Should it be addressing that problem from the standpoint of unilateral cuts, throwing the problem of the deficit on to another level of government, or should the government be addressing the problem in its own house? The government has raised spending this year by 22 per cent, when the economy is growing only at the rate of 14 per cent. That is surely not a display of restraint. The government has gone to the provinces, as it has gone to the Canadian people, and has said. "You must show more restraint. We are showing restraint." That has been stated by a
Federal Transfers to Provinces
government which is showing "restraint" by a 22 per cent increase in spending.
There is another element which I believe to be one of the reasons the general public is so cynical about government and public institutions today. The former Minister of Regional Economic Expansion (Mr. De Bane) said most clearly last year in Winnipeg: "We want more profile; we want to get more of the credit". The government does not seem to realize that there is only one taxpayer who pays the taxes for the federal government, for the provincial governments, as well as for the municipal governments. That taxpayer does not care where the service comes from, he wants the service. That taxpayer wants to see the service provided to meet his needs. However, one level of government is saying, "We will not continue this program; we will cut it outright because we are not getting the credit that we think is due to us". That just does not wash any more.
This is why we have such a cynical attitude toward government today. This government is showing utter contempt for the taxpayer by doing that sort of thing. Therefore, we must rethink this whole system, this system of federal-provincial relationships, so that we do not have such unseemly squabbling between two levels of government over which one gets credit and which one pays at the end of the day. Governments must get together.
I thought the former provincial treasurer for the province of Ontario made some very astute remarks and proposals in his speech the other day. He said that the public is growing tired of these conflicts, of the waste, and of the expense of keeping two levels of government operating in the same fields of activity. He suggested that a small task force or a royal commission should be set up with a real sense of urgency in order to come up with an understanding of this problem and some clear recommendations. This is the approach we feel should be followed by the government, rather than rushing headlong into making these cuts in funding which drastically affect services.
Let us look at what we could do by extending the established programs financing for two years. That would allow time for such a study. We could hold national conferences in the two areas of activity most affected, namely, medical care and postsecondary education. That would provide understanding of national objectives in those two very important areas. Once we had established those national objectives, we could then sort out the areas of responsibility and decide which level of government would pay.
Another interesting observation very clearly arose in our budget committee work. There was a concern that the federal government was using this cut in the established programs financing to move into a greater, more direct role in those two areas of activity. In the case of post-secondary education, there was concern that Manpower would be using this as an excuse to come in directly with funded programs, with direct federal government coercion in the area of post-secondary education. It was called "streaming" in the meetings we held.

March 24, 1982
Federal Transfers to Provinces
The merits of this were questionable because it went right to the heart of the role of higher education in our country. What is the primary role of the university? Is it supposed to produce bodies like sausages at the end so that we will have 5,000 lawyers, 3,000 engineers and 4,000 computer scientists? Or is the objective to educate people and give them freedom of choice as to the type of education they want? Should there be the type of education that the university thinks is right for the community that it is supposed to serve? That is one of the key questions which must be asked here, because if we have a withdrawal of the freedom of decision concerning the type of education we have from the regional level to the federal government level, we will lose the sensitivity of today's universities toward meeting the needs of their communities.
We need a national overview and we can get that from Manpower. That would be important in helping the universities and the students. What we do not need is the federal government using the power of taxation to force universities to do things that might not fit in with the requirements of their regions.
Let us also consider the practicalities of greater control by Manpower of what comes out of the universities. That question was put at three separate hearings with three different groups of people. Interestingly enough, the same answer came back each time to the following question: who has the best feel as to what job opportunities are going to be available in five, six or seven years' time? Each time the same answer came back: The students-not the university president, not the professors, not the placement officers, but the students. It is very interesting that the student should have that best understanding of the opportunities available for him, because it is his life, his job, that is on the line. If the universities, the professors and the placement people cannot understand better than the students what the opportunities will be in three to five years' time, how can the Manpower department here in Ottawa have a better understanding? I would hope that the Secretary of State (Mr. Regan) would address that question.
The concluding question we must ask is whether the federal government should take an active interventionist role in the courses being offered. Equally important, are they capable of it? I think we have learned quite clearly from our budget committee that they are not.
The conclusion that we have come to on this side is that not only is this part of the bill wrongheaded but it could have disastrous effects on the universities and on the colleges, on the hospital funding and on the operations of the hospitals. Let us not make hospitals, universities and colleges a battleground between the federal government and the provincial governments. Let us solve those problems not on the backs of the hospitals and universities; let us solve those problems outside of that arena.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: Let us take the approach that we have discussed here and that is proposed by my colleague from Kingston and the Islands. Otherwise, these two important pillars of our society and our country will be undermined.
There is no real question that we have a problem. It is a problem compounded by the weak economy and by the budget that the Minister of Finahce brought down last November. It has undermined in so many ways the ability of the economy to operate, and therefore the ability of the economy to generate the revenues on which governments must rely to finance their operations. So let us not compound that problem by moving precipitously without adequate consultation.
In my closing minutes, Mr. Speaker, I would like to discuss one aspect of the rationale that the government has given us for moving in the way it has. It is said that there has been an imbalance in the financial strengths of the two levels of government, the federal and the provincial. The federal government has said that it is necessary to embark on this path to restore the balance that was in place ten years ago. Let us look at some of these figures. If you look at raw figures between 1959 and 1978, apparently the federal share of total government revenues dropped from about 52 per cent to 32 per cent. I maintain that that is not an accurate reflection of what is happening because those figures back in 1959 were still high as a result of the type of government responsibilities that we had coming out of the post-war era. So, viewed in isolation, you cannot say that there is an apparent problem.
Let us look at what has happened since the early 1970s, to get a clear understanding of the problem. There has been a reversal in the surplus and deficit positions of the national and other levels of government. During that period, the provincial or local level was in surplus in 1978 and the federal government was in a very large deficit position. Let us look behind those figures. First, the draw from the federal share of revenues after excluding the amount of transfer to the provinces reflected not so much a loss of power by the national government, but rather an assertion of its power in establishing programs. I am thinking here of the programs for hospital insurance, the Canada Assistance Plan, medicare, postsecondary education and so on. It used its federal spending power to Finance services in the fields of provincial jurisdiction. The federal government which initiated these programs did so to leave the direct financing and day to day administration of them to the provinces. But their establishment meant that a transfer of the money and the tax points to that level of government from Ottawa was an important element in that whole process. That is not necessarily an unfair bargain because I think we can all understand that the level at which the taxation occurs, or at which the financing of those programs occurs, should be related to the administration of those programs.
We reached a watershed in 1977 because in return for granting greater flexibility to the provinces in the spending of the health care transfers, the federal government was released
March 24, 1982

from its open-ended commitment to match provincial expenditure according to various cost-sharing formulas for health and post-secondary education. From 1977-78 on, transfers of hospital insurance, medicare, post-secondary education, and the remnants of the revenue guarantee were unified into a package which was labelled the established programs financing, EPF. Part of that was financed by a transfer of personal income tax and the rest was in the form of cash grants.
What has happened since we reached that watershed? What has happened since 1977-78? From then until 1981 the federal share of revenues after transfer climbed from 32.3 per cent to 38.3 per cent, back to roughly the level it was in 1970-71. That has occurred because of the National Energy Program and other revenues; but the simple fact is that the financing capacity of the federal government has increased substantially. Transfers as a percentage of total provincial and local revenues continued to fall from 18.9 per cent to 17.5 per cent, compared to the 1971 level of 20.8 per cent. Transfers as a percentage of provincial local expenditures also declined from 19.2 per cent to 18.1 per cent, again down from the 1971 level of 19.8 per cent.
So by every measure the provinces and the municipalities are now less dependent on federal transfers than they were a decade ago. Indeed, the federal government now has as large a share of total government revenues, after transfers, as it had in 1971, and a significantly larger share of total government spending. Yet in 1971 the federal government was practically in a break-even position. 1 think it had a small surplus in that year, and I do not recall that there was any reputable person raising the spectre of the fiscal imbalance at that time. You will remember that better than I would, Mr. Speaker.
So it should come as no surprise that in the same period from 1978 to 1981 when we saw federal revenues after transfers increasing 81.9 per cent, and federal expenditures after transfers increasing only 50.7 per cent, we should have a significant cut in the federal government deficit and a redress of the balance that the federal government was so concerned about.
The outlook today is that between now and 1983-84, according to federal projections, the federal government expects to increase its revenues after transfers by 38.1 per cent and increase its expenditures by 31.8 per cent, while increasing its transfer payments to other levels of government by only 13.7 per cent. Obviously that is considerably lower than the rate of inflation.
The clear message that I want to leave today is that we have an expectation that the Government of Canada is freeing up its financial resources for new spending programs, more government, more intervention, a higher visibility in the economy, more direct funding programs, more interference in the grassroots programs in the country, with no cost-shared programs and no involvement of the provincial governments and local governments in the administration of these programs.
What we have is a repetition of the great wave of federal spending that we had in the early 1970s. It is going to return
Federal Transfers to Provinces
us to the same problems we had at the end of the seventies at a time when we have shifted a greater load, and therefore a greater taxing requirement, onto other levels of government. The result will be that the over-all provincial and federal government tax load will be considerably greater once we move through this process. The goal is not merely to restore the fiscal balance that prevailed about ten years ago, but to establish a new balance which is substantially more favourable for the federal government. That will take place at the expense of adequate funding of the programs we are talking about today, post-secondary education and medical care.
There is no question that this is something that Canadians must be concerned about. The decision of the federal government to use none of the energy revenues to enrich the equalization programs or continue the financing of the established programs such as the medical and post-secondary education programs reflects the belief of the government that all additional revenues should be applied either to lowering the federal government deficit or, as I indicated a minute ago, to increasing federal government programs and spending; in other words, larger government.
We have had no indication of the government's desire to put some of that money toward an energy tax credit. There are no job-creating programs of any substance, no flow back into the economy through tax incentives and these huge revenues that are coming in as a result of the energy programs. What we have is the government trying to put forward an image of a steadily eroding federal authority over the national economy. That is very suspect indeed. A very persuasive case can be made that without radical changes the federal role in the national economy will become more and more dominant, maybe as dominant as in the early post-war years.


