1982-02-18

ROUTINE PROCEEDINGS


Mr. G. M. Gurbin (Bruce-Grey):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43.
On Wednesday, October 10, 1979, the House unanimously accepted a motion which reflected the understanding of members of all parties of the impact of high interest rates and inflation on Canadians in all walks of life. The prime rates then were 15 per cent and inflation was 9 per cent. Today prime rates are 17 per cent and inflation is 12 per cent.
1 therefore move, seconded by the hon. member for Etobicoke Centre (Mr. Wilson), the exact same motion proposed on October 10, 1979, by the hon. member for Windsor West (Mr. Gray), seconded by the hon. member for Saint-Maurice (Mr. Chretien), and consistent with remarks made by the Minister of Finance (Mr. MacEachen) in the House yesterday, February 17, 1982:
That this House immediately order its Standing Committee on Finance, Trade and Economic Affairs to be set up and that the committee undertake an immediate review of the interest rate policy of this government and of the Bank of Canada, and that for this purpose the governor of the bank and the Minister of Finance appear before it to explain their actions and what they will be doing to solve the problems the governor of the bank himself said interest rates are now causing for individuals and to business.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


LABOUR CONDITIONS
Mr. Joe Reid (St. Catharines):: Madam Speaker, in January, 1980, the unemployment rate in St. Catharines-Niagara
was 10.1 per cent; in January, 1982, that rate increased to a record high of 15.6 per cent; in February, 1980, the seasonally adjusted rate of unemployment was 7.5 per cent, and in January, 1982, the seasonally adjusted rate of unemployment was 8.3 per cent.
Therefore 1 move, seconded by the hon. member for Erie (Mr. Fretz):
Thai the Minister of Employment and Immigration make a statement on motions accounting for the increase.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE CONSTITUTION
Mr. Jim Peterson (Willowdale):: Madam Speaker, 1 rise pursuant to Standing Order 43. Whereas the House of Commons of the United Kingdom yesterday gave overwhelming approval, with the support of all official parties, to second reading of The Canada Bill, I move, seconded by the hon. member for Guelph (Mr. Schroder):
That this House extend its gratitude to the British House of Commons for speedy passage on second reading and for the thoughtful contributions to debate by numerous members; and further, that we look forward to their continued co-operation with regard to the remaining stages of our new constitutional bill.


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


INDUSTRY
Mr. Lome Nystrom (Yorkton-Melville):: Madam Speaker, I rise under the provisions of Standing Order 43. Considering that the government's move to lift import quotas on leather footwear is having very negative effects on the footwear indus-

February 18, 1982
try in this country, and considering that a Quebec work group on footwear made up of labour, business and provincial government representatives, has appealed to the federal government to move to prevent an expected loss of 3,000 jobs in Quebec alone, 1 move, seconded by the hon. member for Selkirk-Interlake (Mr. Sargeant):
That this House urge the government to accede to the work group's demand by limiting global imports of leather shoes to 40 million pairs.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


RAILWAYS
Mr. Len Gustafson (Assiniboia):: Madam Speaker, the Liberal Party promised to double track the entire CN main line from Winnipeg to Vancouver by 1988 for $800 million. It will now take until 1993, at a cost of $2.3 billion. I therefore move, seconded by the hon. member for Bow River (Mr. Taylor):
That the Minister of Transport make a statement on motions accounting for the increased cost and time.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


CANADA POST
Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, on January 1 of this year the rate for mailing a first class letter increased by 76 per cent to 30 cents. I move, seconded by the hon. member for Prince Edward-Hastings (Mr. Ellis):
That the minister responsible for Canada Post make a statement on motions explaining when, during the last election, the Liberal party told the Canadian people that such a massive increase would be implemented when it was returned to office.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. Girve Fretz (Erie):: Madam Speaker, in February, 1980, the inflation rate was 9.4 per cent; in December, 1981, the inflation rate was 12.1 per cent. I therefore move, seconded by the hon. member for St. Catharines (Mr. Reid):
That the Minister of Consumer and Corporate Affairs make a statement on motions explaining the reason for this horrendous increase.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


RESOURCES
Hon. Roch La Salle (Joliette):: Madam Speaker, I rise on a matter of urgent and pressing necessity, under the provisions of Standing Order 43.
In February 1980, the price of heating oil per gallon was 69 cents. In December 1981, the price per gallon rose to $1.22. Since new tax measures introduced by the federal government are responsible for 80 per cent of the increase, I move, seconded by the hon. member for Provencher (Mr. Epp):
That the Minister of Energy, Mines and Resources (Mr. Lalondc) make a statement on motions to indicate exactly when, during the last election campaign, the Liberal Party told Canadians that the price of heating oil would increase by 75 per cent in the two years following re-election of the present government.


Madam Speaker:: Under the provisions of Standing Order 43, this motion requires the unanimous consent of the House. Is there unanimous consent for this motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Hon. Bud Cullen (Sarnia-Lambton):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Last weekend at a meeting of the PC Metro Association, the hon. member for Etobicoke
February 18, 1982

Centre (Mr. Wilson) was telling his fellow party members that they should be praying for the success of Reaganomics. Then in a speech to the Canadian Club in Montreal the hon. member was quoted as saying that he agreed with the economic policy of the Minister of Finance (Mr. MacEachen) that lowering interest rates would drive the value of the dollar down and lead to higher inflation. The hon. member went further and said that he did not agree with the provincial premiers, and that there was no quick fix. Therefore I move, seconded by the hon. member for Willowdale (Mr. Peterson):
That this House congratulate the hon. member for Etobicoke Centre for his effort to publicize the government's common sense monetary policy, and encourage him to preach to his fellow party members the same truth to which he has now become a convert.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


GOVERNMENT'S INTEREST RATE POLICY-MOTION UNDER
Mr. Nelson A. Riis (Kamloops-Shuswap):: Madam Speaker,
I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Arthur Laffer, the guru and key initiator of President Reagan's high interest rate policy, has now joined the growing ranks of financial and economic pundits advocating the abandonment of Reaganomics' high interest rate policy. Therefore I move, seconded by the hon. member for Spadina (Mr. Heap):
That the House urge the Minister of Finance to follow Laffer's recommendations and take the necessary steps to establish a made-in-Canada interest rate policy and to stop our lemming-like journey to financial and economic suicide.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


NATIONAL ENERGY PROGRAM
Mr. David Kilgour (Edmonton-Strathcona):: Madam Speaker, since the introduction of the national energy policy I am informed that oil exploration activity has dropped by 30.4 per cent. In the absence of the Minister of Energy, Mines and Resources (Mr. Lalonde), 1 move, seconded by the hon. member for Assiniboia (Mr. Gustafson):
That the Prime Minister make a statement on motions explaining when during the last election campaign he told the Canadian people that the return of a Liberal government would give such a body blow to the prospects for Canadian oil self-sufficiency.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE PRIME MINISTER
Mr. John Bosley (Don Valley West):: Madam Speaker, on January 12, 1980, the Prime Minister (Mr. Trudeau) said that the Liberal Party "will not simply stand by and let the
recession come." Indeed it did not; instead it brought in a budget to make the recession come faster. Therefore I move, seconded by the hon. member for Cambridge (Mr. Speyer):
That the Prime Minister make a statement on motions stating when he will fulfil his other campaign promise-"Elect me and I'll resign".


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


MINISTER OF MANPOWER AND IMMIGRATION
Mr. Terry Sargeant (Selkirk-Interlake):: Madam Speaker, I rise under the provisions of Standing Order 43. The Minister of Employment and Immigration (Mr. Axworthy) recently distributed 8 by 10 black and white photographs of himself, with instructions that the handsome portraits be hung on CE1C walls across the country. There are 1.2 million unemployed people in Canada today who would rather look at a board full of job listings than the face of the minister, photogenic though it may be. It was customary in days gone by for pictures of the Queen, the Governor General or the Prime Minister to hang in government buildings. Therefore I move, seconded by the hon. member for Skeena (Mr. Fulton):
That the minister come out of the closet and inform the House whether this distribution of his photo is in anticipation of his becoming Prime Minister, or of his succeeding the present occupant of Rideau Hall, or has he aspirations to become the Queen of Canada?
[Editor's Note: And the Prime Minister having entered the Chamber.]


Some hon. Members:: Hear, hear!


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


Some hon. Members:: Agreed.


Some hon. Members:: No.

