1982-03-25

ROUTINE PROCEEDINGS


Mr. Gus Mitges (Grey-Simcoe):: Madam Speaker, in view of the fact that there has been no increase in the yield on government annuities since 1976 to reflect both the massive increases in the cost of living and the massive increase in interest rates, I move, seconded by the hon. member for Simcoe North (Mr. Lewis):
That the Minister of Employment and Immigration immediately act on the recommendation of his department made in February of 1976 that increases be reviewed from time to time to reflect further fluctuation of interest rates so that some measure of relief can be offered to those who purchased these annuities in good faith to supplement their income and retirement funds.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE PRIME MINISTER
Mr. Gordon Taylor (Bow River):: Madam Speaker, the Prime Minister's "hens" are coming home to roost: He played the east against the west, and now we have "separatists" in Quebec and in the west. He subtly worked toward a socialist state and discouraged free entreprise at every turn, and literally drove capital out of the country, and now we have little investment and one million people unemployed. He approved a budget which supports high interest rates, that attacks businessmen and farmers through eliminating IAACs and reducing capital cost allowances, etc., and now businesses and farms are going bankrupt or barely surviving. Therefore I move, seconded by the hon. member for Red Deer (Mr. Towers):
That this House demand that the Prime Minister and the Liberals change their policies at once or get out of the "Hen Hoose". The Canadian people, free enterprisers, will not stand for much more.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


REGIONAL DEVELOPMENT
Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, since last November the Minister of Fisheries and Oceans (Mr. LeBlanc) has repeatedly been asked to meet with the Mirami-chi Tri-Level Association. To date he has not accepted the invitation. On one visit to Ottawa by the association, the group was told that the minister was too tired to see them. In view of the calamity which has developed in the region with reference to horrendous unemployment, which will be capped by the government's foreclosure of CFB Chatham, and considering that he is the cabinet minister responsible for New Brunswick, I move, seconded by the hon. member for Malpeque (Mr. Gass):
That the House instruct the minister to go to bed, rest up, and meet these officials in an effort to cope with the crisis.


Some hon. Members:: Oh, oh!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, 1 rise on a matter of urgent and pressing necessity pursuant to the provisions of Standing Order 43. In view of the fact that two

March 25, 1982
hon. members of the Conservative Party, the hon. member for Fraser Valley West (Mr. Wenman) and the hon. member for York-Peel (Mr. Stevens), with the approval of the sometimes external affairs critic of the Conservative Party, the hon. member for St. John's West (Mr. Crosbie), have agreed to a request by the Salvadoran government to act as election observers, and in view of the fact that the upcoming elections in El, Salvador are an affront to democracy and a mockery under circumstances in which thousands of people, including innocent Salvadoran and foreign journalists have been deliberately murdered by Salvadoran government troops, I move, seconded by the hon. member for Selkirk-Interlake (Mr. Sargeant):
That this House urge the hon. member for Kingston and the Islands who, along with this party, has opposed the sending of Canadian observers to these elections, to keep her Conservative colleagues in Canada and not have anything whatsoever to do with these farcical Salvadoran elections.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE CONSTITUTION
Hon. Bryce Mackasey (Lincoln):: Madam Speaker, I rise pursuant to the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Whereas the British House of Lords has today given third reading to the Canada Bill, thereby completing the final legislative step in the patriation of Canada's Constitution, I move, seconded by the hon. member for St. Boniface (Mr. Bockstael):
That this House convey our appreciation to the members of both British Houses of Parliament for their co-operation in bringing this historic and final chapter of nation building to a successful conclusion.


Some hon. Members:: Hear, hear!


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


Mr. Hnatyshyn:: If the Prime Minister (Mr. Trudeau) says "yes" there must be something wrong.


Mr. Lawrence:: It needs Royal Assent.


Some hon. Members:: Agreed.


Some hon. Members:: No.


ROYAL CANADIAN MOUNTED POLICE
Hon. Elmer M. MacKay (Central Nova):: Madam Speaker, I move this motion in the same spirit as the current mindless and vacuous application by the government of basically good rules, this time with regard to bilingualism affecting the security service of the RCMP, and pursuant to the second protest from members of the RCMP in the capital region. Therefore I move, seconded by the hon. member for Red Deer (Mr. Towers):
That all staff of foreign missions in the capital region be tested for proficiency in both official languages; that failure should require attendance at language courses; and that those who fail such tests after two years instruction be declared persona non grata; further, that Mr. Max Yalden be provided with a list from the security service, in both official languages, of those who are suspected of spying in the capital region so he can establish the level of bilingualism in this particular group; that spooks not meeting the criteria be required to take up residence outside the national capital region, and finally, that the designation of bilingual positions in the security service be postponed until potential spies being surveyed by the RCMP become suitably bilingual.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


FINANCE
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, massive uncertainty in the business community, over what might be the rules considering sales taxes, what might definitely be the rules with respect to life insurance and annuities, and what might or might not be the rules in connection with pension plans, capital cost allowances, etc., is contributing to the lack of jobs and general malaise affecting the country. I therefore move, seconded by the hon. member for Brampton-Georgetown (Mr. McDermid):
That this House does direct the Minister of Finance to present to this House the amendments to the Income Tax Act affecting persons and businesses on or before March 29, 1982, and at the same time on motions advise this House as to the procedure leading to the implementation of his suggested changes in the sales tax.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
March 25, 1982


PENSIONS
Mr. Neil Young (Beaches):: Madam Speaker, I, too, rise under the provisions of Standing Order 43. In view of the fact that the Minister of National Health and Welfare (Miss Begin) said yesterday that it would take between 25 and 30 years to provide significant income benefits for retired Canadians if the country is to rely on the private sector to reform our pension system, I therefore move, seconded by the hon. member for Vancouver East (Mrs. Mitchell):
That this House recognizes that the need for pension income reform is today, and directs the government to use the additional moneys it will gain from the energy agreements and the new taxes from the budget, to increase pensions immediately for those who are retired now, and to bring forward reforms to our public pension system so as to provide decent and adequate pensions for all retired Canadians, now and in the future.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


AGRICULTURE
Mr. Jack Shields (Athabasca):: Madam Speaker, whereas recent forecasts indicate that the agricultural community will suffer a significant drop in income during the next two years due to escalating input costs and stable or falling returns, and whereas the biggest single factor contributing to the disastrous position of Canadians farmers is without a doubt the government's disastrous high interest rate policy, because farmers are dependent on borrowed capital to maintain their operations, and whereas the foolish and impossible restrictions on the small business development bond are forcing thousands of farmers out of business through bankruptcy and foreclosure, because they do not qualify for the small business development bond, I therefore move, seconded by the hon. member for Assiniboia (Mr. Gustafson):
That the government immediately ease the regulations for obtaining a small business development bond by the farming community, so that our farmers may actually qualify for this bond, allowing them to remain in business, so that Canadians may look forward to continuing food production in this country.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.
Oral Questions NUCLEAR ENERGY


NORTHERN ONTARIO WASTE DISPOSAL SITE-MOTION UNDER
Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, I, too, rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Recent earth tremors, as high as three on the Richter scale, have been registered in northern Ontario, near the town of Massey, where Atomic Energy Canada Ltd. is looking at plans to dispose of radioactive waste in subterranean reservoirs. In light of the serious problems this presents, and the fear the local people have of the waste contaminating the town's water supply, I move, seconded by the hon. member for Beaches (Mr. Young):
That this House instructs the Minister of Energy and the Liberal member from Algoma to accept the local MPPs' idea of a meeting with local residents to discuss AECL's plans, and further, that the minister and AECL accept the democratic right of the local residents to accept or reject the use of their region as a test site for nuclear waste disposal.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Otto Jelinek (Halton):: Madam Speaker, my question is directed to our powder puff negotiator, the Minister of State for International Trade. The minister has just returned from a trip to Japan, where he has failed in his negotiations in every way, shape and form on behalf of the Canadian auto industry. He has come back without one encouraging word for the industry which, as he knows, is suffering from record high unemployment and bankruptcy in the parts sector. All the minister had to say about his failure on that matter, before he returned, was that "he was not concerned." Therefore I would like to ask the minister if he could at least tell this House and, more important, the industry, just what he considers to be acceptable target objectives in this very important matter, before even more jobs are lost.


Hon. Ed Lumley (Minister of State (International Trade)):: Madam Speaker, I want to advise the hon. member that I too was disappointed that the Japanese government failed to respond to what I thought was a very fair proposal which the Government of Canada put forward with respect to three items: first, on a short-term basis the restriction of automobiles

March 25, 1982
Oral Questions
for the coming year entering the Canadian market; second, with respect to a ceiling on commercial vehicles, and third with respect to a commitment to undertake negotiation concerning a long-term content proposal. Negotiations are still under way. We hope that, as soon as a decision with respect to the United States-Japan negotiations are finalized, we will be able to finalize the Canadian negotiations.


REQUEST THAT CANADIAN CONTENT REGULATIONS BE IMPOSED
Otto John Jelinek: Madam Speaker, these negotiations, consultations, and broken promises made by the Liberal administration, have been going on for over two years while unemployment in this country has skyrocketed to record levels. Surely it is time to stop pussy-footing around and take a much tougher position. I would therefore ask the minister if he is now prepared to take the necessary unilateral action, for example the imposition of Canadian content regulations, before it is too late. Surely some action has to be taken now. If the minister is not prepared to take that action, I would like him to tell us and the industry why not. Negotiations can no longer go on. They have gone on long enough. We need action. That is what is needed.


Edward C. Lumley: Madam Speaker, obviously we would much prefer to have negotiations take place with the Japanese in a very positive manner. It is totally unrealistic to assume that Japan will decide what to do with Canada's arrangement until such time as it finalizes its arrangement with the United States, being that 90 per cent of its market in North America is the United States. We should give the Japanese government the benefit of the doubt and allow them a couple of weeks to think over the proposal.


LENGTH OF NEGOTIATIONS
Otto John Jelinek: Madam Speaker, the minister surely knows that most industrialized countries of the world have now and have had for some time various agreements with the Japanese without having waited for their neighbours to make agreements. Since the minister and his colleague, the Minister of Industry, Trade and Commerce, are unable to come up with a policy, I will direct my final supplementary to the Prime Minister.
I would ask the Prime Minister how much longer he is prepared to allow his ministers to negotiate unsuccessfully on behalf of and at the expense of the economy and the Canadian worker. Will he stand up in this House as the Prime Minister and tell us when there is going to be a firm policy and some firm action taken with regard to the automotive industry, which is responsible for one out of seven jobs in Canada?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the hon. member asks how long I would be prepared to let the minister negotiate. I would say I do not think he
should take anywhere near as long as that party took to not reach an agreement with the premier of Alberta on a matter of Canadian concern.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


JAPANESE TRADE PRACTICES
Mr. John Thomson (Calgary South):: Madam Speaker, my question is also to the Minister of State for International Trade. How long is the government going to put up with the unfair trade practices of Japan? How many Canadians will be compelled to lose their jobs before his government takes some action?


Edward C. Lumley: Madam Speaker, as I indicated in the speech that I gave to the Canadian Chamber of Commerce in Tokyo, Canada agrees with the principle of free trade, but we want to see fair trade. We indicated to them a number of areas to which we would like to have access in the Japanese market because we believe Canadian manufacturers can compete with anybody in the world, provided we are given access to the Japanese market equal to that they are given here in Canada.


CANADIAN POSITION
John William Thomson: Madam Speaker, I completely agree with the minister.


Some hon. Members:: Hear, hear!


John William Thomson: I am a free trader too, but saying being a free trader does not make it free. The Japanese will not trade fairly. We are shut out of the Japanese market by tariffs and non-tariff barriers in our agricultural products, forest products, automobile parts and other products. You know that it is a one-way street. I want to ask the minister when is the government going to say to Japan that we are not going to play the game any longer? It is a two-chance situation; lose and lose.


Edward C. Lumley: Madam Speaker, I apologize to the hon. member because my voice is rather hoarse and I cannot shout across the aisle as he shouted at me. I am sure that the hon. member is aware of the fact that we are one of the few nations in the world that actually has a trade surplus with Japan.


Some hon. Members:: Oh, oh!


Edward C. Lumley: While the United States of America and the European community have a trade deficit with Japan, we happen to have a substantial trade surplus. We are not happy
March 25, 1982

with the size of that surplus or with the market penetration of our manufacturing goods, but we have indicated to the Japanese that access may not be as easy in this market unless we have an equal and fair opportunity in their market.


CANADIAN PROPOSAL TO JAPAN
Mr. Edward Broadbent (Oshawa):: Madam Speaker, I have a question for the same minister on the same subject. The minister came back from Japan without getting an agreement either on the reduction of exports of vehicles into Canada or, much better, a commitment to produce parts or vehicles in Canada. Nor was he able to get a reduction or elimination of the 10 per cent tariff which stops finished wood products in British Columbia from going into Japan. In short, he struck out on all counts.
Considering the statement made by the minister that we do indeed have a trade surplus, but considering that this is overwhelmingly in raw materials, what specific proposal did the minister take to Japan to flesh out the idea that Canada is an industrial nation also, and Japan cannot go on having free access to our resources without importing some of our manufactured goods as well? What specific proposals did the Governement of Canada make?


Edward C. Lumley: Madam Speaker, the hon. member is aware of the proposal which I made concerning the 10 per cent tariff on SPF. I am disappointed to find out that he has not mentioned that the two negotiations we have undertaken during the past two years with respect to the forest industry in British Columbia and its penetration of the Japanese market have borne fruit in the early months of this year. In fact the Japanese government has indicated that it will change the standards for softwood plywood with respect to the housing market, which opens up a substantial market potential for the British Columbia lumber producers. That will likely be undertaken in July. The fact that the building codes have been changed with respect to three-storey condominiums for wood frame housing, or two by four housing as it is called in Japan, is also a substantial export potential for Canada. These are two positive elements which have been undertaken by this government during the last three months.


Some hon. Members:: Hear, hear!


John Edward Broadbent: Madam Speaker, they are two positive elements but they still did not come to grips at all, with automotive trade or affect the 10 per cent tariff on finished wood products which are the most important items of trade both to British Columbia and Ontario, in particular.


TARIFF BARRIERS BETWEEN CANADA AND UNITED STATES
John Edward Broadbent: Madam Speaker, my supplementary question is directed to the Prime Minister and it is with respect to the Senate Report on Trade Relations with the United States. It is noted in the Senate report that trade barriers in terms of tariffs only between Canada and the
Oral Questions
United States will be removed by 1987. Considering that the United States has in place a whole range of non-tariff barriers-in fact an 87-page FIRA report lists all those non-tariff barriers-does the government plan to take steps to ensure that our industry in Canada can survive by 1987 if tariffs will be removed but the United States maintains a whole series of non-tariff barriers which unfairly discriminate against Canadian producers?


Pierre Elliott Trudeau: Madam Speaker, this is a subject which has been raised at the GATT meetings and at the Economic Summit meeting. Various countries complain about non-tariff barriers being erected against them. As the hon. member indicated, the United States does have non-tariff barriers, as well as Japan. I suppose we would have to say that in some cases Canada does also, in support of the hon. member. What we are attempting to do in the GATT negotiations, and indeed at the Summit negotiations, is to de-escalate these barriers on a multilateral basis.


ROLE OF MULTINATIONAL FIRMS
John Edward Broadbent: Madam Speaker, if the Prime Minister is going to de-escalate the barriers, to use his phrase, and move toward free trade, not only in terms of tariffs but non-tariff barriers, my next question concerns the fact that 45 per cent of Canadian manufacturing is owned in the United States. Does the Prime Minister accept the view that if these barriers are removed, and with 45 per cent of manufacturing owned in the United States, the inevitable tendency will be for manufacturing to shift completely south of the border unless the Canadian government takes steps to ensure that those multinationals in Canada will produce our fair share of the jobs? Given the government's decision to move toward free trade, what is the government going to do with these multinationals to make sure we have these jobs in Canada?


Pierre Elliott Trudeau: Madam Speaker, several years ago this government issued guidelines to ensure that the multinationals situated in Canada would follow a certain number of steps which are compatible with and, indeed, pursuant to Canadian interests rather than foreign interests. These guidelines were issued publicly, and their application is of concern and a matter of surveillance by the government.


CRIMINAL CODE
Allan Frederick Lawrence: Madam Speaker, my question is also to the Prime Minister, but it is on a different subject. Has the Prime Minister's government passed an order in council which as yet has not been made

March 25, 1982
Oral Questions
public, or is he contemplating passing an order in council which would drastically change public policy in respect of offtrack betting or any other form of gambling which, up until now, has not been authorized under the law of this country?


Pierre Elliott Trudeau: Madam Speaker, I would have to take the question as notice. I am not familiar with any such order in council. My understanding is that the Criminal Code determines this matter and that it could not be changed by order in council.


GOVERNMENT POLICY
Allan Frederick Lawrence: Madam Speaker, my supplementary question is directed to the Prime Minister. I assume he will have no difficulty asserting to this House and guaranteeing that before there is any change in government policy in respect of these matters, the change will be debated in this House, the government will not be handing a fait accompli to this House or to the people of this country, and there will be no attempt to change that policy by virtue of any back door process of order in council but instead there will be a legislative amendment presented in the House of Commons.


Pierre Elliott Trudeau: Surely, Madam Speaker, the hon. member knows that no order in council would be upheld by any court if it were in contradiction of the law.


CORPORATE AFFAIRS
Ramon John Hnatyshyn: Madam Speaker, in the absence of the Minister of Justice, who has been away so long in England he will probably come back with an English accent, my question is directed to the acting minister, the Solicitor General.
As the minister knows, lawyers for Uranium Canada, one of the six corporations charged under the Combines Investigation Act with conspiring to fix uranium prices at less than competition, have asked the courts to exclude Uranium Canada from hearings on this matter. Uranium Canada claims it is immune from prosecution because its affairs were directed by the federal government and therefore the Crown is immune. Can the minister tell the House whether it is the position of this government that it is licensed to break the laws of Canada without consequence on the basis of Crown immunity?


Mr. Jim Peterson (Parliamentary Secretary to Minister of Justice and Minister of State for Social Development):: Madam Speaker, the hon. member knows that is a ridiculous question. We are prepared to proceed on these matters always in accordance with the law. That has always been our policy
and our practice in the past. It will always continue to be the way in which we conduct ourselves.


INSTRUCTIONS TO COUNSEL
Ramon John Hnatyshyn: Madam Speaker, 1 will not comment on the description "ridiculous", except to say I would like to direct my supplementary question to the Prime Minister. I am sure the Prime Minister understands the gravity of this matter. I would like to know what the Prime Minister and the government are hiding with this kind of tactic in the courts.
I want to ask the Prime Minister a question with respect not to the court proceeding itself but the instructions which are being given to counsel. Will the Prime Minister tell us whether it is the minister responsible for Uranium Canada who is instructing counsel in this matter, or is it Gordon McNabb, the president of the corporation and one of the unindicted coconspirators, who is giving instructions to counsel with respect to the position this Crown corporation is taking?


Pierre Elliott Trudeau: Madam Speaker, normally the instructions would be given by the minister, and I imagine that is the case in this particular circumstance. I am not quite sure why the hon. member is dragging in the name of Mr. Gordon McNabb. If the hon. member has something to say, he should not hide it. Why does he not go ahead and say what he has to say?


Ramon John Hnatyshyn: I did.


AIRPORTS
Hon. Bud Cullen (Sarnia-Lambton):: Madam Speaker, my question is directed to the Minister of Transport. Today the City of Sarnia celebrates its 125th anniversary. I should like to know from the minister if the airport terminal is on track and will be built.


Allan Frederick Lawrence: Tell him he will have to wait another 125 years.


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I do not know if you can say about a runway that it is on track, but the project itself will be realized on time.


STATUS OF WOMEN
Mrs. Margaret Mitchell (Vancouver East):: Madam Speaker, my question is directed to the Minister of Employment and
March 25, 1982

Immigration. Last year the minister, who was then responsible for the status of women in Canada, indicated publicly that voluntary affirmative action did not work and that mandatory action would be required. Privately, however, we learned that the minister and the cabinet continued to pursue a very ineffective go-slow approach. Now we hear from both the minister who is responsible for the status of women this year, and also from the Minister of Labour, that the same thing applies-that voluntary affirmative action does not work.
Will the Minister of Employment and Immigration explain what evidence he had that led to this statement? Will he also tell the House what action he feels is needed to replace a voluntary affirmative action policy?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, I am very pleased that the hon. member asked that question because it gives us the opportunity to explain that over the past several months we have been engaged in a very active discussion about affirmative action programs with the business community.
As the hon. member knows, two parliamentary committees, one on the handicapped and one on the labour market, recommended that we attempt to develop affirmative action programs in co-operation with the major participants, the labour unions and the business community. That is exactly what I have been doing for the past several months, meeting with these organizations to discuss with them what the most effective means would be of assuring equality of access in the workplace. We are continuing those discussions because we happen to believe that the most effective way of introducing such plans is not through confrontation with these groups, as the hon. member's party advocates, but through co-operation with those groups. That is what we intend to do.


REQUEST FOR COMPULSORY ACTION PROGRAM
Margaret Anne Mitchell: Madam Speaker, my supplementary question is directed to the Prime Minister, and it concerns the constitutional rights of women. The Minister of Labour, the Minister of State for Mines, and the Minister of Employment and Immigration have now publicly stated that the government's voluntary program on affirmative action for women in the workplace has failed, yet the cabinet has refused to implement a policy of compulsory compliance even for the civil service and companies that have contracts with the federal government.
Since the new Constitution endorses affirmative action as a means for women achieving equal rights, will the Prime Minister, as the leader of this country, stop being such a bloody hypocrite-


Some hon. Members:: Oh, oh!


Margaret Anne Mitchell: -and will he tell the women of Canada that he now will require-
Oral Questions


Some hon. Members:: Oh, oh!


Margaret Anne Mitchell: -will he tell the women of Canada that he now will require a policy-


An hon. Member:: Withdraw!


Madam Speaker:: Order, please. I cannot quite recall if that expression is parliamentary or not. I do not have the list before me.


An hon. Member:: It is not.


Madam Speaker:: Since it is creating such a ruckus, perhaps the hon. member would like to rephrase her sentence.


Margaret Anne Mitchell: Thank you, Madam Speaker. Would the Prime Minister stop being such a hypocrite, and will he now require a policy of mandatory affirmative action in the public service, and for all companies that do business-


Madam Speaker:: Order, please. I am told that that expression really cannot be used, and I would ask the hon. member to withdraw it or rephrase the sentence.


An hon. Member:: Withdraw!


Margaret Anne Mitchell: Madam Speaker, I would be very pleased-


Some hon. Members:: Oh, oh!


Madam Speaker:: Order, please. Would the House allow the hon. member to respond.


Margaret Anne Mitchell: Thank you, Madam Speaker. I would be pleased to withdraw. I know the sensitivities of the Prime Minister. On behalf of Canadian women would he please introduce compulsory compliance affirmative action programs in the federal jurisdiction?


Pierre Elliott Trudeau: Madam Speaker, I am in no way as sensitive about this matter as the NDP apparently is. The hon. member should remember that she is a member of a party which has elected a government in Saskatchewan which opposed the insertion of women's rights in the charter.


Some hon. Members:: Hear, hear!


An hon. Member:: That is not true.


Pierre Elliott Trudeau: Surely the hon. lady-if I can call her that-


Some hon. Members:: Oh, oh!


An hon. Member:: Withdraw!


Pierre Elliott Trudeau: -should not forget that when members on all sides of this House were trying to insert a guarantee into the Charter of Rights that women would be treated equally, the last holdout when the Minister of Justice was trying to get the province to come aboard was Premier Blakeney of Saskatchewan.


Some hon. Members:: Hear, hear!
15804

March 25, 1982
Oral Questions INDIAN AFFAIRS


CONTROL OF BAND EXPENDITURES
Mr. Stan Schellenberger (Wetaskiwin):: Madam Speaker, my question is for the Minister of Indian Affairs and Northern Development who, on many occasions, has claimed to support the principle of increased Indian responsibility over their moneys and affairs. Now his department has issued a new directive which takes away much of that authority and will be instituting centrally-run computer programs, involving hundreds of man-years, to look after the expenditures of the three-month expenditure programs. As well, the department is asking for a referendum on behalf of the chief and council, and that is undermining the chief and council and his bands.
Does the minister believe that the reimposition of this type of program is undermining the whole area of more band control over funds and moneys and is really going back to the old type philosophy of Indian agents?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, I wish the hon. member would be good enough to advise me if he is talking about a particular group of bands. Does he mean the bands from Alberta, for instance? He nods his head indicating that indeed he is. May I say that there have been discussions with the chief and some of the band's lawyers with respect to what they were doing. They were in my office about three weeks ago.
You may recall, and the opposition, I think, raised questions about it, that the Auditor General raised some questions about proper procedures to be used by the department with reference to about $15 million to $18 million expended by the band, and indicated that the department was not adhering to the proper accounting procedures with respect to how that matter was to be handled by the band. He implied that we were negligent and that I was negligent in discharging my duties as a trustee on behalf of the Indian people with respect to the handling of these particular moneys of this particular band.
This matter was discussed with them. I indicated that, according to legal opinions I had received from independent legal officers of the Crown, certain procedures would be required that had not been adhered to in the past. As a result, certain controls remain.
I am sorry to go on so long, Madam Speaker, but may I also say that individual Indian members of the band had complained about the way some distributions were made per capita amongst all band members, and had questioned the procedures resorted to by the chief and the band. I informed the chief and the council that a referendum would be preferable in one particular instance, so that the chief and the band council would know that their distribution had the full approval of the band.


REQUEST FOR PARLIAMENTARY TASK FORCE INQUIRY
Stanley Kenneth Schellenberger: Madam Speaker, I have a supplementary question. This new directive affects far more than one band in Alberta; it will affect in the neighbourhood of 40 or 50 bands across Canada. I would ask the minister whether he would be prepared to back off on the directive for at least six months until proper consultation can be had with all the bands that are affected. In the meantime, would he be willing to appoint a parliamentary task force to look into the whole area of the relationship between the government and Indian bands as far as their funding is concerned?


John Carr Munro: Madam Speaker, I would be happy to do that and to discuss it with members of the standing committee next week. If we could have some type of all-party agreement to look into the regulations to see whether some flexibility could be injected into them-and incidentally I told the chief and his advisers that we would be prepared to discuss it with them and take a more flexible approach if we could work out a satisfactory system-I would be pleased to do that. I might indicate at the same time that if some opposition members who are so zealous in seeing that the government responds to the criticisms of the Auditor General would show some patience, perhaps we would not have issued such stringent guidelines in the first place.