Hon. Gerald Regan (Secretary of State):: Mr. Speaker, I want to begin my remarks by dealing with some general thoughts about the financial times and the problems that face not just Canada but other countries of the western world. After I have dealt at some small length with these problems in general, I would like to turn my attention to the question of post-secondary education wherein my particular responsibility lies.
It is generally recognized that the levels of deficits being operated by government in Canada, the United States and some other areas are contributing in a significant way to inflation. It is generally recognized, not just by economists but by most citizens, that it is important for elected governments to show some restraint in relation to the growth of expenditures and make every effort to reduce the deficits that exist. If that is to occur, it is going to take the co-operation of the different levels of government to defeat inflation.
We have a situation which was referred to by the hon. member who preceded me in that the amount of tax dollars expended by the federal government as compared to those of the provincial and municipal governments has vastly decreased in relation to percentage of over-all expenditures of tax dollars in the country over the past number of years. That means that efforts of restraint by the national government alone can be

March 24, 1982
Federal Transfers to Provinces
much less effective in combating an evil like inflation today than would have been the case 20 years ago.
When the Minister of Finance (Mr. MacEachen) carries out fiscal negotiations with the provincial governments in such a manner as to attempt to keep the level of most transfers to the provinces from the federal treasury to the same level that the Government of Canada is prepared, with difficulty, to restrain the growth of those dollars expended directly by the federal government on projects in the interest of our country, he presents a reasonable proposition. It is a proposition which says that the national government in its direct expenditures must restrain the rate of growth of those expenditures and do something to contribute to a reduction of the deficit. The national government in its transfer of funds to the provinces under the various programs must do something to restrain the rate of growth of those funds so that they are not totally unharnessed in relation to the manner in which they grow.
Beyond that, the provincial governments have the parallel responsibility to fight inflation and contribute to the welfare of their citizens by combating this evil and restraining the growth of their expenditures. That is the essence of what we are dealing with.
The Minister of Finance has made it quite clear to the provinces that there will be no reduction in the amount of dollars transferred. Indeed, between the various transfers and the benefit of the tax point transfer and the cash transfer, there will continue to be growth. In particular, in the areas of post-secondary education and health care there will continue to be a very substantial amount of growth.
This is a fact that becomes the subject of repeated distortion by opposition spokesmen and some provincial politicians. Having been a provincial premier, I can well understand that a province, faced with the responsibility of meeting the needs of its citizens and aspiring to undertake new programs, is naturally anxious to receive as much in the way of transfers from the national government as is possible. It is always easier to spend dollars that someone else has the pain of taxing. It is easier to spend than it is to tax. So perhaps with reference to those financial responsibilities, there are times when provincial administrations do not tend to treat the use of funds that are transferred from the federal government with the same serious concern as those that they have the pain of extracting from their own citizens by way of direct provincial taxation.
Let me say a word about the problem of inflation. One of the myths that we hear again and again across the country is that the government has followed this policy of restraint for a very substantial period of time, yet inflation still has not gone down or been conquered. It is quite true that inflation has not been conquered. It is also quite true that through these responsible policies Canada has been able to avoid the ruin of savings of individuals and families which has occurred in many other countries where inflation has not stayed in the vicinity of 10 per cent, 11 per cent or 12 per cent but has risen to 20 per cent, 30 per cent and in some cases to 50 per cent or higher,
resulting in the destruction of everything that working people have achieved.
Therefore, when we talk about fighting inflation let us remember that if you walk away from a fight, if you abandon the policies that are aimed at bringing down inflation, it does not mean that inflation will merely stay where it is. Every economist will agree that there is no structural reason whatsoever why the type of unbridled inflation of 20 per cent, 30 per cent and 50 per cent which has occurred in other countries cannot happen in Canada, if you continue to have a steady growth in the amount of the deficits of national and provincial governments and if you do not undertake the policies of restraint that are necessary to combat inflation.
Let us keep in mind that there is no secret about the level of inflation being 10 per cent, 11 per cent or 12 per cent, and that if you walk away from the fight, tomorrow you could well end up with inflation at levels which have never been seen before in this country and which have resulted in ruin in other countries.
Restraint is not a happy posture for Liberals. When the economy has allowed for it, this party has led the way in social programs and also in transfers to our friends at the provincial level. Those transfers which have grown so much and have gone into different areas of governmental undertaking have been brought in, nourished and have grown under Liberal governments. We are proud of those, as we have been proud of the social programs that we have been able to undertake.
But we have to be responsible. We have had to take the stance of restraint in the interest of our country, and it is a stance that I suggest any responsible party would take if it was in office and not in opposition.


Charles James Mayer: Do you want to trade places?


Gerald Augustine Regan: There is no question about it that it is a great pleasure and there is no greater joy than for people who give their time to public life to be able to introduce new programs for the general welfare of the public and undertake benefits for people who have particular needs which were not met in the past. I have had the privilege of knowing that great feeling of satisfaction when participating in governments in the past. But this has to be done hand in hand with responsibility or you may fail to meet the responsibility for which you were elected. Every member of this House of Commons is chosen by the electorate to serve and is charged with great responsibility, not with reckless spending, not with just trying to appear always to be the good guy, but with facing the difficult issues and with recognizing that you have to take a harder stance for the general economic welfare of the country as well. I am proud of the fact that even if it does not make the government popular when it goes through those difficult times, we on this side of the House are meeting our responsibilities in that regard.
There is a fine test to determine the responsibility for the troubles that governments have. That test can often be applied by asking the question: are the problems that we have restricted to our country or are they general? If you find that they are problems which exist only in this country and not elsewhere, or only in one province and not other provinces of equal
March 24, 1982

resources, then you know there is something strange and perhaps wrong with what the government is doing. It may indicate that there is a need for change of personnel, political party or whatever.
However, if we are extremely troubled and concerned about the economic challenges in Canada and the world today, surely it is at least useful for us to recognize that the troubles with which we are confronted are not limited to knowing how to combat and recognize those challenges. Surely it is useful for us to know-useful but sad-that unemployment is higher in the United States than in Canada. Surely it is useful to know that unemployment is higher in Germany-that country of economic miracle-than it has ever been since that country was re-established at the end of the war. Unemployment there is twice as high as the historical levels during those years.
We also know that the problem of high interest rates besets these other countries. We know that the problems of the economy are general across the free world and, indeed, extend behind the Iron Curtain to those countries of the Soviet bloc. So we are not confronted with a problem which is inimical only to Canada and indeed to which we alone cannot find solutions. When we look at our employment situation in Canada, for example, and at the amount of unemployment which exists in British Columbia in industries which depend upon American markets for the sale of our forest products, when we see the unemployment which exists in some of the maritime industries which sell their goods to the American market, we recognize that we cannot sell those goods and therefore cannot have full employment and recovery unless there is an equivalent American recovery which enables Americans to buy our goods and make investments. That may sound like a limited and simplistic example, but for an exporting country such as Canada it is a valid one because it applies to the same degree to European markets and many other areas. So I say that the test of how we are performing is whether we are doing as well in combating those problems as other countries which are confronted with these economic problems today.
We are not content with the situation at all. If anything, I personally want to say that I am distressed about the economic situation, but I think we are taking those steps which are necessary to combat our problems and inflation.


Mr. Thomson:: A point of order, Mr. Speaker.


Gerald Augustine Regan: I will be happy to answer questions at the end of my remarks, Mr. Speaker.
On the question of deficit reduction, it is interesting to see how politicians-Liberals as well as Conservatives, and certainly the NDP-change their stories and point of view a little when they are the opposition as compared to the government. I noticed that the hon. member for Etobicoke Centre (Mr. Wilson) who just spoke managed to pay no attention, from what I heard, to the question of deficit reduction. Yet when the Conservatives were in office and the hon. member for St. John's West (Mr. Crosbie) brought in his ill-fated budget,
Federal Transfers to Provinces
he dealt at great length with how important it was to reduce the deficit and he proposed cutbacks in various areas in order to do so. Yet when the Minister of Finance, a man who has had a magnificent and shining record as a social reformer and as a man wanting to implement programs for the benefit of the people, faces the necessity of carrying on policies of restraint to combat the deficit, they then twist it around to make it something very different.
One major difference between the position which has been taken by this government and the position which was taken by the former Conservative government is that it wanted to fight inflation-I will give it credit for that-but it wanted to fight inflation on the backs of the people. That is one difference. Hon. members opposite wanted to cut back on social programs. The government-


James Douglas Manly: Has done the same thing.


Gerald Augustine Regan: -has carried on its effort to fight inflation in such a way as to see to it that there is no reduction in the funds that are used for the support of social programs. That is quite a difference, and it is also quite a difference from the situation in the United States. I have also to be critical of the Reagan government because of the fact-


Mr. Waddell:: Don't confuse the name!


Gerald Augustine Regan: -that it has cut back social programs and caused great suffering and loss to the ordinary working people, and the poor people in that country too. That is the difference between the position we have been taking and the position of the Conservatives.


James Douglas Manly: They preach and you practice.


Gerald Augustine Regan: However, one thing about members of the New Democratic Party is that they do not want to make their words clear here in this House. They speak from the comfort of opposition and without the responsibility of office.


Ian Gardiner Waddell: Don't worry, we won't be here very long.


Gerald Augustine Regan: The inflation we are attempting to fight harms the people who members of the New Democratic Party purport to represent more than it harms any other segment of society, yet members of the New Democratic Party never come here with any suggestions as to how to fight inflation.


Ian Gardiner Waddell: Made-in-Canada interest rate policy.


Gerald Augustine Regan: They never come here supporting restraint. They never recognize the necessity of restraint. Instead, they talk about more and more new programs and expenditures. They do so even in these times.


Ian Gardiner Waddell: Eliminate PIPS.


Gerald Augustine Regan: Members of the New Democratic Party are in opposition and they are able to take such an easy and luxurious position.

March 24, 1982
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I would love to see a higher level of responsibility taken by the opposition in these matters. I would like to see consistency. If hon. members opposite want to reduce the deficit when they are in government, then let them recognize the need for doing so when they are in opposition.


Mr. Crosby:: You are the one who stopped the hospital tax.


Gerald Augustine Regan: As usual, I am more concerned about the positions taken by the Conservatives than I am about the positions taken by the New Democrats.


Mr. Jarvis:: Don't fight with your friends, Gerry.


Gerald Augustine Regan: I am just trying to call it as I see it, Mr. Speaker, and the way I see it is that-


Howard Edward Crosby: Tell us about stopping the hospital tax.


Gerald Augustine Regan: -there is a very serious thing happening in this country. It is not a creeping thing but a galloping growth, sponsored by some elements of the Conservative Party, of the worst form of McCarthyism, a disease which spread across the United States back in the fifties. We are seeing it again today.


Mr. Lewis:: Smear. That is what you are doing right now.


Gerald Augustine Regan: You are seeing it today in great measure. Let us look at several examples of it. There has been a letter sent out by the Dominion Life Assurance Company signed by John Mahn.


Mr. Kempling:: Is that relevant to the bill?


Gerald Augustine Regan: It certainly is. The letter was sent out to all that company's clients across the country saying the same thing that some members of the Conservative caucus have been saying across this country. It suggests that the Department of Finance was considering taxing the imputed value of renting a home instead of owning in it.


Philip Derek Lewis: It is.


Gerald Augustine Regan: The sad thing about this is that it has never been considered by the Minister of Finance. He has never contemplated that, and he has made that quite clear in a letter and in statements he has made in the past few days when this particular red herring has been brought forward.


Philip Derek Lewis: Budget documents.


Gerald Augustine Regan: I am glad the hon. member opposite mentions budget documents because I would like him to look at the December, 1979 budget document of the hon. member for St. John's West entitled "Government of Canada Tax Expenditures Account", which lists imputed rent among tax expenditures. That is exactly where this idea originated. It originated not with the present Minister of Finance but with the former minister of finance.


Philip Derek Lewis: Tell the truth.


William James Kempling: It has been in every Liberal budget since 1967.


Gerald Augustine Regan: I would be happy to send a copy of that document from the Crosbie budget to anyone in the country who would like to write to me asking for it.


Philip Derek Lewis: Tell us about Adrienne Clarkson.