February 18, 1982
Oral Questions



ORAL QUESTION PERIOD


Hon. Michael Wilson (Etobicoke Centre):: Madam Speaker, it is hard to look at the smiling faces on the other side and to understand how they can sit there with the blood of all Canadians on their lapels.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: My question is for the Minister of Finance. 1 point out to him that the motion just put by the hon. member for Bruce-Grey proposing that a reference be made to the standing committee on the whole question of interest rates was the identical motion put by the Minister of Industry, Trade and Commerce when he was Finance critic for the Liberal Party a few years ago. At that time interest rates were substantially lower than they are today and those interest rates had done considerably less damage to the economy of the country than the interest rate policy being followed by this government. My question is very simple. Why could the minister not support that motion?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, if the hon. member wants us on this side to support motions moved under the provisions of Standing Order 43, 1 think it would be wise for him to have his colleagues consult in the usual way so that we can assess whether it is appropriate to give that support.


DECLINE IN VALUE OF DOLLAR-GOVERNMENT POSITION
Michael Holcombe Wilson: Madam Speaker, that is an absolute cop-out. The minister could understand that motion. He did not need to have any part in negotiations. He knows the damage which has been done, and he should have had the motion accepted. It is as simple as that.
During the 1980 election campaign, the Liberal Party ran on an election platform of lowering interest rates. Clearly this was a gross deception on the Canadian people. In fact this government's policies have led to much higher interest rates because of the need to defend the Canadian dollar as a result of a record flight of capital.
Since we have seen the decline in the value of the Canadian dollar, from 85 cents in terms of the U.S. dollar at the time of the budget to a current level of just over 82 cents, would the minister tell the House today whether this represents a fundamental change in the interest rate policy of the government, or is it simply a reflection of the opinion of most Canadians that the 1981 budget was an absolute disaster?


Allan Joseph MacEachen: Madam Speaker, when it comes to opinion about the budget, the place to test that opinion is in the House of Commons.


Mr. Crombie:: What about the country?


Mr. Clark:: Answer the question.


Allan Joseph MacEachen: On two occasions the budget was tested through non-confidence motions by members of the opposition. On these two occasions the budget was approved.


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: As hon. members learned in December, 1979, one test is enough. Two is terrific.


Some hon. Members:: Hear, hear!


Michael Holcombe Wilson: Madam Speaker, I think it will be very clear to the people who are in the galleries that the minister totally avoided answering the question put to him. Let me try another question.


Mr. Dick:: You had better keep it simple.


CANADIANIZATION PROGRAMS
Michael Holcombe Wilson: Madam Speaker, this question is for the Prime Minister. In the last week of the 1980 election campaign the government announced a package of policies which have proved disastrous. They have resulted in a record flight of capital from Canada, record unemployment, and record interest rates. In order to avoid setting any more records, for which all Canadians are paying very heavily, would the Prime Minister commit himself to the House that there will be no extension of the National Energy Program into other industries, no extension of the Foreign Investment Review Agency as was threatened during that campaign, and no further nationalization of the oil and gas industry during this Parliament? Would the Prime Minister commit himself on that to this House today?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, we have already been quite explicit in terms of Canadianization. Our objective is to reach 50 per cent of ownership or control by 1990. As for the other items, the foreign investments item and Canadianization generally, the hon. member will find the precise answers in the white paper which was tabled at the time of the budget. As for the other foreign investment items and Canadianization generally, you will find the precise answers in that white paper which was deposited at the time of the budget, which I commend to the hon. member as very worth-while reading if he wants to know-


Michael Holcombe Wilson: Make the commitment in this Parliament.
February 18, 1982


Pierre Elliott Trudeau: -how this country can be developed, and in what ways he could assist rather than always being negative.


LEVELS OF UNEMPLOYMENT IN AREAS OF ONTARIO
Hon. Sinclair Stevens (York-Peel):: Madam Speaker, my question is directed to the Prime Minister, as well. In view of the tragic economic circumstances in this country today, especially in Ontario where we find unemployment of 20,000 in Windsor representing 16.3 per cent of the work force, another
22,000	in the Niagara area which represents over 15 per cent of the work force, and likewise in Kitchener-


Some hon. Members:: Order.


Sinclair McKnight Stevens: -would the Prime Minister indicate why he permits that type of unemployment in those areas which, by coincidence, happen to be represented by Liberal Members of Parliament? Is he simply counting on the fact that they must sit muted within his caucus and certainly not vote against his government to represent their constituents properly?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, in his rather twisted logic I understand the hon. member is suggesting that we should bring particular help to areas represented by Liberals. I think that if we were to do that, he would accuse us of favouritism.


QUERY RESPECTING POSSIBLE RESIGNATION OF PRIME MINISTER
Sinclair McKnight Stevens: Madam Speaker, I think the figures are self-evident. The fact is that the worst unemployment areas in Ontario happen to be those represented by Liberal Members of Parliament who do not stand up in this House and speak on behalf of their constituents.


Some hon. Members:: Hear, hear!


Sinclair McKnight Stevens: Madam Speaker, again if I may ask the Prime Minister, surrounded as he is by his colleagues bedecked with their red carnations, would he at least indicate today that he will keep one promise he made during the election campaign, which is that if elected he would resign? When may we expect that resignation, in view of the calamity he has been to the country?


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Well, Madam Speaker, when I feel my support in the Liberal Party has sunk as low as it has for the Tory leader in his party, I will consider it.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Madam Speaker:: Order. Order, please.
Oral Questions HOUSING


CANADA MORTGAGE AND HOUSING CORPORATION VACANT UNITS
Mr. Ian Deans (Hamilton Mountain):: Thank you, Madam Speaker. It is a little difficult to be heard over the hubbub. I want to address a question to the minister responsible for housing. He is aware, I am sure, that the housing and related industries are being seriously crippled by the high interest rates which have been and are now being charged, and that housing starts have dropped significantly below the level that almost every expert believes is necessary in order to meet our housing needs. We have vacancy rates in major metropolitan areas such as Ottawa, Hamilton and Oshawa, of less than 1 per cent, and we now discover that Canada Mortgage and Housing has in excess of 9,000 units sitting empty. I ask the minister how does anyone explain that to people who cannot find affordable housing, who have to go into housing which costs far more than they can reasonably be expected to pay?


Some hon. Members:: Question.


Ian Deans: That is a question. How does the minister explain to those people that they have to go into housing which they cannot afford while CMHC has those vacant units available in their municipality and refuses to put them on the market for rental purposes?


Hon. Paul J. Cosgrove (Minister of Public Works):: Madam Speaker, one of the difficulties of the hon. gentleman is that he has obviously accepted, at face value, the news report this morning on which he bases his assumptions. The policy of the corporation, indeed, is to rent those units where we are unable to sell in areas, for example, where people are not coming forward to buy that affordable stock of housing. The housing to which we are referring is probably the most affordable housing available to Canadians today. It came into the corporation as the result of the undertaking of the corporation to the Conservative government to sell those properties in return for moneys to assist when there was a large drain on the mortgage insurance fund.


Ian Deans: Madam Speaker, 1 want to assure the minister that I am not basing my question on the news reports.


REASONS FOR UNITS REMAINING EMPTY
Ian Deans: I wonder if the minister would address two particular and quite pointed questions. One concerns the city of Hamilton where there is a vacancy rate of .7 per cent. I personally know of people who cannot find accommodation at a price that they can afford. There are 475 vacant units there under the direction of Canada Mortgage and Housing. In Oshawa there is a vacancy rate of zero per cent.


Madam Speaker:: Order.


Some hon. Members:: Order.

February 18, 1982
Oral Questions


Madam Speaker:: Order, please. 1 am afraid that 1 really must call the hon. member back to order. He is asking extremely long questions and 1 would ask him to make them more brief.


Ian Deans: Very briefly, in Oshawa there are 309 vacant units. How does the minister explain, to those people who cannot find accommodation, the reason those units are standing empty?


Paul James Cosgrove: Madam Speaker, I would repeat my earlier answer. If the corporation is unable to find buyers for the affordable housing which has come into the mortgage insurance fund, those units are rented. Indeed, there are over 2,000 such units which are rented in the province of Ontario. However, one of the reasons we are unable to proceed with the provision of adequate, affordable rental accommodation in this country is because the opposition has not given serious concern to the legislation before the House to provide-


Ian Deans: Nonsense!


Some hon. Members:: Oh, oh!


Paul James Cosgrove: -15,000 units, 5,000 of which are rent geared to income.


Some hon. Members:: Hear, hear!