INDIAN TRUST FUND
Mr. F. Oberle (Prince George-Peace River):: Madam Speaker, one of the criticisms of the Auditor General was in connection with the Indian trust fund, moneys which belong to Indian people over which the minister has a trust responsibility. The criticism was that it is very difficult to audit the trust fund because we don't know where the money is. Of course our major criticism has always been that the government is cheating Indian people in terms of the interest paid on the trust fund. The trust fund is roughly $600 or $700 million that the minister keeps for Indian people, on which he pays something like 4 per cent or 5 per cent less interest than they could obtain from a private institution. What does the minister have to say about this? Will he allow Indian people in the future to spend their own money and invest it in ways other people do, or will he continue this colonial attitude toward Indian responsibility?


John Carr Munro: Madam Speaker, as the hon. member is well aware, we have been endeavouring to inject a good deal more flexibility so that Indian people can govern themselves without interference from bureaucracy. All too often it is criticisms emanating from opposition members who wish to take political advantage of a given situation which winds up in the headlines that results in a burdensome bureaucracy protecting itself from that very criticism. To a degree I think
March 25, 1982

hon. members would like far too much to have it both ways in this particular case.
If the hon. member would check his facts with reference to the bands in question which prompted some of these guidelines, he would find that we have, to avoid the accusation of paternalism, paid out millions of dollars to the bands and gave them the discretion as to how they would handle it. This was subject to the very same criticism. These bands had the money and could earn their own interest on it. It was not residing in any particular government account at the time. I wish the hon. member would check into his facts before he makes allegations.


SEARCH AND RESCUE
Mr. Chuck Cook (North Vancouver-Burnaby):: Madam Speaker, my question is directed to the Minister of Transport, and it is on a question of life and death. The minister is aware that Transport Canada has based a Sikorski 61 helicopter in Prince Rupert which is used, among other things, for the replenishment of supplies to lighthouses on the west coast and the maintenance of other navigational aids. Also the minister is aware that there is no hoist on this aircraft and that its crew has not received any search and rescue training. In the case of a marine disaster this means that the helicopter and its crew would not be able to provide adequate assistance in search and rescue operations. Why has the Department of Transport not equipped this helicopter with a hoist? Why has the department not undertaken formal search and rescue training of the helicopter's crew, considering the task it performs?


Jean-Luc Pepin: Madam Speaker, I do not think I am expected to know about these circumstances. I will find out immediately, but first I will find out whether the helicopter belongs to the Department of National Defence or the Department of Transport. As my hon. friend knows this often happens. I will find out immediately and report in the next couple of hours to my hon. friend.


HELICOPTERS BASED AT VICTORIA, B.C.
Charles Henry (Chuck) Cook: Madam Speaker, the minister was informed of the questions I am asking today. His office had the information on March 10 when it came to my attention. That was 15 days ago. I would suggest that the minister check with his staff to find out what kind of mail involving life and death he is not being shown.
The minister should be aware that the Department of Transport has up to five helicopters based in Victoria. One of them is a Bell 212 nine-passenger helicopter. There are no hoists available on these helicopters, and their crews have not received any training in search and rescue work. There is a one-hour delay in search and rescue response from the base in
Oral Questions
Comox to reach Juan de Fuca Strait. These helicopters, if they were equipped and had trained crews, would be able to come to the aid of a marine disaster there within ten to 15 minutes. This situation involves the life and death of west coast seamen.
Will the minister undertake to determine why these helicopters have not been outfitted with proper search and rescue equipment, and why their personnel have not been adequately trained in search and rescue procedures? It is important to the life of seamen on the west coast that every helicopter and every piece of equipment out there be ready-


Madam Speaker:: Order, please.


Jean-Luc Pepin: Madam Speaker, if the hon. member gave notice of the question I can understand his anger, but unfortunately I did not get it and I did not get an answer to his question. I will do so immediately. I have answers here to about 100 possible questions. It just happens that this one is not one of them. I can only repeat that I will attend to it immediately.


THE ECONOMY
Mr. W. C. Scott (Victoria-Haliburton):: Madam Speaker, my question is directed to the Minister of Finance. It concerns the tens of thousands of Canadians who are losing their homes, their farms and their businesses because of the government's policy of maintaining high interest rates. This policy is causing intense mental anguish for thousands of people, and every time a farm or a business goes offstream our economy is being further eroded. Would the minister assure the House that the government is seriously considering measures to ease the burden on those people most affected by this high interest rate policy?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, I suppose it is a tactic to describe the high interest rate policy as a policy which is pursued by the government for some sinister purpose. The high interest rates which exist are the result of the inflation we experience in the country. As I have stated often, there is no possibility of substantially reducing interest rates unless we succeed in getting our inflation rates down. That is a very complex subject in itself.
The hon. member referred to the impact of high interest rates on particular groups in the country. We have attempted to come to their rescue by various methods, one being the application of the small business bond to unincorporated businesses and farmers. The hon. member specifically mentioned farmers. I should like to advise the House that the four banks which were able to break out their loans for small business bonds directed to farmers provided $473 million to

March 25, 1982
Oral Questions
the agricultural sector through the small business bond, most of which has flowed to that sector since the budget.


PLIGHT OF HOME OWNERS RENEWING MORTGAGES
William C. Scott: Madam Speaker, the minister described to us what he has done for farmers in respect of the small business bond. There is very lilttle evidence of that in most parts of the country. What will the minister do for hard-pressed home owners who are facing eviction because they cannot afford to renew their mortgages?


Allan Joseph MacEachen: Madam Speaker, I am surprised that the hon. member is not aware that there is presently before the House a bill in the name of the minister of housing which is intended to do the very thing the hon. member requested. I wish he would get his party to get that bill out of committee and passed.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


TAX CONVENTIONS
Mr. Stanley Hudecki (Hamilton West):: Madam Speaker, my question is to the Minister of Finance. The negotiation of international agreements aimed at encouraging fair tax treatment and avoiding double taxation represents a real concern to those in Canada's private sector carrying on business in Latin America. While the negotiation of such tax treaties is difficult, would the minister report on the status of such negotiations with Latin America in general, and in particular with Mexico and Brazil?


Allan Joseph MacEachen: Madam Speaker, I would advise the hon. member that very few tax treaty negotiations have been initiated with Latin American countries. I believe the reason is differences in our respective tax systems.
With specific reference to Brazil, a number of meetings have been held over the past several years, but because of policy differences between Brazil and Canada it has not been possible to reach a mutually satisfactory agreement. Exploratory talks with Mexico have been held on the possibility of concluding a bilateral tax treaty, but their position of not concluding such treaties with other countries has not changed.


UNEMPLOYMENT INSURANCE
Mr. Cyril Keeper (Winnipeg-St. James):: Madam Speaker, the Minister of Employment and Immigration today made another one of his biweekly announcements on job creation.


Some hon. Members:: Hear, hear!


Cyril Keeper: Wait for it. He spoke of spending some $200 million of unemployment insurance funds for job creation. Coincidentally, the new UIC legislation will reduce the cost to the federal government for unemployment insurance by some $220 million. The minister is asking the unemployed to pay for his biweekly job-creation announcements. Can the minister tell this House whether this announcement means that the unemployment insurance legislation will definitely be introduced to the House this spring?


Lloyd Axworthy: Madam Speaker, it is unfortunate that the hon. member is stumbling over his own fabrications. There was no announcement by this government to introduce changes in the unemployment insurance program at this time. All we have are recommendations from the task force, which are being considered by cabinet. When they are ready to be presented to the House, they will be presented. I suggest, Madam Speaker, it is very unfortunate that the hon. member is distorting these programs by issuing those kinds of false statements.


UNEMPLOYMENT INSURANCE PREMIUMS
Cyril Keeper: Madam Speaker, my supplementary is to the expert on fabrication. The minister spoke today of taking from the unemployment insurance fund some $400 million for job creation and training, indicating he will take up to some $500 million, at the same time as he is asking Canadian workers to pay increased unemployment insurance premiums. He could take funds from the federal government's reserve of $1.73 billion for real job creation.
Can the minister justify to this House how he can ask the few people who continue to work in this country to pay increased premiums in order to pay for his weekly job announcements?


Lloyd Axworthy: Madam Speaker, once again the hon. member is in very serious error because the fact of the matter is that in the November budget we substantially reduced unemployment insurance premiums. If the hon. member, were paying more attention in this House, he would realize the programs we are bringing in under the unemployment insurance fund are receiving broad-scale support. As of today, we have signed 417 work-sharing agreements covering over 24,000 workers, and averting 10,000 lay-offs.
March 25, 1982

So, Madam Speaker, we are using the unemployment insurance fund for its intended purpose-to help the workers of this country, not to fuel the rhetoric of the NDP.


Some hon. Members:: Hear, hear!


EMERGENCY MEASURES
Mr. John Gamble (York North):: Madam Speaker, in answer to a question asked by the hon. member for Saskatoon West with respect to the effect of the emergency planning order of May, 1981, the Prime Minister stated yesterday that the Charter of Rights affords protection to anyone whose rights are abused under the War Measures Act, the emergency planning order or anything else. The Prime Minister will be aware that the first paragraph of the constitutional resolution provides that the rights and freedoms are subject to such reasonable limits prescribed by law which can be demonstrably justified in a free and democratic society.
I ask the Prime Minister whether the War Measures Act is within the prescribed limits of Section 1 of the new Constitution, and can it in fact still operate so as to deprive Canadians of their rights under the Charter? If not, will the Prime Minister be introducing a bill in this House to repeal the provisions of the War Measures Act on the grounds that they will become unconstitutional under the new Constitution?


Pierre Elliott Trudeau: Madam speaker, I honestly do not know if that is a rhetorical question. The hon. member should reflect on the fact that this kind of question will ultimately be decided by the courts. The preamble to the Charter was introduced, I seem to recall, with the support of all sides of this House precisely in order to assure that the War Measures Act or any other emergency order would not be used in a way contrary to democratic procedures in this country. Therefore I have no hesitation- well, now we have the hon. member for Durham-Northumber-land wanting to get into the act.
Madam Speaker, the law speaks for itself. If the hon. member is suggesting we should delete the preamble to the Charter then I suggest he would have-his seatmate is shaking his head; he does not want that to happen. Therefore, the hon. member should realize that there is this protection in the Charter; it was put in there precisely to answer the kind of doubts the hon. member is entertaining.


DEFINITION OF WAR
John Albert Gamble: Madam Speaker, it is that type of response which creates the confusion. Yesterday the Prime Minister led the Canadian people to believe very specifically that this Charter, and paragraph 1 thereof, would override the provisions of the emergency planning order. He
Oral Questions
now says it should be left up to the courts, which of course is the case. My submission, Madam Speaker, is that he should not delude the Canadian people.
One of the other great problems with the emergency planning order is the references to "in case of war", including the incarceration of Canadians in civilian concentration camps. While "emergency" is defined under the provisions of the planning order, "war" is not. Will the Prime Minister agree to amend that order, offensive as it is, to provide that when "war" is referred to under this order it is real war between Canada and some foreign nation, and not apprehended war?


Pierre Elliott Trudeau: Does the hon. member want me to say something about the cold war, too? I await his suggestions.


CORPORATE AFFAIRS
Mr. Chris Speyer (Cambridge):: Madam Speaker, my question to the Prime Minister has to do with the uranium cartel and its prosecution. As the Prime Minister is aware, the Crown, through the Attorney General of Canada, commenced conspiracy proceedings alleging that two Crown corporations are guilty of conspiracy. Perhaps the Prime Minister is not aware of this, but presumably on the instructions of the Minister of Energy, Mines and Resources counsel for these two Crown corporations are making statements to the Ontario courts such as this, "The people making decisions were the Crown, and the Crown is immune." So we have the unholy spectacle on the one hand of the Attorney General launching a prosecution on behalf of the Crown, and the Minister of Energy, Mines and Resources saying on the other hand that Crown corporations are immune. Will the Prime Minister please square the circle? Is the Crown divisible?


Pierre Elliott Trudeau: Madam Speaker, I submit with respect that the question is prohibited under the Standing Orders of the House. This matter is now before the courts and it would be as improper for me to answer the question as it is for the hon. member to ask it. If the hon. member persists, I ask that the question be ruled out of order.


INSTRUCTIONS GIVEN TO COUNSEL
Chris Speyer: I would like to ask the Prime Minister whether or not the Minister of Energy, Mines and Resources is giving instructions to counsel representing these two Crown corporations to take the position that they are immune from prosecution.


An hon. Member:: No answer.

March 25, 1982
Business of the House BUSINESS OF THE HOUSE


WEEKLY STATEMENT
Madam Speaker:: Does the hon. member for Yukon have a question on House business?


Mr. Nielsen:: Yes; I was waiting for the Prime Minister to reply to that last question, Madam Speaker.
I have a question for the government House leader. Could he indicate the business of the House for tomorrow and for as much of next week as he can and, if possible, even take us further?


Mr. Pinard:: Madam Speaker, tomorrow we will resume debate on Bill C-97, at second reading stage of the fiscal arrangements legislation.

As far as next week is concerned, Monday afternoon, we shall proceed with Bill C-97 on fiscal arrangements. Following our discussions with the House leaders, it seems reasonable to set the following agenda for the remainder of next week. Monday evening, we could deal with the report stage of Bill C-88 on loans to farmers. Tuesday, we could complete third reading of Bill C-88. Wednesday, assuming that the committee report on the National Housing Act will be available, we could deal with the report stage and third reading of Bill C-89. Thursday, again assuming that the committee report on Bill C-97 on fiscal arrangements will be available, we could debate and complete the report stage of Bill C-97. Next Friday will be an opposition day, unless otherwise indicated, and on Monday of the following week, we could dispose of the third reading of Bill C-97 on fiscal arrangements.


Mr. Deans:: Madam Speaker, some time later today we will move to an allotted day. We have a motion standing in the name of the hon. member for Humboldt-Lake Centre. I would like to ask for unanimous consent of the House to change that motion from standing in the name of the hon. member for Humboldt-Lake Centre to standing in the name of the hon. member for Regina West.


Some hon. Members:: Hear, hear!


Madam Speaker:: Does the House give consent to the proposal of the hon. member for Hamilton Mountain?


Some hon. Members:: Agreed.


Madam Speaker:: Agreed and so ordered.



ROUTINE PROCEEDINGS


Mr. Lome Greenaway (Cariboo-Chilcotin):: Madam Speaker, it is my duty to present a petition signed by the anglers and friends of anglers of the interior of British Columbia. The purpose of the petition is to alert the Parliament of Canada to the gross injustice of the present Chinook salmon fishery regulations as they apply to interior anglers, as well as the mismanagement of that fishery by the Department of Fisheries and Oceans.
The nature of the petition is to demand an immediate inquiry into the Chinook salmon fishery management on the Fraser River and to encourage a dialogue between the Department of Fisheries and Oceans and anglers of the Lillooet area, who have long advocated better regulations in order to enhance the chinook fishery.
The petitioners hope that in your examination of the petition, Madam Speaker, you will find it in order and that you will use the discretionary powers vested in the office of the Speaker to allow discussion and referral to the appropriate committee at the earliest possible time in order that this injustice and mismanagement be righted most expeditiously.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 3,464, 3,497, 3,591, 3,676, 3,683 and 3,752.
f Text]


Mr. Cossitt: 1.	Did the government hold receptions of any kind in Montreal on November 17, 1981 up to and including November 22, 1981 and, if so (a) what department was the host (b) was the Hyatt Regency Hotel involved (c)what establishments were involved, if any (d) what was the complete cost of any function including food and alcoholic beverages and what was the breakdown under each heading?
2.	(a) What was the guest list of those invited to any such receptions and what was the reason each person was invited (b) were invitations sent by special delivery and, if so, what was the total cost to the taxpayer of printing and sending out such invitations?


James Scott (Jim) Peterson: 1. The
Government of Canada held a reception in Montreal on November 17, 1981
(a)	Fitness and Amateur Sport hosted the reception.
(b)	The reception was held at the Hyatt Regency Hotel.
March 25, 1982

(c)	No other establishments were involved.
(d)	Food including tax	and service	$5,500.00
Beverages including tax and service	$2,407.05
Decorations	$ 172.80
Staffing	$ 871.0 0
Total	$8,950.85
2.	(a) The guest list included:
(i)	Accredited reporters (300)
(ii)	Senior members of the Canadian Football League Executive
(iii)	Senior members of the Grey Cup Festival Committee
(iv)	Major sponsors of the CFL, the Festival Committee of the pre-game and half-time shows
(v)	Senior members of the Canadian Football teams
(vi)	Politicians and select federal, provincial and municipal civil servants
Guests were invited to promote and encourage support for Canadian amateur athletes and their teams, as did the municipal and provincial governments by hosting receptions as well.
(b) Some out-of-town invitations were sent by Canada Post special delivery.
Material and printing of all invitations and envelopes $950
200 invitations at $1.17 special delivery	$234
Total	$1,184


Mr. Cossitt: Is it the policy of the government to be concerned with the operation in Canada of organizations preaching hate such as the Ku Klux Klan and, if so, what steps will it consider taking immediately to curb the activities of such groups that seek to promote racism and other matters not consistent with the Canadian democratic process?


James Scott (Jim) Peterson: As far
as the Minister of Justice is concerned, yes. The government, like the overwhelming majority of Canadians, is fundamentally opposed to the philosophy and activities of the Ku Klux Klan. Should this organization or any of its members contravene any provision of the Criminal Code, in particular those pertaining to hate propaganda (sections 281.1 to 281.3), I have asked my provincial counterparts to initiate prosecutions and I have obtained assurances to that effect.


Mr. Manly: 1.	For the fiscal year 1981-82, were funds shifted by the Department of Indian Affairs and Northern Development from the capital funding for education to operating and maintenance funding for education in each province and territory and, if so (a) what were the funds (b) for what reason were they transferred? 2
2.	Were steps taken to involve Indian representatives in each province in this transfer of funding priorities and, if so, what were they?
Order Paper Questions
3.	What amount of the $1 million recently approved in vote 5c of the estimates for the Indian and Inuit affairs program, Department of Indian and Northern Affairs, will go to programs in the province of Alberta and what projects and activities are planned in Alberta with the funds?
4.	Were steps taken to involve the Indian leadership in Alberta in these decisions and, if so, what were they?
5.	Were there any requests by Indians in Alberta for supplemental education funds?


John Carr Munro: 1.	(a) In British Columbia,
$1,470,000 was transferred from capital funding for education to operating and maintenance funding for education. These funds were for the Tache School ($810,000) and the Klappan School ($660,000).
(b) In British Columbia, construction starts were delayed pending Treasury Board approval to proceed with the projects. These delayed construction starts resulted in funds being transferred to offset operating and maintenance deficits in the education activity.
2.	Both Indian bands are aware of the reasons for the delays in the construction starts and it was through consultation with Indian representatives that it was decided to shift funds from capital funding for education to operating and maintenance funding for education.
3.	Of the $1.2 million recently approved in vote 5c of the estimates for the Indian and Inuit affairs program, $25,000 was for technical housing training in Alberta. The training is to provide the necessary managerial or technical skills to enable bands to successfully implement major new housing or renovation projects on reserves.
4.	For concerns of this nature, the Alberta region relies on the Indian Band's policy and negotiating committee. This item was not brought before the committee by either the bands or the department as neither party thought it sufficiently important to be placed on the agenda.
5.	Yes, there were requests by Indians in Alberta for supplemental education funds. These requests fall into the following categories:
Requests by Indian parents for financial assistance to meet the educational needs of their child(ren) who were enrolled in regular school from grades kindergarten to twelve;
Requests by Indian students who were under departmental sponsorship in high school, occupational skill training and university/professional educational courses;
Requests by Indian bands which administered education programs under contribution agreements, and which due to circumstances unforseen at the time the agreement was signed, required supplementary funding for an existing contribution program.
Requests by Indian bands and organizations to initiate new educational projects or new educational programs under contribution agreements which were not identified as a requirement at the commencement of the fiscal year.

March 25, 1982
Order Paper Questions IMMIGRATION APPLICATIONS FROM POLAND


Mr. Cossitt: In each of the past three years, how many (a) applications (b) inquiries for immigration to Canada were received by the Canadian Embassy in Warsaw, Poland and how many visas were granted for (i) landed immigrant status (ii) visits to Canada?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: (a) Tabulated below is the immigration statistical information requested from the Canadian Embassy in Warsaw:
1979	1980	1981Immigration applications received cases/(persons)	548/(992)	532/(1,023)	819/(1,752)Immigration visas issued	474	477	1,249Visitor visa applications received	10,675	11,576	13,913Visitor visas issued	7,592	7,928	9,852Visitor visas refused	701	417	483
The apparent discrepancy between the total for visitor visa applications received and the total for visa decisions rendered is based on the large number of withdrawals or cancellations of applications due largely to applicants' change in plans and/or difficulty in securing travel documents.
(b) The Canadian Embassy in Warsaw does not record inquiries by subject matter. For statistical purposes applications received are treated as immigration inquiries.


Mr. Herbert: What percentage of total public service salaries is paid for (a) pensions (b) paid vacations and holidays (c) paid rest periods (d) unemployment insurance (e) sick leave (f) life and health insurance and payments in lieu of (g) workers compensation (h) productivity and other bonuses (i) other benefits?


Hon. Donald J. Johnston (President of the Treasury Board):: The table below shows the cost of the benefits listed as a percentage of Public Service salaries:
(a)	pensions (including Canada/Quebec pension plans)	Per cent 12.20(b)	paid vacations and holidays	!0.80d)(c)	paid rest periods	5.14b)(d)	unemployment insurance	1.79(e)	sick leave	3.40")(0	life and health insurance and payments in lieu of	1.62<g)	workers compensation	0.55(h)	productivity and other bonuses*2*	0.01(i)	other benefits*3*	7.33
*'* These benefits do not involve cash disbursement above the employee's basic salary.
(2) Include suggestion, merit and long service awards.
*3) Include such benefits as overtime, severance pay.


Mr. MacKay: 1.	Is the Canada-U.S.S.R. Protocol on Consultations signed in Moscow on May 19, 1971 by the Prime Minister and the Chairman of the U.S.S.R. Council of Ministers still in force?
2.	Were there periodic meetings between Canada and the U.S.S.R. provided for in article 1 of the protocol and, if so, in each case (a) what was the (i) time of the meetings (ii) level of participants (iii) topic on the agenda (b) what were any agreements reached?
3.	Did the government make contact with the government of the U.S.S.R. in accordance with the provisions of article 2 of the protocol, in relation to the situation arising out of the invasion of Afghanistan by Soviet troops and in relation to the imposition of martial law in Poland, and (a) if so, in each case, what were the details (b) if not, what was the reason for inaction?
4.	Were there consultations between the government and the U.S.S.R. provided for in article 5 of the protocol and, if so, in each case (a) what was the (i) time of the consultations (ii) level of Canadian representation (iii) topic of the consultations (b) what were any agreements reached?
5.	Did the government consider renouncing the protocol at any time after the invasion of Afghanistan by Soviet troops and/or after the declaration of martial law in Poland?
6.	Is it government policy to inform its allies in NATO about consultations, negotiations and representations by the parties to the protocol?


Mark R. MacGuigan: 1. Yes.
2. Meetings between Canada and the U.S.S.R. undertaken in the spirit of the Protocol on Consultations have occurred on a number of occasions. These meetings however are not invoked under the direct authority of the protocol nor was this intended. The purpose of the protocol is to provide a framework for the development of a dialogue with the U.S.S.R. on issues of mutual interest or international importance. A list is provided of those occasions when consultations were held within the context of the protocol.
Date			Agreements
Level	Topic	ReachedOctober. 1971	Prime Ministers	Bilateral and	Canada/U.S.S.R.International	GeneralRelations	Exchanges AgreementSeptember, 1973	Foreign Ministers	NoneNovember, 1973	Foreign Ministers	NoneSeptember, 1974	Foreign Ministers	NoneSeptember, 1975	Foreign Ministers	NoneJuly, 1976	Senior Officials	NoneMarch, 1977	Senior Officials	NoneApril, 1979	Senior Officials	NoneSeptember, 1979	Foreign Ministers	NoneNovember, 1979	Senior Officials	NoneSeptember, 1981	Foreign Ministers	None
March 25, 1982

3.	Following the Soviet invasion of Afghanistan, the government raised its deep concerns on this issue directly with the Soviet government on several occasions, the latest of which was last September when the Secretary of State for External Affairs met Foreign Minister Gromyko in New York. Canadian views on Poland were also discussed at that time. The two governments, however, have not invoked article 2 of the protocol at any time.
4.	Article 5 of the protocol refers to consultations in general and therefore the response to question 2 applies.
5.	The government did not consider renouncing the protocol either after the invasion of Afghanistan nor in connection with recent events in Poland. The government believes that in times of crisis it is better to preserve the existing mechanisms for dialogue rather than creating additional barriers to the important process of East-West communication.
6.	Regular consultations and exchanges of information with Canada's allies are routine and ongoing. Therefore, when appropriate, we do not hesitate to exchange information on negotiations or consultations we have undertaken with the U.S.S.R. if the information is of importance and relevance to our allies.


David P. Smith: Madam Speaker, if question No. 3,278 could be made an order for return, this return would be tabled immediately.


Madam Speaker:: Is it the pleasure of the House that question No. 3,278 be deemed to have been made an order for return?


Some hon. Members:: Agreed.


Mr. Cossitt: 1.	With regard to the answer to question No. 2,754 which stated in part that "over 5,000 systems" for solar heating of hot water for washing purposes would be installed in the next four years by 14 government departments and 15 Crown corporations, what is a list of the locations of all the installations and how is the expense of $125 million justified to provide alternative methods of heating water to wash hands?
2.	(a) Did the government ever make a study as to what the savings in energy would be (b) how long will it take to recover the program costs of $125 million?
3.	Does the government anticipate the cost will rise above $125 million and has it made any allowances in this regard?
Return tabled.
Supply


David P. Smith: I ask, Madam Speaker, 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.



GOVERNMENT ORDERS


Madam Speaker:: Today is the Final allotted day. The House will go through the usual procedures this evening to consider and dispose of the supply bills. However, in view of the recent practices, would the House agree that the bills should be distributed now?


Erik Nielsen: I am sorry, Madam Speaker, I did not hear your remarks at the beginning of your statement. Would Your Honour repeat them?


Madam Speaker:: This being the Final allotted day, the House will go through the usual procedures tonight. However, what I ask hon. members is whether they agree, according to the usual practice, that the bills be distributed right now?


Some hon. Members:: Agreed.


Madam Speaker:: The House agrees. It is so ordered.