Gerald Augustine Regan: I am starting to get to them over there, Mr. Speaker. They are getting all worked up. One thing they cannot take is the truth, because they live on insinuations.
Let me mention a couple of others. Another insinuation they have been living on these days is the insinuation respecting internment camps. They insinuate that this government has some plan to lock people up in internment camps. They do not come out and say that, but they ask questions around the edges of the fact that we in this country have always had regulations relating to what to do if a war should break out and if there were people about who were subversive. They say, "This will fit in with our pattern of trying to say these guys are quasisocialists and against free enterprise".


William James Kempling: Read the order in council.


Gerald Augustine Regan: They try to suggest those kinds of lies.
They also spread around the country the idea that the government will restrict the right of people to own property and that we are against private enterprise.


Mr. King:: Absolutely.


Gerald Augustine Regan: This nonsense is also a type of McCarthyism, but that is the only way they can find to fight the government today.
I want to deal today only with those distortions which relate to this bill. However, I want to say that we are fighting inflation, but we are doing so in a way which protects the social system which has been built up. We want to protect our ordinary citizens, medicare, hospitalization, the Canada Pension Plan, family allowances and the Canada Assistance Plan. These are programs the Liberal government has built up over the years. We are fighting inflation in such a way as to protect the interests of the people.
One would think we were living in many solitudes, because no matter how often it is repeated, hon. members opposite will not take note of the fact that transfers for education and health have not slackened and will not decrease. They will continue to grow. Equalization continues to grow. I have figures here which show, for instance, that transfers from the Government of Canada to my province of Nova Scotia will increase this year from $513 million to $606 million.
As I said earlier, more than any person in this House, the Minister of Finance has shining credentials of Liberalism and of protecting our working people, and I believe that stands to his credit when he is forced by economic circumstances to restrain and to cut back expenditures.
March 24, 1982

Let me talk about education. A little while ago we heard an hon. member cite some myths. One of the myths is that we are going to tell the universities that they must be turned into glorified vocational high schools and teach people trades, and that we will no longer support the pursuit of higher education as it has existed in the past. The truth, of course, is the exact opposite. The truth is that we have said to the provinces that we are prepared to continue to increase funding for postsecondary education.
At the same time, the Minister of Employment and Immigration (Mr. Axworthy) announced the expansion of a skilled trades program out of new funds and the expansion of funds for programs that in many instances will be utilized, 1 presume, through community colleges. This means that the skills needed in industry today will be provided. At the moment it is a national disgrace that industries have to bring in immigrants because Canadians are not trained in the skills that are in demand.
Just this week the Minister of Employment and Immigration announced that an additional $208 million will be made available to support training at the higher levels. This is not a transfer of money from the universities nor a lessening of efforts to support post-secondary education. This is an area in which one distortion occurred and I want that to be clearly understood.
We have difficulties with post-secondary education in this country today. The government wants to do its share in this field. We want to see to it not only that the universities are maintained but that they continue to improve. This level of government has been paying the lion's share of the cost of operation of post-secondary institutions in the country.
Unfortunately, the block funding concept which was introduced in 1977 has not worked well. Some provinces, notably Ontario and Saskatchewan, have failed to act in a responsible manner and have used federal funds that have no strings attached in such a way as to allow them vastly to diminish their own percentage contribution to the cost of post-secondary education. That has posed a very serious financial problem for the universities.
The public wants the two levels of government to pull together, Mr. Speaker. I agree with the statement on that score made by the hon. member who spoke ahead of me. I think we are all public servants elected at the national or the provincial level and it is the expectation of the people who elected us that we will work together. But it takes two to tango, Mr. Speaker, and federal bashing has become a national preoccupation with too many provincial governments.


Ian Gardiner Waddell: That is because the target is so tempting.


Gerald Augustine Regan: 1 think it is important that we have a good working relationship, but I would have it work in such a way that the people can properly judge what each government is doing.
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Let me outline where we stand in regard to post-secondary education since I assumed this portfolio of Secretary of State some four or five months ago, Mr. Speaker. My first task was to become familiar with the people involved in post-secondary education in this country and to find out what they think about higher education at this time. 1 have had meetings with the Association of Universities and Colleges of Canada, the Association of Canadian Community Colleges, the Canadian Federation of Students, educators, administrators, individual students and groups of students from Halifax to Victoria. 1 found that these people are proud of the post-secondary education system which was built up during the 1960s and 1970s but that they are concerned about the future financial health of the institutions as a result of persistent under-funding by some provinces. There is concern for the autonomy of educational institutions and concern about financial barriers which prevent people from all segments of society from taking advantage of the opportunities presented by higher education.
Notwithstanding their concern about the future of postsecondary education, people associated with our universities and colleges have shown positive feelings towards the role of the federal government in higher education. On March 4, 1982, the AUCC stated as follows:
While recognizing the primacy of provincial responsibility in constitutional terms we emphasize the importance of a continuing major federal role in the support of universities.
On March 1, 1982 Donald Savage, the executive secretary of the Canadian Association of University Teachers, stated:
If ever there was a constitutional convention in this country, the joint responsibility of the federal government and the provinces for the financing of universities is surely it. Both sides should live up to their responsibilities.
All across the country I have been saying that the federal government is prepared to live up to its responsibilities. It is prepared to do its part. I believe that the way to accomplish this is to change the present system so that the people of Canada know the contribution that each level of government is making to post-secondary education. Let the provinces accept our offer to finance post-secondary education separately and not as part of block funding, along with health or anything else, so that people know exactly how much money is transferred by the federal government to the provinces for that purpose. Let the provinces agree to that. People could then calculate what the budgets are for all the post-secondary institutions in a particular province. They would then see how much we offer as our portion. It is much more than the provinces pay out as their share. They would then see whether we were pulling our weight. The amounts would be available for everyone to see. If some provinces resist that, it is because they have had the comfort of spending federal moneys and of making it look as if they were provincial moneys.
Some hon. members have suggested that we want to gain political credit for this. Do we want plaques to be put in universities showing that the national Government of Canada has given x number of dollars to such and such an institution? Not at all, Mr. Speaker. It is not a question of political credit; it is a question of the right of the public to know what is done with their tax money. There is only one taxpayer, and he pays

March 24, 1982
Federal Transfers to Provinces
federal and provincial taxes so he has a right to know. The principle of accountability is involved and he has a right to know what the government has done with his money and whether it has been wasted or used properly. That is what is important.
If we can achieve that, then we can move into an era of better relations between the federal and provincial governments. The same would hold true in the case of health financing and other things.
I like to quote the great American poet, Robert Frost, who once said that good fences make good neighbours. That analogy is apt. We need clear-cut arrangements between the provinces and the federal government about the percentage that each is willing to pay. I am prepared to negotiate those percentages. It is not so important how much each level of government pays; what is important is that we try to give equal opportunity to people in all parts of the country to attend a post-secondary institution and that people know how their tax money is spent.
That is why I believe it is extremely important that we develop a system that will contribute to the sort of federal-provincial relationship in which there is no reason and no temptation for governments to claim credit for efforts of other governments. We must have a mature and harmonious relationship between the federal government and the provinces if this country is to thrive.
The national government now spends directly only 32 per cent of the total tax money spent in the country. If the country is to survive and if the people are to think that the national government is relevant, then it is important that it deal more directly with the delivery of services to its citizens.
Contrary to what the hon. member for Etobicoke Centre said, I think we have gone as far as we dare in decentralizing. There is no federation in the free world in which the provinces have as much power, vis-a-vis the national government, as they have in Canada. I think it is part of our tradition and part of our way that our provinces be proud, be independent and have pretty widespread powers. But you could only go so far in that direction before destroying the integrity of a national government. I do not care whether the national government here is a Liberal one, a Conservative one or a New Democratic one; whatever it is, it will be important that the government have relevance to people in every part of the country and that this chamber, where the elected representatives meet to debate the laws of the country, has first relevance to Canadian citizens.
What we have to do is to be seen to be delivering our programs. We have to be accountable to the public. It is not a question of political credit; it is a question of good constitutional sense to keep that proper balance between the provinces and the federal government.
There are other distortions that I would have dealt with had time allowed. For instance, the allegation that what we are suggesting would interfere with the autonomy of universities is utter nonsense. We have asked provincial representatives if they would sit down with us so we could discuss with them the
general ways in which our universities could be improved in terms of accessibility and mobility so that citizens who do not find the particular course they want to take in their own province can have free access or entry to a university in other parts of the country. This seems fair if the national government is to continue to pay more than half the cost. It is only fair that Canadian citizens should be able to attend university wherever they like.
What we do want to do is quite contrary to what has been suggested by some people. I hope the last thing this national government or any national government would ever want to do would be to bring down the standards of our universities. If we are to be able to provide a standard of living to our young citizens tomorrow who are in the educational system today, and if we are going to give them an opportunity to compete in the world effectively, in a world where change is the only constant factor, where technology is changing at such a rapid rate that people may have to be retrained three or four times in their lives, then I think we have to give them a better education than any other country.
We believe that Canadians want their children to have the best possible education to adjust to changing technology. That is the position we take and that is the position I will pursue in my negotiations to reach a harmonious agreement with the provinces on the future of post-secondary education.


James Douglas Manly: Mr. Speaker, I welcome the opportunity to speak on Bill C-97 regarding fiscal arrangements between the federal and provincial governments. As we look at this bill, I think the most eloquent comment on the principles that lie within it were made outside of the House and before the bill was tabled by the Prime Minister (Mr. Trudeau), when he said that cooperative federalism is dead. We question that statement. Was it simply the despairing word of a tired man, the kind of utterance that we all make from time to time when things have not gone our way? Was this the kind of statement that we might want to characterize as being unforgivably naive, or was there something deeper and more significant in what the Prime Minister said? This bill and other recent actions by the Liberal government-for instance, the VIA Rail cutbacks and the abolition of the Crow rate-indicate the Prime Minister and his cabinet have changed course and no longer accept the principles of co-operative federalism. They do indeed believe that co-operative federalism is dead.
When we look at the track record of some of the provincial governments, we must agree that their intransigent attitude has not been helpful. Too many of them believe more in their own political survival than they do in the welfare of Canada and of all Canadians. Fed-bashing is an easy and popular thing to do, especially when the Prime Minister adopts such an indifferent manner toward the very real problems of Canadians in all regions of this country. But fed-bashing is not the answer. I would like to suggest to members opposite that province-bashing is not the answer either, nor is budgetslashing.
March 24, 1982