ONE-YEAR MORTGAGES
Mr. David Orlikow (Winnipeg North):: Madam Speaker, my question is directed to the minister in charge of housing. Last weekend, at a HUDAC conference, the chief economist of the Canadian Imperial Bank of Commerce predicted that three-year to five-year mortgages would be gone very shortly, and that they would be replaced by mortgages of one year or less. Given the fact that it will be impossible for people to try to plan to buy a house or to decide how to refinance a house if the mortgage rate goes up as it has in recent years, every year, and given the fact that housing sales are down by 85 per cent in a city like Winnipeg, have the minister and his department given consideration to the terribly adverse effects which will result from this idea of mortgages lasting only one year or less?


Paul James Cosgrove: Madam Speaker, I would have to comment on the introductory remarks of the hon. gentleman. Indeed there has been a variety of projections of housing starts for 1982, which range from 145,000 up to a high of 185,000. However, I recall that last year the leader of the party of which the hon. gentleman is a member predicted starts in 1981 of 145,000; in fact, they were closer to 180,000, which was the first time there had been an improvement in housing in the last five years. Therefore I am not as pessimistic as the hon. gentleman in terms of starts.


Ian Deans: That's absolute nonsense!


Paul James Cosgrove: Second, the legislation before the House of Commons, Bill C-89, contains provisions to assist housing, and I wish the opposition would get off their legislative duffs and pass it.


Some hon. Members:: Hear, hear!


LABOUR CONDITIONS
David Edward Crombie: Madam Speaker, my question is directed to the Minister of Unemployment and Immigration. The minister will know that two years ago we were creating jobs at the rate of 35,000 a month in this country. The minister will also know that as a result of being under his direction for the past two years, we are now losing jobs at the rate of 35,000 a month. Indeed, we are looking at a situation where close to a quarter of a million jobs have been lost in the last seven months alone. As the minister responsible for job creation, how long does he intend to let the situation continue to deteriorate?
[DOT] (U30)


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, the hon. member for Rosedale has been in this House long enough and has certainly listened to enough debates to realize that the kind of economic situation we are in is not the cause of this government or of any one minister, but is in large part the result of circumstances affecting every industrial country in the world. I need only point out that the unemployment rates we are facing, which are very severe and tragic, are also being experienced by every other country in the OECD areas.


Some hon. Members:: Oh, oh!


Lloyd Axworthy: Those who scoff simply show they do not know. Ignorance is no excuse for that kind of loudness. The fact is there is a serious problem, a problem that we obviously share with many other countries. I would point out to the hon. member that, contrary to his assumption that we are presiding over the elimination of jobs, we have in fact been doing the opposite. We have been using government powers and resources to add to employment.
As I have pointed out in this House before, through our direct employment jobs we have created over 100,000 jobs in 1981-82. That is 100,000 jobs-
February 18, 1982

[ Translation]


INDUSTRY
Roch La Salle: Madam Speaker, my question is directed to the Minister of Industry, Trade and Commerce. In view of the fact that a large number of representatives of the footwear industry are in Ottawa today, and considering that the new policy recently announced by the minister entirely fails to offer the protection and assistance this industry needs, could the minister inform us, in anticipation of representations that will very probably be made by government members, since they have been exposed to the same pressures and recommendations as I have, could the minister inform us today whether he is prepared to reassess his decision and include leather footwear in his over-all quota system, so as to prevent the loss of 2,000 more jobs in Quebec alone within three months?


Hon. Herb Gray (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: Madam Speaker, I may point out to the hon. member that the policy we announced is in line with the decisions and report made by the Anti-Dumping Tribunal. We have also set up a special fund of $17 million to help finance the modernization and positive restructuring of this industry. I am therefore very pleased that representatives of the industry have had a very useful meeting with four of my colleagues from the province of Quebec this morning, and 1 should be happy to receive any suggestions from my colleagues that could help us improve our present policy.


THE ECONOMY
Miss Pat Carney (Vancouver Centre):: Madam Speaker, my question is addressed to the Minister of Finance. When I was first elected to this House two years ago the inflation rate was 9.4 per cent. In December, 1981, the inflation rate was 12.1 per cent, which is corroding the faith of Canadians in the country. When does the minister expect the inflation rate to be back below the 9.4 per cent that it was at when this government was elected?


Allan Joseph MacEachen: Madam Speaker, the most recent forecasts that we have prepared for the inflation rate are contained in the budget.
Oral Questions ENERGY


INCREASED COST OF HOME HEATING FUEL
Gary Michael Gurbin: Madam Speaker, my question is also for the Minister of Finance. The minister will know that in spite of some efforts by the government, many Canadians today and in the near future will continue to depend on oil for their home heating needs. In February, 1980, the cost of a gallon of heating oil was 69 cents. In December, 1981, it was $1.22 a gallon, a rise of 77 per cent in less than two years. Will the minister confirm to the House that 80 per cent of this increase, which is about 42 cents, is a federal tax that is at the direct expense of all users of home heating oil, including those who are on fixed and low incomes?


Allan Joseph MacEachen: No, Madam Speaker, 1 will not confirm that, but I will confirm the fact that the energy pricing agreement that now exists was entered into between the Government of Canada and the producing provinces of the west. When we were attempting to get a better deal for the Canadian people in that agreement, members of the Conservative Party, like the former minister of finance, were encouraging the western premiers to hang in there so that the prices would be even higher than they are under the agreement which we have succeeded in arranging.


EXTERNAL AFFAIRS
Mr. W. Kenneth Robinson (Etobicoke-Lakeshore):: Madam Speaker, I have a question for the Secretary of State for External Affairs. In view of the fact that Canada, like a large number of other countries, has been invited by El Salvador to send special observers during the period of February 15 to March 30 to witness the process under way there to elect a constituent assembly to prepare a new constitution under which further elections will be held to form a representative government, can the minister indicate if the government has come to any decisions with respect to Canada's role in that election process?


Hon. Mark MacGuigan (Secretary of State for External Affairs):: Madam Speaker, Canada had indicated a willingness to participate in an international observer force. We did receive an invitation from the El Salvador government to participate in a kind of observer force. However, discussions with representatives of that government have revealed that the kind of force which they are inviting us to participate in and the kind in which we have traditionally participated are very different. What they have in mind is not an international observer group which would monitor or judge their elections, because they would apparently view this as an interference in their internal affairs, but rather one where countries would

February 18, 1982
Oral Questions
send reprsentatives to El Salvador to witness and inform themselves.
We continue to believe that elections in that country, imperfect as they may be, are better than none, but the terms of observation which are available to us are not consistent with what we believe to be necessary, nor with our practices of the past.
We will be witnessing the elections through our normal diplomatic observations and through the members of the parliamentary subcommittee who will be visiting that country. 1 would just add that our considerable interest in the area was indicated last week by my announcement of a tripling of our aid to Central America.


DISASTERS
Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, my question is to the Prime Minister. I congratulate him on his carnation. I believe it was supplied by Tony Merchant.
A couple of days ago the Minister of Energy, Mines and Resources told a reporter with respect to the Ocean Ranger, a drilling ship in Hibernia, "We are responsible for these rigs and everything that happens on these rigs". That was a quote from Mr. James Rusk of The Globe and Mail. Does the Prime Minister stand by that statement of his minister of energy and will he explain to the House why there will be two inquiries, one by the Government of Canada and one by the government of Newfoundland? Why not a joint inquiry?


Pierre Elliott Trudeau: Madam Speaker, I want to point out to the hon. member that he should learn about the distinction between a rose and a carnation. Then maybe he could distinguish between his razzmatazz and a hole in the ground.


Some hon. Members:: Hear, hear!


Pierre Elliott Trudeau: In this case we are talking about holes in the bottom of the sea, and the authority of the minister that he referred to is in verifying the drilling aspect of the rigs. In so far as the concrete suggestion of the hon. member is concerned, it is perhaps not indiscreet to say that that is the course which the minister of energy had preferred. I know that before we announced our inquiry, or before Newfoundland announced its inquiry, he communicated with Mr. Marshall, the responsible minister in Newfoundland, and was hoping to discuss such an eventuality, but the government of Newfoundland chose to go ahead on its own and announced its own inquiry.


SAFETY AND SEAWORTHINESS
Ian Gardiner Waddell: Madam Speaker, my supplementary is to the Prime Minister. I was informed this morning from St. John's that on February 6, when the Ocean Ranger rig began to list badly because of ballast problems and an abandon ship alarm was sounded on that day, the rig operator did not know whether the crew was to abandon the ship from the high or the low end of the rig. The crew complained about this at a safety meeting and were told by Mobil officials that they would try to send someone out to the rig two or three weeks later to give the answer.
My supplementary question to the Prime Minister is, has he looked at these documents that the Minister of Energy, Mines and Resources tabled in the House? They are really conservation documents, not health and safety documents at all. How can the Government of Canada and the Prime Minister who has just taken responsibility for what goes on on the rigs, as has the Minister of Energy, Mines and Resources, let a rig such as this, with almost criminally lax safety precautions and regulations, operate and not have it recalled into port?