ALLOTTED DAY, S.O. 58-RAILWAY TRANSPORTATION
Mr. Les Benjamin (Regina West) moved:: That this House condemns the government for
a)	proceeding to abandon the Crowsnest Pass freight rate;
b)	failing to implement the recommendations of the Hall Royal Commission;
and
c)	failing to nationalize CP Limited and build a modern, integrated transportation system to create jobs, develop the economy, and enhance national unity.
He said: Madam Speaker, throughout the entire history of our country, the people of Canada have carried on an exercise in co-operative federalism in sharing the costs of running our economy, and particularly transportation, in all regions of the country. One can start in the Atlantic provinces, where we shared-with the people there-the costs of moving the agricultural, processed and manufactured goods within the Atlantic provinces to central Canada. We willingly agreed to tariffs to protect the manufacturing industries in central Canada, and those costs have been shared by all Canadians. We agreed to share in the costs of construction of massive infrastructure for the aircraft industry and the St. Lawrence Seaway. We also agreed to share in the costs of transporting

March 25, 1982
Supply
some agricultural production out of western Canada to export position. I call it co-operative federalism. In our terms, it is a foundation of a co-operative commonwealth.
A number of myths have been perpetrated and emphasized by those who would like to do away with the Crowsnest Pass or statutory grain rates. I would like to spend a few minutes in dissolving those myths. The first one is that the railways lose money hauling grain. They have never lost money hauling grain. They have received full payment, both directly and indirectly, since the first railway was built.
1 want to illustrate by using the figures for the year 1980 in which, at most, the railways lost $10 million hauling grain. If one uses the formula devised by Mr. Snavely in his third report, under the terms of reference ordered by the minister, the railways' costs for hauling grain for 1980 amounted to $671 million. That included a 25 per cent return on investment; it included $123 million of add-on profit; the revenues received by the railroads using the Snavely commission, Transport Canada estimates and publics accounts, amounted to $538 million. Mr. Speaker, they got $132 million from the grain producers; they got $193 million from branch line subsidies; they got $70 million from branch line rehabilitation; they got $4 million in boxcar repairs; and $9 million in hopper car lease; and $116 million saved them in interest charges on the hopper cars purchased by the various governments from the Canadian Wheat Board. Mr. Speaker, they have been fully compensated. That is the case in almost every year you want to look at. Certainly it is the case in every year that I have looked at.
The minister complains that the grain producers pay only 20 per cent of the cost of hauling grain. Why is he picking just on the grain producers? Using the same Snavely formula, cost recovery on hauling grain would be 46 per cent. On the St. Lawrence Seaway cost recovery is only 20 per cent, using the Snavely formula. On the National Harbours Board the cost recovery is 43 per cent, using the Snavely formula. On our highways and roads system, using the Snavely formula, cost recovery is 32 per cent. For Mirabel airport, the cost recovery is 14 per cent; and for Pickering it is only 2 per cent.
Why the Minister of Transport (Mr. Pepin) chooses to pick on the grain producers, when everyone else gets subsidies as large or larger, is beyond me. It has been said that the Crow rate is an unfair transportation subsidy. Well, of the $2.4 billion in transportation subsidies, $277 million went to grain movement; $971 million went for air subsidies; $335 million for marine; and over $500 million for VIA Rail.


Jean-Luc Pepin: Wrong figures for air.


Leslie Gordon Benjamin: Mr. Speaker, I do not know why the minister picks on the grain producers. May I also remind the House that one of the main items of logic towards keeping the Crowsnest grain rate for grain producers is that it allows the grain producer to compete in the international market. The United States grain producers have access to massive inland water
systems, entirely built, paid for and operated by the public of that country. That allows them the cheapest form of transportation for most of the grain near the Missouri, Ohio and Mississippi River systems and in some of their canal systems. It allows them to put the grain into export position at a lower cost.
The Argentine raises almost all its grain within 300 or 400 miles of salt water and for the longer distances of their grain haul the Argentine government pays all of the transportation costs. Australia produces most of its grain within 200 or 300 miles of export position. Since this country as a whole, all of Canada, benefits to the tune of four billion or five billion a year in a foreign exchange benefit, surely it is only fair that the nation as a whole share in the cost of getting that grain to export position, just as we share in the cost of transporting goods out of Atlantic Canada or in Atlantic Canada, just as we share in the cost of building airports, seaways and so forth.
Mr. Speaker, this is myth No. 2: grain is a main roadblock to increased western grain capacity. Everyone agrees that rail capacity in western Canada has to be increased and will require a massive investment of many billions of dollars. To lay the blame for that lack of capacity on grain producers is both unfair and unreasonable. Mr. Speaker, "It ain't wheat, it's coal". The department's own figures show that by 1986 or 1987 only about 14 per cent of that capacity will be required for grain; the rest will be for coal, potash, sulphur and other products like that.


An hon. Member:: Canadian Pacific coal.


Leslie Gordon Benjamin: Mr. Speaker, I have a strange feeling, a suspicion, that there are some companies and bureaucrats slobbering outside the door of the Minister of Transport, waiting to get some action going on the coal blocks held by the Government of Canada. Canadian Pacific was required to cede 50,000 acres to the federal government by 1904. Several federal departments and the government of British Columbia have been bickering about it. The reserve on those lands was 7.8 billion tons, and if you multiply that by $60 to $100 a ton, you have enough revenue to goldplate the rails all the way to the Pacific Coast. The government holds rights under the Crowsnest Pass Agreement Act for 50,000 acres of coalbearing land in southern British Columbia. The development of those coal blocks is not possible without revocation of the Crowsnest Pass Agreement Act, the legislation which limits prices for the sale of this coal to $2 per ton. I submit, Mr. Speaker, that is why the minister and his cohorts say that Crow must go-"It ain't just wheat, it's coal."
Mr. Speaker, myth No. 3; raising grain freight rates will result in increased livestock production and processing in western Canada. Well, Mr. Speaker, does anyone really believe, is anyone under the delusion, that the massive livestock and dairy industry in Ontario, in southern British Columbia, the hog arid dairy and livestock industry in Quebec and Atlantic Canada, are going to hold still for something like a $20-a-ton increase in their cost for feed grain? I doubt very much that Quebec or Ontario would hold still for that. I am
March 25, 1982

pretty certain that the federal government will be the first in line to pay some subsidies to recover the increased cost of feed grains for the benefit of those feeders, livestock producers and dairy producers in eastern Cana- i and in British Columbia.


Jean-Luc Pepin: Give the westerners a chance,


Leslie Gordon Benjamin: It is a delusion suffered by the cattlemen, by what I call the Texas cowboy syndrome, that they have been suffering in southern Alberta and Saskatchewan for many years. If they were so right, I cannot understand why most of the packing industry pulled out of western Canada; if they had such a good advantage, why didn't they stay?
The statutory grain rates are so fundamental to our history, our economy, the strengthening of confederation and national unity that even the slightest consideration to requiring grain producers in western Canada to pay more can be called nothing less than a betrayal and traitorous. Those who want to destroy the statutory grain rates for our grain producers are the ones who started the row in the first place. It was not the grain producers who raised the issue. I think the first occasion it was raised was in Winnipeg in the mid-seventies by a former minister of transport.
With them are the railroads naturally, although I do not think they particularly care where the money comes from as long as they get it. Who else supported the destruction of the statutory grain rates for western grain producers? This minister and his two predecessors wanted them changed. Naturally the cattlemen's association, the Winnipeg Commodity Exchange, some of the specialty crop raisers whose grain does not come under the jurisdiction of the Canadian Wheat Board-


Jean-Luc Pepin: What about the Government of Alberta?


Leslie Gordon Benjamin: The minister raises the Government of Alberta. I am glad he did. We will be able to use that in the coming weeks. We can also use some quotes from Conservative Members of Parliament, but I will not belabour the House with that today. There are two provincial governments, the Saskatchewan Association of Rural Municipalities, the cow-calf operators of western Canada, the National Farmers' Union and, no question about it, the majority of the membership of the Saskatchewan wheat pool want the Crowsnest rates kept for our grain producers.
Why the government would even consider flying in the face of what was said by Mr. Justice Emmett Hall is beyond me. It is the most definitive study ever done on the principle of statutory rates, particularly those that apply to grain. I remind the House that if the statutory rates for grain can be tampered with and increased, it will automatically lead to raising, if not cancelling, the maritime freight rate subsidies.
If our prairie grain producers have to pay by 1987 what Mr. Snavely calls for, 5.1 times the Crow, that means a cut in net farm income of 36 per cent. Farmers will have less income to spend on the purchase of trucks, tractors, fertilizer, sprays and other supplies. It could mean the loss of another 51,000 jobs
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for Canadians, many of them in the industrial heartland of this country.
The government should make these investments in increased western rail line capacity, but in return for those investments it should obtain equity. How much more do we have to give the railroads in order for them to carry out or have the capability of carrying out their responsibilities? Canadian National has had over $2 billion of its bonded indebtedness taken off its books and transferred to the books of Canada, making the people of Canada the only shareholders in that corporation. As a result, Canadian National has been relieved of paying anywhere from $30 million to $100 million a year in interest charges on that debt. Our shares in Canadian National are an investment which have returned great benefits to this country.
Canadian Pacific is a similar case. It is not only just the millions of acres of land given to them along with the mineral rights from 1881 on, it is also the cash they were given. As a result of those benefits, the investments they made to develop subsidiary companies have returned to them billions of dollars. This has more than compensated for any alleged loss in moving western grain.
Since 1881 we have provided Canadian Pacific with billions of dollars in annual subsidies. In fact, during most of the decade of the sixties, had it not been for federal government subsidies, Canadian Pacific would have shown net losses. This was at the expense of the taxpayers of Canada.
We in this party say that if you are going to provide capital and put it into either Canadian National or Canadian Pacific, it is not unreasonable to get equity in return for that investment. I agree it would only be a paper entry in terms of any funds given to Canadian National. It would just increase the shares we own. In the case of Canadian Pacific, it is money the minister suggests will have to be spent over the next four or five years. If we obtained equity in return for that capital, the people of Canada would own 20 per cent of the shares of Canadian Pacific Limited, which means control of Canadian Pacific.
I do not know of any private enterpriser who would agree to put capital into a company without getting equity in return. I have never heard of such a thing, but that has been perpetuated by successive national governments since 1881. To compound the felony, when you look at Snavely's third report, he not only wants them guaranteed a 25 per cent return on investment plus another 22'/2 per cent add-on profit, but he includes in that investment the CPR mainline track from Port Moody to Kamloops, which was built entirely by the taxpayers of Canada, to be turned over to Canadian Pacific at no cost. Mr. Snavely says that Canadian Pacific should get a 25 per cent return on that investment. That is not equitable, it is robbery.
I do not understand why the minister would resist taking equity in Canadian Pacific Limited. There has certainly never been any objection to taking equity in other corporations in this country. Having equity gives you some say as well as control in the operation of that system. In conclusion, I remind

March 25, 1982
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the House that this issue is so basic to confederation that anyone who tries to tamper with it does so at their peril.
We also welcome what I believe to be the unanimous support of the members of the official opposition, albeit reluctantly by some who had to be dragged, kicking and screaming, into it. We welcome the support of the Saskatchewan Progressive Conservatives, albeit reluctantly on the part of their leader, who said that two thirds of the grain producing farmers must go. Of course, we welcome the support of the Saskatchewan Liberal Party, which is led by a former member of this House. I hope that the minister will add that name to the list of those who want to keep the Crowsnest Pass rate for the producers.
If it is proven through whatever formula is chosen that the railways are losing money hauling grain, we would not object to the railroads being paid the difference between the compensatory rate and the Crow rate. We would insist that it go directly to the railroads and that the money must be invested in the railway plants. The rates would continue on the basis of maintaining the statutory rates for the grain producers, equal rates for equal distance and no variable rates. We also say that if there are any proven losses, that is a separate matter. If the government and the Parliament of Canada decides that those proven losses should be made up to the railroads, then let us do so by all means.
It is not necessary to change the statutory grain rates. It is only a matter of making a decision in the public interest to make up that difference directly to the railroads as is done in so many other areas. If user-pay was applied, no one could afford to fly, drive a car, ride the bus or put a boat in the Seaway. If you are to have full cost recovery, it would be necessary to double and triple current air fares as well as raise the marine rates so high that no shipping concerns would wish to enter our ports, let alone the Seaway.
To return to my opening remarks, this is how we share the costs of our nationhood. Surely that is fair and civilized and demonstrates how we can treat one another decently and civilly. It shows how we can keep a united country. It is not just a question of whether the farmer is paying 18 cents or 20 cents a bushel to ship his grain; it is whether or not Canadians are paying for the cost of keeping the nation united through co-operation, trust and fairness.
I believe that the single issue of statutory grain rates has much greater ramifications. The consequences not only concern grain producers in the three prairie provinces; it means much more to the whole country. I hope that the minister will decide to keep the statutory grain rates in place and that any additional funds required, for the two railways in particular, for capital investment in western transportation in return for equity and any operating subsidy required will be continued, but that money given to the railways for branch lines, branch line rehabilitation and interest charges saved on hopper cars and other equipment will be counted in those subsidies. Only then can additional moneys be expended for the full recovery of operating costs.
I do not know what else I can say in order to persuade the minister and the government that this is the wrong course of action and will cause irreparable damage to our nation, particularly western Canada. Although this issue may not be significant enough to contribute to the destruction of Canada, it merits the necessity for Canadians to work together again in sharing the cost of what is a fundamental necessity for Canada.
I hope members who speak after me during this debate will delve into other aspects of the argument. I also hope that members opposite will study the issue from the different aspects which I have mentioned, namely, the sharing of the cost of running the country and keeping our western grain producers in particular in a competitive position with other producers in the international grain trade. This area is so crucial to our entire economy that I submit it cannot be ignored.
Although we cannot have a vote on this resolution, it is my hope that the House will agree that the motion is valid. With that agreement I think we could go a long way to accomplish much more during this session of Parliament.


Lloyd Axworthy: Mr. Speaker, the hon. member who preceded me indicated that this is a debate about a view of the nation. I agree with him on that. There is no question that what we are debating here today are two very different perspectives of where Canada should be heading. On the one hand, we hear a plea from the NDP to keep the status quo. We hear a plea for the past, a plea for retrenchment, a plea for reaction and regression. The NDP want us to hold the line. They do not want us to make any changes or to have any vision. They want to hunker down in their corner and protect the old traditions of the past.


Leslie Gordon Benjamin: You did not listen, Lloyd.


Lloyd Axworthy: We are prepared to put forward a vision of the future, one that sees opportunity and progress in the prairies.


Mr. Blaikie:: Visions of the CPR is not a vision of the future.


Lloyd Axworthy: I will get to the hon. member for Winnipeg-Birds Hill (Mr. Blaikie) very soon because I want to address remarks to his constituents, especially in view of the stand he has taken. We want to have a vision which provides an opportunity for the prairies to divesify. We are talking about a new industrial strategy and vision for western Canada where there will be the opportunity to diversify the economy, redress the grievances of the past and bring about a stability and growth in that economy which will place the western region at the forefront of economic growth in Canada. We are not prepared to buy the argument proposed by the NDP and their counterparts is Saskatchewan.


Mr. Nystrom:: And Ralph Goodale.


Lloyd Axworthy: Their argument is based upon fabrication. We saw what trouble they had in question period when they
March 25, 1982

were fumbling with the facts. We know how loose and goosey they are with the facts-anything to get 15 seconds on the evening news. What we have over in the corner opposite is Canada's great fog machine. All they can produce is a great cloud which completely shrouds the truth. They are not capable of understanding the reality of the situation.
I am afraid that the New Democratic Party caucus has been too busy reading the fiction produced by the NDP in Saskatchewan. Mr. MacMurchy, the great ad man, is travelling around the country from town to town and meeting to meeting, taking his shoe off and banging on the desk, claiming all sorts of wild and totally unbelievable claims about the proposal that we made for the Crow rate. The claim is that we are going to get rid of the Crow and that that will cost western farmers 13 times the present cost.
It seems that members of the New Democratic Party are not very good at arithmetic. We have known that for many years, but they seem to have come to a mental block when it comes to dealing with the Crow affair. What we are talking about is a commitment by this government to an additional $600 million per year in perpetuity in terms of the statutory grain rate. I did not hear the hon. member for Regina West (Mr. Benjamin) talk about that. He conveniently forgot that fact, just as Mr. MacMurchy seems to forget about it. We are not talking about doing away with the Crow; we are talking about a major commitment by the federal government to establish a new statutory rate to which we will contribute six hundred million additional dollars per year.
It seems incredible that in a debate which is so serious and important to the growth and development of our region in western Canada and to the prospects of this country, members of the New Democratic Party are not prepared to deal with what is real, what is true and what is fact. They seem to have blocked their vision, and we know why. They have a certain base and constituency, and what we are seeing is the evolution of the NDP into the real reactionaries of the west. They are the people who are incapable of thinking in progressive terms. They are not swimming with the stream of the new generation of westerners who are trying to develop a new basis for enterprise and entrepreneurship in the west, who want to develop industry and new processing plants, create new work for the railroads and develop new centres of research. Members of the New Democratic Party are not interested in that. They are interested in harking back to the brave old days of the 1920s and the Regina manifesto. Those were the halcyon days when they were going to create a magical crusade, the children's crusade of Canada. It is unfortunate because this debate is too important for Canadians to be ground into the prairie dust with that kind of fiction.
The fact is we are debating something which could be one of the most important investments this country could make in its future. We are talking about one of the largest megaprojects.
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We are talking about $13 billion of investment in a brand new and modern transportation system which not only will provide for a substantial increase in capacity to move goods to market but also increase the agricultural output of the west by $2 billion in 1990. It will also provide for a wide variety of new jobs and employment in western Canada.
I sit here with some interest watching members of the New Democratic Party from Manitoba and the city ridings of Winnipeg. They seem to ignore, for example, the study which was put forward by the city council of Winnipeg. That is not a one-sided body. On that council are members of all parties.


William Alexander (Bill) Blaikie: The council is run by the ICEC, and you know it.


Lloyd Axworthy: The Winnipeg city council pointed out that one of the most serious drawbacks to the development of manufacturing in the city of Winnipeg has been the existing Crow rate. The council also talked about the closings of the Swift plants in St. Boniface, Edmonton and Regina being the direct result of existing grain rates.


Some hon. Members:: Oh, oh!


Lloyd Axworthy: Hon. members say that is not true. I have the study here; I will be glad to table it for hon. members. Perhaps members of the New Democratic Party are not interested in listening to facts or listening to the Winnipeg city council.


William Alexander (Bill) Blaikie: We are.


Lloyd Axworthy: All they want to do is yell. They have very loud voices, and I suppose they enjoy listening to the echoes in the echo chambers between their ears. They are not prepared to accept the facts. I want the hon. member for Winnipeg-Birds Hill to go back to his riding and tell his railway workers that he is prepared to give up 2,000 additional jobs for railway workers in Manitoba because of his stand on the Crow rate.


William Alexander (Bill) Blaikie: Nothing to do with it.


Lloyd Axworthy: I want the hon. member for Winnipeg North (Mr. Orlikow)-


William Alexander (Bill) Blaikie: Come up and run against me. You run in Winnipeg-Birds Hill and we will see.


Lloyd Axworthy: We will be glad to run a good candidate against the hon. member. We want him to tell his railway workers-


William Alexander (Bill) Blaikie: Any time you want.


Lloyd Axworthy: Aren't they getting excited, Mr. Speaker?


William Alexander (Bill) Blaikie: Resign and we will have a by-election.


Lloyd Axworthy: We have obviously plunged the needle into their veins because they certainly are spouting a lot of blood on the floor of the House of Commons. We can always tell when members of the New Democratic Party hurt because they bleat. They are bleating very loud and long this afternoon.

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The fact is that what we are talking about is an opportunity to develop major new manufacturing in western Canada, to develop employment for tens of thousands of westerners, and to provide the opportunity to increase substantially and enhance our agricultural products, livestock, grain processing and grain production itself.
We are talking about a vision of the future. We are talking about the willingness of this government to take a stand and to open a debate in western Canada and across Canada on one of the most important items which will lead to the development of the economy of this country and the economy of the west.


William Alexander (Bill) Blaikie: Let's have public hearings.


Lloyd Axworthy: We are very pleased and proud that the Minister of Transport (Mr. Pepin) has been prepared to take that stand. Lie has received the endorsements of a wide variety of western groups for his stand.
It seems that the members of the New Democratic Party are afraid of dialogue. That is the great party of democracy. In the House hon. members are always asking that we get into debate.


William Alexander (Bill) Blaikie: Public hearings.


Lloyd Axworthy: They are afraid to get into an honest consultation whereby farm groups have the opportunity to sit down and put their points of view on the table and look at what they can produce in our economy. No one is going to cook the books for them. They can come to Dr. Gilson, present their facts and figures and talk about what is really taking place. Out of that will come a report and recommendation which will then be debated in the House of Commons. What could be a clearer, more open process of policy making than that?
But members of the New Democratic Party are afraid of that process, and I know why. They are afraid of what it will show. It will show that the kind of conventional shibboleth on which they have been hanging their hats for years will be proved false and wrong. It will show that they are simply captives of the past and that their stand is not one which will promote the progress in which we in western Canada are interested.
Over the past year the western affairs cabinet committee has spent many months meeting with a wide variety of western groups. That committee met with literally hundreds of westerners who spoke to ministers on the committee. The committee met with these people in private and in the open to discuss the economic future of western Canada. One message came through loud and clear, and that is that we must modernize the transportation system. We must have a transportation system which can move our grain and our commodities. We must have a system of rates which allows for proper manufacturing and processing in the west. We must have a transportation system which guarantees the future of western Canada.
That is the basis upon which all our history is founded. There was no disagreement about that. There was certainly
disagreement about the different methods which might be used and the different formulae which could be proposed.
It is for that reason that we have recommended-and our cabinet colleagues accepted it-that the next step in that process should be dialogue and consultation to arrive at what the proper formula should be. No one was prepared to take the first step, so one of the major commitments this government made was to put $1.3 billion on the table as our commitment to western Canada and to the modernization of the transportation system. We realized we were not going to move this debate off dead centre, where it had been for years, unless someone was prepared to put hard money on the line and was prepared to make a major investment, a major commitment of large amounts of money to the improvement, expansion and modernization of our transportation system. That is what we did through the western fund. That is the kind of commitment this government has now made, and that has broken the log jam. We are now in a position where the parties are prepared to talk. The result of consultations right across the west is that people are prepared to come to the table to present their cases and offer their different formulae.
The NFU and the NDP, those two brothers of blindness, are not prepared to enter into that kind of debate and discussion.


Lorne Edmund Nystrom: What about Ralph Goodale?


William Alexander (Bill) Blaikie: What about the Liberals in Saskatchewan?


Lloyd Axworthy: The NFU and the NDP are not prepared to enter into that discussion. By the very fact that they are entering into that consultation westerners are showing that they are interested in the future and that they are not listening to the siren calls of the NDP federal caucus, which is simply out of step, out of tune and out of time.
The whole point of this debate is to talk about a different kind of future. It is important that we clear up much of the mythology the NDP is trying to conjure up with respect to this matter. Mr. MacMurchy is running around Saskatchewan, as are his colleagues in his caucus, saying that the federal government is going to introduce variable rates, and everyone gets all excited about that. The Minister of Transport and the Prime Minister (Mr. Trudeau) have said very clearly in Saskatchewan that if westerners do not want variable rates, they will not have them. It is up to them to go to Dr. Gilson and present their case for or against this. If it is the decision of westerners not to have variable rates, they do not have to have them.
We hear the NDP claim that this will ruin rural life in western Canada, that it will have the effect of a wrecking crew in small towns. The authority cited by the hon. member for Regina East (Mr. de Jong) was Mr. Justice Emmett Hall, who pointed out in his study that the primary reason that small towns are being ruined in western Canada is because of the actions of the provincial governments-the new road systems, electrification and all the other programs such as the centralization of the school system. If one examines the reasons for
March 25, 1982

change in the small towns and rural life in the west, it will be seen that they have little to do with changing the Crow rate. The provincial governments are responsible because they brought about the changes. That is the basis of Judge Emmett Hall's report, and he is the man who is quoted as the great authority on railway rates. He should be an equal authority on the impact of those rates on the small towns and rural life of western Canada.


William Alexander (Bill) Blaikie: Mr. Speaker, would the minister accept a question?


Mr. Deputy Speaker:: Does the minister want to accept a question?


Lloyd Axworthy: Mr. Speaker, I will be very glad to accept a question if I have time at the end of my presentation. I could ask the hon. member for Winnipeg-Birds Hill how he can justify to his constituents the loss of several thousands-


William Alexander (Bill) Blaikie: Oh, oh!


Mr. Deputy Speaker:: Order, please. The minister has the floor.


Lloyd Axworthy: There are a lot of important questions, and for answers to some of them we must look to those ostriches of the past who dug their heads in the prairie gumbo, unwilling and uncaring about the future. Talk about gophers and groundhogs, Mr. Speaker! Members of that party opposite have not seen the light of day for years.
What we are talking about is the necessity to deal with this question in western Canada on the basis of facts and realism. We are not talking about getting rid of variable rates. We are not talking about ruining small town life either. What we are talking about is the kind of investment that the producers of western Canada have been requesting for years. We are talking about the kind of investment that will restore the urban centres of western Canada to their pre-eminence as transportation centres. We are talking about the creation of employment across Canada, from the steel mills in Sydney to the locomotive shops in Quebec and Ontario and the major urban centres of western Canada. The change in the Crow rate will have multiple benefits for every community across Canada. It will create employment.
The NDP hawk their wares daily. They say, "Create more employment, create more jobs and invest in the country". What we are doing is changing the Crow rate to provide for one of the most important and critical investments that will create employment for tens of thousands of Canadians. Members of that party cannot be so hypocritical as to argue out of both sides of their mouths at the same time and expect Canadians to believe them. They will be found out after a while. They tell their constituents in Saskatchewan that they defend the Crow, and then they come down here and tell eastern workers that they are trying to create more employment for them. Why do they not go to the workers in Sydney, London, parts of Quebec, Winnipeg and Regina and say that they are trying to create more employment by standing against
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any change in the Crow rate, which would bring about a substantial investment of $13 billion in western Canada in the next few years and thus provide countless man-hours of employment in a variety of industries?
How can they try to get away with such duplicity? Their attitude is beyond belief. It is one of the greatest acts of piracy that we have ever seen in this House. They are trying to conjure up in the minds of westerners the idea that this is something that will deprive them of their birthright. Westerners have been asking for a fully developed, diversified economy as part of their birthright, one that is not based only upon raw materials but one that involves a variety of industrial enterprises and thus will not be subject to the cycles of resource markets but, rather, will provide a stable pattern of employment.
We offer an opportunity to put that in place in western Canada. We offer a system that will have enormous impact upon our export markets. It will not only provide an almost $2 billion increase in the export market for raw grain producers, but will provide a wide variety of new markets for processed materials such as oil seeds. Why are the canola crushers so anxious for this change? Why are the commodity producers so anxious for it? It is because they realize that for years they have been deprived of the opportunity of making their case and establishing a firm investment pattern in all regions of the country.
I return the plea of the hon. member for Regina East. If he is prepared to deal with this issue with a sense of honesty, a sense of realism and a sense of the progress which his party says it believes in, then I would ask him to change his position on the Crow rate. He should be prepared to help westerners enter into consultation, to engage in the kind of co-operative approach and participation that we offer so that we can reach a solution that is fully reflective of all issues. We want the inner few at that table. We want all the farm groups there and all interests to be represented. We would ask the NDP to use their good offices with the Saskatchewan government, with the pools and with the inner few to get them to participate and find the best answers for the west and for our transportation system. Rather than raising the flags of negativism and opposition, let them recognize this as a real opportunity for the west to develop fully its economic position.
We return the plea, Mr. Speaker. We have opened up the debate and dialogue and we are prepared to make a major investment in western Canada. We are prepared to enter into wide-based consultation with all groups and all kinds of interests. It is up to members of this House from every party to see that this takes place and it is particularly up to western members of the opposition to use their good offices to ensure that the debate is founded on facts, on figures that are real and not fabricated, on premises that are true, not fiction. They have a responsibility and an obligation to their constituents in western Canada to ensure that such negotiation takes place. If they persist in simply trying to distort, twist, hide and cover

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the necessity for the modernization of our transportation system, they are doing a serious disservice to all Canadians.
We return the plea to the NDP and ask that they get on the right track and begin thinking of progress in the country. We ask them to help develop a proper, new statutory rate that will benefit producers and westerners alike.