Because some provinces act like spoiled children, that is no excuse for the federal government to join them in their childishness. In spite of the provinces, the great majority of Canadians would like the federal government to provide leadership within a framework of co-operative federalism.
Looking at this bill, New Democrats oppose its unilateral action of imposing a new equalization formula on the provinces. I think all Canadians join in the basic support of the principles of equalization. Equalization payments to poorer provinces ensure that all Canadians have access to a basic standard of services without people in those provinces having to pay a disproportionately high rate of tax. But all Canadians have not yet agreed on the precise formula for calculating these payments. Because the federal and provincial governments have not yet agreed on a formula, the federal government has decided to act unilaterally.
First, the federal government proposed a formula that was entirely based on conditions in Ontario. Because this was clearly unacceptable to the provinces, the government has now proposed a formula based on five provinces. This formula has been proposed so recently that the provinces have not yet had time to determine all of its implications. But the proposal appears to be particularly unfair to the province of Manitoba. Over the next five years there will be an over-all increase in Manitoba of 9 per cent during the tenure of the agreement while other provinces will get between 11 per cent and 13 per cent. The people of Manitoba are very concerned about this. Other provinces are not yet aware of all the implications the formula has for them. Surely, given a consensus that all Canadians have about the desirability of equalization payments, it would make sense for the fedeal government to be patient in establishing a new formula.
We suggest that the government extend the present formula until a new formula, agreeable to all parties concerned, can be found. This could meet the March 31 deadline and give all parties time to negotiate. We emphasize and reiterate that preemptive unilateral action on the part of the federal government does not help.
Our most serious concern with this bill is the provisions in it that eliminate revenue guarantee compensation. The Minister of Finance (Mr. MacEachen) when intoducing the bill on Monday anticipated our concern when he said "It will be argued in the Flouse that, by removing the revenue guarantee, we are undermining our support for post-secondary education and health". That is exactly what the federal government is doing. I suspect the Minister of Finance will realize this when he seriously considers the implications of what he is doing.
The Minister of Finance maintains publicly that no cutback is involved. But however we want to argue about the meaning of words, the fact remains that over the next five years the provinces will receive less money. The reduction of transfer moneys to British Columbia means that the province of British Columbia will receive $93.8 million less in 1982-1983 than it would otherwise. It will receive $107.2 million less in 19831984 than it would otherwise.
Federal Transfers to Provinces
Over the next five years of the agreement the elimination of the revenue guarantee compensation will mean that the provinces will receive $5.7 billion less than they would have were the compensation still in place. In the double-speak of the Minister of Finance, this may not be a cutback, but it certainly looks like one to me and, I suspect, to most Canadians.
It is true that over the past several months the provinces and the federal government have played an elaborate game with these funds. The federal government in its propaganda lumped these funds with federal funding for health and higher education. The provinces in turn, wanting as much latitude as possible, denied that these moneys were in any way tied to health services and education. Now, Mr. Speaker, we seem to have reached half-time and the teams have changed ends. The federal government now claims that the revenue guarantee was never intended to be part of the contribution to health care or education.
The parliamentary task force on fiscal arrangements made a lengthy study of this question and I think its report, "Fiscal Federalism in Canada", puts the whole question into perspective. On page 12 the task force concludes that:
-by virtue of the interna! allocation established by the federal government, fiscal transfers associated with the revenue guarantee must now be considered part of the health care package and/or post-secondary education transfers and should therefore be allocated, in the renewed EPF arrangements, to health and/or post-secondary education, in proportions to be negotiated.
Regardless of the game being played by the two levels of government, we need to recognize that eliminating revenue guarantee compensation will seriously affect provincial revenues. This in turn will have a serious effect on national standards of health care and opportunities for higher education. New Democrats have always insisted on the primacy of health care for all Canadians and we oppose any measures resulting in a lessening of those standards.
Taken by itself the cut in funding would have an eroding effect on our medicare system. It would be part of the slow but steady wearing away of a system which was the crowning achievement of an earlier Parliament. The present Minister of Finance was responsible in an earlier-and for him I presume a happier-day for piloting medicare legislation through this House. Many speakers have pointed to the rather sad irony involved in that same minister now introducing a bill which will help to erode our health care system.
Time and again the parliamentary task force was told there was no certainty that the provinces would be able to or would want to pick up the slack caused by this lack of revenue. For the provinces the decrease in revenue leaves them with three possibilities: to increase taxes or premiums to pay for these services, a regressive measure because it puts an increased burden on poor people. British Columbia this past month has had a 30 per cent increase in its medicare premiums. Second, they can cut back their health care services. They can introduce user fees and double billing, of which we are seeing examples in different parts of Canada. Third, the provinces can rearrange their priorities and cut back in other areas.

March 24, 1982
Federal Transfers to Provinces
We know very well, Mr. Speaker, that some provinces and their governments are not that keen on medicare and would not hesitate to cut programs. I think this points to the more serious effect of this decrease in funds. Over the past four years some provinces have cut back on the universality of medicare by introducing user fees and double billing.
When the task force looked at the situation they saw that many provinces had already pared the medicare system to the bone; that in fact there is no fat in the system. New Democrats, both in this and previous Parliaments, have consistently urged the Minister of National Health and Welfare (Miss Begin) to force the provinces to maintain a program which will ensure all citizens access to medicare. We want to defend the principle of universality and the minister has consistently maintained she is doing exactly that. I suggest that the present bill, by withdrawing revenues from the provinces, will give them the very argument they want so that they can stand up and tell the minister that they are not able to afford universal standards and they have to introduce double billing and user fees, and maintain those practices already in effect.
This bill will have a similar effect on higher education. There will be cutbacks in programs, higher tuition fees, and education will become more the privilege of the few rather than the right of all who can benefit by it. The country will lose the benefit of critically trained minds at a time when these people are becoming more and more important to our economy. The result of these cutbacks will be that teachers are laid off. In effect, it will mean a gigantic waste of our most precious resources. As we look at those provinces which are already increasing tuition fees and cutting back, we see that these cutbacks will simply give the provinces a convenient out and the federal government will once more become a convenient whipping boy for the cutback mentality which is most detrimental to our program.
The federal government wants to have a greater degree of credit for its good works. I suppose that is understandable. The scriptures tell us that you should not let your left hand know what your right hand is doing. Certainly that is characteristic of the government in other respects, but when it comes to having any kind of program which gives benefits to people the federal government wants to shout it from the rooftops. I suggest that the federal government's attitude is-well, it is understandable. Regrettably it is like that of a parent neglecting legitimate responsibility for his or her own children in order to be involved in highly visible community affairs. Cutting back on funds for health and higher education in order to dole out money in highly visible programs is irresponsible.
In conclusion, Mr. Speaker, I would like to emphasize that Canadians do not want to see a continuation of this foolish squabble between the federal and provincial governments. They do not want to see it used as an excuse for cutting health and education programs. Canadians are not too much in favour of provincial governments being more powerful than the federal government. They want to see governments, both federal and provincial, which can work together in their
interest. With that in mind, I hope that the government will be very open to amendments when this bill goes to committee.


Some hon. Members:: Hear, hear!


Hon. Bud Cullen (Sarnia-Lambton):: Mr. Speaker, during the last couple of days in which I have had the opportunity to listen to the debate, if 1 may say so, present company excepted, the tone of the debate has improved. I would compliment the hon. member who spoke previously, the Secretary of State (Mr. Regan), and particularly the member of Parliament for Kingston and the Islands (Miss MacDonald) who spoke yesterday. Although obviously I do not agree with the conclusions reached or some of the stances taken by hon. members opposite, it does seem to me that our debate has improved when some of the rhetoric has been taken out and we have had an opportunity to examine the facts. 1 think it was a mark of intellectual honesty on the part of the hon. member for Kingston and the Islands when she conceded in the debate yesterday that there were some provinces that were at fault as they were not maintaining their share of the post-secondary education dollar, and that they had a responsibility. She said that the people who elected those particular governments should see to it that they live up to their requirements under this particular act and to their responsibilities, chiefly for education, which is a jurisdiction they guard very jealously, as we all know.
The Secretary of State indicated what I thought to be an appropriate position, namely, that we should set aside the postsecondary education costs and look at what the provinces and the federal government are contributing. He said that we should leave the same formula in place. He felt that three caveats should be attached to that particular agreement, but the provinces could not agree. It seems to me that some of them may not want to agree because, as he pointed out very clearly, they have a greater responsibility to the people, particularly the young people that they are endeavouring to educate at the post-secondary level, than they have been fulfilling.
I remember a debate concerning whether we should maintain the old system where provinces had to account for each and every dollar that they spent on post-secondary education. The provinces said to the federal government, "Look, we have an elected Parliament as well; we are elected legislators; we have a responsibility to the electorate. It seems that we should be trusted, under the block-funding system, to use the money in an appropriate way". I believe it was primarily the party opposite, the New Democratic Party, which felt that that was inappropriate. The party was somewhat apprehensive that the provinces would take that particular action. As it turns out, it would seem that at least two provinces have been less than candid or proper in their application of the funding that they received from the federal government. When one looks at the statistics, and I do not think anyone really argues with the amount of moneys which have been transferred, one finds that the share that the federal government has paid for postsecondary education has gone up. However, in some of the
March 24, 1982

provinces, at least, that figure, that responsibility or that commitment has gone down because they know that they no longer have to account to the federal government under the block system. Therefore, they have been able to utilize that money in other areas where, in their view, they may get more political impact for the dollar, or, to give the best interpretation, they might have felt that they had adequate facilities, that they were able to compensate the professors, adequately, that they were able to keep the tuition fees at a decent level and, on that basis, the money would be better spent in another area.
I do not know, at this time, whether the block-funding system was a good move, but it was a move by the federal government in the hope that the provincial governments would not apply the money that they received for post-secondary education to other areas. The hon. member who spoke previously indicated what is felt on all sides of the House. I do not think that anyone could seriously argue with the philosophy of equalization where the have-not provinces need assistance. There has been a suggestion that the amount of money from the federal level had gone down. 1 will deal with that in a few moments. On the basis of that, it has been suggested that the federal government does not care, or else has lost touch with the people. The hon. member for Kingston and the Islands indicated-although it was sort of a back-handed compliment-that it was at the federal government level that we moved into many areas where the provinces have responsibility. We moved into the unemployment insurance field, the pension field and the health field. However, I would remind hon. members opposite, and sometimes hon. members of this party who might forget, that it was this particular party, while in power, that brought in great social measures, such as the Canada Pension Plan, the Old Age Pension Plan, the guaranteed income supplement, that established the Farm Credit Corporation to help the farmers and that introduced the Adult Occupational Training Act in, yes, the field of education. That was done in recognition of the fact that the federal government also has a responsibility. However, it alone could not train young people. It had to move in conjunction with the provinces on an individual basis, entering into agreements with the provinces every three years to train the young people of this country. Many colleges of applied arts and technology are very happy that the funding is available under the Adult Occupational Training Act at the federal level to help maintain their running expenses.
Modesty prevents me from commenting on who is responsible for a particular bill, but we do have immigration legislation which the United Nations High Commissioner for Refugees wishes every country had in place because of the humanitarian way we treat refugees and immigrants who wish to live in this particular country. We received commendations specifically because we incorporated into our legislation a responsibility to refugees and described the manner in which we would deal with them. We expanded the definition of
Federal Transfers to Provinces
refugee. We have a concern for the ordinary person. People commenting on this particular bill who might take the position that we are not paying as much as we should because we are uncaring have not read the legislation. Great social benefits have accrued to the Canadian people and to immigrants to Canada as a result of legislation brought forward by this particular party and this particular government.
What has been the size of the contribution of the federal government? I will go into this in more detail in a few minutes. However, on the surface, I think people should recognize that the transfers to the provinces alone represent 20 per cent of the expenditures of the federal government. In other words, the taxes are collected by the federal government, and 20 per cent of the expenditures we make are turned around and immediately transferred to the provinces for their use. I think the figures, in fact, do bear repeating. The press release issued by the minister indicated that an estimated $105.5 billion would be provided to the provinces under the amended fiscal arrangements act. Under the present act, $61.3 billion has been transferred to the provinces since 1977. We are therefore talking in terms of large amounts flowing from the federal level to the provincial level, as is appropriate under the fiscal arrangements act.