Pierre Elliott Trudeau: Madam Speaker, either the member was not in the House when the Minister of Energy, Mines and Resources and the Minister of Transport-


Ian Gardiner Waddell: I was here.


Pierre Elliott Trudeau: If he was, he should remember that the minister informed the House that there was the matter of international jurisdiction over the high seas, and the seaworthiness of the rig which was established by international bodies and internationally recognized.
The function of the Minister of Energy, Mines and Resources is not to testify to the seaworthiness but to testify to its operations as far as seeking energy on the ocean floor is concerned. If the hon. member wants to assert the authority of Canada over vessels on the high seas, he may be indicating a new course of international law. However, I want to put to him that the allegations he is making will, of course, have to be verified and reported on by the commission that we have established. If he has facts of this nature which he wants to put before the commission, of course he should do so.


EFFECT OF TAXES ON PRICE OF GASOLINE
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, my question is for the Minister of Finance. In February, 1980, a gallon of gas in Toronto cost $1.18. In December of last year a gallon of gasoline cost $1.97. A report states that the federal tax increase on gasoline is 50 cents of that figure. Will the
February 18, 1982

minister confirm that federal taxes have increased the price of gasoline by 50 cents a gallon?


Allan Joseph MacEachen: Madam Speaker, I will not confirm that.


Miss MacDonald:: How about 75 cents?


Allan Joseph MacEachen: I will confirm that we, as a government, refused to proceed with the 18-cent tax on gasoline which was proposed in the preceding budget.


LABOUR CONDITIONS
Hon. J. Robert Howie (York-Sunbury):: Madam Speaker, my question is for the Minister of Industry, Trade and Commerce and the Minister of Regional Economic Expansion. Since the last election, the Atlantic VIA Rail passenger service has been removed, the Canadian Forces Base in Chatham will be closed, over half of the maritime lumber mills are down, and hundreds of CN employees have been laid off. When will the Liberal government start creating more jobs in Atlantic Canada than it destroys?


Herbert Eser (Herb) Gray: Madam Speaker, in the past two years we have taken important steps in the area of job creation in the Atlantic provinces.


Charles Joseph Clark: They have all been backwards.


Herbert Eser (Herb) Gray: In the hon. member's own province we have announced the Mitel project which will create over 1,000 jobs in the Buctouche area. We also announced support for a new zinc smelter project which will create hundreds of jobs in the hon. member's province. We also announced support for the expansion of the Saint John, New Brunswick shipyard, and the Halifax shipyard. These are just some examples of what we have been doing in a concrete, meaningful way to create new advanced technology jobs in the Atlantic provinces, and we will continue doing so.


NATIONAL DEFENCE
Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, in the absence of the Minister of National Defence I will address my question to the acting minister. The government has decreed that DREE be eliminated and CFB Chatham is being exterminated by the same government. Is it the intention of the minister to forget about Chatham and, if not, when will he announce what plans the federal government has to secure the future of this very important New Brunswick town?
Oral Questions


An hon. Member:: Somebody better answer.


Charles Joseph Clark: Nobody speaks for New Brunswick.


RAILWAYS
Mr. Doug Neil (Moose Jaw):: Madam Speaker, my question is for the Minister of Transport. During the last federal election the Liberal Party was silent on its plans to make grain farmers pay higher prices for moving their grain to market. Why is the government bringing in such a policy at a time when the net incomes of the producers are predicted to be reduced by 10 per cent to 15 per cent?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, the answer is obvious. The reason is to give western Canada the best railway transportation the world has ever seen. For that purpose the Minister of Finance has provided $1.35 billion for the next four years in order to accomplish that objective. The government also felt that in order to realize the full objective, which every westerner wants, it was necessary to rebalance the contribution that the railways, the government, and the farmers make to the transportation of grain. That is the basis for our decision. I dare say, and the hon. member knows it very well, that people from western Canada are quite willing to accept it and generally approve of it. There are a few reactionaries who do not, but I thought that they were all at that end, on my right side. I see there are also a few from Saskatchewan in the Conservative opposition.


AGRICULTURE
Mr. Gordon Taylor (Bow River):: Madam Speaker, my question is for the Minister of Agriculture. During the 1980 election the Liberal Party promised farmers low prices for the fuel they used in the production of food. Since then fuel prices have gone up by 67 per cent. Why has this government not rebated a portion of this gasoline tax to farmers as was proposed by the Clark budget in 1979? For once, will the minister give the House a straight answer and not the usual baloney garnished with manure?


Hon. E. F. Whelan (Minister of Agriculture):: Well, Madam Speaker, I know the hon. member very well. He knows that our food inspection system does not permit bologna to be garnished with any such material whatsoever. He knows that we have one of the safest food inspection systems in the world.


Some hon. Members:: Hear, hear!

February 18, 1982
Oral Questions


Eugene Whelan: And I want to tell the hon. member that I know from which end of the bull his statement comes from, too.


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Eugene Whelan: I also want to say to the hon. member that I am sure he realizes that farmers who are taking delivery of diesel fuel and gasoline in certain quantities, according to the regulations, do receive a refund on the federal excise tax. There is some concern for farmers who buy propane and use it to propel their vehicles at the present time. That is not allowed under the present act. We have made representations in the hope that those regulations will be changed so they can get refunds also. I would remind the hon. member that the farmers with whom we compete, namely, those in the United States, pay more for their fuel than we do in Canada.


Some hon. Members:: Hear, hear!


Mr. Paproski:: That is not true.


INQUIRY OF THE MINISTRY
Madam Speaker:: The hon. Member for Bonavista-Trinity Conception.


Mr. Dave Rooney (Bonavista-Trinity-Conception):: Madam Speaker-


Some hon. Members:: Hear, hear!


An hon. Member:: It is his anniversary question.


An hon. Member:: Where is your trailer?


Richard David (Dave) Rooney: I will get to that. Madam Speaker, when I came into my lobby today I was asked if I would wear a rose.


An hon. Member:: A carnation.


Richard David (Dave) Rooney: A rose by any other colour. I feel depressed.


Madam Speaker:: Order, please.


Mr. Nielsen:: Let him speak.


Madam Speaker:: Order, please. The hon. member has the floor if he wants to ask a question. If he wants to make a speech, he can choose another time to do so. He is perfectly free to do so, but at this particular time he must ask a question.


Richard David (Dave) Rooney: Madam Speaker, why are all the Liberals- and there were a couple on the other side-wearing roses when 84 people died on the oil rig off Newfoundland? Who wants to answer? I do not know.


Some hon. Members:: Oh, oh!


Some hon. Members:: Hear, hear!


An hon. Member:: Come on, Pierre.


Pierre Elliott Trudeau: Madam Speaker-


Madam Speaker:: Order, please. The hon. member for New Westminster-Coquitlam.


EXTERNAL AFFAIRS
Miss Pauline Jewett (New Westminster-Coquitlam):: Madam Speaker, I am sorry to deprive the Prime Minister of the opportunity to respond, since he is the only one wearing a rose, but I will go ahead with my question, which is addressed to the Secretary of State for External Affairs.
As the minister will know, NATO is planning to hold its winter naval exercises in the Caribbean Central American region, assembling in the Gulf of Mexico and moving to the Straits of Florida, about a wave away from Cuba. This is the first time NATO has gone into the region for its naval exercises, and I want to ask the minister if he can tell the House why NATO has chosen to do this at this time.


Richard David (Dave) Rooney: Madam Speaker-


Some hon. Members:: Hear, hear!


Some hon. Members:: Oh, oh!


Madam Speaker:: Order, please. The hon. member for New Westminster-Coquitlam has the floor.


Pauline Jewett: Madam Speaker, I want to ask the minister why NATO has chosen at this time, for the first time in its history, to hold its winter exercises in the Central American-Caribbean area. Is it to promote American interests in that region, and is the visit of two NATO admirals to Ottawa next week connected with this?


Mark R. MacGuigan: Madam Speaker, NATO military exercise decisions are made for military and not political reasons. 1 can assure the House that there is no political motivation whatsoever attached to this exercise.
As to the visit of some top NATO military officials to Ottawa next week, that is an event which has long been planned by the Minister of National Defence as a routine matter to inform us better on NATO military planning. It has no connection with any other event.
February 18, 1982


REASONS FOR CHOICE OF EXERCISE AREA
Pauline Jewett: Madam Speaker, it is nevertheless reminiscent, as Walter Gordon was reminding us this morning, of General Norstad's visit 19 years ago.
If there is no political reason for this, why is NATO going contrary to its habitual practice of having these exercises in the Mediterranean? Why is it passing right adjacent to Cuba, and does the minister not think this will be a destabilizing influence in the area? I know the minister himself wants Canadian government policy to be one of promoting stability and avoiding provocation.