Some hon. Members:: Hear, hear!


Mr. Deputy Speaker:: The hon. member for Winnipeg-Birds Hill (Mr. Blaikie) on a point of order.


William Alexander (Bill) Blaikie: Mr. Speaker, is there some time left in the minister's allotment and, if so, would he permit a question?


Mr. Deputy Speaker:: Would the minister accept a question?


Lloyd Axworthy: Yes, Mr. Speaker.


William Alexander (Bill) Blaikie: Mr. Speaker, when the minister was speaking of the NFU and the NDP being blind brothers together in this struggle to preserve the statutory rate, I wonder why he left out the Liberal Party of Saskatchewan? Given his supposed interest in the facts, why was this particular fact not brought to the attention of the House in his speech?


Lloyd Axworthy: Mr. Speaker, I would be very pleased to correct the record for the hon. member. The Liberal Party in Manitoba, Alberta and British Columbia endorsed the Crow rate resolution. We met last Friday with the leader of the Liberal Party in Saskatchewan to discuss it and cleared up many of his concerns. He was also buying some of the propaganda put out by Mr. MacMurchy in Saskatchewan about the variable rates.
In western Canada two governments support the change as well as the western Liberal Party. We hope that if the NDP go back and talk to their own brethren in Saskatchewan they will come on board as well.


Some hon. Members:: Hear, hear!


Ramon John Hnatyshyn: Mr. Speaker, my time is limited but I want to open my remarks by observing that the Minister of Employment and Immigration (Mr. Axworthy) does not know what a service he has done Mr. Goodale and his political pursuits in Saskatchewan. He knows not what he has done! I think he demonstrated one thing during this debate, and that is that while he may have obtained a new pair of glasses, he still cannot see what the issues in western Canada are and he is doing a disservice to western Canadians in promoting this particular policy.
A lot of people are watching this debate today and a lot of people will read about it. They may be a little mystified by some of the antics that have taken place today. There has been a lot of yelling back and forth between the Liberals and the NDP. People may be a little surprised about that because, as the Canadian public knows, the philosophy of the two parties is very similar. They support very much the same issues and on many important issues they stand together, like Tweedledum and Tweedledee.
There is a story which I think is probably true about Noah's ark. The story is similar to the relationship we see between the NDP and the Liberal party. The New Democratic Party supported the Liberal government on 19 different confidence motions. It supported the government through thick and thin on every important issue. We remember when the leader of the New Democratic Party said that the constitutional document is a very civilized one. He stood four-square behind the Prime Minister (Mr. Trudeau) on this particular issue. On important economic issues, such as defeating our government on its budget which would have resulted in progress for the country, the NDP and the Liberal party were together. They are together on every issue. By the time I finish my comments today, I hope to demonstrate precisely what is happening with respect to this issue.


Cyril Keeper: Mr. Speaker, I rise on a point of order. Would the hon. member permit a question?


Ramon John Hnatyshyn: Mr. Speaker, I only have 20 minutes. If I have time remaining at the end of my remarks, I would be glad to do so.
In any event, at the time of the flood there were two animals of every species on Noah's ark. Noah was somewhat concerned with respect to the cats. In order to ensure that there was no hanky-panky between the cats, he decided to put two animals to watch. He chose the two giraffes because they had long necks. He said to the giraffes, "Now, you watch to make sure that nothing happens here which might increase the number of passengers, because we have a full load". Well, after 40 days, the platform came down and off came the animals two-by-two, except for the kittens. There were 19 of them following the two cats. Noah said to one of the giraffes, "I thought I put you in charge of this; you were supposed to watch what was happening". He said, "I am sorry, Noah, I thought they were just fighting"!
That is exactly what we have on the floor of the House of Commons-the NDP and the Liberal Party pretend to fight, but they are together on so many issues.
Canadians will understand, particularly with respect to this item, that statements have been made by spokesmen on behalf of the New Democratic Party which indicate that it was prepared to negotiate an end to statutory Crow rate. On the basis of statements made by the Minister of Employment and Immigration, we now know that the Crow rate will be axed. It is not worthy of being axed, but it will be axed to the detriment of western Canadians. If this is allowed to go through, I fear it will be the end of a way of life for our farmers. I submit it will mean the end of the family farm.
In 1977 the Hall commission made two significant and fundamental recommendations. The first was the retention of the Crowsnest statutory rate, and the second was that the
March 25, 1982

difference between the statutory rate and the cost of transporting grain would be paid directly to the railways. To ask western Canadian producers to pay commercial rates for hauling grain is to ignore an historical and statutory right, to ignore the competitive realities of the marketplace and to ignore the natural and artificial advantages of competing countries.
I am glad to see the Minister of Transport (Mr. Pepin) present in the House because I should like to give him some advice. I ask him to change his advisers who set up the place of meeting to discuss the Crow rate in Saskatchewan. He went to the town of Delisle which is a great town in my constituency. Whoever was the Liberal adviser who told the minister to go to Delisle, Saskatchewan, should receive the golden finger award. The minister was sent to the hotbed of people who were very much opposed to his position. Last fall I attended a barbecue with 1,000 other people. The minister went there to meet with 1,000 farmers and he was barbecued.


Jean-Luc Pepin: I was on ice!


Ramon John Hnatyshyn: That is right, the minister was put on ice. I am very serious about this issue. I am sorry that the western representative in cabinet has taken such a position on this very important issue. As I say, Canadian grain producers must meet the competition of the international marketplace. They purchase their inputs in a Canadian marketplace which is protected to some extent. Any increase in freight costs will result in an automatic reduction of their earnings. Any reduction will impact upon the industry as a whole and particularly upon those who are dependent upon it.
On a more basic level, this situation for westerners, particularly those in my province of Saskatchewan, is very much like the situation in respect of the language rights of residents of the province of Quebec. It was part of the confederation package between Canada and the prairie provinces; it is the prairie Magna Carta. I ask hon. members from all parts of Canada to remember this in the months and weeks to come. We came to the bargaining table with different needs and aspirations. We have a collective duty to protect the rights won by the respective partners to this great pact. This plan sounds the death knell for untold numbers of rural communities and, in general, for the rural way of life.
Many hon. members in the House will not understand the social and cultural fabric of the west and how important it is to westerners. Many will not understand how vulnerable it is to destruction from economic forces at work at this time. Western Canadian producers cannot afford any increase in the Crow rate. Next year farm income will drop by 15 per cent. Farm costs will rise by 25 per cent in 1982, after a 63 per cent increase over the last two years and 89 per cent over just one three-year period. Where does that massive increase go? Well, 55 per cent to 60 per cent of that money goes into the hands of the federal government. Massive amounts of money, possibly $51 billion, will flow out of the west in the next five years. Aside from those figures, the cost of maintaining the Crow to the federal government is paltry.
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I am appalled at the lack of respect the federal government has shown the producers of western Canada in moving to change the Crow when there is substantial and fundamental opposition. I cannot understand the Prime Minister coming to the city of Saskatoon, Saskatchewan, and saying that the people protesting against a change in the Crow rate are uninformed. I represent those supposedly uninformed people and I will take their attitude over that of the Prime Minister any time. What did he say when he arrived in Saskatoon? He was asked a question about the statutory rate. In his response he said that the government cannot please all the people all the time, everywhere on everything. He said that he had yet to go to an open rally in a province where someone has not said, "Why should we pay the shot?" Here it happens to be prairie farmers and "big deal", says the Prime Minister. What kind of attitude is this for the Prime Minister of the country with respect to the legitimately held views of a very significant and important part of our population, the western grain producers? It is no wonder that every time the Prime Minister goes to western Canada he increases the votes of hon. members of the opposition by 2,000 to 3,000. It is because of his attitude, his arrogance and his insensitivity to western problems.
The people of western Canada see this situation as a lack of faith in western Canada. The Minister of Transport indicated that a decision will be imposed if no consensus is reached out of the Gilson hearings. I say to the minister who is sitting here now that this is unacceptable. The people of western Canada understand the game. They feel that the Liberal government says, "What do we have to lose in western Canada-nothing political". The government has shown, its concern for the farming community in its budget; it can just as easily give the west a shaft over the Crow rate. There is nothing in the budget and it is getting even worse treatment in terms of this particular issue.
I have warned before, and it has now come to pass, that the so-called western development fund will be the vehicle by which Liberals will make up the Crow gap in 1982. This fund, the $4 billion elusive dream of the October 28, 1980, budget of the Minister of Finance (Mr. MacEachen), is now the $1.3 billion nightmare for westerners. Is it any wonder westerners have so little faith in the Liberal party and its policies? First of all, the federal government announced in 1980 a $4 billion fund to promote the modernization of the grain handling and transportation sector, as well as to promote western industrial diversification. Then in the 1981 budget the government slashed it by 60 per cent. In February, 1982, the federal government used that money as a handout to the railways without tangible guarantees as to how it is to be used. If the government can slash that fund once, they can slash it again. I thought The Globe and Mail in a recent editorial stated the case very well when it said this:
The fact is that the prairies do not trust the federal government. They have no faith in any promises Mr. Pepin may make, no faith in any promises the government may make. They have the Crow. They will stick to the Crow.

March 25, 1982
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Will the federal government ever, Mr. Speaker, grasp the idea that it takes action, not promises, to win back a totally disillusioned electorate?
My specific concerns about the proposal are innumerable, but I want to outline a few. First of all, the entire process is taking place outside of Parliament. Once again it is not Parliament that will examine a major change proposed by the government. It has apparently forgotten that Parliament exists. The whole process is to take place behind closed doors. It is remarkable that discussions on a proposed change which can be so devastating in impact will not be open to scrutiny, particularly by the producers affected. The proposal places a ceiling on further government contributions beyond the 198182 shortfall at a time when massive funds are about to flow into federal tax coffers. The proposal opens the door to variable rates, which is absolutely and profoundly unacceptable. Western farmers have not fought for 80 years to maintain the statutory rate only to see it tossed to the wind.
Even if we have a statutory rate as part of the package, the proposed open-ended escalator to be paid for by the producer spells variable rates, and that is wrong. One harks back to the words of Mr. Justice Emmett Hall who gallantly fought against the Crow rate desecration. I quote him:
If once tampering with the statutory rate is accepted or condoned as an item on the bargaining table, all will be lost.
Mr. Justice Hall is a distinguished constituent of mine and I subscribe to his position absolutely. Once the subject is on the bargaining table, Mr. Speaker, it will only be a matter of time until it is lost. There is no position to take except to adhere through thick and thin. The Crow is not bargainable. That is also a statement by Mr. Justice Hall, a perceptive man who has given leadership on so many issues of importance to this country.
After the rates go up, Mr. Speaker, and when the smaller farms and towns start to die, how will the service be any better? There is nothing in this proposal to guarantee that service. Those guarantees must be there before we even think about giving more money to the railways from whatever source. We also want to know how the proposed subsidy will be distributed. The government has given absolutely no indication of that. They have told Dr. Gilson basically this: "We want to dump the Crow. We want to hit all those westerners who dare to refuse to vote Liberal. We do not care what impact it has in the west; you figure out the fine print and do it quickly and quietly."


Jean-Luc Pepin: Why would we do that?


Ramon John Hnatyshyn: The minister knows that is what the Liberal government is saying to Dr. Gilson. We from western Canada do not accept that way of dealing. We do not stand for the status quo either. We recognize the problems in the present system of moving grain. Under the present branch line subsidy system it is well known that the railways are subsidized to be inefficient, as they clearly have been in many areas. The railways should receive adequate compensation for hauling grain, but the existing statutory freight rates should remain.
We have said the shortfalls should be met by the federal treasury, and adequate guarantees must be provided to ensure adequate capacity and performance. As well, the anomalies in freight rates between processed and unprocessed products must be resolved in some fashion.
Above and beyond the yearly payment of the 1981-82 shortfall, the federal government has an ongoing responsibility. However, the railways must demonstrate to the satisfaction of the producers that they can deliver grain on time in a reliable and effective fashion before additional payments should be made. With deference I say to the minister who has responded on behalf of the government that he has the thing all wrong. You do not go to the farmers and say: "Now, you pay for some-


Jean-Luc Pepin: You are talking about billions of dollars.


Ramon John Hnatyshyn: -imprecise commitments to improve service and we will see that things happen to the benefit of farmers down the line." He should be saying to the railways: "Get the system in order and then we will come back to the farmers and see whether there is any room to talk at that time." The problem with the minister is that he has it reversed.
The fact, Mr. Speaker, that this proposal is going forward without the fullest consultation really dismays me.


Jean-Luc Pepin: Lots of people know more than you do about it.


Ramon John Hnatyshyn: 1 can hardly believe there has not been consultation, not only with the agricultural organizations and associations but with the producers themselves. We know that in Saskatchewan there is serious questioning, not only in the pools but in all organizations, with respect to the position being taken and the whole process which is going on.
I would like to close my remarks, Mr. Speaker, by saying that I am interested to see that the NDP has finally brought this motion forward. I would not want to suggest they were more interested in its political effect than in the issue itself. I would be the last to accuse them of any sort of devious frame of mind such as that. However, it is rather interesting that this matter has been on the Order Paper and we were obliged to bring it forward immediately following the announcement while they have let the matter lie until this week. Has it anything to do with the calling of the provincial election in Saskatchewan? I ask that question rhetorically because I know the NDP, all of whom have to take a course in sanctimony before they come into this House, will answer that one-


An hon. Member:: Before they run as candidates.


Ramon John Hnatyshyn: That is it, before they run as candidates, says my colleague, the spokesman on a leadership review of the Liberal Party. Mr. Speaker, I simply want to say that when they take such a position I wish they would get together with Premier Blakeney, because he has been equivocating. I am sorry to say that, notwithstanding all the material I get in my home, the letters and so on telling me what they are going to stand for. Premier Blakeney has been quoted as recently as
March 25, 1982

January of this year as saying that he was quite prepared to negotiate a change in the Crow rate. In an interview on the CBC he acknowledged that fact. This is the same Premier Blakeney who is going to the people of Saskatchewan, arm in arm, I take it, with-


Mr. Deputy Speaker:: Order, please. I regret to interrupt the hon. member but the time allotted to him has expired.


Cyril Keeper: On a point of order, Mr. Speaker, since the House opened last October the Tories have voted with the Liberals 26 times, whereas the NDP did so only 13 times.


Ramon John Hnatyshyn: Very shoddy business.


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, this is my first debate as Parliamentary Secretary to the Minister of Transport. It is perhaps very appropriate that I take part in this debate on Crow rate change. I was a little disappointed that the original mover, the hon. member for Humboldt-Lake Centre (Mr. Althouse), withdrew his support and had his colleague, the hon. member for Regina West (Mr. Benjamin), move the motion. I do not know why, whether he was afraid to defend his own motion-


Jean-Luc Pepin: He is campaigning in Saskatchewan.


Jesse Philip Flis: -because I come from that part of Saskatchewan. I was born and raised in his riding. I was born and raised in the riding of Humboldt-Lake Centre, where that hon. member, the original mover of this motion, comes from. I am sure that this motion does not represent the wishes of the farmers in his riding. As a matter of fact, my family left Saskatchewan 30 years ago because of the CCF government at that time under Tommy Douglas. My father, along with four sons and two daughters, saw no future in that province because of the lack of foresight of the government at that time. Unfortunately, it is the same lack of foresight of the federal New Democratic Party which will force many farmers out of that province again.


William Alexander (Bill) Blaikie: You like the Tories in Ontario?


Jesse Philip Flis: I am sad that I must say that that is a fact and the truth.


William Alexander (Bill) Blaikie: What about interest rates?


Jesse Philip Flis: I can understand the concern of the farmers for the Crow, as it gave an element of security in a changing world for 85 years. However, change must come. It is happening everywhere. Even the Saskatchewan Power Corporation, owned by the provincial NDP government, increased its electricity rates by 8 per cent in 1980 and by 12 per cent in 1981. The provincial government says that it is okay to increase electricity rates, but that it is not okay to increase shipping and grain rates. I do not know how Premier Blakeney explains this double standard that he is practising within his own province.
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I want to show that the changes to the Crow proposed by the government are for the better, not for the worse. The attitude of the NDP, federally and provincially, of opposing any change whatsoever is simply irresponsible. Provincially, it might be excusable because of the Saskatchewan pre-election fever obviously getting in the way of rational debate. It is surprising, however, as in the past Premier Blakeney has taken a much more realistic position.
I would like to quote what Premier Blakeney said when he appeared on a CBC show on May 20, 1977. I would like my colleagues from the NDP and the hon. member for Saskatoon West (Mr. Hnatyshyn) to listen very carefully to what Premier Blakeney said at that time. He said:
Now 1 don't want to be quoted as saying that I'm happy to see Crow increase, that's not so, but I'm realistic enough to know that time goes on and costs go on and I think farmers are realistic enough to say that at some time they would look at increasing Crow, provided they receive the same legislated statutory protection they now have for the Crow rate.
There are three aspects to Premier Blakeney's statement. First, as time goes on costs will increase. That is a fact. Second, farmers are realistic enough to realize that at some time in the future they would look at an increased Crow rate. That is a fact. Third, farmers would want legislated statutory proection. That is a fact. That is what the premier stated on May 20, 1977. On February 8, 1982, the Minister of Transport (Mr. Pepin) realized Blakeney's forecast of 1977. Why the change of heart in Mr. Blakeney? I do not know why.


Cyril Keeper: Because your family left Saskatchewan.


Jesse Philip Flis: I do not know why. Even with the imminent election, the scare tactics and misrepresentations are not justifiable. The provincial government produced a beautiful little booklet which I believe is entitled "The Pepin Plan"-


Some hon. Members:: Oh, oh!


Jesse Philip Flis: -paid for by the provincial taxpayers and which led the Saskatchewan people astray. They pulled the same tactic with the Constitution and it did not work. It is pulling the same tactic on the Crow rate and it will not work. There have been further misrepresentations. The Minister of Employment and Immigration (Mr. Axworthy)-


Cyril Keeper: That is a misrepresentation.


Jesse Philip Flis: -referred to the ad man, and he is correct. The Saskatchewan minister of agriculture, Gordon MacMurchy, put out a press release on March 8, 1982, which stated:
Ottawa has only committed itself to a contribution of $612 million for four years-to 1985-no more.
This is totally incorrect. The Government of Canada has committed itself to paying the Crow benefit, estimated at about $600 million, indefinitely, and the commitment will be enshrined in law. This is what Premier Blakeney wanted and still wants, and this is what the farmers want.
Based on an erroneous premise, Mr. MacMurchy went on to calculate alleged losses to farmers in the province of Saskatchewan. However, he completely ignored the concept of sharing

March 25, 1982
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future cost increases to be developed by the federal representatives on Crow. He completely ignored the benefits which could flow from increased grain production and grain prices. He completely ignored the benefits of improved railway performance and a better delivery system. He also completely ignored the potential for savings by producers-


William Alexander (Bill) Blaikie: Are you still reading?


Jesse Philip Flis: -in reduced on-farm storage costs. I do not think this kind of misrepresentation will get the provincial government anywhere.
Federally, the NDP has clearly missed an opportunity to show some leadership. The major farm groups recognize the need for change. They have agreed to participate in the process and get the best possible deal for farmers. The NDP are saying, "Ho, ho, ho". Well, it is not Christmas time. I will refer them to the list of farmers and farm groups supporting the change in Crow. First of all, there are the prairie farm commodity associations, such as the Western Barley Growers Association with a member membership of 1,000, the Flax Growers Western Canada, the Palliser, the Manitoba and Saskatchewan rapeseed producers, the Alberta rapeseed producers, the Alberta hog producers and the Canadian Cattlemen's Association. That is a total membership of over 97,000. The Western Agricultural Conference has lent its support to changing the Crow. Under that group are Unifarm, with 63,000 members; the Alberta Cattle Commission with 13,000 members; the Alberta pool with 55,000 members; the Saskatchewan wheat pool with 70,000 members; the Saskatchewan Association of Rural Municipalities with over 2,000 members-


Leslie Gordon Benjamin: Oh, no, that is not true.


Jesse Philip Flis: -the United Grain Growers with 60,000; the Saskatchewan milk producers, the Saskatchewan Chicken Marketing Board, the Saskatchewan Turkey Produce Marketing Board and the Saskatchewan Egg Marketing Board. As well, under that group, there is support from the Co-op Hail Association, the Saskatchewan hog producers, the dairy producers co-op and the Manitoba pool. The number of members supporting this amounts to over 300,000. Taking those two groups alone, we have over 400,000 members saying, "Yes, it is time we do discuss a change in the Crow". So much for the "ho, ho, ho" of the NDP. Instead of supporting the farmers they claim to represent, the NDP take the position of the renegade National Farmers Union-


Some hon. Members:: Oh, oh!


Jesse Philip Flis: -an organization which was almost moribund until it found this last vestige of the past to cling to.
Almost everyone recognizes that changes come. I might refer the NDP to some of the editorials which are supporting these changes.


Cyril Keeper: Talk to the people.


Jesse Philip Flis: I refer the NDP to an editorial in the Winnipeg Free Press entitled "Unnecessary Issue", which states:
There should be no mistake that those who oppose a change in the Crow are outside the mainstream of western agriculture.
I suggest that the NDP are outside the mainstream of western agriculture. The editorial of March 22, 1982 in the Winnipeg Free Press further states:
In Saskatchewan, it would appear that short-term political advantage is more important.
There is no political advantage for this government to change the Crow rate, as suggested by the hon. member for Saskatoon West. However, this government, and I think all hon. members in this House-


An hon. Member:: There are no Liberals left to defeat. You are right about that.


Jesse Philip Flis: -when we are elected, must set goals for the future. We are not building a country-


Cyril Keeper: That's for sure.


Jesse Philip Flis: -for ourselves. We are building a better Canada for generations to come, for our children, our great grandchildren and so on.


An hon. Member:: Certainly not for today.


Jesse Philip Flis: I wish the NDP would take that responsibility. Its members should just ask themselves what will be the benefits of the change in Crow for future generations.
The NDP is failing to represent the best interests of the farmers. As the Minister of Agriculture (Mr. Whelan) said in this House, it would be a betrayal not to do anything about the Crow. Members can read in Hansard of February 8, 1982, at page 14748, what the Minister of Agriculture said. He said this:
I think that it would be a betrayal not to do anything about the Crowsnest Pass rate, to accept and go along with the old program, the old agreement of 1897 and not move ahead. If we did all things like that in our country we would not be the envy of the world for our agricultural industry.
1 am proud to be a member of a party that shows it is not afraid to take that stand.
Let us be clear on what the federal government is proposing under this change. First, grain will always have a special status. The process set up by the Minister of Transport will guarantee that this special status will be enshrined in legislation, to give the farmer the security that he or she needs.
Secondly, the government will provide an annual payment- not just for four years-of the Crow benefit, calculated for 1981-82 at some $600 million. This commitment will also be in legislation, as requested by the Premier of Saskatchewan.
The sharing of future costs increases, as suggested by my friend for Regina West, is a matter for negotiation. It is a major part of the Gilson exercise. What could be more democratic than direct negotiations with those affected? This
March 25, 1982

government has always believed in and practised the consultative process. It will always believe in obtaining ideas, suggestions and recommendations from the grassroots of this country. That is what the process will be. There will be requirements of railway performance, service, investments and adjustments in other rates to promote certain agriculture, and a monitoring system to make sure that they do what they are supposed to do.
Also in legislation there will be a mechanism or framework to determine what the rate should be. The railways will not be able to charge what they want-again, as falsely promoted in some of the western provinces.
In the past, the farmer has a guaranteed rate but no guaranteed service. That did not do him or her a lot of good. The Wheat Board said it lost $1 billion in sales in the late 1970s because of transportation problems. The Secretary of State for International Trade (Mr. Lumley) said recently he knew of six countries which had turned to other markets because Canada could not guarantee delivery through its present rail system. What the government is proposing is that the guaranteed rate be replaced by guaranteed service-I wish to emphasize that, Mr. Speaker-along with a perpetual financial commitment from the government. That is leadership, and I wish the NDP would adopt some of it.
Mr. Speaker, the result will be that the railways will be compensated. Even Premier Blakeney concedes that this is necessary. The farmer will be protected and will have the assurance that he or she will be able to move his or her grain. To me, that is a better deal than the west has had in the past, and I think the NDP should go for it. The governments of British Columbia and Alberta, and the Saskatchewan Wheat Pool, are going for this deal, so surely the federal NDP members who were elected to make decisions on what is best for the whole country-not what is best for one region but what is best for the entire country, what is best for future Canadians- will support us in this process to come up with what is an equitable rate for farm producers.
I want to thank the NDP for bringing this topic to the floor of this House on one of the opposition days, because it has given the government an opportunity to set the facts straight, and to correct some of the false statements that the government of the province of Saskatchewan is repeating to its people. They will be able to read what has been said in this House and they will be able to get the truth.
I would like to congratulate the Minister of Transport, not because I am his parliamentary secretary-


Some hon. Members:: Oh, oh!