Howard Edward Crosby: How does that compare with other increases?


Jack Sydney George (Bud) Cullen: During the 1982-83 fiscal year beginning April 1, federal transfers for health and post-secondary education programs will amount to $11,677 million. That is an increase of $1.2 billion over 1981-82 program-related transfers. Therefore, there has been no cutting back of the federal commitment to assist in these particular fields. In fact, not only will there be an increase, but it will be significant, amounting to $1.2 billion in one year alone. Equalization outlays-


Howard Edward Crosby: You already made that speech.


Jack Sydney George (Bud) Cullen: The hon. member has the right to heckle me because I was heckling him yesterday afternoon and he nailed me right between the eyes. I apologize for one of the statements made. He certainly handles heckling better than I do.
Equalization outlays will-


Ian Gardiner Waddell: Flatter him. He may shut up.


Jack Sydney George (Bud) Cullen: -grow to $4.7 billion in 1982-83 from $4.4 billion in the current year under the new system, with expanded revenue coverage and a representative average standard. It is anticipated that six provinces will benefit.


Howard Edward Crosby: Give us some original material.


Jack Sydney George (Bud) Cullen: I did indicate that I was repeating something that I felt had to be repeated so that the message will get across, hopefully, to hon. members opposite, and certainly to remind people in this particular party, in case they should be feeling a little apprehensive, that the federal government has been anything but picayune in the amount of money that it has been transferring to the provinces.

March 24, 1982
Federal Transfers to Provinces


Howard Edward Crosby: Come on. You had three weeks to think about this.


Jack Sydney George (Bud) Cullen: I would like to comment on the general issue of the fiscal balance within the Canadian federation and the more specific issue of how this relates to the need for restraint by the federal government and how this need is being implemented. Some comments on these matters might be useful in view of the importance attached by members of the opposition to these matters in the debate on Bill C-97 and to their apparent lack of understanding of the relevant facts or a refusal to acknowledge them-and, of course, that is a political position which we can understand.
In his opening remarks yesterday the Minister of Finance (Mr. MacEachen) referred to the striking decline in the federal share of total public sectors' revenues in the past 20 years. This was criticized by some hon. members challenging the minister's use of the 20-year time span and contending that a ten-year time span from 1971 to 1981 would be better. They argued further that, using a shorter time span, the position of the federal government vis-a-vis the provinces has been improved. From this they went on to imply that the cuts in the federal transfers to the provinces are unreasonable.
I thought that at that time there was really nothing sacred about a 20-year time span. Other periods of time could be used. For example, a good case could be made for going back 25 years and starting with 1956. If we do this, we find that the decline in the share of revenue at the federal level is much more significant than that of local government. It would bring about $60.5 billion of additional revenue into the formula in 1982-83.
When I looked at the period of 1956 to 1981, I found the federal share of total government-owned source revenues had declined from 64 per cent to 49 per cent on a national accounts basis. Its share of total revenues, after transfer payments, has declined from 61 per cent to 38 per cent. I have done the research on this particular subject, Mr. Speaker, because it is my honour to chair the Standing Committee on Finance, Trade and Economic Affairs and it seems to me that we have to have the actual figures before us, we have to understand the percentages that we are talking about to determine if, in fact, the revenues flowing to the federal government have declined. It would seem from the research and the study that I have done that most assuredly that is true.
In addition to looking at longer time spans, let us look at the shorter time spans. If we take a ten-year time span we do not find, as certain hon. members suggested, that the federal share has increased. Thus, if we compare the federal government share of total revenues from own sources between 1971 and 1981, we find that it declined from 51 per cent to 49 per cent. In the case of total revenues after transfer payments, the share remained unchanged at 38.3. While this may suggest to members that a levelling off has occurred, the fact of the matter is that a substantial portion of present federal revenues in recent years has been earmarked to pay for oil import
subsidies-which have protected consumers in all parts of Canada from high and economically-disruptive oil prices.
Federal revenues available for general expenditures are now significantly lower than that which is shown in the national economic accounts. It is, moreover, the case that federal government responsibilities have increased markedly in recent years as a consequence of its primary role among Canadian governments in responding to a succession of international shocks to the world economic system. These considerations lead me to believe that the federal government faces unprecedented demands upon its revenues to meet new types of expenditure, and that this had led to a situation of unprecedented need to restrain existing expenditures of all kinds.
The federal government has responded to this need for restraint. However, it has done so in a careful and well-balanced manner which has avoided disruption and dislocation to particular parts of the economy. Can you imagine, Mr. Speaker, if there had not been any intervention, the impact that the OPEC nations, action to quadruple the price of oil would have had on the economy of Quebec and the four Atlantic provinces? But the government saw fit and considered it appropriate enough to intervene and, as I have said, to avoid disruption and dislocation in that particular part of the economy.
Some hon. members might have us believe otherwise, but the facts are there for all to see. They argue that federal expenditures are growing uncontrollably, and that the only place where restraint is being exercised is in federal payments to provinces. Mr. Speaker, this is certainly not true. First of all, if we look at the government's total outlays on a public accounts basis, we find that they are growing more slowly than the consumer price index. Thus, in the last budget, total federal outlays were projected to increase by 11.7 per cent in 1982-83 as compared with 12.3 per cent for the CPI. Also, for the longer period from 1981-82 to 1985-86, total outlays were projected to grow at an annual rate of 10.9 per cent as compared with an annual rate of 11.2 per cent for the CPI. Also, these rates of growth are consistent with the government policy adopted in the mid-1970s that the trend growth rate in its total outlays should be held within the trend growth rate of the gross national product.
Mr. Speaker, as a member of the treasury benches at that particular time, I well remember that position being adopted by the government of the day and I am happy to say that it has met the commitment that was made, not just recently but back in the mid-1970s, to see that the rates of growth were consistent with the growth in the CPI.
Mr. Speaker, I would like to turn, finally, to one other allegation made by certain hon. members, that federal constraint is being applied in such a way as to fall almost exclusively upon the provinces. Again, this allegation is not valid. Federal restraint has not, should not, and in any case could not possibly apply evenly to all programs or to all years. If we look at the rate of growth of federal outlays from 1981-82 to 198283 we find that they are relatively high for public debt charges
March 24, 1982

and national defence, and relatively low for transfers to provinces because of a change in the latter which will lower its growth rate for a single year. However, if we look at outlays over a longer period, beginning with 1981-82 and including the year in which the growth rate for transfers to provinces is reduced, that is, 1982-83, we find that transfers to provinces are growing at a rate which compares favourably to the rate for the total of other federal expenditures.
Mr. Speaker, the word "totality" was in my notes, but 1 cut it back to "total" because I find the word "totality" a difficult one to use, as a Liberal, from time to time.
Specifically, transfer payments to provinces are projected to grow at 11.8 per cent through to 1986-87 while all other expenditures projected in the budget for the four-year period to 1985-86 are projected to grow at 10.9 per cent.
Finally, I would emphasize that federal outlays under the fiscal arrangements are not being reduced. They are growing, and they are growing in each and every year. Payments under two major programs-equalization and the EPF-which were $61 billion in the five years ending this coming March 31, will amount to $105 billion over the next five years. We estimate that if we had continued the revenue guarantee and had not made EPF transfer payments equal per capita in all provinces, federal outlays would have amounted to about $110 billion for these same five years. In other words, the two changes that are being made in EPF will moderate somewhat the growth of transfers to the provinces.
In my view, this applies a degree of restraint to transfers to provinces which is entirely acceptable and which is comparable to what is being done for other categories of federal expenditures. It is something to which provincial governments should be able to adjust without great difficulty.


Some hon. Members:: Hear, hear!


Mrs. Margaret Mitchell (Vancouver East):: Mr. Speaker, I also am pleased to rise on Bill C-97. My colleagues have expanded in some detail about the financial aspects of this bill. We have said, of course, that our party is opposed to Bill C-97 for a number of reasons. First of all, we oppose this bill in principle because it is an autocratic, unilateral action on the part of the federal government. It is typical of this Liberal government that disregards the financial agreements made with the provinces in 1976, that makes changes in the established programs financing arrangements unilaterally, changes that will severely curtail health care and post-secondary education. It also eliminates revenue guarantees to provinces, as has been pointed out.
We also oppose the cutbacks, of course, which will create inequity and inequality in provincial health and education services. The cutbacks in this bill will allow and encourage the privatization of medicare, a process which has unfortunately already started in a number of provinces-the provinces particularly, 1 might mention, of Alberta and Ontario. It will make it difficult, more difficult indeed, for progressive governments, such as those of Saskatchewan and Manitoba, to
Federal Transfers to Provinces
continue universal health care for their citizens-a principle that 1 would hope all parties in this House would certainly endorse.
I want to concentrate on the community impact and the human impact on people in areas such as my riding of Vancouver East. They will suffer as health services are cut as a result of the cutbacks laid down in this bill. It is important that we not only maintain but extend our health care services with increased financing.
If we look at the demographic trends in the Canadian population, we see an aging population with many expensive health care needs. These will increase. It is important that these needs be met not by institutional and long-term care, but with preventive care so that our older population can remain in their homes as long as possible and receive support services in the community.
Those from the west know-and I must say the Liberal government is not tuned into this-that there is a new mobility pattern in our country. Thousands of people are moving west and north, particularly young people, in search of employment. There will be new communities in the future. Adequate health care services must be provided for workers in some of the more remote areas. Expensive new facilities such as hospitals will be required. Increasing unemployment and economic stress has created increased pressure for millions of people. This creates an impact on the need for physician and psychiatric care services. Increased poverty means poorer nutrition for children and young families, and as a result they will require increased health care, something they are entitled to in a country like Canada.
It is a federal responsibility to increase funding for medical research. For example, urea formaldehyde has been a frequent topic of discussion in this House. There are new environmental hazards as well as the impacts of microtechnology, particularly on women workers. All this is in addition to chronic illnesses such as cancer, heart disease and arthritis for which we have not yet found a cure. Therefore, there must be increased federal funding.
My colleague, the hon. member for Cowichan-Malahat-The Islands (Mr. Manly) talked about the impact of these cutbacks on provinces such as Manitoba, so I will not dwell on this in my remarks. It is particularly important for the federal government to assist not only in maintaining but in improving health care services. I will not touch on post-secondary education; other colleagues will speak to this subject. It is a struggle just to maintain the status quo. In addition to investing funds, we must plan properly so that the health care dollar is better used. This may help to reduce or at least sustain the present level of health care costs.
Members opposite have said that the federal government made a mistake by moving into block funding for health care services. We agree it was a mistake. It gave up federal control over the need for general health care standards across this