Mark R. MacGuigan: Madam Speaker, Canada's attitude toward the Caribbean and the Central America area is well known. It is certainly one of co-operation with all the countries in that area, including Cuba, for the advancement of peace. We have frequent discussions with Cuba. We have been having them in the last day or so, and the Cubans are certainly under no illusion that there is any threat in which we are participating. I do not think the hon. member does us any service in suggesting that there is some hidden political motivation in what is a normal military exercise.



ENVIRONMENTAL AFFAIRS


Charles Joseph Clark: Madam Speaker, my question is directed to the Minister of the Environment, who yesterday confirmed that 12 containers of uranium hexafluoride were destined to be on the Russian freighter which sank and waved away rescue attempts in mysterious circumstances. We do not know the size of those containers, although I am given to understand they could be very large, perhaps as large as 12 metric tons. Those containers could be lying now on the floor of the Grand Banks where, as a result of corrosion or the impact of sinking, they could cause leakage, which would seriously contaminate Canadian fish stocks. In light of that possibility will the Minister of the Environment tell us what safeguards and standards are in place to stop the potential contamination of Canadian fish stocks off the Grand Banks as a result of the shipping of Canadian processed uranium material to the Soviet Union?


Hon. John Roberts (Minister of the Environment and Minister of State for Science and Technology):: Madam Speaker, I do have some information about the containers. They are specially designed, heavily walled steel cylinders which weigh about 1 3 tonnes and contain about eight tonnes of uranium. In more than 25 years of transporting thousands of these cylinders around the world, no cylinder has ever been punctured resulting in the release of material during transportation. It
Oral Questions
would take many hundreds of years before a cylinder could be corroded under water so that the uranium would come into contact with sea water. If and when that happened, the uranium would be dissolved in the water, adding eight tonnes of uranium to the ocean. The amount of uranium estimated to occur naturally in the world's oceans is about four billion tonnes. It would be impossible to detect or estimate the impact of such a release because it would be so small. I do not think the concern expressed by the right hon. gentleman is one which need preoccupy us.


Charles Joseph Clark: In other words, the minister's standard is that he is not worried, so no one else should be.



NUCLEAR ENERGY


Charles Joseph Clark: Madam Speaker, my supplementary is directed to the Secretary of State for External Affairs or to whomever reports in the House on behalf of Eldorado. Eldorado has indicated that uranium hexafluoride is enriched in the Soviet Union at the request of Eldorado's customers. That is why we are shipping it to the Soviet Union. Will he confirm that this Russian uranium process produces a byproduct which can be regarded as waste, but which in fact can be used to produce plutonium and to produce weapons? If so, will the minister tell this House of Commons now what are the final destinations of that byproduct?


Mark R. MacGuigan: Madam Speaker, this is a practice which has gone on for a considerable number of years, including the time of the right hon. member's government. It has been a continuous commercial process in which countries-often neutral countries as in this case, which I am not at liberty to identify at this stage-


An hon. Member:: Why not?


Mark R. MacGuigan: Because it involves a competitive situation in which Eldorado is involved. However, often neutral countries request that we have our uranium hexafluoride enriched, which we are not able to do in this country. My information is that there is exactly the same tonnage out of as into the Soviet Union, and we are satisfied that there is no advantage being given to the Soviet Union by this process. Of course the right hon. member knows that the Soviet Union itself is a producer of uranium and does not need any uranium from us.



DESTINATIONS OF ENRICHED URANIUM

Charles Joseph Clark: Madam Speaker, what the minister admitted when he said that the same tonnage goes out as goes in is that the Soviet Union is

February 18, 1982
Oral Questions
disposing of this byproduct, which could be treated as waste but which also could be used to produce plutonium or to produce weapons. That is what is happening to Canadian uranium in Russian hands; he has just said that. However, he will not tell us which countries are receiving the benefits of this Canadian uranium chanelled through and processed by Russian hands. He has an obligation to tell the people of this country and the House of Commons which countries are benefiting from this Canadian uranium in a way that may allow them to make use of plutonium and may allow them to produce weapons. Which countries are they?


Mark R. MacGuigan: Madam Speaker, the countries which are the recipients of this uranium are countries with which we have agreements, so we have their guarantee of non-proliferation. I repeat that this is the same practice which has been followed for many years. It is a commercial practice, and it was followed during the time of the right hon. member's government as well.
* *
*



ESTIMATES


Mr. Al MacBain (Niagara Falls):: Madam Speaker, 1 should like to put a question to the President of the Treasury Board. Is the minister in a position to tell the House at this time when he will be tabling the 1982-83 main estimates, and if there will be a lockup?
to take the necessary action to try to keep at least that one promise that he made to the Canadian public?


Herbert Eser (Herb) Gray: Madam Speaker, as the Prime Minister promised, we have begun consultations with the United States with a view to getting action on problem areas connected with the auto pact. We will continue these consultations. That work is being carried on by my colleague, the Minister of State for International Trade, and myself.
In addition, we have taken other important steps aimed at strengthening and upgrading the manufacturing and technology base of our auto industry. The most recent step was the announcement of the $25 million fund to be spent over the next two years to assist auto parts companies in this country take advantage of production opportunities in North America.
We have also taken action to establish in Canada a new Volkswagen project. This will provide 1,500 jobs, 500 of which will be in the plant itself, and 1,000 in the plants of individual Canadian parts manufacturers. Another example I can give is the KHV diesel engine project.
I see you are about to call me to order because of the length of my answer. Madam Speaker, but these are just some examples that will demonstrate the concrete action we have been taking and examples of action that will be taken on behalf of the auto industry.



PETITION

Hon. Donald J. Johnston (President of the Treasury Board):: Madam Speaker, I hope to table the main estimates next Tuesday. Today I sent letters to the Right Hon. Leader of the Opposition and the leader of the New Democratic Party in an effort to work out arrangements that will make sure they are fully briefed. I hope this can be done without a lockup unless, of course, the hon. member for York-Peel (Mr. Stevens) insists upon having a lockup. 1 am sure we would be delighted to lock him up this year!



MR. JELINEK-LACK OF DOOR-TO-DOOR MAIL DELIVERY IN BRONTE MEADOWS, MILTON, ONTARIO

Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the one hundred and eighty-second report of the Clerk of Petitions stating that he has examined the petition presented by the hon. member for Halton (Mr. Jelinek) on Wednesday, February 17, 1982 and finds that it meets the requirements of the Standing Orders as to form.
*
* *
* *
*
AUTOMOTIVE INDUSTRY	[Translation]
LIBERAL ELECTION CAMPAIGN PROMISE	BUSINESS OF THE HOUSE


Mr. Otto Jelinek (Halton):: Madam Speaker, my question is for the Prime Minister. Two years ago during the federal election campaign the Prime Minister promised that the Liberal party would "-get a fair share for Canada of business in the auto industry". I do not have to quote any statistics to remind the Prime Minister and the House that not only did he not keep his promise but that the industry itself has reached an all-time low. I therefore would like to ask the Prime Minister-because it is his remark that I refer to-when he is going



WEEKLY STATEMENT

Mr. Pinard:: Madam Speaker, since my colleague cannot seem to make up his mind to ask, next week, the business of the House will include consideration of Bill C-78 to improve benefits to laid-off employees and subsequently, Bill C-89 on national housing. Depending on the circumstances of the debate on these two bills, we shall probably have an opposition day on either Thursday or Friday of next week. I shall be
February 18, 1982

advising my colleagues which day it is to be. That will be the order of business for next week.


Erik Nielsen: Madam Speaker, I am sure that 1 heard the government House leader correctly. He stated that next week we would deal with Bills C-78 and C-89, I presume on Monday and Tuesday, consecutively-


Yvon Pinard: And Wednesday.


Erik Nielsen: -and Wednesday, the government House leader interjects-and that there would be another opposition day next week in addition to the allotted day now on the Order Paper for tomorrow. We will be proceeding, I presume, with the allotted day tomorrow, as he has indicated so many times.


Yvon Pinard: Madam Speaker, if my colleague requires that tomorrow be an allotted day, I am pleased to agree with him. As a matter of fact, tomorrow will be an allotted day as well.