Jesse Philip Flis: -but because here is a minister who took the bull by the horns, as we used to say out west-


An hon. Member:: Take the bull by the tail.


Jesse Philip Flis: -who has shown leadership, who saw what is best for the future of the country, saw what is best for future agricultural producers. I want to congratulate him in this
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House. He knows what is good for the future of this country and he was not afraid to get up and say so. It is very easy, Mr. Speaker, to refrain from taking any decision, as the NDP continually do. No decision is very easy to take, but it is very tough to take unpopular decisions. Our minister, the Minister of Transport, did take an unpopular decision, but it is a decision that will benefit future Canadians; and that is what we are elected for, to build a country that will be the best in the world.


Some hon. Members:: Hear, hear!


Stanley Kenneth Schellenberger: Mr. Speaker, I find it very interesting that the member for Parkdale-High Park (Mr. Flis) should say such nice things about his minister. He said his minister took the bull by the horns; he may very well end up with the tail by the time this whole process is through.


Jesse Philip Flis: You don't know which end of the bull is which.


Stanley Kenneth Schellenberger: Well, I think I raise a few more bulls on my ranch than you do in your little lot in Toronto, when it comes to knowing which end of the bull is which.
I find it passing strange that while farmers are facing some of the worst dilemmas they ever faced since the Depression in regard to costs versus the price they are getting for their grain, we as a national government, under the leadership that the hon. member for Parkdale-High Park is talking about, are discussing making that farmer look forward to paying more for transportation of his grain to the west coast and east coast.
The Minister of Agriculture has been saying some very interesting things. In a speech in Winnipeg he said that between 1975 and 1981 the ratio of farmers' net income to farm cash receipts dropped from 39 per cent to 21 per cent. He went on to say that it might be even worse in the coming year and that the net farm income is expected to drop 15 to 20 per cent in 1982. He was in such a depressed mood at the time, Mr. Speaker, that he went on to say that perhaps he should revise the old Farmers' Creditors Arrangement Act to try to bring farmers through this period.
The minister responsible for the Wheat Board announced the initial prices yesterday or the day before. The farmers in my constituency are facing a decrease in the initial price that they will receive for grain in 1981-82. For barley it is down 30 cents a bushel; for oats it is down some 31 cents a bushel. All other prices remain the same, no change. Farmers are facing increased costs of production, as was mentioned by the Minister of Agriculture (Mr. Whelan). We get from the Canadian Wheat Board a lowering of the initial price system. They are not prepared to take their responsibility in the face of this type of income figures. They use the act that they have, the section that is there, where they can borrow money if need be to maintain a price, and they feel that that price is justified and what better time to do that than today as we face these terrible income pictures.
The deputy minister of transport stated, as he was discussing the new proposal on the Crow rate-and this is in the Western

March 25, 1982
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Producer of February, 1982, an article by Mr. Adrian Irwins-that the range of increase looks as though it might be doubled, or maybe tripled, over a period of four or five years. He says that is kind of ballpark. That is the type of statement we get from the deputy minister of transport, Mr. Kroeger, as farmers are looking at the kinds of cost they may face in the future. He says they are not sure whether they will double or triple, and that is why we have the study. Farmers putting in a crop this year do not know whether they will have enough money at the end of the year to pay their costs, let alone enough to live on, yet they are being asked to accept a change in the Crow rate.
No wonder the motion before us today and the motion which the Progressive Conservative Party put before the House on Febuary 26 state that we should be very cautious about the proposals being made by the minister and look for leadership when we are dealing with transportation costs in western Canada. We made a very responsible suggestion. If the railways have been capable of delivering grain for the last 85 years at half a cent a ton mile, perhaps in the next 20 years they will be capable of delivering grain for the $612 million being proposed. If they show that the capacity is there, maybe farmers could then look at whether or not they should pay some increased costs. That is a very responsible suggestion which would take us to the year 2000.
I will be making suggestions which I hope will be looked at. Some excellent suggestions were made by the hon. Mr. Justice Emmett Hall as well as by Mr. Hugh Horner in his study "A review of the red meat industry". Some excellent suggestions could be proposed to help farmers with their income problem. The railways should be given an opportunity to show they mean business in the prairies and are going to take the incentive, the Crow gap, the money being provided by the government, and move the grain.
I want to discuss two suggestions made by people who have studied this area in the last number of years as well as put forward my own suggestion. Hon. Mr. Justice Emmett Hall put forward an excellent suggestion. Another suggestion that should be looked at is in Mr. Hugh Horner's study. The railways have stated this many times. They feel that their branch lines inhibit them. Over the years we have provided subsidies for branch lines. We have never actually seen that money go to grain branch lines; it has always gone into the general operating fund.
There is some difficulty in moving grain across the branch lines. In many cases the hopper cars are too heavy. They cannot be loaded to full capacity. Some $200 million a year go into branch line subsidies, but this is not being used to upgrade them.
In the 1977 Hall report, some suggestions were made that have never been discussed. In chapter V regarding branch lines, four alternatives were outlined. One suggested we should study a mini-train alternative, an independently owned and operated power unit delivering modified grain cars from the elevator to the loading facilities on the main line where the
grain would be transferred to hopper cars. Another alternative was a short line, independently owned and operated loading unit delivering grain from the elevator to the main line train assemblies. He went on to discuss the trucking alternatives. The other was a do-nothing alternative which is a continuation of the present system.
The second proposal, the short line alternative, makes eminently good sense to me. The railroads have never done anything but ask that branch lines be abandoned. Perhaps it is time for us in western Canada to put forward another alternative. The branch lines should be turned over to the provinces as part of the rural rail bed and allowed to be operated by independent owners or co-operatives. That suggestion was made by Mr. Justice Emmett Hall and outlined by Hugh Horner in his study for the Alberta government, his review of the red meat industry. He suggested that grain independent branch lines be transferred to the provinces at a nominal fee and operated by the provinces as part of the rural road system. He discussed the $200 million a year in branch line subsidies and $80 million a year for branch line rehabilitation. These subsidies do not necessarily go to the upkeep of the branch lines. The railways use the money wherever they feel they can get the greatest economic return.
Our motion in February proposed that this issue be directed to the parliamentary committee, for intensive study and the turning over of branch lines to the provinces to be operated as part of their rural rail bed could be part of that study.
These branch lines are analagous to the rural road system. They are an essential part of the infrastructure for rural western Canada and they should not be allowed to deteriorate. The farmers and businessmen of those areas should be allowed to form co-operatives and run them in a fashion that would keep them as an integral part of western rural Canada.
There are many advantages to this system which are outlined in this review. Often when we get excellent reports such as the one by Mr. Justice Emmett Hall and Mr. Hugh Horner they are allowed to gather dust. We go on with what members opposite call leadership, which is just doing away with a program that has been part of western Canada for the past 80 years.
The minister should accept our suggestion of providing the Crow gap, some $600 million, to the railroads and ask for a guarantee of service. In the meantime, we should be allowed to put forward these kinds of suggestions.
If the federal government were to pay that $600 million and set up a task force or royal commission to study the feasibility of turning over the 8,000 miles of branch lines to the prairie provinces at a nominal fee to be run as part of their rural road system, we could establish rural regional rail co-operatives to operate these short-haul lines as part of the rural system of road beds. They could purchase through an incentive plan some smaller locomotives. Huge locomotives would not be required for the operation. The grain cars could be transferred to the main line, picked up at regional terminals and pulled to the ports as part of a unit train.
March 25, 1982

The grain could be cleaned at the inland terminals and the screenings used as feed for livestock. We could establish a provincial rail authority to oversee the operation of the system and disperse the revenues and costs to the rural co-operatives. The GTA could still be in charge of rail car allocation. We could very easily put in place the same kinds of tax credits as in the oil industry and movie industry to allow these cooperatives to buy the extra grain cars and locomotives needed to operate the system.
This whole area makes eminent sense to me and is one that should be proposed to western Canada. It is one that the leaders in western Canada should be allowed to discuss so that we do not just have to accept the position being put before western Canada by the Minister of Transport and his one-man committee, who is holding negotiations behind closed doors so that we do not know exactly what is happening.
These ideas, along with those which have been proposed to the Wheat Board during the last few years to assist western farmers, must be considered. Such ideas included an assured market plan which the Wheat Board called MAP. Farmers are now saying that we should take a second look at this program in order to make some changes.
Mr. Jarvis, head of the Wheat Board, has recently been discussing a proposal for a cartel, which is something I have some difficulty with. It is just another name for something that members from all parties in the House have started with the United States, namely bilateral arrangements whereby we would set floor prices so that our two countries, which move approximately 70 per cent of all export grains in the entire world, would not be in such a competitive position that we are actually selling to countries who can afford to pay at below the farmers' cost of production.
If these ideas were being proposed at this time, along with fuel rebates, proper extensions of the small business development bond, plans to assist farmers who face extremely high interest rates and energy expenses during the next five years, then perhaps we could ask western farmers to look at some changes in the Crow rate in the next 20 years.
There is another anomaly which has not been addressed by the Minister of Transport in his Crow rate proposal. It concerns the British Columbia railroad and the farmers who deliver grain from the Peace River region. They have never been included in the Crow rate proposal. The British Columbia government has been paying the Crow difference out of the grain which is coming from the Peace River area for many years now. Until the last couple of years, the Wheat Board had not even been allocating some of the grain cars which were purchased by the government and the Wheat Board to farmers in that area. This situation has been rectified due to the strenuous arguments made by the hon. member for Prince George-Peace River (Mr. Oberle).
I believe the Minister should accept this proposal and ensure that the farmers in the Peace River area of British Columbia have their problems placed before the committee which he
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established so that disbursement of moneys may also be made to the British Columbia area. I believe that this is a very important consideration.
I would like to speak for a moment about some of the situations which can happen when an aggressive group is put into a system which, although it has been functioning for 85 years, has not been functioning very well and even deteriorating. When we were the government in 1979 the hon. member for Vegreville (Mr. Mazankowski), who was the Minister of Transport at that time, decided that some emergency plans had to be put in place in order to deliver grain until a system could be worked out to alleviate the many problems in the western grain transportation and gathering system. He convened an emergency grain movement task force of which I was glad to be a part. In a matter of two months we were able to set up the Grain Transportation Authority. We were able to make some 16 recommendations.
Even though nothing changed in the system at that time, the amount of grain which moved from the prairies to the ports increased substantially. To us this indicated that by aggressively addressing the problems in the system it could be made to work at a greater capacity than in the past. This was proven by the task force which was working in the prairies at the time.
We discovered some very interesting things which should have been happening for a long time and were not. We found that we should reduce segregation in the grain terminals and pursue the pooling of oil seeds. The system which had been operating for years was one whereby each grain company demanded that the car which they loaded in the prairies be delivered to their terminal when it came to port, even though the rapeseed was exactly the same in all cars. When a train pulled into Vancouver with some 100 cars, we often had to have 60 to 70 switches in order to get the right cars to the right terminal.
After the task force found that these things were happening, the Grain Transportation Authority went to work and discussed the whole matter. We now find that there is a pooling of oil seed cars, with the result that the turn around in those cars has increased dramatically.
We should employ supplementary quotas to attract grain to our interior cleaning facilities. At a time when there is a shortage of cars and there are cars which go to port with 5 per cent to 15 per cent of weeds in them, just imagine how much more grain we could move if those cars were cleaned in the prairies. There is a need for those screenings to remain in the feed industry of Alberta and Saskatchewan. We can relax some of the cleaning standards for our high grade wheats because they are really not needed.
We can pursue the possibility of making some effort to provide incentives instead of constantly imposing penalties to get our grain moved by the railways and the companies in a more efficient manner. Therefore, there are ways of making the system work more efficiently if Members of Parliament and task forces are allowed to look at new ideas and methods. There is much to be found out.

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We are facing some very astonishing statistics concerning the movement of products from the west to our ports.


The Acting Speaker (Mr. Ethier):: Order, please. 1 regret to interrupt the hon. member but the time allotted to him has expired.


Hon. John M. Reid (Kenora-Rainy River):: Mr. Speaker, when one is discussing the grain industry in the west, one is discussing a topic which probably gets spoken about more in the House of Commons than any other. I think when one speaks about the grain industry in the west, one is also talking about a subject which has great emotional attachment and we are dealing with a mythology that is very important to a great many people. In debating this subject today we are also debating a subject which is in the very middle of a raging debate in western Canada. We are dealing with something which is alive and well.
I believe we are also debating a subject which I think the House of Commons has very seldom debated. In the eight or nine years since the Hon. Otto Lang first raised the question of the Crow rate, I cannot recall when the subject was debated in the House of Commons so often. One of the reasons some members are unfamiliar with the debate and what has been happening to the railways and to the wheat farmer vis-a-vis the transportation system is that we in the House of Commons have been afraid to touch the subject. This is because we understand the emotional impact that discussion of this subject has back west. We have therefore tended not to deal with this question in the House in an adequate way.
Now that the government has finally made a decision to move and attempt to deal with some of the problems which have been caused by the Crow rate, it is somewhat of a shock and surprise to us all to discover that when we go back to review our own records of our committee hearings there is almost nothing in the file. We are all beginning to learn the facts anew.
In my judgment, having been an advocate of studies of the Crow rate back in the middle 1960s when I came to the House of Commons and joined the Standing Committee on National Transportation, and after spending a year travelling the railways of Canada with the committee which rewrote the National Transportation Act, I can recall what a terrible day it was to those of us who wanted to see the Crow examined when the House turned down the clause in that bill which would have allowed to take place the study as to what the costs and the benefits of the Crow were.
I think that decision of the House in 1967 set us all back in terms of being able to deal with this particular question. Therefore, it becomes much more difficult for us to do it now at a time when the economy is slowing down and at a time when everyone is being forced to tighten their belts.
Why are we doing it now? It is for the same reason that everyone is cutting back in every field. We have discovered that our ambition to spend in the private, corporate and governmental sense is exceeded by the revenue we have to spend. We have now reached the point in the Government of
Canada accounts where 25 per cent of every dollar we collect as revenue goes to pay the national debt. There is just not much money in the bucket any more, and the consequence of that is that the government is examining all its expenditures.
We know when it comes to the railways that there must be massive investments over the next ten years. That money has to come from somewhere, and it is going to come from the Canadian taxpayer, it is going to come from the railways, it is going to come from the consumer of the goods that are moved on the railways, and a greater share will have to be paid by the producer of the goods which move by those railways.
The question we are discussing is: What are the fair shares and what are the amounts each group will pay? I think it is an absurdity to say that the amount paid by the producer of grain is going to disappear. The projections we have-and nobody has challenged them-are that by the year 1990 the grain producer will be paying 2.5 per cent of the cost of moving his grain, yet if we go back 25 years to the middle fifties, we find that the grain producer was paying 75 per cent of the cost of moving his grain. 1 find nothing written anywhere in the statutes of man or in the word of God that says this is the condition that has to go on forever.
Who is paying the cost? Part of the NDP motion today says we should nationalize the CPR.


Lorne Edmund Nystrom: Right on.


John Mercer Reid: Will that save anybody one cent? My God, when I look at the profits of CP Rail, I see one person who is subsidizing the grain producer, and that is whoever owns shares of CP Rail, because CP is not making any money. The people who subsidize are the railway workers. Every railway worker takes less pay than he would otherwise get because of the subsidy which goes into the system. Everyone who moves freight in and out of western Canada-or almost anywhere in Canada-pays a part of the Crow subsidy, and that subsidy is going up as the amount paid by the grain producer goes down.
The farmer has paid a heavy cost too. We do not have diversification of western Canadian agriculture because of this. One of the things I have taken an interest in is the question of triticale. It is a very interesting subject for those who want to understand the problems the Crow has caused to the agricultural industry. Here we have a new grain. It is probably the only new grain discovered in the last 500 or 600 years. We are not growing very much of it, even thought it was put together at the University of Manitoba. It is grown in Mexico. It is grown in Russia. It is grown in Poland. Only now is it beginning to be grown in western Canada. Why is it not growing in western Canada in substantial amounts? Because it cannot be shipped out of the country, or anywhere, because it has to pay the full rate, and the full rate discriminates against any grain crop produced in western Canada unless it happens to be on the short list which comes under the Crow. What does that
March 25, 1982

mean for farmers in western Canada? It means they are locked into a one-crop economy. That is not very sensible because any economist and any farmer will tell us that what they really want to do is rotate crops and make sure they are able to protect themselves against being wiped out totally by whatever disease or pest might come along.
Let me refer to a story which appeared in the Star-Phoenix of Saskatoon.


Ramon John Hnatyshyn: A great paper.


John Mercer Reid: "Topsoil drift said fault of Crow rate" is the headline of a story by Nancy Russell on March 18. The story points out that because there is only one crop and not enough variety in what is being planted in western Canada, topsoil is moving on. There has to be a greater range of crops planted, but the Crow works against that. The Crow locks farmers into a very limited number of crops they can grow on an economic basis because they cannot move those crops out. If farmers cannot move them out, it does not make any sense to grow them. If they cannot grow them at a profit, it does not make any sense to grow them.
When we look at the subsidies which are in our system, there are two points we have to remember. The subsidy which goes into the Crow is paid by all Canadians. Who gets the benefit of that subsidy, Canadians or our foreign customers? I put it to hon. members that in point of fact the person who receives the benefit of the subsidies we have built into our system is not a Canadian at all but a foreign customer. This applies not only to grain but also to many other minerals I know we export, and even to some of the manufactured goods we export. I do not mind paying subsidies, but I really would like to see their major benefits reside here in Canada.
The other point 1 want to make about subsidization or any kind of system is that if we do not put into the system the money that is needed to make the system work, it will not work. In the last 25 years we have systematically deprived Canadian railways of the revenue they need to make their systems work. That is why branch lines are down. That is why there has not been the kind of investment the railways should have been making in hopper cars. That is why the Government of Canada and the provincial governments have had to go to the rescue. They have had to buy hopper cars for the railways because the railways are not generating enough profits to be able to buy the cars. This applies not just to cars but to the whole range of things the railways do. We have starved the system, and nationalizing the CPR would not change that one little bit. What has to happen is that more money has to go into the system so that we can bring it up to date. The difficulty is that not having invested enough money in the system in the last 20 years, the investment in the eighties will have to be massive indeed.
The second point about subsidies is that they tend to protect those people who were there first. In the case of the Crow rate, that was the farmer. It is important to recognize that when the Crow rate was developed it did provide enough money to cover the cost. It did provide a little margin of profit. Probably until the end of the Second World War and perhaps into the early fifties there still was not much of a burden, but what has
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happened since then? The basic understanding of governments and the railways about the Crow rate was that instead of costs going down, as had been the assumption, costs went up, and the costs are now escalating at a rate which simply cannot be sustained by the system unless there is a new source of revenue. The question we are debating is where that revenue for capital improvements will come from. Where is that revenue for operating expenses to come from, who is going to pay and how much?


Lorne Edmund Nystrom: Not the farmers, John.


John Mercer Reid: Why should the farmer be in the position where 25 years ago he was prepared to pay 75 per cent of the cost of moving his grain and in 1990 he insists on paying only 2.5 per cent of that cost? Is there a God-given right to that? Everyone else has to play in the international market. There are very few people who are exempt from playing in the international market, I recall the deals we made in the GATT, and I know the way tariffs are coming down in the next five years. If anyone has any illusions that the old concept of a high tariff country is going to be there for very long, he just has not been paying any attention to what has been going on, and he has not been paying any attention to the inability of our tariff barriers to keep foreigners out. My goodness, the automobile industry is now taking full-page ads in the newspapers of Canada to say that they have no tariff protection. The New Democratic Party has said, "We want 85 per cent tariff protection for the automobile industry". I do not think that is an appropriate way to go, but the NDP has said, "We are no longer a free-trade party from the west; we are now a high-tariff party from Ontario." The New Democratic Party wants 85 per cent Canadian content in any portion of cars coming in. That is crazy, but that is the NDP position. That is certainly what members of the NDP are promoting in the province of Ontario, and that, I take it, is coupled with the NDP position that the manufacturers of Canada should be protected and the farmers should be protected. There is not enough money in Canada to do that.
The dilemma we have in trying to deal with the Crow, in my judgment, is a very simple one. We have a system which has been in place for 85 years. We have a system which, all things being equal, probably would not need to be changed. But all things are not equal. Inflation and increased transportation costs have conspired to put an intolerable burden on the whole railway system. The question we have to ask ourselves is how we can restore the railways so that they will be able to provide us with the kind of service we require to keep our foreign clients on whom the western grain producer is totally dependent.
Nationalization of the CPR would not bring a single additional penny into the system; the money must come from outside. Where will it come from, Mr. Speaker? What are the economic effects of the kind of cross-subsidization that we have? I think there have been two main victims of that form of

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cross-subsidization and one has been the west. It has hindered the development of alternative economic opportunities in the west and it has blocked the diversification of agriculture. It means we have been locked into a pattern set in the west in 1896.
Another group of people has had to pay for that subsidy as a result of the total distortion that has taken place in freight rates in Canada, in two ways. The first has been the kind of distortion that in the Canadian rate structure has always put a premium on moving natural resources as opposed to moving manufactured goods. In other words, the way the freight structure was established, largely as a result of the Crow, was that it tended to take resources from the natural resource areas and move them to the cities to be manufactured and then move the manufactured goods back. If we look at the freight rate structure for any natural resource, we will find a bias in favour of the movement of resources to the city. That structure developed as a result of the Crow.
The second bias in the system is that a good portion of the deficit that the railways occur in the movement of grain is covered by the freight shipper on other commodities. That means that potash, iron ore, lumber and all bulk goods pay a higher cost for transportation as a result of the subsidization cost. We in the rural areas pay a higher cost for freight than would be the case if the subsidy did not exist.
While I have a great deal of difficulty with the process developed by the Minister of Transport (Mr. Pepin) in stripping frunds from VIA Rail, I have to say that I think it was a healthy thing to take the cost of subsidization of passenger rail service away from the freight shipper. That was a sound move. I think we should put our subsidies on the table; that is, pay them directly and not try to incorporate them by passing the burden to other people who use the system.
We have to decide where the subsidy is to go. The question is whether it should go to the farmer directly or to the railroad.
I have a strong feeling that, regardless of the administrative difficulties, the subsidy should go to the farmer. I believe that for the simple reason that the farmer takes the risk. He decides what to plant and what market to approach. If the subsidy were paid to the farmer, then he would be in control and could do what he thinks is best.
I recognize that there is an institutional argument for the subsidy to be turned over to the railways, but I do not believe that the railways can necessarily decide what is best for me. I believe that the subsidy should be paid directly to the farmer so that he can make his decisions and, of course, he will make decisions in his best interests. I think my main point is clear, Mr. Speaker. There is the choice of subsidizing an institution, the railways, or putting the subsidy in the hands of the farmers. I believe it would be better not to put it in the hands of the railways but to put it in the hands of the person who can make the best use of it.
I have gone over the minister's proposals in some detail. By and large I have been surprised that this is but a modest step forward. It is not an elimination of the subsidies built into the Crow; basically what we are saying is that the subsidy is going
to be kept at a particular level and that increased costs after that level will be shared in some proportion.


The Acting Speaker (Mir. Ethier):: Order, please. I regret to interrupt the hon. member but his allotted time has expired.


Mr. Len Gustafson (Assiniboia):: What is the importance of the situation? Agriculture or the production of food in Canada is in a foremost position. As long as it remains number one, Canada will remain strong. We must be very careful not to take steps to undermine agriculture. Wheat is one of the major bases of agriculture, particularly in western Canada, as is the movement of wheat. We in the Progressive Conservative Party stand for upgrading branch lines because there are too many of them which cannot carry hopper cars or are only carrying hopper cars with half loads. This does not make sense. A contribution has been made by the government to upgrading these branch lines and, in many cases, the work is being done. But I could point to rail lines and branch lines in my own area where culverts were moved in and then moved out without any work being done. It is most important to see work done in these areas.
What will the outcome be for farmers? First it will be very dependent upon the attitude of government in the House and the attitude of hon. members regarding this very important issue. We have a commission to study the issue which is conducting hearings at the present time. I should like to say something about this study because there has been a great deal of talk concerning what is really being said by grassroot farmers. I represent grassroot farmers in my riding. I have talked to them and they have said that they want the retention of the statutory Crow rate. It is most important that it be retained.
What about production and its importance to farmers? I should like to indicate a few facts in this regard. In 1905, 90 per cent of all people were engaged in agriculture. They produced enough food to feed the people of North America. Today we have a little over 4 per cent of Canadians who are engaged in agriculture and are producing enough food to feed the people of North America and a good deal of the world. It is important to keep agriculture strong.
What will it do for Canadian consumers? We all know that Canadian consumers purchase the cheapest possible food compared with many other countries of the world. This is an important factor. Perhaps we could argue today that farmers have received an advantage which others have not received. In many cases farmers have purchased under a tariff and have sold on open markets. In many other cases they have purchased in areas where they have paid a third more, and perhaps even 50 per cent more, because of a protected market. 1 remember years when a good truck was selling for $2,000 or $3,000 less in Crosby, North Dakota, than a similar one was selling for in Estevan, Saskatchewan. Why was this? It was because of a protective tariff.
Such things have existed throughout the history of Canada. I am not suggesting that it was wrong in all cases, but I am suggesting today that farmers cannot afford to pay an additional $1 per bushel. I raised this matter with the Minister of Agriculture (Mr. Whelan) in the House on the basis of having personally gone to Alexander, North Dakota, and checked on the price of moving grain from that city to Seattle. The price at that time, which was approximately two years ago, was $1.35 per bushel. Under the statutory Crow rate, wheat is
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moving out of Weyburn, Saskatchewan, at 19 cents per bushel.
I am suggesting to the House that the increased cost in the movement of grain could amount to as much as $1 per bushel in the next four, five or six years. This is a very serious threat to the economy of western grain farmers and of Saskatchewan in particular. This is why I take a strong stand that the statutory Crow rate must remain and that the Government of Canada must make up the Crow gap.
What is our responsibility in this situation? Today we have a very, very irritated western Canada. It is irritated because of the insensitivity of a government which did not understand the western Canadian energy policy. For example, I have spoken with people who are involved in the service and supply industry in Weyburn, Estevan and Swift Current. They indicated that they are only selling 20 per cent of production in southwestern Saskatchewan. On April 1 a new quota will be set for south Saskatchewan which will also restrict production. The people of that area will only be permitted to move 35 per cent of production. They do not understand this severe measure. They do not understand why hundreds of people should be out of work. They do not understand why service and supply companies should be going broke, be forced into bankruptcy and be forced to sell their equipment when Canada needs oil but purchases offshore oil from Mexico at a cost to Canadian taxpayers of $16 per barrel higher, with about $9.06 in incentive grants to refineries, when the same grade of oil is available in Saskatchewan. I want to suggest that people do not understand that. When they do not have jobs you cannot explain why they should have to go through this. If the government and Members of Parliament are as insensitive to the Crow rate as they are on the national energy policy, you are going to have a very serious situation in western Canada. I would like that to go on record here as giving a warning of the existence of a very serious situation, and it is most important that the government and the Minister of Transport be sensitive to it.
I do not feel, Mr. Speaker, that I should belabour the subject. I have made my point. We face a very serious issue, probably the most serious in the history of western Canada. Therefore, I advise Members of Parliament, the government and government backbenchers, to weigh very seriously the issue of the statutory Crow rate and make their decision taking into consideration the future of this nation and the importance of the agricultural industry to this great country of ours, Canada. I thank you.