March 24, 1982
Federal Transfers to Provinces
country. It lost some of its negotiating power with the provinces with regard to insisting on certain priorities which are essential for a sound preventive health care program.
As I said, I want to concentrate on the human side of health care services and the kinds of services that will be affected by the federal cutbacks and, therefore, the lack of adequate funding to the provinces which are implied in this bill. It is also important to talk about the health needs of young children. I refer to reports presented to the House last spring by the Standing Committee on National Health and Welfare and its recommendations with regard to young families, and the federal responsibility toward them.
Finally, in my remarks I will refer to concerns of the National Action Council on the Status of Women in its brief presented to the task force on federal-provincial fiscal arrangements. It is concerned particularly with the health care of women in Canada.
First I want to talk about the type of health care services which will give us a more sensible and practical value for our dollar. This will help to alleviate some of the expenses of chronic institution care which consumes so much of the health care dollar. My party believes that not enough funding is given to medical care services, medical delivery systems and community health programs. I refer to programs that should be readily accessible to families and individuals in their neighbourhood, adapted to local conditions.
I wish to speak about the importance of community health clinics that are developed under the guidance of community boards which provide services geared to the ethnic make-up of many communities. My riding of Vancouver East is multiethnic. There is a large proportion of low-income people. The services they require must receive federal funding. They require demonstration grants from the federal government.
Some years ago in my riding a health centre was developed. It was established as a model for other clinics. It is called the Reach Clinic and was developed in co-operation with UBC medical services and local general practitioners. A community board runs the operation. It is a non-profit organization which employs workers from many different ethnic backgrounds. It serves a multi-ethnic community. There is a medical card which can be used by families for all health services. It was one of the first community clinics to develop a dental program for low-income families, a very important service that is not available in most communities.
Recently the Reach Clinic began a program for adolescent parents. I have talked before in the House about the extreme social and health problems caused by the great increase in adolescent pregnancies. There is a need for a whole range of support programs for teenage mothers. Many are really children trying to rear children of their own. This kind of clinic provides support for adolescent parents and education with regard to job training, and helps young mothers with child daycare programs so that they can get on with their lives knowing that their children are receiving proper care. It provides information on parenting skills, nutrition and an awareness of basic health needs.
The experience of health community clinics in Quebec adds another important dimension. I refer to the whole question of prevention. There are family-life education programs, access to contraceptives, and freedom of choice with regard to abortions which should be available through community health care clinics. In my riding we also have a downtown health society which was adapted to the needs of street people, including alcoholics, drug addicts and those who live in the downtown area of Vancouver. Most of these people have extremely low incomes, inadequate diets and severe health problems. Therefore this downtown clinic, again with a community board, stressed hot meals and good nutrition for street people. It helped to provide dental care to those who had no access to it and provided referrals to many community services.
In the Chinatown area next door, another health care concept is being developed as part of a social and co-operative housing project. This is largely for Chinese Canadian residents, many of whom are elderly and do not speak English. There are also many public housing projects in this community and, therefore, a public health department has agreed to decentralize and move into the basement of a new senior citizens development. This unit will be open to all residents of the community. It will provide a Cantonese-English-speaking staff as well as a community advisory committee. It is possible to adapt this centre to the needs and desires of elderly Chinese people to make available traditional herbal medicines and acupuncture in the future.
Another important health care centre is a day care centre for adults which provides medical care for the disabled and elderly. This will allow many of them to remain in their homes. Again, this centre would have a Cantonese staff, provide Cantonese meals, which will provide beneficial mental health and morale as well as good nutrition for these people.
I mention these examples because I believe it is extremely important that they be funded and not just maintained as demonstration projects. They should be expanded in every community, certainly throughout the metropolitan areas in Canada. This cannot be done without adequate funding and without fiscal arrangements which are fair to the provinces.
As I have mentioned, most of these services are provided in poverty areas. This requires a very high degree of subsidized care. For example, some centres in Victoria, Winnipeg and other cities have new health care clinics which have a combination of social services, health care services and a multiplicity of comprehensive support services. They provide services which prevent and cure the early symptoms of poor health which would ultimately relieve the expense of institutional care for these people.
As mentioned, there were a number of recommendations made by the subcommittee on the international year of the child to the Standing Committee on Health, Welfare and Social Affairs last spring. I would like to refer to a number of recommendations which were made on behalf of Canadian
March 24, 1982

children with regard to health services. There were several medical practitioners on the committee.
1 would like to refer to a few excerpts from this report, particularly from the section on children and health. It was felt by members of the committee that fetal and neonatal mortality and risk of handicaps are still substantial, varying widely from province to province. The recommendation went on to say:
The risk could be reduced with improved prenatal care. A key issue is the need for a system of reproductive care that provides among other things: regular care and supervision for all mothers during pregnancy: information for parents about the effects on the unborn of nutrition, smoking, and alcohol and drug usage during pregnancy; and good prenatal child care.
There was also considerable concern that with our sophisticated medical practices in Canada, many Canadian children are not being adequately immunized. It was recommended in particular that an extensive public education program be undertaken through federal and provincial co-operation to make the public more aware of the effects on the fetus of maternal nutrition, smoking and the use of drugs and alcohol during pregnancy and to stress the importance of immunization for young children.
You may think that this does not apply to the bill under discussion today but I can assure you that these recommendations relate very directly to the need for adequate funding for health care and preventive services to provide for the future good health of our children.
It was also proposed that family allowances should be extended so that mothers at the time of pregnancy will receive the proper nutrition to provide proper prenatal health care so that children will be born well developed physically and mentally.
The committee also stressed the quality of nutrition, which ties in very closely with health services and preventive health care, which is of serious concern, particularly the entire diet provided to children from low-income families.
I saw examples of inadequate diets for many children when I worked in co-operative food stores in public housing projects where children of families on very low-income used their money for junk food. This is not only true for low-income families but these families do not have the money for nutritious foods. Positive steps must be taken for adequate nutrition. Nutrition programs should be made available in preschool and elementary school hot lunch programs.
Another recommendation was to consider having more nonprofit food banks operating on a permanent basis in Canada for distribution to those in need.
I would indicate that this report has never been dealt with in the House. It has not gone to cabinet and has not been considered by the Minister of National Health and Welfare (Miss Begin). I consider this to be a disgrace after the amount of work that has been put into this report, not only by the Standing Committee on Health, Welfare and Social Affairs but also by many voluntary groups across Canada.
Another problem severely affecting young people, predominately from the age group from 15 to 19 years, is suicide.
Federal Transfers to Provinces
Preventive measures must also be adopted to avoid fatal accidents. We also advocated recommendations based on studies which reveal the increasing number of adolescents who are using tobacco, alcohol and drugs, and we recommended that school help programs should stress the dangers of the use and abuse of such drugs. It was our belief that there should be a national advertising campaign warning against the harmful effects of drug abuse. Also, education and treatment service should be provided to control drug and alcohol abuse among the employed. This should not be a matter of concern only to the unions who are launching programs to improve the health conditions of workers, but to employers as well.
Those are some of the recommendations in the report on children and the need for federal funding to be continued and expanded for the preventive health care services.
In the alternate report which 1 presented to that committee on behalf of our party, I also stressed the importance of expanding the public health facility to enable health care nurses to reach out into the community, particularly homes where families are not likely to be using traditional medical services. Health care nurses should meet with young mothers to get them involved in supportive services and provide the kinds of health care services that are needed at a very early age so that children will have a better future.
Finally, if time permits, I would like to raise some of the points respecting health care cutbacks, which are of particular concern to women in Canada. These points were raised in a brief submitted to the parliamentary task force on federal-provincial fiscal arrangements by the National Action Committee on the Status of Women in July, 1981. The National Action Committee stated:
-health care is an area of particular concern to women . . . Women arc much more frequently diagnosed as suffering from health problems than men are. Women feel the effects of federal and provincial cutbacks in health care more severely since they are the principal consumers of health care services.
Health care cutbacks put women in a double jeopardy position. First, the unequal treatment of women causes them to have higher rates of health breakdowns and second, society restricts their access to the means of ameliorating their health problems.
We are also concerned with the cutbacks in the funding of health care services from the standpoint of women as workers. Except for the highly skilled positions of doctors or managerial staff ... the majority of workers in the health care system-
By far, are women.
The fact that this committee invited both the Canadian Nurses Association and NAC's member group, the Canadian Union of Public Employees, to make representations at its hearings indicates that the committee recognizes the enormous implications of the cutbacks for the women who work in hospitals.
From the perspective of women, both as consumers of health care services and as workers in the health care system, we arc tremendously concerned by the overall decrease in funding as well as the elimination of mandatory federal-provincial cost-sharing formulae.
With the introduction of the Established Programs Financing (EPF) arrangements in 1977, the federal government limited its expenditure increases to the over-all growth in the economy and eliminated conditional grants in favour of cash and tax-point transfers to the provinces. While this change was supposed

March 24, 1982
Federal Transfers to Provinces
to give the provinces greater autonomy in the health care field, it has simply meant that there has been a substantial decrease in health care funding on both the federal and the provincial levels. The provinces have used the introduction of the EPF system as a means of decreasing their share of health expenditures. In 1975-76, the provincial share of health care expenditures was 41 per cent of the total. In 1980-81, it dropped to 27.8 per cent of the total moneys expended. By allowing the provinces to evade their responsibility in this area, severely restricting its own contribution to health care, the federal government has reneged on its commitment to the Canadian people to provide equality of access and a quality health care service from coast to coast.
Quality health care is our right. It is not a privilege conferred upon us by our federal or provincial governments. The National Action Committee, therefore, demands that the over-all level of funding from both federal and provincial governments for health care services be increased substantially and that the federal government reinstitute a cost-sharing formula to ensure that the provincial governments live up to their responsibilities. It is clear to us that block funding is ineffective: the provinces are not sufficiently committed to the delivery of quality health care services without some form of incentive-
Cutbacks in post-secondary education have more or less followed the same pattern as the cutbacks in health care, with the result that there are fewer places open in post-secondary institutions, fewer jobs, and the cost of users is escalating.
This affects women particularly.
Women's access to post-secondary training has traditionally been severely limited because of discrimination in selection and lack of resources.
This lack refers to education training resources. I might add that there is a lack of adequate manpower allowances and a lack of daycare to go along with them. The brief goes on to read:
Eighty per cent of women in the paid labour force are concentrated in five low-paying employment ghettos: clerical/secretarial, small manufacturing, hospital work, teaching and services. These five areas are the very ones that will be most severely affected as a result of the introduction of micro-processing technologies over the next two to five years.
Paid employment is the fundamental right of every adult who wants it and if women are not, once again, to be pushed out of the labour force, massive job retraining in the non-traditional areas of employment as well as in new technical sectors must be provided to them. To cut back post-secondary education funding at a time when women are going to be facing a technologically-induced employment crisis is to effectively bar women from the labour force. The National Action Committee, on behalf of the more than three million women that it represents through its member groups, strenuously objects to any policy that negatively affects the employment prospects of women. We demand that our federal and provincial governments immediately expand funding for postsecondary institutions and make every effort to ensure that women are recruited for training and retraining, as well as for jobs in these institutions.
Recently, women in Canada have witnessed the severe contraction of subsidized child care spaces, rules to limit access further, the lowering of standards, and the introduction of child care businesses that cut corners and make profits at the expense of our children. The National Action Committee vehemently opposes any effort by our governments to transfer responsibility for child care from the public to the private sector. One of the original bases upon which NAC was founded was to fight for a publicly funded, twenty-four hour, free, child care system that would be accessible to all.
I can tell hon. members that this party soundly endorses that recommendation. The brief goes on to say:
The National Action Committee is concerned because recent cutbacks in day care funding and the refusal of our governments to regard child care as anything but a welfare service have restricted access to the already-inadequate child care system and resulted in the lowering of standards and in poor wages and working conditions for child care workers, almost all of whom are women. We would like to reiterate most strongly the demand, articulated by women across Canada, for a free, universally-accessible, twenty-four-hour child care system.
In this area, we are particularly concerned that an incentive funding program be developed to force provinces to provide adequate levels of funding and ensure that uniform, quality services are available from coast to coast. A cost-sharing approach will no doubt give the federal government the much needed incentive to
drastically expand child care, as well as provide provinces with the necessary stimulus to develop the programs.
We would like to point out here that if the federal government is genuinely committed to the principle of economic equality for women, a principle to which it has so often paid lip service-
But done little.
-it must initiate action on this fundamental underpinning of women's equality-a good child care system available and accessible to all. The federal government can no longer hide behind the argument that this is a matter for provincial jurisdiction. The time for child care has come.
A number of other issues could be raised on behalf of women, and I am sure other speakers will be raising them, but since my time is now up, I would just like to stress once again the importance of an adequate federal funding program for health care services and post-secondary services, particularly for women in Canada and their children, who must have a better start in life.