Erik Nielsen: Madam Speaker, tomorrow is the allotted day which has been on the notice paper all week. The government House leader is simply confirming that it is there, that he is not going to change his mind again and change tomorrow as an allotted day. Is that a correct understanding of what he said?


Yvon Pinard: Madam Speaker, all I can say is that I think we agree. The hon. member expressed a wish that tomorrow not be changed and 1 said that I am pleased to confirm that it is not my intention to change it; and that, furthermore, there will be another allotted day probably next week on Thursday or Friday, depending on the progress of business at the beginning of the week. If the hon. member now prefers that we change the day tomorrow, I will consider it.


Some hon. Members:: Hear, hear!


Erik Nielsen: Madam Speaker, 1 did not want the government House leader to change it last week and we certainly do not want him to change it this week.


Some hon. Members:: Hear, hear!


Yvon Pinard: Madam Speaker, I think it is a bit late to tell me that now. I invited the hon. member to a House leaders' meeting last Thursday morning and he did not come. He could have told me that at that time.


Erik Nielsen: Madam Speaker, if, as the government House leader says, he is holding regular House leaders' meetings and he held one last week, I wonder why he did not hold one this week to inform me of what he has just informed me across the aisle.


Yvon Pinard: Madam Speaker, the answer is very simple: 1 did not intend to change the allotted day tomorrow.


Some hon. Members:: Hear, hear!
Sinking of "Ocean Ranger"


Mr. Beatty:: Madam Speaker, could I raise a question of House business with the government House leader? He will remember that he indicated he was opposed to calling concurrence on the fourth report of the Standing Joint Committee on Regulations and Other Statutory Instruments because the government was actively considering what action it would take as a result of the recommendations of the Task Force on Regulatory Reform and the recommendations made by the Economic Council of Canada to the standing joint committee. He indicated that he would be presenting proposals to Parliament in the near future. May I ask him where those proposals are and when they will be put before Parliament?


Yvon Pinard: Madam Speaker, the hon. member asks a question that I suggest he take up with his House leader. 1 should not like to refer to what we have discussed together on the subject of parliamentary reform.


Madam Speaker:: Taking into account that we must assume that tomorrow will be an allotted day, I want to inform the House that since there are two motions on the Order Paper, the Standing Orders require me to choose which one will be debated tomorrow. Of course, the deadline for other motions to be presented to the House is six o'clock tonight. In principle, I suppose that I should wait until six o'clock to announce my decision on which motion I choose; however, as a courtesy to the House I could, if the House wishes, announce my decision now so that everyone concerned could be prepared for the debate. If the House wants me to announce that now, there would be the caveat that if another motion were filed before six o'clock I would have to reconsider my decision and come back to the House and announce my choice.
I should like to have an indication whether the House would like me to announce my decision now or later.


Some hon. Members:: Now!


Madam Speaker:: My decision was not easy because we do not have very many precedents. 1 looked into the principles which might guide me in choosing which of the two motions would be debated. I considered the fact that the motion in the name of the Right Hon. Leader of the Opposition (Mr. Clark) is from the official opposition and also that it requires the House to come to a decision. Therefore I have decided that the motion in the name of the Right Hon. Leader of the Opposition will be debated tomorrow.


Some hon. Members:: Hear, hear!



DISASTERS


Paul James Cosgrove: Madam Speaker, as the minister responsible for the parliamentary precinct, I should like to advise hon. members that flags will be flown at half mast tomorrow to join in the day of sympathy

February 18, 1982
Privilege-Mr. Corbett
in Newfoundland and that federal government offices in the province of Newfoundland will be closed tomorrow in order to join with that province in mourning its tragedy.


Charles Joseph Clark: Madam Speaker, I take it the statement of the Minister of Public Works (Mr. Cosgrove) was in the nature of a statement on motions. I must say in passing that we are pleased to have the tradition re-established in the House of Commons.
In response to the statement on motions of the minister, I should simply like to express our total approval of the action which has been taken and of the opportunity for hon. members of the House of Commons, and all of us associated with the activities of the federal presence across the country, to express our profound sympathy to the families and survivors of those who died in this tragedy at sea. Also I should like to express our great regret at this terrible tragedy and our hope that the survivors and their families find some solace in knowing that the nation joins in their sense of deep loss and great regret.


Ian Deans: Madam Speaker, I rise on the point raised by the Minister of Public Works (Mr. Cosgrove) and by the Leader of the Opposition (Mr. Clark). On behalf of the New Democratic Party, I should like to join both hon. members in the sentiments expressed. While it is not possible to express adequately the sense one feels at a time like this when such a tragedy occurs, I hope as a result of this we will redouble our efforts to ensure that it will never occur again.



PRIVILEGE


Robert Alfred Corbett: Madam Speaker, I should like to take this opportunity to reserve a question of privilege for a future date which arises out of my question to the Acting Minister of National Defence in the House today. If I decide there has been a breach of privilege, my position will be based upon the fact that in Monday's Hansard of February 8, 1982, the Acting Ministers of National Defence are given as the Secretary of State for External Affairs (Mr. MacGuigan) and the Minister of Veterans Affairs (Mr. Campbell), both of whom were present in the House today. The parliamentary secretary was also in the House today, and although the government benches may be in total disarray, surely someone speaks for the Department of National Defence in the House.


Madam Speaker:: The hon. member need not give verbal notice of a question of privilege in the House. He should send written notice to my office, as the Standing Orders require. There is no need to take up the time of the House by giving verbal notice of a question of privilege.


Mrs. Ursula Appolloni (Parliamentary Secretary to Minister of National Defence):: Madam Speaker, I rise on the same
point raised by the hon. member for Fundy-Royal. I think the hon. member is suffering from a lapse of memory. He asked the same question on February 9-


Madam Speaker:: Order. The hon. member's question of privilege has not yet been raised. If it is raised, the hon. parliamentary secretary will have an opportunity to answer it.


Robert Alfred Corbett: If Madam Speaker did not receive the written notice which 1 sent with one of the pages, then at least the House should be aware that I gave written notice.


Madam Speaker:: 1 received the notice of the hon. member during question period. I thought it was a notice telling me that he wanted to be recognized at the end of question period on a question of privilege arising out of the deliberations of today. I have the notice; this is why I recognized the hon. member at the end of question period. But I warn the hon. member that his notice was too brief to satisfy the requirements of the Standing Orders. Therefore, if the hon. member has a question of privilege to raise, I would be grateful if he rewrote his notice and sent it to my office.



ROUTINE PROCEEDINGS


[Stage Direction]
Eighth Report of Standing Committee on Transport and Communications-Mr. Dionne.
[Editor's Note: For above report, see today's Votes and Proceedings]

[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. 3,530, 3,723, 3,728, 3,729 and 3,734.


Mr. Cossitt: 1.	Was a Mr. Petrie hired by the Royal Canadian Mint and, if so (a) is he the father-in-law of Mr. Yvon Gariepy, former Master of the Mint (b) on what date was he hired and was it during Mr. Gariepy's tenure in office (c) was he classified as a consultant (d) what were his duties?
2.	Did he leave such employment and, if so, on what date?


Hon.   J.-J. Blais@Minister of Supply and Services: 1 am informed by the Royal Canadian Mint as follows:
February 18, 1982

1.	There is no Mr. Petrie at the Royal Canadian Mint. However, we did have a Mr. Robert Pitre.
(a)	No.
(b)	Mr. Pitre was hired on February 16, 1976, during Mr. Gariepy's tenure in office.
(c)	No.
(d)	February 16, 1976, to January 1, 1979-Messenger
January 1, 1979 to May 26, 1980, supervisor of tours, Ottawa Plant.
Duties: -supervised tour guides -scheduled tours as requested -escorted VIPs on special tours -supervised operation of the theatre -supervised sales of numismatic coins to visitors -co-ordinated all tours with security guards
May 27, 1980 to May 14, 1981-supervisor of tours. Under contract, duties as above.
May 15, 1981 to August 28, 1981, trained new supervisor.
2.	Yes. August 28, 1981.


Mr. Herbert: Whal percentage of public servants working in the Department of Fisheries and Oceans in Quebec indicate English as their first official language?


Hon. Romeo LeBlanc (Minister of Fisheries and Oceans):: The answer is 14.7 per cent.


Mr. Herbert: What percentage of public servants working in the Department of Supply and Services in Quebec indicate English as their first official language?


Hon.   J.-J. Blais@Minister of Supply and Services: Data retrieved from the department's personnel administrative and reporting system indicates that out of 5,067 public servants employed in the province of Quebec by Supply and Services Canada for which linguistic data is known, 2,536 or 50.05 per cent indicate their first official language as being English.