Mr. Laverne Lewicky (Dauphin):: Mr. Speaker, it gives me great pleasure to be able to speak to this whole issue of the Crow rate. I would like to preface my remarks with a comment about a term we use in sociology, one that I have probably used in one of my first lectures in teaching sociology, namely, ethnocentrism. The idea behind that is that so often we judge other cultures-in this case other regions of Canada-based on our own limited experience, background and academic training. When I think about the fact that the Canada bill has

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just been passed in the English House of Lords, and specifically about the clause dealing with multiculturalism, I realize it took a little while for us in Canada to realize that there are ethnic groups in Canada with a different background from those with an English or French heritage. It is of interest to me that reports such as that of the task force on Canadian unity, the Pepin-Robarts report, recognized this diversity. I urge the minister to go back to his own report because it also dealt with the question of regional diversity. There are differences in regions from one coast of Canada to the other. The report asks this question:
What of regionalism, which we have identified as the second line of cleavage in Canadian society which needs attention in the present crisis?
In looking at this report it seems to me we had an intelligent co-author who recognized that there are regional differences.


Jean-Luc Pepin: Indeed.


Laverne Lewycky: Looking at some of the specific recommendations on page 125 we see a plea that we:
-recognize the diversity among Canada's regions and the need to permit all regional communities to flourish.
With the knowledge that the current Minister of Transport was involved in that kind of study, I am utterly baffled, dismayed and disappointed that he now fails to recognize the academic rhetoric which is now being used. I think it is important that we look at this whole issue as one which gives us an idea of the nature of Canada; how we are different from region to region, how these historic developments have occurred, and how we can make sure they do not continue to work to the detriment of a specific region of Canada.
I would, therefore, like to focus for a moment on what I might call an historical argument for the retention of the Crow rate, for the importance of painting, as it were, an economic picture of Canada and taking a look at our history. In sociology we would say that as Canada developed, there was a kind of axis, a metropolis called central Canada, and a hinterland in the prairie provinces. We developed a national policy on transportation in such a way that there was resource extraction from the west, much of which for a long period of time was in the form of wheat. At the same time we saw the development of manufacturing at the centre, the metropolis. This policy was developed to some extent at the expense of the west. As this developed, and as tariffs were given to the east to protect the manufacturing industry-


Jean-Luc Pepin: And taken away.


Laverne Lewycky: -we found in the process that we were paying more in the west. The one concession that we in the west had was that we could depend on a statutory and stable rate for the movement of grain. But we now have a minister- who, I thought, having been involved in this commission, would understand the regions the best-working to the detriment of the prairie provinces.


Leslie Gordon Benjamin: He undermines his own report.


Laverne Lewycky: As the hon. member says, he is undermining his own report. We in the west, especially in Manitoba, have a particular problem with these proposals because Manitobans do not really stand to benefit from the development of the Rogers Pass and other things because most of our grain is shipped through Thunder Bay and through Churchill.


An hon. Member:: Not enough of it.


Laverne Lewycky: As the hon. member says, not enough of it. More should be shipped through Churchill.
I would now like to look at the Manitoba scene, especially the Tyrchniewicz Report of March, 1980. We should take a look at this report to see what the negative economic impact would be on Manitoba. This study was not done under a New Democratic Party administration in Manitoba; it was done under a Conservative administration. The Conservatives did not reveal the results of this study because, of course, they were afraid that their position might be untenable. Any educated person who looks at the report could see what the negative impacts would be on the Manitoba farmers if we had a removal of the Crow rate.
This study was done for the Government of Manitoba by three faculty members of the Department of Agricultural Economics at the University of Manitoba. One of their principle conclusions was that if the Crow rate were removed, on the hypothesis that the increase in freight rates would be 3.4 times the present amount times Crow, there would be a $50 million drop in farm output in Manitoba. It would cut the net farm income by an average $1,056 per farm. An area such as mine, the Parkland region, could not take such a loss. It is an undeveloped region and it is economically deprived. Many people do not have a net income of $7,000, never mind some of the higher incomes of people in urban centres. Many people live at the poverty level. In my constituency alone, there are seven Indian reserves with an average unemployment rate of 80 per cent to 85 per cent. Such a change would mean a terrible loss in these kinds of areas. This can be seen if one adds all the other increased costs of moving grain, let us say, by trucks, and the increased cost on roads. We would face a terrible loss in Manitoba. It is a real laugh to hear all the statements suggesting that a change in the Crow rate bring benefits to Manitoba.


Leslie Gordon Benjamin: Manitoba does not get a nickel.


Laverne Lewycky: In no way will we will see increased opportunities for the processing industries in Manitoba and other provinces because there are tariff barriers and restrictions which will not allow for the easy growth of these industries. In no way will eastern provinces support programs for their own industries when the Minister of Transport (Mr. Pepin) is promising that the easterners will not suffer anything as a result of the change in Crow. There will be no opportunity for further development of processing industries in the west.
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The other fear I have is that if the Crow rate is removed, we can expect the death knell to sound in places like the Port of Churchill and other ports which might otherwise be developed.
As far as Manitoba is concerned, there is no way that the removal of the Crow rate would provide any kind of economic benefit. I was quite troubled this afternoon while listening to the Minister of Employment and Immigration (Mr. Axworthy).


An hon. Member:: Propaganda.


Laverne Lewycky: He is the minister who supposedly represents western Canada. I was amazed at his lack of understanding of some of the problems that we face there. An article in the Winnipeg Free Press, dated March 13, 1982, quoted him as saying that the Crow is one of the icons of western ideology. He has a complete lack of understanding. Actually, the Liberal Party is one of the icons in the west. One can find there only a few old pictures of Liberals.


Leslie Gordon Benjamin: It's an endangered species.


Laverne Lewycky: There was a meeting which took place in Fort Garry which, I believe, was called a two-day think tank, but it produced nothing but tanked thinking, as far as I can gather from the impact that it had on the Minister of Employment and Immigration. It is really detrimental to the west to have the Minister of Employment and Immigration as minister, because he does not seem to understand some of the historic problems that we have faced in the west. Perhaps he should read some of the speeches made by Senator Hazen Argue in the other place. Even as late as November 27, 1981, the senator said that it is unlikely that changing the Crow rate would do much to stimulate the livestock and the processing industries on the prairies. That was his candid assessment of what would happen on the prairies. I think we ought to take cognizance of what the senator said in the other place. In fact, he said:
I don't intend to let the wool be pulled over my eyes and I don't believe that farmers can afford to have it pulled over theirs, either.


Leslie Gordon Benjamin: He is just a sheep, anyway.


Laverne Lewycky: I think Senator Argue was correct in stating that. He is a cabinet minister. The other day the Prime Minister (Mr. Trudeau) indicated where cabinet ministers should go if they disagreed with government policy. Senator Argue said further that the report prepared by Transport Canada earlier this year concluded that the impact of freight rates on the location of livestock and processing industries is exaggerated. I wish that the other members of cabinet would take cognizance of what some of their own members have said. They should take note of some of the wisdom in their own wisdom bank, rather than in their think tank, in terms of a fair and equitable policy with regard to the movement of grain in the west.


Some hon. Members:: Hear, hear!


Laverne Lewycky: Let us take a look at some of the specific reasons for arguing that the Crow rate should be retained. The
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distance over which we must move grain in western Canada to get to port is much greater than in any other competing country. However, in terms of our balance of payments, our grain exports are quite sizeable. It is in our own national interest to ensure that our agricultural economy is properly supported. Other countries do that. The hon. member for Regina West (Mr. Benjamin) mentioned earlier what competing countries, such as Australia, Argentina and the United States, do in terms of export of their grain. Our situation in western Canada is regionally different. As the Minister of Transport stated in his former report, there are regional diversities. I wish he would recognize these regional diversities and see that they are taken care of.
We should take a look at the whole question of tariffs, at the benefits they have brought to central Canada and how much they have cost other regions of Canada. I said earlier that the manufacturing sector in central Canada was able to develop because of tariffs. There is no manufacturing sector in western Canada to speak of. As a result of these policies and tariffs which enabled the central Canadians to develop their industrial sector, the prairies, with 16 per cent of the population, have been able to develop only 8.1 per cent of the manufacturing jobs.


An hon. Member:: Shame!


Laverne Lewycky: In anyone's books, this is inequality. This is an illustration of what I mean when I say we should take into consideration some of these other aspects. Certainly, many reports have recommended the retention of the Crow. I simply want to underline the following statement of Mr. Justice Emmett Hall in 1975:
If once tempering with the statutory (Crow) rate is accepted on condoned or is an item on the bargaining table, all will be lost. For once the subject is on the bargaining table, it will be only a matter of time until it is lost step by step.
In other words, what he said is that the economic forces would inevitably shift the total cost of grain transportation to the farmers. That is not the problem that producers of other commodities face. The coal producer can pass on his transportation costs, and Premier Blakeney of Saskatchewan recognizes this. The potash producers can pass on the costs, but the farmers are not able to pass on their costs. They have no control over the price they receive for their grain. The farmers have no control over their input costs, no control over the costs of fertilizer, no control over the costs of energy. Their economy is squeezed; it is a cost-price squeeze. Farmers are always being forced into this vice.
The one item that they have had throughout the years has been the statutory Crow rate. Now the Minister of Transport (Mr. Pepin) wants to destroy this and with it destroy the agricultural economy of western Canada.
Arguments have been made about this, such as that if you give the railways more money the railways will do a better job
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in transportation, that is if you give up the Crow rate. Yet, when you take a look at the facts, you see that the railways have not been doing their job, they have not been living up to their standards. The removal of the Crow rate will not solve this problem.


Jean-Luc Pepin: How do you know?


Laverne Lewycky: Mr. Speaker, I have a quotation here from George McGovern, the former United States senator from South Dakota. Speaking of the situation there, he said "We have a line here in South Dakota so bad that a boxcar fell off the track the other day and the train was standing still." They have variable rates there. Is that the type of transportation system we are trying to model ourselves after?


Leslie Gordon Benjamin: They have commercial rates.


Laverne Lewycky: They have commercial rates, as the hon. member says. Changing the Crow rate will only add to the railway's profits, not to improve the transportation of the prairie wheat. We have to keep this in mind when we look at this whole subject.
Some arguments have been made about the increase in grain traffic and the way grain is clogging up the railways. It is said that because of this you have to have railway expansion. Yet if we take a look at some of the statistics, we find that by 1990 the grain that will be marketed out through the west will be only 14 per cent of the traffic. Coal and potash will be the greater commodities marketed there. So, if the percentage of the grain commodity being exported there is going to be reduced, why should we place all the burden of transportation on the backs of the farmers, who already have been hit by this government's policies in so many ways? It is important for us to make sure that we see that our agricultural economy remains healthy, that our agricultural economy continues to thrive and flourish, because that is the only way that we in Canada as an entire country can ensure that we do meet all of our food needs.


The Acting Speaker (Mr. Ethier):: May I remind the hon. member that his allotted time has expired.


Mr. Ralph Ferguson (Lambton-Middlesex):: Mr. Speaker, the farmers out west-


Leslie Gordon Benjamin: What does a bushel of wheat look like, have you any idea?


Ralph Ferguson: Perhaps I should start off, Mr. Speaker, by advising the hon. member for Regina West (Mr. Benjamin) that I am a farmer, too, from southwestern Ontario. We have produced corn, soybeans, wheat, barley, beef cattle, laying hens. I say that just to have it on the record. I worked on a farm all my life. As a matter of fact, during the years of World War II, I helped my father on many occasions to unload western barley out of the boxcars to take it back to our farm to
March 25, 1982
feed it to livestock, ultimately to assist in the war effort to feed our troops in England and the troops of our allies.
I am delighted to take part in this debate today on a topic of vital interest to many Canadians. It has been an issue of extreme importance for so many years. Like all pieces of legislation that are in constant use, this particular matter should be updated to keep abreast of the modern facilities required to fill the world markets and use fully the productive capabilities of western Canada.
We know the Canadian Constitution was passed today in the British House of Lords. The old British North America Act was amended many times over the years, as required. So, too, must the Crow rate be re-examined to ensure that the farmers of Canada have access to world markets.
I would like to point out that the agri-food strategy report, presented by the Minister of Agriculture (Mr. Whelan) in September last, points out that we in Canada can increase our production by a tremendous volume. But what good is this increased production if we do not have an efficient transportation system capable of delivering that product to the port of export or to the Lakehead?
Looking back, it is interesting to note that in 1908 and 1909 the rate from central Saskatchewan to Thunder Bay was about 18 per cent of the price of a bushel of wheat. Then, as wheat prices increased, that rate dipped to about 5 per cent in 1920. The same cost of transportation climbed to about 40 per cent during the 1930s, when the world wheat prices bottomed out. At the present time the price has dropped to about 3 per cent or 4 per cent of the cost of a bushel of wheat.
Surely the time has come when we must ensure that we do have the modern and updated facilities for the increased traffic, to benefit not only the farmers but the total agricultural industry and all the allied services that have an effect on our total economy.


Leslie Gordon Benjamin: Agreed.


Ralph Ferguson: Mr. Speaker, we in Canada compete against the farmers in the nation to the south of us, who have a great inland waterway extending into the heartland of the production areas. We have to compete against the unit trains with modern non-stop unloading at some of the Gulf ports. We must also ensure that we provide the incentives here in Canada to modernize the system in a way that will allow us to compete aginst our neighbours to the south of us.
Mr. Speaker, may I call it six o'clock?


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


[Stage Direction]
AFTER RECESS

The House resumed at 8 p.m.
[Stage Direction]
March 25, 1982
The Acting Speaker (Mr. Daudlin):: When the House rose at six o'clock, the hon. member for Lambton-Middlesex (Mr. Ferguson) had the floor.


Ralph Ferguson: Mr. Speaker, at six o'clock I was pointing out that if we as Canadians are to compete against the farmers of the nation to the south of us who have a great inland waterway extending into the heartland of their crop production areas, or if we are to compete against the unit trains with non-stop unloading, then we must ensure that we provide incentives and the modernized systems that allow us in Canada to compete, particularly those people in the prairie provinces.
We are no longer just referring to huge volumes of grain moving on these lines. We are referring to huge volumes of coal, sulphur and other goods and products for export. If we expect to have the services that are required for competition with other goods, I respectfully suggest that an adjustment is required now. 1 refer to the fact that grain shipments account for about 20 per cent of the traffic to the coast at the present time.
The government's total contribution to grain transportation since 1970 has been $1.7 billion. We have spent over a billion dollars in branch line subsidies in the last decade. We purchased 8,000 hopper cars in 1973, and in 1980-81 we leased another 2,000 hopper cars at an annual cost of about $12 million.
In 1974 we shared half the cost to the railways of $44.8 million for rehabilitating 7,200 boxcars. From 1977 to 1984, we spent or committed $495 million to upgrading and rehabilitating dependent rail lines in the prairie network. Between 1968 and 1982 we spent $23 million for port improvements at Churchill, Manitoba.
We are committed to $30 million for site development for the grain terminal at Prince Rupert, British Columbia. Since 1971 we paid $184 million to subsidize the movement of export flour and grain to Atlantic ports, mostly from elevators in the Georgian Bay area. Certainly the Government of Canada is prepared to commit additional funding over the next several years to assist in the movement of grain.
As a member of this Thirty-second Parliament from the province of Ontario, there is one point I want to make abundantly clear. Many people from western Canada feel that the Crow rate is of tremendous benefit to Ontario. This is no longer the case. In the last few years Ontario has been a net exporter of feed grains and is no longer a beneficiary of the rate. Other areas of eastern Canada do benefit to some extent, and also from the livestock feed freight subsidy that applies to eastern Quebec and the Atlantic provinces.
I hope we do not begrudge that assistance to those areas whose potential productivity or diversity of production is limited due to climatic and geographic locations and other conditions. It is also the areas that supplied scores of men from eastern Canada, not only Ontario but other provinces, who travelled west on the old harvest excursions to help with harvest there after the eastern harvest was completed. These were all forms of assistance that were provided to ensure that the harvest was completed in those days when there was not as
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much competition from other goods moving on the rail lines. We were able to market the grain in a better form than we are today.
The question as to whether or not the Crow rate should be changed was not really an issue until the early 1960s. In 1961, the MacPherson Royal Commission on Transportation acknowledged an emerging railway revenue problem and recommended that subsidies be paid to the railway for losses incurred by reason of continuing utilization of light density lines and the Crow rate. As well, in the 1960s, the branch line rationalization process got under way.
The railways could neither maintain nor reinvest in the large branch line network, with the result that by the early 1970s the system began to deteriorate. In response to this situation, the federal government began to spend large sums of money, as I mentioned earlier, to purchase rolling stock and repair branch lines.
It was in 1975 that the then minister of transport, the Hon. Otto Lang, called for a change to the Crow rate by articulating his "bold approach" concept. The bold approach introduced the notion of Crow benefit which would result in a producer not having to pay the full cost of moving grain by rail in one increase. At that time his initiative faced severe opposition.
In 1975, the American consultant, Mr. Snavely, headed a one man commission to look into the cost of moving grain by rail. His report was released in 1976 and showed that the railways lost $103 million in 1974 for moving grain. His results were generally accepted by the west but no concensus as to who should pay the railways for lost revenue emerged at that time. In 1979, an updated report produced figures for 1977 losses of $160.5 million and a further update produced figures for 1980 which showed losses of $244.4 million.
In 1978, primarily because of transportation difficulties, the Canadian Wheat Board announced that it had to forgo or defer grain sales of approximately $1 billion. As a result, in January, 1979, the board ordered 2,000 hopper cars to be paid for out of producer funds at a cost of $87 million. At the same time, producers were forced to store grain on farms for longer periods and, certainly, interest rates were higher as well.
The result was a realization by many that the existence of the Crow rate was no longer in the producers' best interest. During the fall of 1979 the Crow rate became the major topic of discussion at many of the farm meetings.
Eventually, these discussions emerged mainly between two umbrella organizations; the Western Agricultural Conference and the Prairie Farm Commodity Coalition. These two groups each put forth a position requesting the federal government to address its responsibilities in the area of rail transportation.
Simultaneously, the matter of capacity constraints to the rail system through the mountains placed additional emphasis on the necessity of the railways to earn more money for

March 25, 1982
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moving a commodity which represents 20 per cent of the railways' workload but provides only 3.5 per cent of the revenues.
Obviously, something had to change. One year ago, I was pleased to be invited to a meeting here in Ottawa which was called by some of Canada's farm leaders to hear their presentations on this issue. Their opinion was that by talking with each other and with us, as members, as well as with those directly affected, a workable solution could be found. I commend the minister for the action that he has taken in this response and I will be waiting for the recommendations from Professor Gilson which I believe will lay the foundation to enable us to update and modernize a system which will be a credit to this nation.
One point that I cannot agree with, however, is a suggestion by the NDP that we nationalize the CPR. I cannot accept such a far-fetched proposal because when I look at the CPR in my particular area-in fact, the Montreal to Windsor corridor-I find that the lines run parallel in most places and throughout most of that area, while the CNR lines are double tracked. This is a heavily travelled area for both rail lines. Is the NDP suggesting that we close one of these lines which are so heavily used and create a bottleneck which would be as critical to that area as that which we are trying to eliminate through the Rockies in the next few years? Are they suggesting that we nationalize a huge company which provides the only competition to our nationally run railway? Are they suggesting a move which would not improve the service but would most certainly place many people out of work? I strongly disagree with them.
I do agree, however, that the time has come, by any measure of comparison, to re-evaluate a program that has served us reasonably well for the last 85 years. But due to changing times and values, a broader scope of users and a need to compete in world markets, we simply cannot stand still. The Crow rate has served this nation well in the past but if we are to let our system rest on its laurels, we will end up with a system that has rusted on its laurels. Neither the prairie farmers nor Canadians will benefit.
The Government of Canada is taking these initiatives in dealing with the capacity problem in the interest of all Canadians. The whole economy will benefit from the opportunities which will be fulfilled as a result of these initiatives. The people of the three prairie provinces in particular will benefit because they have the capacity to feed a hungry world. They will be supplying those markets. However, as Canadians, we must ensure that the transportation system is capable of handling the volumes of grain and food which is produced to feed those hungry nations. Thank you, Mr. Speaker.


Gordon Edward Taylor: Mr. Speaker, I am very happy to have the opportunity to speak tonight on this motion. I would like to congratulate the members of the New Democratic Party for introducing this motion. I think that it is most opportune and that the discussion at this stage is very proper.
I find the process set out by the hon. minister is good and I would like to review it for a moment. I like the proposal, that is provided it works out in the way in which I believe it can. Since I am not a prophet I am not saying that it will, but it is
capable of working to the advantage of Canada and western farmers-Canadian farmers for that matter.
The process as set out by the minister in a report from a Ministry of Transport release simply says that the consulation process will lead to a new statutory framework. I think that is axiomatic. If the Crow rate is to be replaced, I say that it certainly has to be replaced with something equally beneficial for those whom it now serves. It should be made statutory not simply a measure which can be changed at will or at the whim of any president of the CPR, or even at the whim of any government, without careful consultation.
The process involves $3.2 billion over the next four years- not $3.2 billion per year, but $3.2 billion over the next four years. This is assumed to be the shortfall between the Crow and the actual cost.
The next step in the process makes the assumption that the money will be paid to the railways. I am sorry to see that because I think that all avenues should be considered in deciding how this will be handled. However the proposal says that the railways will guarantee performance and service related to grain transportation in return for an improved level of financial compensation. I will deal with that point in a few minutes.
The railways will begin extensive investment programs and implement rate adjustments to encourage agricultural processing in western Canada. There will be intensive consultations with the affected parties in the west, which will be completed sometime this spring. Then during the summer, I understand the governments of the four western provinces will have an opportunity to consider those recommendations and to make representations of their own to the federal government and to the people. Finally, the matter will be brought to Parliament in the fall of this year.
It appears the process could work to advantage. There are one or two things I do not like too much about it. I do not like closed-door consultations. I think it would have been far better to admit the press as well as members of various organizations which are interested. However, I have faith in our agricultural leaders, and possibly this will work out. If secrecy is required after representatives of the various grain organizations leave the consultation table, I do not think that would be right at all. These people should have the right to come back and talk to their people and make further representations if that is necessary.
We are putting great faith in the railways, and the CPR in particular. I want to review briefly some of the things which have happened in the past and examine whether there is reason for putting such tremendous faith in the railways carrying out their obligations, whether they are set out in statute or otherwise. Let us go back to the beginning of the railways and when the CPR was offered $25 million and 25 million acres of land, including all its mineral resources, to build a railway across
March 25, 1982

this country. Twenty-five million dollars of about 100 years ago would have a value today of close to $1 billion when we take into account inflation and so forth. The railway received a very large sum of money. In addition to that large sum of money the railway received 25 million acres of land plus all its minerals. That was quite a gift. I do not think we can forget that today, because for that money the CPR promised to build a railway. This is what the agreement says: "perpetual and efficient operation of a railway." That means forever. How has that worked out? The CPR has reneged on passenger service. It ignored passengers for a very long time and finally got rid of them altogether. The CPR treated passengers very shabbily for a number of years and did not want to provide passenger service at all, but it was under an obligation under its agreement to carry passengers. The railway was paid for carrying passengers and, in my view, the Government of Canada had no right to let the CPR out from under that obligation simply by saying, "All right, we will forget about it." The railroad received millions and millions of dollars through mineral resources, and in return it was to operate an efficient railway perpetually. Now the railway has cast off half of that service. I do not think the people can forget that, and I do not think the government should forget it either. Governments have been guilty of not making sure the CPR lived up to that arrangement.
In about 1897 or 1898 the CPR was anxious to secure the rich coalfields of British Columbia. Again it presented a proposition to the government, and that led to the Crow rate. I want to read from the actual bill which was assented to on June 29, 1897. I will not read the whole bill. Although the whole bill is worth reading, I will read just two of its clauses. They read as follows:
Subject to the conditions hereinafter mentioned, the governor in council may grant to the Canadian Pacific Railway Company a subsidy toward the construction of a railway from Lethbridge, in the district of Alberta, through the Crow's Nest Pass to Nelson, in the province of British Columbia (which railway is hereinafter called "the Crow's Nest Line") to the extent of eleven thousand dollars per mile thereof, and not exceeding in the whole the sum of three million six hundred and thirty thousand dollars-
There was another three and a half million dollars paid to the railway to permit it to go into the rich coalfields of British Columbia. For that what did the railway promise to do? It said:
That the company will construct or cause to be constructed, the said railway upon such route and according to such descriptions and specifications and within such time or times as are provided for in the said agreement-


Jean-Luc Pepin: And it did.


Gordon Edward Taylor: Listen.
-and, when completed, will operate the said railway for ever;
Forever.


Jean-Luc Pepin: It doesn't say with subsidies.


Gordon Edward Taylor: The bill went on to deal with the particular rates that were to be charged. Here is what the railway promised the rate would be: a special rail freight rate was to be applied to the transportation of export grains and flour from
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shipping points in British Columbia, Alberta, Saskatchewan and Manitoba to Thunder Bay, Churchill and ports in British Columbia. The Canadian Pacific Railway entered into the Crow's Nest Pass Agreement with the federal agreement in 1897. As part of the agreement, the CPR agreed to maintain the Crow rate in perpetuity. Does that not mean forever? It did not mean just until 1982. It said forever, in perpetuity. The CPR received $3.6 million plus a number of other benefits in return for its promise to build a line into the rich coalfields of British Columbia. When I was a boy I used to wonder why everyone would laugh around the coalmines and say of the government, "Well, that is the CPR, isn't it?" They thought the CPR was the Government of Canada. I am beginning to think that too. The CPR apparently tells the government what to do, not the other way around.


William Alexander (Bill) Blaikie: It always has.


Gordon Edward Taylor: The CPR got out of passenger service after it was paid for getting into it. Now it wants to gets out of the Crowsnest Pass rate which it promised to keep in operation forever. I think that is something of which we should be mindful when we start looking at the proposition today.
I want to deal for a moment with the actual condition of the CPR. Perhaps it is poor. Perhaps it has had tough luck. Perhaps it has been beaten by inflation.