Mr. Dan Heap (Spadina):: Mr. Speaker, I wish to rise to speak in criticism of Bill C-97. Although some of the points that I will make have been touched upon already, I shall make them again, as well as some more specific points, because they bear repetition and clarification.
As well as being arbitrary and one-sided in the way it has been handled in comparison with the tradition of federal-provincial negotiations, this bill also represents very interesting manoeuvring on the part of the federal government to make the principle of federal-provincial negotiations fairly unworkable. Delays were introduced which had the result of making it impossible to meet the timetable set for serious negotiations.
First of all, I want to comment on some of the effects of the cuts that have been envisaged and about which we have been warned and which, to some extent, have already occurred.
In the riding of Spadina and in the city and province in which it is located, cutbacks in education and health care services and specifically post-secondary education are already being experienced. The federal government will maintain that this is all the fault of the provincial government, yet it seems to give different figures at different times. For example, at the present time a figure in the range of 55 per cent of the funding for post-secondary education in Ontario is given by federal government spokesmen. I remember that last summer a spokesman for the federal government claimed that it was contributing 87 per cent of the cost of post-secondary education at places like the University of Toronto. That statement came from a person who had been engaged, as secretary to the Prime Minister (Mr. Trudeau), in a good deal of the planning and manupulation of the figures. He was hoping to move further up the ladder and into cabinet. I refer, of course, to Jim Coutts, the one and always aspirant to election in Spadina. He stood in front of the university, at Convocation Hall, and asserted that this government was paying 87 per cent of the cost of universities such as the University of Toronto. Since then other government spokesmen have said it is paying something like 50 or 55 per cent. Either the government has
March 24, 1982

cut its contribution by almost half within a few months or the figures given by one spokesman or another are not to be believed.
In any event, Mr. Speaker, the effect of cuts by both the federal government and the provincial government of Ontario are already being felt in the area of post-secondary education in the province. Next fall the fees will be raised by at least 12 per cent, and when the cuts now proposed by the federal government go into effect, the fees will undoubtedly be raised again for 1983. There have been cuts in programs at the University of Toronto, Queen's University and colleges such as St. Lawrence and St. Clair. There is a general cut in accessibility. During the past year 50,000 student applications were rejected by the post-secondary education system in Ontario because places were not available. In fact, only 45 per cent of applicants for 1980 and 1981 were accepted. There simply is not enough room to educate the students we have, even though the ratio of university educated people to population is lower in this country than it is in the United States and Japan.
What is happening is that the money envisaged as being withheld from post-secondary education as such, is to be recycled into specific job training tailored to particular job needs. That does not provide the equivalent of a genuine postsecondary education which the country needs and which many other countries still provide.
There is, in fact, no attempt to set any sort of minimum standard on post-secondary education. There is no standard of accessibility relating to the poor, the immigrant, the native peoples. There is no standard of quality in education. Of course, the trouble is that the government which enacted the original legislation for EPF and revenue guarantees failed to ensure any such guarantees. It claimed that if the matter went badly it would ensure them, but now it is backing out.
In the field of health, such a well-known hospital as Toronto Western has closed its obstetrics department. This was not done cheerfully, the director told me, but after great heartsearching. There were operating deficits and something had to go, so now the obstetrics department has gone from one of the major hospitals of our country. Previously, that hospital had closed wards and made other cost-cutting moves. Such things do not contribute to the wellbeing of any hospital. There have also been cuts in public health services in Toronto and other cities and municipalities.
Of course, the general cuts in hospitals have, through antiunion legislation, mainly been borne by the nurses, nursing aides, orderlies and cafeteria workers. While doctors are allowed to strike-just like the Tories-nurses are not allowed to strike, and hospital support workers are thrown in jail for doing what doctors and Tories do with impunity.
OHIP fees have been raised and hospitals are inventing all kinds of new fees for patients. Things that were previously part of the service are now not available under QHIP but are charged separately. Hospital admissions have slowed down, and there have been cases of serious illness or injury where people were not treated in time because of delays in admissions. There have also been cases where people have been discharged prematurely, evidently because of over crowding
Federal Transfers to Provinces
once certain wards and facilities were reduced. There have been cases where people were discharged prematurely and their health suffered afterwards, even to the point of death in some cases.
The point is that the government introduced Bill C-97 which, if it passes in its present form, would amend current legislation and result in changes to two of the most important programs developed in this country, the established programs financing and fiscal equalization.
We in the New Democratic Party are deeply concerned with the reduction in federal funding for essential social programs and by the government's refusal to work co-operatively with the provinces in order to ensure first-rate education, health and other basic public services.
I want to comment now on the established programs financing and how it evolved for health care and post-secondary education. Federal transfers to the provinces originated in the imbalance between federal and provincial expenditure responsibilities and revenue capacities. Under the BNA Act the responsibility for health, education and welfare resides with the provinces. After World War II the federal government used its superior fiscal resources to initiate a number of national shared cost programs in these areas. These major new programs were designed to ensure that national standards in the quality of health and education programs delivered by the provinces would be achieved. This undertaking that certain standards would be achieved and maintained was made at that time.
Throughout the late 1960s and the early 1970s the federal government became increasingly alarmed by the rapid growth in its financial transfers to the provinces for hospital insurance, medicare and post-secondary education. Over the strong objections of the provinces, many of which could never have participated in these national programs without substantial federal cost sharing, the federal government instituted a number of arbitrary and controversial measures to cut back its contributions to these programs.
Federal contributions to post-secondary education programs were capped in 1973-1974. In 1975 the federal government announced a schedule of annual ceilings to its medicare contributions, and gave its notice of intention to terminate the hospital insurance agreements in 1980.
Reacting in part to the unanimous concern expressed by the provinces over this arbitrary imposition of ceilings and in part to continuing concern about the rate of increase of its contributions, the federal government proposed new funding arrangements for health and post-secondary education in 1976. Effective April 1, 1977, federal conditional grants to the provinces in support of hospital insurance, medical care and post-secondary education were replaced by the established programs financing arrangements that we now have. EPF replaced federal conditional cost-sharing payments in these program areas by unconditional cash grants, together with the

March 24, 1982
Federal Transfers to Provinces
transfer of tax room from the federal to the provincial governments. The per capita federal EPF transfer to the provinces escalates annually at the rate of increase in the gross national product. It is calculated independently of provincial program expenditures. One of the important points is that the federal government knowingly separated its granting from any cooperation by the provinces; it foresaw the possibility that that co-operation would fail. It undertook to restore a requirement of co-operation, and it has now reneged on that undertaking.
There were five principles to the established program financing. They were announced by the Prime Minister at the conference of first ministers in June, 1976. First, the federal government should continue to pay a substantial share of program costs. Second, federal government payments should be calculated independently of provincial program expenditures. Third, there should be greater equality in per capita terms in federal contributions to the provinces. Fourth, funding arrangements should be permanent. Fifth, there should be continuing federal participation in the development of policies of national significance in health and post-secondary education.
These principles announced the end of traditional costsharing in hospital insurance, medical care and post-secondary education. An unconditional block funding arrangement was implemented with no matching requirements by provincial governments. Two restraint objectives were intended. The first introduced an element of certainty for the federal government in its financial commitment to these programs. The second provided increased flexibility for provincial budget planning to allow greater scope for cost-saving measures.
The principle of predictability and certainty of federal transfers was to give provinces the opportunity to undertake proper expenditure forecasting, secure in the knowledge that federal contributions would not be capped or withdrawn.
By establishing the financing of these programs on a permanent basis, the federal government attempted to alleviate provincial uncertainty concerning future federal contributions. At the June, 1976, conference the Prime Minister stated exclusively the federal government's commitment to the principle of long-term certainty. He said:
The fourth principle (of EPF) is that the arrangements be established on a more or less permanent footing, to reduce the uncertainty that has attended in the past the questions of continued federal involvement and the dimension of federal financial contributions . . . (notice of termination) would not be given lightly, because the intention is to underline the relative permanence and stability of the new arrangements.
Not all the provinces were encouraged by the new funding proposal. There are serious liabilities in having an unconditional block fund approach to federal financing of provincial programs when national standards in the quality of these services are paramount. Notwithstanding concerns, the actual financial offer made by the federal government was judged unacceptable by all provinces. In brief, the provinces were asked to assume all the financial risk in large program areas that were experiencing substantial cost pressures. Moreover, provinces were assuming this risk at the same time the federal government was proposing to terminate the 1972 revenue guarantee program.
The revenue guarantee was to become a central aspect of both the 1976 and 1981 negotiations on established programs financing. The revenue guarantee was introduced by the federal government in 1972 to encourage provinces to parallel federal income tax reform. It was a promise by the federal government that over a five-year period the provinces would lose no revenues by adopting the federal income tax changes. Although the provinces warned the federal government that the tax reform measures would significantly reduce revenues, the federal government insisted that the loss of revenue would be minimal. Ottawa optimistically assumed that revenue guarantee payments to the provinces would be small. Despite an arbitrary formula change by the federal government which reduced revenue guarantee payments to the provinces for 1974 and subsequent years, payments were nearly $1 billion per year by 1976 and were escalating.
Provincial estimates of the cost of tax reform have been absolutely correct. Termination of the revenue guarantee would severely disrupt provincial finances. Although the federal government recognized there would be a difficult period of adjustment for all provinces when the guarantee ended, it resolutely maintained that the guarantee would expire at the end of 1976.
Given the importance to provincial finances, the ten provincial premiers unanimously requested the transfer of four personal income tax points and associated equalization as partial compensation for the termination of this program. The stage was set for a major compromise.
Central to the negotiations was the federal government's legal commitment to cost-sharing under its hospital insurance agreements with the provinces until mid-1980. Provinces would have been entitled to claim any difference between this open-ended cost-sharing arrangement and the hospital insurance component of EPF for the first three years of the new program. The federal government wanted to get out of this commitment.
The federal government offered the provinces financial compensation. There was one equalized point of personal income tax plus an equivalent amount of cash for termination of the revenue guarantee. Significantly, the compensation for termination was included as a permanent part of the basic structure of the EPF arrangements and as an inseparable component of the contributions paid to the provinces for health and education. In exchange, the provinces agreed to waive their rights to open-ended cost-sharing under the hospital insurance agreements.
In the period 1977 to 1981 there were further major developments. Given federal assurances in 1976 that EPF was a permanent arrangement for funding of health care and higher education, the provinces had reasonable expectations that EPF would evolve smoothly. However, five major developments occurred over the last four years which put in question the federal government's real commitment to EPF, that is to
March 24, 1982