Mr. Herbert: What percentage of public servants working in the Department of Transport in Quebec indicate English as their first official language?


Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):: Of the public servants working for Transport Canada in Quebec, 7.8 per cent indicate English as their first official language.


Mr. Blenkarn: 1. Arc practicing optometrists not allowed to guarantee passports, when bankers, doctors, postal officials and lawyers are allowed to do this work and, if so, for what reason?
Order Paper Questions
2. Docs the government believe optometrists are mentally or emotionally incapable of serving as guarantors on a passport application, despite the fact they carry on professional practices and retain patients' records in a similar manner as medical practitioners?	-


Mark R. MacGuigan: 1. Practicing optometrists are not on the list of eligible passport guarantors. The approved guarantor list is designed with two objectives in mind: first, to make the list broadly enough based to ensure that all Canadian citizens have ready access to one of the guarantors in their community; and second, to keep the categories to manageable proportions so that the Passport Office can, without disrupting rapid service, carry out the necessary security review and checks of the applicant and the guarantor. It is considered that the present list is broad enough to ensure that Canadians have access to a guarantor and that additions are not required at this time.
2. No.
[English)


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


David P. Smith: Madam Speaker, if question No. 1,960 could be made an order for return, this return would be tabled immediately.


Madam Speaker:: Is it agreed that question No. 1,960 be made an order for return?
Some bon. Members: Agreed.
[Text)


Mr. Blenkarn: 1.	Which countries have received Cl DA loans and, in each case (a) what was the amount of the loan (b) what amount was repaid (c) what amount is outstanding?
2.	Which countries are in default on loans made by Cl DA?
3.	Which countries receiving Cl DA aid have nationalized Canadian companies without compensation?
4.	What is the cost of the recent Cl DA poll on Canadian opinions regarding foreign aid?
5.	(a) How many Cl DA personnel are engaged in responding to persons who write letters to editors in Canada about Canadian foreign aid (b) is writing such responses their full-time responsibility (c) what are their salaries?
6.	(a) How many research fellowships have been granted by the International Development Research Centre in the past three years (b) what are the criteria for the fellowships (c) what is the remuneration?
Return tabled.


Sinclair McKnight Stevens: Madam Speaker, could the parliamentary secretary indicate why question No. 2,042 which I asked on
15146

February 18, 1982
Order Paper Questions
January 29, 1981, has not yet been answered? I feel it is an affront to the House that we are not being told the total cost of the December 1980-January 1981 world tour of the Prime Minister or what percentage of the total cost was actually paid by the taxpayers of Canada. Surely it is an affront to the House.


David P. Smith: Madam Speaker, 1 will make inquiries and endeavour to obtain the answers as soon as possible. As the hon. member knows, answers of that nature have been tabled before, and they will be in the future.


Mr. Cossitt:: Madam Speaker, I would not want to disappoint the parliamentary secretary, having raised this matter on approximately 20 previous occasions. In view of the fact that the government has a habit of celebrating unfortunate anniversaries by wearing carnations, and that today is another unfortunate anniversary, I should like to indicate to the parliamentary secretary that five years, eight months and seven days ago today I placed a question on the Order Paper concerning the Canadian Transport Commission. I asked how many passes had been given by Air Canada to members of the commission, to their wives or to any officials of the commission.
The parliamentary secretary has been here for some time, and before that he had predecessors. I have asked every one of them when this question will be answered. There is a grave conflict of interest involved here. The situation is that the Canadian Transport Commission, the group which governs Air Canada, received free passes from Air Canada for wives, employees and various people. What are Benson's boys trying to hide that the government does not want to tell us? I should like to have some sort of answer, rather than the answer I have been given by the parliamentary secretary and every one of his predecessors, namely "soon". Obviously "soon" in terms of the Liberal Party means never. When will 1 know exactly why, for five years, eight months and seven days, the parliamentary secretary or any of his predecessors have not had enough gumption to rise and give the answer?


David P. Smith: Madam Speaker, it should be pointed out that that question was on the Order Paper the entire tenure of the Clark government and was not answered. In any event, I do not want to disappoint the hon. member. I assure him that the question will be answered in due course, in the fullness of time.


Some hon. Members:: Oh, oh!


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


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Wednesday, February 17, consideration of the motion of Mr. Bussieres that Bill C-93, to amend the statute law relating to certain taxes and to provide other authority for the raising of funds, be read the second time and referred to Committee of the Whole.
Mr. Harvie Andre (Calgary Centre):: Mr. Speaker, I join in this continuing second reading debate on Bill C-93, which is one of those common but regrettably deceptive bills the government has a habit of bringing in. It has a very innocent title- "An act to amend the statute law relating to certain taxes and to provide other authority for the raising of funds." It is an apples and oranges bill consisting of a borrowing authority, which is the apples part, taxes in the form of a natural gas and gas liquids tax and a petroleum gas revenue tax, which is the oranges part. This bill arises out of a budget brought down in October, 1980, almost a year and a half ago.
The borrowing authority provision, we argue should more properly be considered as a separate piece of legislation since it deals with a totally different subject from petroleum taxes. However, we are stuck with the fact that these two mixed items, and I believe inappropriately mixed, are considered in one bill. Therefore, we are forced to debate what amounts to two different subjects on the same occasion and vote on what amounts to quite separate principles. So be it. My colleagues have debated at some length the implications of the borrowing authority. Therefore, I would like to concentrate my remarks primarily on the oranges part of this bill, the petroleum and gas revenue tax and the natural gas and gas liquids tax.
These two taxes arose out of the National Energy Program, which was part of the 1980 budget brought down October 22, at which time these provisions were introduced. Given that fullness of time, it is interesting to look back at the National Energy Program to see what was promised and compare it to what was delivered to see what new nirvana the Minister of Energy, Mines and Resources (Mr. Lalonde) and his colleague, the Minister of Finance (Mr. MacEachen), promised us when they introduced the budget in 1980. It is interesting to see what hell has, in fact, ensued as a consequence of this budget and the accompanying national energy policy.
The national energy policy had three goals-security of supply, Canadianization and fairness of revenue sharing. These were magnificent goals, goals that no Canadian could oppose in terms of their objectives. But what has happened? What has this program led to? What is the reality as opposed to those statements of intent?
February 18, 1982