Lorne Edmund Nystrom: No, no.


Gordon Edward Taylor: Perhaps it will go on welfare. If it applied, I think it would probably get welfare from the federal government.


An hon. Member:: It is about time it went off welfare.


Gordon Edward Taylor: Let us look at the CPR's record. I have here its 1980 record. The CPR got its starts, as I said, with a gift of $25 million and 25 million acres of land, including mineral rights. In addition, it got another $3.6 million to build the line from Lethbridge to the mineral-rich Kootenay Valley in southern British Columbia. From this start it has expanded into a giant corporation, with current assets in 1980 amounting to $4,362 billion. That is only part of it. The company has properties valued at cost totalling $8 billion plus an investment portfolio exceeding $379 million.


Jean-Luc Pepin: That must be a sin.


Gordon Edward Taylor: It has other assets worth over $289 million.


Jean-Luc Pepin: Shame.


Gordon Edward Taylor: According to CP's actual 1980 report on its current accounts, it is making profits on almost everything. It is down a little with respect to truck transportation and one other enterprise, but on everything else profits are way up. The total profit for the year was very good-so much so that the company was able to provide a dividend of $3.89, I believe to the millions of people who invested in it. The only branch that earned less in 1980 than in 1979 was CP Telecommunications
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March 25, 1982
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and perhaps CP Air. CP Air is going through a bad period and could not be expected to provide much, but it still came up with $2.8 billion. In 1980 the only ones to lose money were CP trucks, CP Rail, CP Telecommunications, CP Air, CP Ships Navigation, miscellaneous hotels, and what have you. Every branch made a profit in 1980 except for CP trucks. They apparently know how to run a railway but they do not know how to run a truck line. They would have been wiser to stay out of the trucking business. They tried to eliminate the competition, but the truckers were too smart. CP is not a poor corporation; it has done exceptionally well. I do not say that it should have lost money. I am a free enterpriser and I like to see people make money. But I also like to see people live up to their agreements and not make their whole purpose in life the pursuit of money.
CP Rail could very well continue operating with the freight rate it agreed to guarantee forever. The profit record shows that it could still operate this way and come out ahead. I think the government has to be very careful about letting the corporation renege again on one of its obligations that it undertook for perpetuity.
I want to deal with some other points now, Mr. Speaker. There is a suggestion, which apparently arises from the annual report, and some farm organizations agree with it, that the shortfall of $3.8 billion should be paid to the railways. I have some misgivings about that. The railways have a pretty bad record of living up to their obligations. If we let them renege on their obligations, as we have done to date, it will be a poor deal and the western farmer in particular will be affected.
In his statement the minister said that there would be a guarantee, but what kind of guarantee, Mr. Speaker? Will it be a guarantee that the railways will not haul coal or sulphur or other minerals and let the wheat wait? I live in a coalmining area and I have seen carload after carload of coal and minerals go by while the wheat already loaded in the cars is not picked up. What kind of guarantee is there that the railways will haul the grain and give the farmers the service that they need?
Agriculture is a big industry in this country, Mr. Speaker. The farmers who raise barley and oats are important; they feed the world. I remember one time being at a meeting where a lawyer got up and said, "I plead for all". Then a minister got up and said, "I pray for all". A farmer got up and he said, "I pay for all." There is a lot of truth in that, Mr. Speaker. The farmer may be a livestock farmer, a beef farmer, a hog farmer, a horse farmer, a barley farmer, a potato or fruit farmer- there are all kinds of agricultural products.
I think the minister and the government should take a long look at agriculture when they are reviewing this plan. It is important that every phase of agriculture receive service. The minister spoke of getting a guarantee from the railway. The Minister of Energy, Mines and Resources (Mr. Lalonde) has referred to an ironclad guarantee. Well, this guarantee should be double ironclad. Like hundreds of farmers in the west, I do
not have faith in the CPR. It has not been fair to the western farmer and it has not lived up to its obligations. Simply paying over the shortfall to the company will not guarantee anything.
Perhaps we should examine the possibility of making the payment to farmers. A payment on an acreage or some other basis would have some merit and should be considered. The farmer could sell his grain wherever he wanted. He could haul it in his truck. He could feed it to his hogs or to his cows. He could send it by truck and compete with the railways. That would make the railways cut the lard out of their operations, if there is any. It would rationalize the whole thing. A lot of things could be done.


The Acting Speaker (Mr. Daudlin):: Order, please. I regret that I have to interrupt the hon. member but his allotted time has expired.


Gordon Edward Taylor: Thank you, Mr. Speaker. I regret it too.


Mr. John Evans (Ottawa Centre):: Mr. Speaker, I almost regret that the time of the hon. member for Bow River (Mr. Taylor) has expired because I always enjoy listening to him. He has such a colourful way of putting across his views. I should like to make some comment about the approach he has taken to this issue, and, more important, about the approach taken by the member of the New Democratic Party who set down the motion.
What is at issue is whether we are going to make the hard decisions that are necessary in order to ensure that we have a rail transportation system in this country for the 1980s, the 1990s, the year 2000 and beyond that will provide the service required by western Canadian producers, to move their products from the point of production to the point of export or consumption. Are we going to worry about the future of this country, or are we going to continually squabble about the past? I for one opt for the future of this country and not the past, as does the Minister of Transport (Mr. Pepin).
A similar and related issue is whether we are going to deal with Canadian problems in a way that will maximize our opportunities, or are we going to squabble amongst ourselves about trying to preserve the status quo? The status quo in western Canada is simply not good enough. There is great potential in western Canada and we must maximize the opportunities there and not squabble about how to preserve the present. Canada has always been a land of opportunity and we must maximize that opportunity.
Those are the issues involved in the Crow rate, the VIA Rail argument and so many other aspects of the discussions that we have had in the House over the last few months. I refer to the issues related to the budget, about whether we are going to get inflation under control or let it get out of control, about whether we are going to take the hard decisions that are necessary if we are going to have a prosperous future. Are we going to do these things or continue squabbling about things past until we find ourselves in a position where we cannot take advantage of the opportunities that we have and cannot
March 25, 1982

compete with the rest of the world? There is no reason whatsoever why Canadians cannot be at the top of the pile rather than half way down it.
Let us look at the Crow rate. What was it originally designed to do? Was it originally designed to be a subsidy? I suggest that it was not meant to be a subsidy. It was meant to be a stabilizing factor, so that farmers could count on a stable rate for the transportation of their product to markets across time. They could count on the rate because it would not fluctuate wildly. Were farmers from 1897 to 1925 to 1940 receiving subsidies from the railroads or from taxpayers? The answer to that is no, they were not. During the period from 1897 to 1925, the rates for handling grain were in fact somewhat below the statutory Crow rate. Farmers paid the full shot for moving grain. This was the same from 1925 and through the 1930s when costs and prices declined dramatically. Farmers were not receiving a subsidy from anyone, and they did not ask for a subsidy from anyone. They were paying the full shot up to 1940. In 1950 the situation was the same. Farmers paid the full shot of moving grain, and they were not asking for a subsidy or a handout.
In 1940 wheat was selling for $28 per metric ton. If we look at the cost of moving grain at that time, which was $4.28 per tonne, the relationship was approximately 17 per cent-the cost to farmers of moving their grain was about 17 per cent of the price of the tonne of grain which was being moved. In 1950, because of the inflationary period during the Second World War and shortly thereafter, the cost as a result of the statutory Crow dropped to 7.2 per cent. From 1950 to 1970 the relationship held constant; the relationship between the price of grain and the statutory Crow stayed at about 7.2 per cent. The cost to farmers relative to the price they were receiving for wheat stayed at about 7 per cent, which was down from 17 per cent during an earlier time. In 1980, when economic conditions changed dramatically in all western countries, the percentage of the cost of moving grain dropped from 7.2 per cent to 2.2 per cent. In the period from 1940 to 1980, the percentage of the total grain price, which in 1980 was $219 per tonne as opposed to $28 per tonne in 1940, dropped from 17.2 per cent to 2.2 per cent. Especially during the period from 1970 to 1980, a very real subsidy was obtained, whether it was a subsidy from the railroads or from Canadian taxpayers, as a result of the purchase of grain hopper cars and other infrastructure, branch line subsidies or whatever.
If we look at the problem of subsidies, we Find that, in the absence of remedial action, it is forecast at present the cost to farmers of transporting grain under the statutory rate, which was 20 per cent of actual cost in previous years, will fall to 12 per cent in 1985 and 7 per cent in 1990. I think that is important and relevant.
I have heard the arguments of hon. members opposite, which I think are false, that one reason for the Crow rate was to offset eastern tariffs which protected eastern manufacturers, that the protective tariff was absorbed by western farmers or westerners generally, even by people in British Columbia, and
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that if eastern manufacturing was to be subsidized by Canadians, then western agriculture should be equally subsidized. Times are changing. We have now entered into a general agreement on tariffs and trade which will substantially reduce tariffs from 1981 to 1985; indeed on some products they will be gone altogether. Is it a valid argument that the justification for the Crow is the existence of tariffs to protect eastern manufacturers? If protective eastern manufacturer tariffs are being eliminated, should there not be an adjustment to the Crow?
I am not a lawyer, but when conditions change dramatically in the area of contract law, is it not true-and I am sure the lawyers in the House will correct me if I am wrong-that it can be raised as grounds for reopening the contract? If conditions change dramatically enough, such that one party is put at an extreme disadvantage with regard to another in a contract, is it not grounds for reconsidering the contract? In some cases I understand that it has been the case.
I would suggest that conditions have changed dramatically. What has changed dramatically? We went from very low rates of inflation and very low increases in the costs of doing business during the 1940s, 1950s and 1960s, to very high rates of inflation during the 1970s, which raised the cost to farmers of moving grain and in all other areas, such as the costs of fuel, seed grain, heating and labour. The costs of all these items rose, but the cost of rail transportation did not. If companies are expected to provide reliable transportation to move products to market, it seems only fair that they should be allowed to earn a fair rate of return, as the hon. member for Bow River indicated earlier. He believed that a fair rate of return should be available. He asked whether he could rely on CPR to move grain. What would happen, for example, if we in the House of Commons in our wisdom decided to tell Ottawa taxi-drivers that for some reason they had to transport Members of Parliament from the House of Commons to their residences at a rate which was only 20 per cent of the cost they could charge anyone else in Ottawa? How long would Mr. Speaker wait if he called for a taxicab from the House of Commons and said that it was for a Member of Parliament?


William Alexander (Bill) Blaikie: What would happen if they were given half of Ottawa?


Mr. Kempling:: What would happen if we paid for their cars and for their gasoline?


John Leslie Evans: It would be an extremely long time, Mr. Speaker. The hon. member for Bow River was concerned about moving grain, and I am concerned about moving grain. I want to see western agriculture and manufacturing being given the greatest possible opportunity. If the railways are able to obtain full tariff for moving potash, coal or other products, if the rail transportation system is already overloaded or running close to capacity and they had a free choice, what kinds of products would they move? They would move the ones on which they get full tariff, and in the case of taxi drivers, they would take passengers other than Members of Parliament.

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The grain is going to sit on the siding, and that is not acceptable. We have to find a way to ensure there is an economic benefit to the transporters to move that grain, and clearly right now there is none. The railroads lose money year after year moving grain when they can be making money moving something else. That is a not a situation difficult to understand for anyone who thinks about economic problems. If we do not allow a fair rate of return on every aspect of a company's business, it will take those areas where it does not make money and shove them aside. Western grain farmers are going to become second-class citizens, and we cannot allow that because we have a great potential in the grain growing regions of western Canada. The grain has to be moved.
In the last two or three years, Mr. Speaker, I have heard it said that because we could not guarantee the movement of grain we have lost as much as $1 billion to SI.5 billion worth of foreign sales.


William Alexander (Bill) Blaikie: If the railways had not been on strike.


John Leslie Evans: Whether it be potash from Saskatchewan government mills, which is competing with grain growers in Saskatchewan and paying the full tariff, by the way-


Mr. Friesen:: I wonder if the hon. member would permit a question.


John Leslie Evans: The hon. member can ask his question at the end of my remarks. There is another point I would like to make, Mr. Speaker. As the hon. member for Bow River said, it is important that those who come to an agreement live up to the agreement; there is more than just money involved, there is honour involved, the obligation to live up to an agreement. I ask all members to consider the following. Last September an agreement was reached between two parties, the Government of Canada and the Government of Alberta. One of those parties is now saying that the agreement is no longer valid. I am not saying it is wrong, but why are they saying that? They are saying it because economic conditions have changed dramatically; the world price of oil has dropped. So, after nine months one party to the agreement says it is no longer valid, we have to renegotiate. And they are taking unilateral steps to force the other party to renegotiate.
I am not condemning that, Mr. Speaker. There might be good and valid reasons for it. However, I am saying that we have one nine-month-old agreement on which it is all right to renegotiate, but we have another agreement which is 84 years old which it is not all right to renegotiate. If economic conditions change, then certainly we are big enough in this country to open our eyes and see the consequences involved if we do not look realistically at the problem and renegotiate agreements which are totally and hopelessly out of date and out of touch with reality.
Were we to stay with the Crow rate as it is now, Mr. Speaker-the total transportation system is going to cover its costs, no two ways about that-what is going to happen is that
because grain farmers are not paying the full cost of moving their grain, the loss the railroads incur is going to be passed on to someone else. That will be the people who move potash, coal and other products. I ask you, Mr. Speaker, is it fair to ask the people moving those other products to absorb that additional cost which in turn may make them uncompetitive in world markets, and which may cost the jobs of people who work in the potash mines, coal fields and in the production of agricultural products not covered by the Crow? Is it fair to Canadian taxpayers generally to ask them to pick up part of that cost? These are questions which have to be asked, and the Minister of Transport has asked the questions.
When I was at the University of British Columbia my colleagues in the transport centre there were telling me the Crow rate has to be examined. No transport minister has had the courage to stand up and take that bull by the horns except for this one, and I applaud him for it. I think the process he has established is a fair one, and we will come up with a fair resolution of this problem. We will have the basis for developing an efficient and effective transportation system to increase and enhance the prosperity which is there to be had in western Canada.


The Acting Speaker (Mr. Daudlin):: I regret to advise the House that the hon. member, having used up all of his allotted time, can only be asked a question with the unanimous consent of the House.


An hon. Member:: No.


The Acting Speaker (Mr. Daudlin):: There is not unanimous consent. The hon. member for Yorkton-Melville (Mr. Nystrom).


Lorne Edmund Nystrom: Mr. Speaker, the hon. member for Ottawa Centre (Mr. Evans) said the Minister of Transport (Mr. Pepin) should be applauded for his actions. I think he is probably the only person doing so because if the minister were to come to western Canada today I am sure he could not beat A1 Capone in an election. That is about how popular the minister is, Mr. Speaker. It strikes me as rather curious to hear four or five Ontario members such as the parliamentary secretary, the hon. member for London-Middle-sex (Mr. Bloomfield) and the member who has just spoken, get up and tell us how they are going to solve all the problems in western Canada. If the Liberal Party is so wise or, as the member says, the best in the west, why are there only two Liberals remaining in western Canada? I can assure you, Mr. Speaker, that if my constituents are any indication, those two members will not be here come 1983 or 1984.


Some hon. Members:: Hear, hear!


Lorne Edmund Nystrom: As my friend says, it could not happen to a nicer guy if it happens to the Minister of Employment and Immigration (Mr. Axworthy).
In addition, Mr. Speaker, it strikes me as rather odd hearing the hon. member for Ottawa Centre speak about the west as if we were back in the caveman's age and hauling our grain to
March 25, 1982

market on this rickety old transportation system which has not changed since 1897 or 1891. That is the impression he tries to leave with the House, that we have not modernized, we have not improved the branchlines or kept up the main line. I am not sure if he is aware, Mr. Speaker, that the farmers of western Canada, the governments of Alberta, Saskatchewan and the Government of Canada have supplied some 14,000 hopper cars to move western Canadian grain. We indeed have modernized the system on the prairies. The Potash Corporation of Saskatchewan, for example, has 1,400 cars moving potash out of our province right now. The reason they have done this is that the railways went on strike many, many years ago in regard to moving grain from the prairies. The last time the CNR bought a boxcar to move grain was about 1947. For the CPR it was way back in 1951. Despite these facts, Mr. Speaker, we have a government across the way which stands up and defends the railways. We heard an excellent speech in the House tonight from the hon. member for Bow River (Mr. Taylor). He spoke about the CPR, concerning all the money it had received, and the promises and agreements it had made to move the farmers' grain forever at a rate known as the Crow rate in this country.
I think, because of the speeches that I have heard here today and the incredible ignorance one sees exhibited on the government side of the House, that it might be very useful to spend a few minutes going over the Crow rate and presenting to the House, in a very positive way, what my constituents are saying to me and what the feelings of western Canadians are. I do this because the Parliamentary Secretary to the Minister of Transport (Mr. Flis) rose in the House this afternoon and admitted that what the government was doing was a very unpopular decision, to use his words. I also remember the Speech from the Throne in April of 1980, when the Prime Minister (Mr. Trudeau) said to the country that despite the fact that the government did not have any elected members from the three western provinces, it would listen to western MPs in the House of Commons. I have gone through two years in this Parliament, and I wonder where the listening is evident, for the government is surely not hearing, if it is trying to listen. No matter where I go in my constituency, whether I speak to farmers or urban dwellers, people in my riding want the Crow rate kept. They see it as a part of the confederation bargain. They see it as a part of our nationhood. Ontario got the tariff protection. Ontario got freight rates which benefited the province. We got the Crow rate in the prairies.
Perhaps it might be useful to spend just a few minutes reviewing briefly the history of the Crow. Transportation has always been a part of national policy in this country, and it should be a part of public policy in Canada. If one looks back to 1881, at that time Canada needed a national railway to link central Canada with the west coast in British Columbia. A deal was struck with the railway companies, back in 1881. In return for building a railway to the west coast, the government gave the railways $25 million at that time, which would be
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worth a lot more now, of course, because the value of the dollar has really diminished in the one hundred and some odd years. As well, the government gave the CPR 25 million acres of land with mineral rights. It gave the CPR many tax exemptions in addition. However, that was the deal and, in return for all the gifts and concessions, the railway was built to open this country and tie the west coast with central Canada.
Some 16 years later, in 1897, the federal government once again wanted to build a railroad. This time, it wanted to build a railway in the southeastern British Columbia end of the Crowsnest Pass. Therefore, once again, the government of the day said, "We will have to strike a deal. We will give you something if you will build a railway."


An hon. Member:: And they gave.


Lorne Edmund Nystrom: The government of the day decided to give the CPR 43.6 million and $3.7 million worth of land. In return, the CPR would do two things. First of all, it would build a railway into southeastern British Columbia. It would also guarantee that the rates on grain moving out of the prairies would be guaranteed for the settlers in the prairies of the day and that rates and settlers' effects moving from central Canada into the west would be regulated for the settlers who were opening up western Canada. That was the deal in 1897.
The hon. member for Bow River has spoken in detail concerning benefits granted to the CPR. One can now look at the CPR and see how it has benefited from this massive deal over the years. The CPR is probably the biggest welfare bum that we have in this country.


Some hon. Members:: Hear, hear!


Lorne Edmund Nystrom: If we had done the wise thing over the years, which any investment person or businessman would have done, we would have taken equity in that railway and the CPR would have become a public utility many years ago and could served the Canadian people.
I would like to continue the history of the Crow, and I hope the hon. member for Ottawa-Vanier (Mr. Gauthier) will listen to this. During World War I, the agreement was suspended. By 1925 the CPR, to the surprise of no one, had persuaded the Liberal prime minister of the day, Mackenzie King, to get rid of the agreement, to cancel the agreement, to throw it out, because the CPR was saying, "We will lose money". That was way back in 1925.


An hon. Member:: Same old song.


Lorne Edmund Nystrom: But what happened in 1925 is something that I hope will happen today, 57 years later, in 1982. From the west, back in 1925, Members of Parliament representing farming and labour got up and debated, arguing to save the Crow. Because Mackenzie King needed political support in western Canada in order to maintain his government, he decided to relent, to call an agreement an agreement, and to save the Crow rate.
At that time, a couple of amendments were made which were very important. The first amendment was that the

March 25, 1982
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railways could not tamper with the rates. In other words, there was a fixed rate for the movement of the farmers' grain on all lines moving the grain out to the ports. The other principle was that there should be equal rates for equal distance. In other words, a farmer in a little town in northern Saskatchewan, like Porcupine Plain in the riding of McKenzie, could ship grain to market for the same price as a person a couple of hundred miles south of the city of Weyburn because they were the same distance from the seaport. That was a very important principle. It meant that the railways could not set social policy by playing off one community against the other.
The other important result from the Crowsnest agreement back in 1925 was that the farmers were given a delivery system and elevators were built. An entire social and economic structure began to flower and flourish across the prairie provinces because there was a fixed rate for the movement of grain. There were no variable rates, so the railways could not play any games. A farmer could pick up the law books of Canada and he would know that he would be charged 18, 19 or 21 cents per bushel for the movement of his grain to the seaport.
What will result from the plan of the Liberal Party which sits across the way? First of all, the Crow will go. So said the Minister of Transport, when one has stripped away all the rhetoric, the flowery wording, the prose and the poetry in his announcement back in February. The minister will do three things. First of all, he will fix a rate for the railways in the statutes. He assures us that the railways of this country will receive guaranteed rates for moving the grain in this country. The railways instead of the farmers will have a statutory rate in Canada.


Some hon. Members:: Shame, shame!


Lorne Edmund Nystrom: The second principle in the Liberal plan is that the producer should pay more. The farmer will pay more to move grain to market. The third principle in the Liberal plan is that there should be no fixed rate for the farmers of Canada. What will be missing, first of all, will be fixed rates under the Crow and, second, there will be no guarantee of equal charges for transporting grain equal distances.
What will be the consequences? The consequences will be very simple. In a few years' time, the effective rate for a farmer moving grain might be doubled or tripled. It will eventually go up maybe 10 or 20 times the present price a farmer pays to move his grain. This will mean that small farmers will be forced off the land. The minister may call that efficient. He may call it economy of scale. However, whatever he calls it, ordinary farmers in my riding will suffer. They will be pushed off the land because they will not be able to afford to farm.
The second consequence, when one considers variable rates, will be that the railway, the CPR, will determine social policy in this country because it will have the right to decide the rate from a certain town to a certain branch line compared to another town on a secondary main line, compared to a third town on a main line. If the rate will be, say, 10 cents or 20 cents a bushel higher on a branch line, farmers will obviously start hauling their grain to a secondary line or a main line, to a
different town, to a different community. Eventually, the elevator will close and the town will fold. The CPR will be making social and economic policy in this country. I say to Your Honour that that is not good enough and it is not right.
I want to mention two other points. The hon. member for Ottawa Centre went on at great length about the importance of being competitive and the importance of being efficient. I agree with him. It is very important that we be competitive and efficient, that we modernize the grain transportation system in western Canada. But I want to say to the member for Ottawa Centre that when we look at the Crow rate we must compare that in terms of a benefit to our farmers with what American farmers, Australian farmers and Argentinian farmers and European and other farmers are getting in other parts of the world. We are in tremendous competition with those countries.
If we look south of the border, for example, we find the Americans have subsidized the grain farmers massively-the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) knows this-in the program they have in the Missouri and Mississippi barge river systems. I think it was about $8 billion or $9 billion that was put into it by the government of the United States of America. They have done that, not only in the building of those systems but in their maintenance, to the tune of over half a billion dollars a year. Judge Emmett Hall said it was about $1 billion a year in terms of payments from the American government to maintain the transport system in the United States of America. From what I hear, in talking with senators and Congress members in the United States, it is not the intention of the American government to diminish those subsidies or to remove them. In other words, if we diminish what we pay in terms of an operating grant or a subsidy to our farmers in terms of the Crow rate and if the Americans do not, then we will be all that less competitive in the world scene, and we will probably sell less grain in the world.
Mr. Speaker, about five weeks ago I had a chance to go to Brussels and speak with the people in the European Common Market. I found that the Europeans give massive subsidies to their farmers. Once again, if they continue to subsidize their farmers and if we reduce the subsidy to our farmers, our farmers will be less productive and will probably sell less grain on the world market. That is important, that is important to all of us in this country, not just to farmers but to people in the cities-in Winnipeg, in Halifax, in Montreal, in Toronto or in Brantford or elsewhere-because the export of grain is a major benefit to all of us. In fact, in the first 11 months of 1981 our exports of grain were some $5 billion. That has a tremendous impact on the over-all wellbeing of all of us as Canadians. Lo and behold, we find the Government of Canada has not done any major studies whatsoever to assess the impact of reducing the Crow rate benefits to western Canada, on the over-all economy, or on the Canadian dollar, on the balance of payments, or on unemployment, or on any of these issues.
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Mr. Speaker, if you look at it just from a competitive point of view, it is very important to all of Canada that we keep the Crow rate and keep it firm in law when other countries around the world give other subsidies to their grain producers. If you look at it from a bureaucratic point of view, the Crow rate system is probably the least costly and the most efficient way to help the grain farmer of any country in the world. We do not need hundreds of bureaucrats sending out cheques to farmers or assessing the income of farmers or assessing the income of the railways. All we need to do is to fix by statute the rate which we have had now for many years, and have that as our way of helping the grain farmers in western Canada.
Mr. Speaker, more and more people are becoming more and more concerned about the lack of real democracy. Once again we see the ugly head of hypocricy rearing itself in this Crow debate. We find a minister wanting to give to his cabinet, through order in council powers, the right to negotiate future increases in what the farmers will have to pay for the sale of grain. So in the future farmers will not have any direct input through their Members of Parliament from western Canada. Farmers will have to rely on the generosity of the sensibility of a federal government to set a reasonable rate for the shipment of this grain.
Mr. Speaker, that is like sending a skunk into the henhouse to collect your eggs. It is no wonder that more and more western Canadians are becoming alienated from the federal institutions that all of us in the House would like to keep, improve and democratize in the years that lie ahead. It is very dangerous that this government wants, once again, to take away from us our rights as Members of Parliament, representing our people, to get up and represent them in the House.


William Alexander (Bill) Blaikie: Thank God it is a statutory right and they cannot take it away, like VIA, without debate.