say, to the national health program and the post-secondary education system.
The first was the 1978 federal budget cuts. In August, 1978, the federal government announced significant budget cuts and a re-allocation of funds from existing programs to new priorities. Included were major unilateral cutbacks in federal-provincial transfers. At a November, 1978, finance ministers' meeting the federal finance minister suggested EPF would be the target for reductions. That proposal startled the provinces. EPF was not yet a year and a half old and was supposedly based on stability and predictability. In retrospect, this was the first indication that the federal government was anxious to back out of its financial commitment under EPF. The provinces, aware that reductions in federal funding would have lowered health and post-secondary education standards, rejected the federal proposals. As a result, the federal government cut back other transfer payments to the provinces.
Second was the federal allegations regarding the provincial misuse of EPF funds. Beginning in 1979 the federal government initiated an attack against the provinces, alleging provincial misuse of EPF funds. Provincial governments were accused of diverting medicare funds to other programs. These allegations precipitated a royal commission report on Canadian health services. Although the Hall commission report concluded that the provinces were not diverting health dollars, the federal campaign escalated up to and through the recent fiscal arrangements review. Over the past year provincial postsecondary education expenditures have become the favourite federal target. That there was an increase in federal contributions to the financing of health and post-secondary education in relation to provincial expenditures may be true, in some provinces, for the initial years of the new arrangements. This is not surprising, however, given the nature of the block-funding proposal introduced by the federal government.
One other technical feature of the EPF formula influenced the relative size of federal contributions in the initial years. Transfers to the provinces are escalated each year on the basis of a lagged three-year moving average of the growth in the national economy. During the early years of block funding the escalator was, to a considerable extent, based on the inflated but declining growth rate of the Canadian economy during the mid-1970s. This naturally inflated federal contributions to the established programs during the initial years. This was known to all governments in 1976 and its effects were predictable. The fact that EPF was deliberately front-end loaded during its introductory years, made this aspect of the formula an effective characteristic for selling the new arrangements to the provinces. It was also well understood in 1976 that provincial program costs would rise faster than federal contributions during a period of accelerating inflation. That is the current situation. In recent years provincial governments have been carrying an increasing portion of the accelerating health and education costs.
When the block funding arrangement was proposed in 1976, stable and predictable transfers for health and post-secondary education programs were primary objectives. These have been achieved by the current arrangements. Federal projections of
Federal Transfers to Provinces
the transfers under the EPF arrangements provided to the provinces in 1976 were extremely accurate; within 2 per cent of the amount actually transferred.
The third thing that happened in those four years, Mr. Speaker, was that the federal government became increasingly preoccupied with the lack of public visibility for federal transfers to the provinces. Given the nature of the block funding financing arrangements, it is no surprise that the federal government is having visibility problems with the EPF. As far as public accountability is concerned, the federal government not only can but is obliged to enforce the conditions specified in the national medical care and hospital insurance acts. If accountability is a problem, then the federal government is either not carrying out its obligations, or the specified conditions do not clearly spell out the respective responsibilities of the federal and provincial governments. It is a federal problem, not a provincial problem, and the Secretary of State (Mr. Regan) and the Minister for National Health and Welfare (Miss Begin) should get moving in carrying out their duty to enforce these principles of accountability and equal access to a quality level of care.
The fourth thing that happened in these years was the October, 1980, federal budget. The federal government indicated that it intended to achieve significant savings in social transfer payments to the provinces beginning in 198283. At the December 17, 1980, federal-provincial finance ministers' meeting the provinces urged the federal government to proceed with negotiations at the earliest possible date so that a mutually acceptable agreement could be reached in the interest of all Canadians. However, the federal finance minister was not willing to discuss the federal government's proposals at that time. He finally agreed to hold a meeting in March, 1981 but the meeting was never called.
At the western premiers' conference in Thompson, Manitoba, on April 28, 1981, and again at the meeting of the western provincial finance ministers and treasurers on May 5, 1981 in Victoria, the western provinces repeated their call to the federal government to table EPF proposals as soon as possible. Ottawa disregarded both requests. At the 22nd annual premiers' conference in August, 1981, the premiers were unanimous in agreeing that intergovernmental negotiations on EPF must commence immediately. Ottawa again ignored the provinces.
For more than an entire year, Mr. Speaker, Ottawa stonewalled the provinces in their repeated requests for ministerial negotiations on financial arrangements. The federal finance minister delayed meeting with his provincial counterparts until November 23, 1981, in Halifax. We must conclude that the federal timetable was designed to ensure there would be no time or opportunity for real negotiations and consultations.
The fifth thing to happen was the establishment of the parliamentary task force on federal-provincial fiscal arrangements in February, 1981. Its mandate was to examine fiscal arrangements within the context of the federal government's expenditure plan as set out in the October 28, 1980, budget. It

March 24, 1982
Federal Transfers to Provinces
was to report to Parliament by the end of June, 1981. The main thrust of the federal finance minister's presentation to the task force was that transfers would have to be cut significantly to meet the federal government's over-all strategy of reducing its deficit. He implied that transfers were a major contributing factor to the federal deficit, and confirmed that the federal government was seeking net savings in social program transfers of $1.5 billion. In August, 1981, the task force released its report and flatly rejected that part of its terms of reference, requiring its examination to take place within the context of the October 28, 1980, federal budget.
In addressing the federal government's concerns about its deficit, the task force stated:
-federal grants to provinces and municipalities expressed as a percentage of total federal spending have been fairly constant since 1970. There is, therefore, no ground to suggest that the federal transfers have been getting out of hand. In fact, they grew at a slower rate in the 1970s than they did in the 1960s.
The task force rejected the arguments that federal-provincial transfers were responsible for the federal deficit. In the view of the task force, the federal deficit is the result of the general economic situation and federal tax and expenditure decisions. If the federal government gives away billions to the wealthiest corporations in this country and refuses to collect taxes from them, it is no wonder that the federal government has a deficit.


Some hon. Members:: Hear, hear!


Daniel James Macdonnell Heap: In his presentation to the parliamentary task force, the chairman of the Economic Council of Canada likewise took issue with the federal finance minister's statements that transfers to the provinces must be cut to reduce the federal deficit. He said that one should seriously doubt the wisdom and fairness of solving the federal deficit problem by merely transferring the problem to the provinces. This is not a solution at all. In the summary and conclusions to its report, entitled "Financing Confederation Today and Tomorrow'', the Economic Council reiterated its position. The Council's first recommendation was that the federal government reconsider its proposed reduction in transfers to the provinces.
I now wish to look at the federal cutbacks to the EPF. The federal government announced in its November, 1981, budget that the changes to the established program financing arrangements were as follows: first, effective April 1, 1982, compensation to the provinces for the termination of the revenue guarantee which had been built into the EPF will be eliminated; second, as of April 1, 1982, federal contributions for health and post-secondary education programs will be on an equal per capita basis; and third, by March 31, 1983, new federal-provincial arrangements for the financing of post-secondary education and human resource development will be devised. If the provinces are unco-operative in developing these new arrangements the federal government will freeze future transfers to the provinces for post-secondary education at their 1982-83 levels. Fourth, by March 31, 1983, the national standards for health care are to be clarified and an effective mechanism for their maintenance is to be developed. This is to
be done in consultation with the provinces and incorporated in new federal health legislation.
The financial implications of these steps are as follows: the elimination of the revenue guarantee will save Ottawa $813.7 million in 1982-83 and $5,306.2 million over the five-year period of the 1982-87 fiscal arrangements. Savings to the federal government, by placing the EPF transfers on an equal per capita basis, will amount to $127.9 million in 1982-83 and $574.6 million over the next five-year period. In total, the federal government will cut back transfers for health and postsecondary education by $941.6 million in 1982-83 and by $5,880.8 million over the period 1982-83 to 1986-87. These cutbacks are substantially greater than the savings proposed in the federal budget of October, 1980.
What we have to consider is the misleading federal presentation and data errors. In its November, 1981, budget, the federal government attempted to mask the real impact of the cuts to the EPF by presenting tables which suggested that increased provincial revenues resulting from the tax increases contained in the federal budget would offset EPF cutbacks. This is extremely misleading. Any additional tax revenue received by the provinces is from provincial home source revenue. It is collected from provincial taxpayers as a provincial income tax. It is not a federal transfer. Moreover, in those years when the federal government instituted tax changes which reduced provincial home source revenues, there was no thought of compensating the provinces with increased federal transfers. Even if this tactic were acceptable, which it is not, the actual cost of the EPF cutbacks to the provinces was further misrepresented by massive errors in the federal budget. By its own admission, the federal government overestimated the alleged revenue increases to the provinces by almost $650 million.
The federal government has never presented the provinces with a complete EPF proposal. It has always split its negotiations and threats. The deadline of March 31, 1982, was set by the federal government for legislation on the financial aspects of the EPF. This was after the federal government delayed for a year the request of the provinces for negotiation on this very point. The deadline for legislation on program issues is March 31, 1983. The latter is accompanied by the threat to freeze federal payments for higher education if the provinces cannot agree to as yet unspecified federal conditions. The package is incomplete. It provides for financial cutbacks without first addressing the programs to be financed. This is a complete reversal of the proper process of review and negotiation. Definitive federal proposals with respect to health and higher education objectives and conditions have not yet been made. The federal initiatives are completely contrary to the principles outlined by the Prime Minister when he introduced EPF in 1976. Of course, if the Prime Minister resigns in the next month or two, he can slough off all responsibility for all of his promises.
In essence, the federal government is attempting to reduce its financial involvement while increasing its control over provincial spending in health and higher education.
March 24, 1982


Mr. Blaikie:: Won't work. The health minister should resign.


Daniel James Macdonnell Heap: It should be noted that, except for a three-year notice of termination clause in the EPF arrangements, there is no legislative deadline for changes to EPF. Without legislative action, the existing financial arrangements will continue indefinitely, in keeping with the intended long-term nature of EPF. The federal government's stated intention to establish new financing arrangements for post-secondary education clearly indicates that it wishes to terminate the current EPF arrangements within one or two years. However, no notice of termination has been given in the House of Commons in spite of the Prime Minister's stated principle of permanency and stability. It is not known whether or not these new financing arrangements for post-secondary education will be accompanied by further cutbacks in federal funding for universities
Federal Transfers to Provinces
and technical schools. The pattern is clear, however. The federal government is seeking more political visibility for lower levels of spending without any concern for quality of services provided to Canadians.
Mr. Speaker, this bill is a bad one. I believe it should be voted down by this House. I hope that the federal government will seriously reconsider it and, particularly within the committee, will be willing to accept amendments.


Mr. Deputy Speaker:: It being six o'clock, pursuant to Standing Order 2(1), this House stands adjourned until two o'clock tomorrow afternoon.
At 6 p.m. the House adjourned, without question put, pursuant to Standing Order 2(1).

Thursday, March 25, 1982