Lorne Edmund Nystrom: Mr. Speaker, that means that through the waving of a magic wand the Minister of Transport can decide to double the Crow rate, to triple the Crow rate, to put it up by ten times. Look at what they did with VIA Rail. They decided to get rid of all kinds of rail lines for passenger service. We did not have the right to have a committee look at it or study it. Members elected from western Canada did not have the right to get up in the House of Commons and vote-to vote on a bill to reduce the service to this country by VIA Rail.
I think that is dangerous, Mr. Speaker. It is giving awesome powers to government, awesome powers to bureaucrats and regulatory agencies, powers that are dangerous in a democratic society.
Mr. Speaker, the Minister of Transport was in Delisle very recently and got a little preview of the feelings on the prairies. If he is serious about holding this country together, perhaps he will change the bill that he is going to bring into this Parliament next fall and guarantee the Crow for western Canadian farmers.
Mr. Speaker, the government has been talking about all the grants to railways. We have given hundreds of millions of
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dollars to the CPR. We have the CNR, which is supposed to be a publicly owned people's railway. I suggest, in closing-


The Acting Speaker (Mr. Ethier):: I regret to interrupt the hon. member, but I would remind him that his allotted time has expired.
May I give some information to the House. There seems to be an agreement to recognize the hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) for eight minutes; the hon. member for Portage-Marquette (Mr. Mayer) for seven minutes; and then conclude with the hon. Minister of Transport (Mr. Pepin). Is that agreed?


Some hon. Members:: Agreed.


Hon. Alvin Hamilton (Qu'Appelle-Moose Mountain):: Mr. Speaker, in the eight minutes allotted to me I can say all that is necessary. First of all, I have heard the word "subsidy" in this so-called Crow debate too many times to sit silent. Let me say once again that there is no such thing as subsidy in the Crow rates. They are maximum rates. During most of the history of the railways in the whole of Canada, the freight rates paid by the farmers under the Crow agreement were the main profit source of the railways. For decades, 90 per cent of the profits came from the shipping of grain to foreign markets. We carried the people of Ontario and of southern Quebec; we carried the people of British Columbia on our backs, when they were losing money in those areas because of the competition of ships, or trucks that carried goods across the prairies, and when most had a losing operation by taking a profit out of the farmers.
I would prefer the word "subsidy" not used, because it is not a subsidy-and the record shows it.
In 1967, after ten years of intensive study by a royal commission, it was admitted to the House by the then minister of transport that there need be no more mention of the Crow in the House because we had proved for ten years that there were no losses on the Crow rates. These are the facts. No more should "subsidy" be talked about.
Mr. Speaker, a month ago I tried to steer this debate to what I thought was the crux of the situation. I think it has occurred several times today. Rightly or wrongly, the Crow rate in the minds of westerners is part of our Magna Carta, protecting our rights for what we did in opening up the west. No one is going to change that. It is just as sacred as is a constitution that lasts a thousand years. That does not mean it cannot be discussed; but do not try to push it across us that because the railways said they are losing money on the Crow we have to change a solemn agreement made long ago.
I am not going to go into any serious discussion about the Crow. Enough has been said. In my remarks a month ago I made very clear the minimum that would have to be done before there could be discussion. Before the minimum is done, it will be at least 20 years from now. Therefore, the discussion

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led off by the minister's announcement a few months ago is really irrelevant.
What we are doing here today is curious. When the debate was led off by the hon. member for Regina West (Mr. Benjamin), I thought he was making an effort, which was unusual for him, to be constructive and to try to get people to sit down and discuss this rationally. All of a sudden the minister from Winnipeg, the Minister of Employment and Immigration (Mr. Axworthy) suddenly launched a direct frontal attack on the NDP.
I was watching the debate and wondered what was going on. The next speaker was from Saskatoon West (Mr. Hnatyshyn). He smelled something irregular. When you find a minister of the Crown attacking the NDP, knowing how much they owe to the NDP for these last 15 years, you wonder. That member got up and told the story about two cats in Noah's Ark. Members know the story. It is as old as the hills. How are you going to keep the population down in a cramped little ark? Noah appointed a couple of giraffes to look into all the corners and make sure there was no funny business. When they ended the long trip and were going ashore, all the animals left the ark two by two. They were thanked for their consideration for each other. At the end of the row two cats came out.


An hon. Member:: We told that story earlier.


Francis Alvin George Hamilton: I am repeating the story to freshen your minds and to make clear what is going on here. When you have a situation where two cats appear to be fighting in the spring, common sense and experience tells you that they are not always fighting.
When the fight developed this afternoon, I thought it was funny that these two cats should be fighting. When I heard the story being told by the hon. member for Saskatoon West, I thought his intuition was right. It is spring.
All this talk today is only for one purpose. There is a Saskatchewan election in the offing. We wait minute by minute to see when it is going to be announced. It was obvious what the Liberals were doing. How could they help their allies in Saskatchewan? They could not help them by attacking the Conservatives. The only thing they could do was to crucify one of their loyal members. At one time he was the member for Assiniboia. He was the cat who tried to tell the farmers 15 years ago they had to believe in user-pay. He saw his boss, the former minister of transport, go down the drain. He went out and became the Liberal leader. He said he had changed his mind and was now for retention of the Crow. You can imagine Liberal cabinet ministers going out in public and crucifying this Liberal leader in Saskatchewan, saying he was not for retention of the Crow, he was a good loyal Liberal, and what Otto says he follows.


An hon. Member:: Otto, is he still around?


Francis Alvin George Hamilton: He is still around. He is vice-president of a grain company. I am saying that something funny is going on here. When you see two cats fighting, do not always believe what you see. We are simply
going through the preliminary ritual rhumba of an election in Saskatchewan. It is absolutely necessary that the Liberals appear to be opposed to the NDP. If they are not, how are the Liberals out there to know what to do? Now you see the situation, and I leave the answer to the public.
Why is this going on? It is simple to explain. There will be an election in Saskatchewan. What you hear and what you see ain't necessarily so.


Mr. Charles Mayer (Portage-Marquette):: Mr. Speaker, this is a very important debate we are having on this, an NDP opposition day. It is important for many reasons. After having listened to the debate, I find it unfortunate that there should be so much rhetoric and so little light shed on the problem. In many ways it is the responsibility of the government to shed light on this problem.
We all know there is a problem. The railways are not receiving enough money from the movement of grain to adequately compensate them and, as they tell us, ensure that they have enough capacity to move the raw materials that western Canada is capable of producing. Everyone realizes that, including the provinces.
The three prairie provinces have been involved. They have either bought or leased hopper cars. The federal government, to its credit, has recognized the problem. It has been involved in purchasing hopper cars and in a boxcar rehabilitation program. The producers have recognized the problem and, through the Canadian Wheat Board, have bought hopper cars to assist with capacity.
The lead speaker for the government was the minister from western Canada, the only elected member of the cabinet from western Canada, the Minister of Employment and Immigration (Mr. Axworthy). I found it unfortunate that he did not set a little higher tone for the debate. He talked about enormous export increases for western Canada as a result of changing the Crow.
A lot of producers and members of this House would have been very interested to hear him tell us where these enormous increases will come from. He could have explained to us and the producers why a change in the Crow will have the effect of increasing exports. If it is going to increase exports, everyone would be in favour, but they would like to know why. We would also like to have been told that when we have the increased capacity to move grain and raw materials to export position, the government will be willing to follow through and look after Canadians in terms of the way we trade with other countries. We all know we had serious problems in the last series of GATT negotiations and how they ended up. It is true that many tariff barriers were lowered. For a period of eight years we are going to move to lower tariffs. We also know there are many non-tariff barriers which prevent Canadians from competing in markets such as the European Common Community and Japan.
If our government had seen fit to see that agriculture was better represented at those negotiations, it would be a lot easier
March 25, 1982

for producers and members from western Canada to have some faith and have trust in what the government is doing.
The hon. member for Yorkton-Melville (Mr. Nystrom) pointed out that in many ways it is interesting that when we have this debate on a purely western issue the government does not really have any western members to stand up and talk about what it is intends to do in terms of western Canada. Today we heard from a parliamentary secretary, the hon. member for Parkdale-High Park (Mr. Flis) who was born in Saskatchewan but has lived in eastern Canada for a long time. A lot of western people watching this debate on TV and subsequently looking at Hansard will find it curious that that kind of member has to stand up on behalf of the government and tell us why in western Canada we have to do things differently.
In many ways I find it unfortunate that we should have the rancour, bickering and politicking going back and forth that we had today. That does not shed any light or give guidance to people genuinely concerned about the issue from a factual point of view.
That obligation does not end at the federal level. If we set a proper tone for the discussion and discussed it in terms of the issues and facts, it will be reflected back to the people we represent. On the same basis, the provincial governments have a responsibility. I find what the Premier of Saskatchewan said, as long ago as 1977, unfortunate. I will quote from an interview broadcast on CBC telelvision on Friday, May 20, 1977, close to five years ago. He said:
Because we believe that farmers are entitled to the Crow rate but we think that under certain circumstances, at some future time, the case might be made for increasing the level for Crow, provided that it was given the same statutory protection.
Clearly, as long as five years ago, the Premier of Saskatchewan was suggesting that there could be changes in the Crow. We all know that in the last four or five months he has continued to say that he is prepared to look at changing the level of the Crow. Yet when it comes time to review that, he takes an entirely opposite position.
I think it is unfortunate in many ways because, as I said, it does not shed a lot of light or provide much insight into the problem. It only confuses the issue.
This is a very serious matter for western Canada. It will have a profound effect on us for many years to come. I think it is the obligation of everyone, particularly the government since it is responsible for governing the country, to see that this decision is made with as much diligence as we can provide in Parliament.
I feel it is important to repeat that it is unfortunate today that we could not have had a discussion at a different level with respect to these problems and provided some solutions which would increase our productivity and our ability to contribute to Canada, instead of the politicking and rhetoric which we have witnessed.
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I would like to close by simply saying that we all agree that there is a problem. I believe that it is up to us all to see that this problem is solved in a fashion which will benefit western Canadians with the best possible results. If this is achieved, it will result in a great benefit to all of Canada.


Jean-Luc Pepin: Mr. Speaker, I will try to maintain the high degree of debate which the hon. member for Portage-Marquette (Mr. Mayer) longs for.
This is chapter two in our series on western rail transportation and the Crow rate. I am sure that there will be many other chapters before we come to the end of this debate-


An hon. Member:: You can be sure of that.


Jean-Luc Pepin: -hopefully, by the fall, when we will be in a position to give westerners a much better statute for transportation of their grain than they have now.
At present, they have a statute which obliges them to pay only half a cent per ton mile but there is no equivalent obligation on the part of the railways to transport the grain. This is the root of the problem which we are faced with now. This is why the federal government had to take action in the recent past and buy hopper cars and proceed to branch line rehabilitation along with the other events which have taken place in recent years. I read recently that the Crow rate was dead from the moment the federal government had to begin buying hopper cars.


An hon. Member:: I think so.


Jean-Luc Pepin: During the debate on February 26 I tried to explain why we have to enhance the condition of the main line in the west and why we believe that the farmers will have to make a greater contribution to the transportation of their grain than they do now. I tried to answer the questions as to what guarantees the railways would have to give, which would be immensely greater than they give now.
Of course, I emphasized the great contribution that the federal government would be making through adding $1.3 billion to the $1.8 billion for four years already committed by it to grain transportation.
What has happened since our announcement on February 8 in Winnipeg? A moment ago, one of the members of the Conservative Party complained that they were not given much attention. The reason for that is quite obvious. We are sympathetic to their position because they are totally divided and, being charitable people, we do not want to exploit that situation. That is why we pick on our friends in the NDP, because at least they are offering a target which the Conservatives, unfortunately, are not.
I am just pointing out to the hon. member for Portage-Marquette that it is the NDP which have provided the opposition to us on this matter. It is not particularly the federal NDP either; opposition has come primarily from the Saskatchewan provincial NDP partly because of a certain election-as the

March 25, 1982
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hon. member for Qu'Appelle-Moose Mountain (Mr. Hamilton) indicated-which may take place in that particular province in the near future.
I have found what they have been saying to be rather interesting and I have been following what has been said in all the papers. As you know, Mr. Speaker, I am of the class of '63 in the House-I recognize I have been on holidays for nearly seven years-but for the past 20 years I have seen my party subjected to the daily moral reprimands of those political monks and nuns who form the New Democratic parliamentary wing. Well, I have news for you. They are not beyond temptation and they are not beyond sin. We have had an illustration of that today. They have a way of occasionally powdering figures and powdering concepts, which is really their trademark. We saw evidence of that today. They have found a way to distort the 1880 and 1897 agreements, the Canadian Pacific and Government of Canada railway construction agreement of 1880 and the Crowsnest agreement of 1897. I do not need to display my intellectual capacity because these distortions have been proven in many books and articles. There is a recent one on Sifton which corrects all the interpretations made by the member for Yorkton-Melville (Mr. Nystrom), who looks like a Rhodes scholar and probably was one. What the NDP are repeating today are perceptions which have been found to be incorrect in history and which a number of authors have debunked.


An hon. Member:: Tell us about the shares in Power Corporation.


Jean-Luc Pepin: You see, that is a very intelligent argument. It has been used in Saskatchewan. Somebody said that it was because I served on the board of Power that I was supporting CP in this matter since Power has shares in CP. This is nasty, brutish, short and particularly immoral because when I was on the board of Power it did not have a share in CP. These are the kinds of arguments that are made by those saintly people over there who take pride in being superior to everyone else and in this particular instance, as in many, really lie. I find that remark particularly disagreeable and nasty.


Some hon. Members:: Hear, hear!


William Alexander (Bill) Blaikie: Tell us about Ottawa Pioneer Grain. Tell us that has nothing to do with this.


Jean-Luc Pepin: We have heard again this afternoon certain interpretation of the meaning of the Hall Commission. Hall has suddently become a great expert on the Crow. When you read the book, you find he has hardly four or five pages on the subject, and some of it is contradictory. Nevertheless, this is the rewriting of history that the members from the NDP resort to. There is a quote which I will have to refer to next time, a feuilleton, which says that this government will introduce the variable rates in Saskatchewan. This is being repeated every day. The Prime Minister was in Saskatchewan recently and said that if western farmers do not want variable rates, there will be no variable rates. They keep repeating that, and I have it here. It reads:
The Pepin plan eliminates a fixed rate in law for the movement of grain and it eliminates equal rates for equal distance.
That is not true. I hope that it is parliamentary, when it is true, to say, and there is no other way to say it, that it is a lie.


Erik Nielsen: Like double tracking.


Jean-Luc Pepin: That is true. It is being done now.
To continue with this statement, it said:
In doing so, it threatens the social and economic fabric of rural Saskatchewan.
So the introduction of the variable rates which most probably will not be introduced-


Some hon. Members:: Oh, oh!


William Alexander (Bill) Blaikie: Most probably?


Jean-Luc Pepin: We have not done it. The point I want to make is that that concentration or consolidation is a phenomenon which has already taken place in Saskatchewan. Perhaps a few figures will illustrate that. The number of permits in the west has gone done from 200,000 to 140,000. The sizes of farms have grown. There has been a reduction in the number of country elevators from 5,200 in 1970 to 3,090 now. The number of delivery points has also been reduced, from 1,835 in 1970 to 1,245 now. There has been a reduction in the number of grain companies. That consolidation which hon. members opposite fear we might bring about already exists in the west. This is not something that the "dirty" Liberals or "nasty" Liberals or "immoral" Liberals are going to create. This is something which already exists. Why does it exist? It exists for a number of reasons. The economics of primary elevators is one of those reasons. As elevators have become obsolete in the west they have been replaced by bigger ones with better health standards, better working conditions and what not. Indeed, some smaller elevators have disappeared and a number of social entities have been downgraded because of their disappearance. That is a fact of life. This was not created by variable rates or a reduction of the Crow rate, which has not yet taken place.
I love to read at night, and I have been reading some material from Mr. Justice Hall. He said this:
Rural electrification has no doubt had the most significant positive social impact on rural life . . . Due to the ability to keep bread, fresh vegetables and fruits for a longer period, these commodities were purchased in greater quantity, farther from home leading to the closing of local bakeries and stores.
The phenomenon of consolidation has been studied by Mr. Justice Hall. I repeat, it did not take place today. It will not take place in the future. It has already taken place. It is due to a number of factors, some of them economic and some of them social. For example, some consolidation has taken place by virtue of action taken by the province of Saskatchewan. It is the Saskatchewan government which has presided over the concentration of schools and the elimination of schools where there were not enough students. It is the Government of Saskatchewan which has contributed to the concentration of
March 25, 1982

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social services, hospital services and the like. I have all the figures here for those who would care to have them.


Mr. Blais:: They don't care.


Jean-Luc Pepin: This consolidation has also been the will of the people of Saskatchewan. It was not imposed on them. This afternoon we were told we presided over the destruction of rural life in Saskatchewan-for something we have not done yet, by the way-because of something which took place when the Crow was still in existence. Hon. members opposite should think a little bit.


Jean-Jacques Blais: Impossible.


Jean-Luc Pepin: Hon. members should listen to what Mr. Justice Hall said on this particular point because it is beautiful. This concentration of rural life in Saskatchewan, as he said:
-took place, not as a part of a planned development-
Not because of nasty politicians.


Lorne Edmund Nystrom: Liberal politicians.


Jean-Luc Pepin: Listen to that scholar.
-but as a result of many people making individual decisions on where they wished to shop, do business and socialize.
It was because they wanted to do it.
It is the people and the spirit of the people which gives the community viability, not the railways nor the elevators.
Consolidation is a decision of the people in Saskatchewan. They made these decisions before there was any possibility of reducing the Crowsnest rate or of having variable rates. And again, that decision has not yet been taken. I cannot judge all the things members of the New Democratic Party do, but in this matter they are really misinforming the public when they say that increasing the Crow rate will destroy rural life in Saskatchewan.
There are many things I would like to say. One argument to which 1 took exception is that part of the resolution which says that the government is failing to enhance national unity. I take exception to that. Why? The hon. member for Dauphin (Mr. Lewycky) accused us of working "to the detriment of the west". He accused the Minister of Employment and Immigration (Mr. Axworthy) of being a bad westerner.


An hon. Member:: Right on.


Jean-Luc Pepin: I have some quotes here. Who was the man who said-


The Acting Speaker (Mr. Ethier):: Order, please. It being 9.45 p.m. it is my duty to interrupt proceedings and to put forthwith every question necessary to dispose of supplementary estimates (E) and interim supply and to adopt all stages of any bills based thereon.


MOTION FOR CONCURRENCE IN SUPPLEMENTARY ESTIMATES
[Stage Direction]
(E)
Donald James Johnston: That Supplementary Estimates (E), 1981-82, laid upon the Table Thursday, March 18, 1982, be concurred in.


The Acting Speaker (Mr. Ethier):: Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


William Alexander (Bill) Blaikie: On division.


[Stage Direction]
Motion agreed to.
Mr. Johnston thereupon moved that Bill C-99, for granting to Her Majesty certain sums of money for the public service for the financial year ending March 31, 1982, be read the first time and printed.
Erik Nielsen: Mr. Speaker, I wonder if the minister would provide the usual assurances that there is nothing contained in the bill which exceeds the requests which are contained in the estimates.
While he is doing that, would he please indicate the size of the aggregate contingency fund that is now available to the government?


Donald James Johnston: Mr. Speaker, there is nothing contained herein that exceeds the amount provided for in the estimates. I am not clear what point the hon. member for Yukon (Mr. Nielsen) is making with respect to the government's contingency fund.


Erik Nielsen: Well-


The Acting Speaker (Mr. Ethier):: This discussion can be carried out only with the unanimous consent of the House. There cannot be debate or questions at this time. If there is unanimous consent, I can recognize the hon. member for Yukon (Mr. Nielsen) again.


Some hon. Members:: Agreed.


Erik Nielsen: Mr. Speaker, this is a customary question which is always put at this stage of the proceedings.


An hon. Member:: During Committee of the Whole.


Erik Nielsen: I was simply interested in having the President of the Treasury Board (Mr. Johnston) indicate to hon. members what is the total amount available to the government by way of the aggregate contingency fund at this time.


The Acting Speaker (Mr. Ethier):: Is it the pleasure of the House to adpopt the motion?


Some hon. Members:: Agreed.

March 25, 1982
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[Stage Direction]
Motion agreed to.
Mr. Johnston thereupon moved that Bill C-99, for granting to Her Majesty certain sums of money for the public service for the financial year ending March 31, 1982, be read the second time and referred to Committee of the Whole.
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Ethier in the chair.
Clauses 2 to 7 inclusive agreed to.
Schedule agreed to.
On Clause 1-short title
Erik Nielsen: Mr. Chairman, I wonder if the President of the Treasury Board could answer my question now. What is the total aggregate of the contingency fund now available to the government?


Donald James Johnston: Mr. Chairman, I am still not altogether clear. I presume the hon. member for Yukon is referring to Treasury Board Vote 5 with respect to the contingency that exists in the Treasury Board vote which is ultimately required for salary shortfalls. I do not recall this question having been asked before and I do not know why it should be pertinent at this particular time.


Erik Nielsen: Mr. Chairman, it certainly is pertinent because the schedules speak of a contingency fund in net terms. I am simply asking the President of the Treasury Board, who should have the information at his fingertips, what the total aggregate of the contingency fund is which is available to the government at this time. He should have this information if he is up on his job.


Yvon Pinard: Mr. Speaker, there is no cause for debate. The first question was customary, the second is not. I suggest that the hon. member have his question put on the Order Paper and that we proceed in accordance with Standing Order 58(10).


Donald James Johnston: Mr. Chairman, as the hon. member for the Yukon probably knows if he has examined Treasury Board Vote 5, he will see that the amount of the main estimates provided for was $220 million and that $60 million additional was provided for in Supplementary Estimates C, if that is the question he has asked.


Erik Nielsen: No, it is not the question I asked, but I will not hold up matters. Indeed, I cannot. It surprises me that the President of the Treasury Board would not be able to come forward with a global figure as to what the contingency fund is. I am sure the taxpayers of the nation would be very interested to learn what is in the sock for the government, that it does not have to bring before parliament in order to meet its obligations from time to time.


Donald James Johnston: Mr. Chairman, I hate to delay proceedings on this point but it is well known to members of the House that Treasury Board Vote 5 is specifically there to cover salary costs in particular. A certain amount is placed in the main estimates each year with respect to anticipated salary cost movements across government. The contingency fund to which the hon. member refers is contained in Treasury Board Vote 5 and is allocated specifically to meet costs in excess of the amounts provided for in the estimates. That has to do with the entire collective bargaining process, and that has been the situation for many years.
I mentioned a moment ago that the amount provided for in the main estimates was $220 million, which was supplemented in Supplementary Estimates (C) by an additional $60 million, so the total amount of Treasury Board Vote 5 for the year 1981-82 was $280 million.


Erik Nielsen: Mr. Chairman, it is wrong for the President of the Treasury Board to misconstrue my comments in that fashion. In my question I was referring to the total contingency fund available to government. If he is not prepared to give me that answer now, that is his option. I certainly do not intend to hold up proceedings tonight and I certainly do not intend to put the question on the Order Paper because it would never be answered.


Donald James Johnston: Mr. Chairman, I do not want to hold up proceedings either. It is not clear to me that the hon. member knows what he is talking about. In any event, he will have ample opportunity to speak to me either privately or to question me in the House or when I appear before the committee. I will be very pleased to answer any questions in that regard. I must say, however, that the only contingency fund with which I am familiar as President of the Treasury Board is Treasury Board Vote 5, with which I expect the hon. member for Yukon is also familiar.
Clause 1 agreed to.


[Stage Direction]
Preamble agreed to.
Title agreed to.
Bill reported.
The Acting Speaker (Mr. Ethier):: When shall the bill be read for the third time? By leave, now?


Some hon. Members:: Agreed.


Donald James Johnston: that the bill be read the third time and do pass.


[Stage Direction]
Motion agreed to, bill read the third time and passed.

Donald James Johnston: That the House concur in Interim Supply as follows:
March 25, 1982

That a sum not exceeding $8,786,438,129.08 being the aggregate of:
(a)	three-twelfths of the total of the amounts of the items set forth in the Estimates for the fiscal year ending March 31, 1983, laid before the House of Commons on February 23, 1982, $7,667,738,200.25;
(b)	an additional six-twelfths of the total amount of Economic Development Item 1, Transport Item L40 and Treasury Board Items 5 and 10 (Schedule A) of the said Estimates, $217,930,900.00;
(c)	an additional four-twelfths of the total amount of Environment Item 15 and Labour Item 5 (Schedule B) of the said Estimates, $19,107,733.33;
(d)	an additional three-twelfths of the total amount of Transport Items 20, 35, 65 and 80 (Schedule C) of the said Estimates, $189,073,750.00;
(e)	an additional two-twelfths of the total amount of Communications Items 5, 15 and 45, External Affairs Item 25, Indian Affairs and Northern Development Items 15 and 35, National Health and Welfare Item 40, Public Works Item 55, Secretary of State Items 30 and 40, Transport Item 25 (Schedule D) of the said Estimates, $144,821,666.67;
(/) an additional one-twelfth of the total amount of Agriculture Item 15, Communications Items 1 and 75, Consumer and Corporate Affairs Item 1, Employment and Immigration Item 20, Energy, Mines and Resources Items 1 and 15, External Affairs Items 1 and 35, Governor General Item 1, Indian Affairs and Northern Development Items 40, 45 and L50, Industry, Trade and Commerce Items 5, 10 and L30, Secretary of State Item 1, Supply and Services Item 1, Transport Item 45 and Veterans Affairs Item 25 (Schedule E) of the said Estimates, $547,765,878.83; be granted to Her Majesty on account of the fiscal year ending March 31, 1983.


The Acting Speaker (Mr. Ethier):: Is it the pleasure of the House to adopt the said motion?


Some hon. Members:: On division.


[Stage Direction]
Motion agreed to.
Mr. Johnston thereupon moved that Bill C-100, for granting to Her Majesty certain sums of money for the public service
Supply
for the financial year ending March 31, 1980, be read the first time and printed.
Motion agreed to.
Donald James Johnston: that Bill C-100, for granting to Her Majesty certain sums of money for the public service for the financial year ending March 31, 1983, be now read the second time and referred to Committee of the Whole.


[Stage Direction]
Motion agreed to, bill read the second time and the House went into committee thereon, Mr. Ethier in the Chair.
Denis Éthier: Shall Clause 2 carry?


Some hon. Members:: Agreed.
Clause 2 agreed to.
Clauses 3 to 5 agreed to.
Schedules A, B, C, D and E agreed to.
Clause 1 agreed to.


[Stage Direction]
Title agreed to.
Bill reported, read the third time and passed.
The Acting Speaker (Mr. Ethier):: It being three minutes past ten o'clock, the House stands adjourned until tomorrow at 11 a.m. pursuant to Standing Order 2(1).
At 10.03 p.m., the House adjourned, without question put, pursuant to Standing Order.

Friday, March 26, 1982