First let us look at the question of self-sufficiency. The minister of energy informed this Flouse that there would be no question but that Canada would be energy self-sufficient by 1990 because of the extraordinarily good energy policies that he and his colleagues had brought in. What is the reality? There is not a single, knowledgeable individual or organization in this country that believes that assertion by the minister. There is not one, Mr. Speaker. Indeed, the National Energy Board, an independent body, after having held months of extensive public hearings across the country, and with the best information available to it, in its report in June, 1981, after looking at various alternatives, reported at page 9:
The board is not forecasting oil self-sufficiency in either of the above cases.
In other words, in terms of any of the alternatives the board looked at and any assumptions it could make, the board could not see oil self-sufficiency. In this connection the board was looking at the year 2000. The National Energy Board says that Canada will not be self-sufficient by the year 2000 based on the government's energy policies. Does that stop the minister of energy? Not at all. The Minister of Energy, Mines and Resources issues a press release saying that Canada will be self-sufficient. Why will Canada be self-sufficient? Because the minister of energy says so. Is there any evidence to that effect? There is not. The minister of energy says that Canada will be self-sufficient because a combination of the Alsands and Cold Lake projects, together with a conservation program, will make it possible. There are also some heavy upgrade programs that will help in this objective.
Let us look at what has happened. The Cold Lake project is dead. The Alsands project looks like it is dead. It is taking a while to die, but it certainly looks as though it will die. The heavy oil upgrading program of Polysar, which was a big part of the program the minister was trumpeting about in October, is dead. These things which the minister was counting on are dead. But what did the minister say last week when these facts were brought to his attention by a reporter with a good filing system? The minister said, "Well, we do not really need Alsands and Cold Lake anyway; we will be self-sufficient as a result of east coast offshore and Beaufort." II we take a look at what the minister said a year ago, we find that he said, "We are not counting on Beaufort or east coast offshore to make us self-sufficient. We are not counting on that; we will be self-sufficient because of Alsands, Cold Lake and these heavy upgrading programs."
If you were to buy a used car from the minister, Mr. Speaker, you would deserve to buy a lemon. The fact is, that because of the incredible incompetence of this government, self-sufficiency is out the window. We had better all pray that some new equivalent of the Ayatollah Khomeini does not come along. We had better pray that that madman in Syria, Assad, can keep those madder men in the city of Hama, who are trying to impose a Khomeini-type revolution in that country, under control. If anything happens in any Middle East country or in any other of the single-party states around the world upon which we rely for oil, then we will find ourselves in a pretty pickle indeed. But not to worry; by then the minister of
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energy and his colleagues will be long gone and will not be held accountable or responsible for the situation. We know that they will have no consciences to bother them about the legacy they have left to Canadians of the future.
What about the second part of the program, that of Canadi-anization? We are going to Canadianize the oil and gas industry. 1 heard the minister say that. He.said that he was going to Canadianize the oil and gas industry by having at least 50 per cent of the industry owned by Canadians by the year 1990.
The minister did not tell the House how he would achieve that. It was not by having the Canadian part grow but by having the foreign part shrink. What we will be doing is making sure the oil and gas industry is such a smaller component than it used to be; the Canadian component of 50 per cent will be 50 per cent, but 50 per cent of a whole lot less than it was. The hypocrisy of the minister is absolutely mind-boggling.
One wonders about the editorial writers at the Ottawa Citizen who rate this minister as an A-l minister. You wonder if they can read, if they keep records. Do they remember what in fact has been said? As just one example, Mr. Speaker, in July, 1981, the Canadian Development Corporation bought out the shares of Elf Aquitaine, a 75 per cent French-owned company. According to The Globe and Mail, the Minister of Energy, Mines and Resources said, in talking about the agreement between the CDC and Elf Aquitaine:
-the agreement was very welcome and demonstrated that the federal government's policy of increasing Canadian ownership of the oil industry is being carried out "expeditiously and effectively".
That is what the minister said; Canadianization is working. Well, Mr. Speaker, on January 30, 1982, the minister was in France, the country that used to own 75 per cent of Elf Aquitaine. Speaking of the France-Canada Chamber of Commerce, it is reported that:
He also made a strong appeal for increased French investment in Canada, particularly in the energy sector, in a speech at a luncheon meeting of the France-Canada Chamber of Commerce.
In July, 1981, he said "Hallelujah, Canadianization is working because we bought out this French-owned company." In January, 1982, he is in France saying. "We would like French money to come over here and invest in the oil and gas industry." He is trying to suck and blow at the same time. But that does not prevent George Radwanski of the Toronto Star saying what a great minister this is, that he is Canadianizing. On this same trip he stopped in Paris en route from Kuwait where he was trying to encourage the Kuwaitis and others in the Middle East to invest in Canadian energy projects. First he announces to great acclaim, fanfare and the singing of "Hallelujah, we are going to Canadianize, buy out these rotten foreigners;" and then announces with great pride and wide smiles, "1 have talked the Arabs and French into investing in Canadian energy projects." If you bought a used car from that man, Mr. Speaker, you deserve to have a lemon.

February 18, 1982
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The reality is, Mr. Speaker, that the National Energy Program had nothing to do with self-sufficiency or Canadiani-zation. It was simply gimmicky phrases utilized, effectively I admit, by the government. What that policy was really all about was indicated by the minister in a speech in Sherbrooke, Quebec, on October 22, 1981, when according to the Canadian Press he said:
-a stronger threat to Canadian unity than Quebec nationalism could soon be posed by the growing wealth of Alberta. The other nine provinces would eventually be at the mercy of Alberta's every fancy, he said, and a wave of Alberta nationalism of unprecedented strength could rise up if the federal government held back now from showing its teeth. "We don't pay enough attention to this threat.'' I.alonde said, "but it's a real one. it's there."
Well, Mr. Speaker, yesterday in the Alberta provincial riding of Olds-Didsbury we had the result of this minister baring his teeth. For the first time outside the province of Quebec Canadians voted for a separatist because of the policies of the Minister of Energy, Mines and Resources, who says that a bigger threat to Canadian unity than Quebec nationalism is Alberta's wealth. And to that kind of behaviour the Ottawa Citizen says A-l. I hope and pray, Mr. Speaker, that the message the people of Olds-Didsbury were trying to send yesterday will be heeded by some responsible people opposite. Hopefully there are some in that Liberal Party somewhere who will heed that message, who will say to the Minister of Energy, Mines and Resources, the Minister of Finance, the Minister of Transport (Mr. Pepin) and others who feel they can strengthen national unity by beating on the heads of western Canadians: Stop! We want this whole country to stay together. We do not want Canadians to feel that their national government does not represent them. We do not want Canadians to turn in frustration to separatism because they cannot get the attention of their supposed national government.
This feeling, Mr. Speaker, which exists in Olds-Didsbury and elsewhere, indeed I might say the feeling which exists in knowledgeable people here in central Canada-and there are some-is a reflection of the NEP and what it is doing. Because the fact of the matter is that that program, particularly as exemplified by the taxes in this bill, the petroleum and gas revenue tax and the natural gas and gas liquids tax, is hurting Canadian companies more than it is hurting the foreign multinationals which supposedly are the villains and the ones we are supposed to be hitting.
The fact of the matter is, Mr. Speaker, that the NEP hit Canadian-owned companies harder than foreign-owned companies. That is not my opinion, that is not information from a suspect source; that is from the Petroleum Monitoring Agency of the Department of Energy, Mines and Resources, the minister's own department. This report, which came out about six weeks ago, covers the first six months of 1981; in other words, the first six months of full operation under the NEP. It shows that the result of the NEP is that during that time foreign-owned companies suffered a 28.5 per cent income drop in their Canadian operations. In comparison, Canadian-owned companies suffered a revenue drop of 52 per cent. So, Mr. Speaker, for the purposes of Canadianizing the industry we
introduce taxes which hit Canadian-owned companies twice as hard as foreign-owned companies.
The NEP, Mr. Speaker, has in fact driven Canadian companies out of Canada. The Petroleum Monitoring Agency report shows that Canadian-controlled junior companies increased their foreign exploration in the first six months of 1981 by 247 per cent as compared with the first six months of 1980. They were driven out of Canada. There was a 247 per cent increase in foreign operations by Canadian companies which were driven out of Canada by a government which says it will Canadianize the oil industry. That was a blatant falsehood, an out and out deception.
The reality is that the minister spoke the truth in Sherbrooke when he said that the object was to put those westerners in their place, to bare their teeth, because wealth in Alberta cannot be tolerated and is a threat to national unity. How effective were they? Again, the Petroleum Monitoring Agency, which obtained its data from StatsCan, showed that during the first six months of 1981 the petroleum industry earned an average return on capital employed of 9.4 per cent. In comparison, the manufacturing industry earned a return on capital of 11 per cent.
Therefore, this mythical, over-wealthy, rapacious beast, this western Canadian oil industry which must be put into its place, whose coffers must be dipped into because it is a threat to national unity, earned 9.4 per cent on capital employed. This was presumably so that the money could be used to benefit companies in Windsor such as Chrysler, or other manufacturing concerns which apparently, according to Statistics Canada, only earned 11 per cent and were in deep trouble. We beat on the heads of the companies which earned 9.4 per cent in order to subsidize the companies which earned 11 per cent. All of this is for national unity. However, the peole of Olds-Didsbury were not fooled by that. What we are doing is Canadianizing the oil and gas industry in the United States.
According to an article in World Oil, which is a highly respected technical journal:
In addition, political and economic developments in Canada have created apprehension ... (on the part of)... U.S. and Canadian investors. In particular, imposition of price controls and the prospect of impending confiscatory taxes caused petroleum capital to be shifted massively out of Canada and into the United States... Of the total drilling forecast for years through 1985, the combination of non-industry equity capital and flight capital from Canada will account for an estimated 9,000 to 10,000 wells per year.
Canada-owned companies which were supposedly to be helped by the National Energy Program have left Canada to the extent that they can expect to drill 9,000 to 10,000 wells in the United States per year for the next several years. In comparison, the whole oil industry will be expected to drill
5,000	wells in Canada in 1982 and 10,000 wells in the United States because of a national energy program designed to Canadianize the oil and gas industry.
The sheep in the backbenches on the other side say, "Aye, aye, that's great! Isn't it wonderful?" Isn't the minister wonderful? Isn't this policy wonderful? It really makes one
February 18, ! 982

wonder. If one looks at the chart of drilling activity in Canada over the period 1971 to 1980, one sees an almost steady progression. The number of wells drilled in Canada in 1980 was about 10,000, 75 per cent of which were drilled by Canadian-owned, independent oil and gas companies. Since the National Energy Program, that amount dropped down to 6,800 in 1981, and will drop to about 5,000 in 1982. All of that energy, drive and money will be helping to make the United States self-sufficient, helping to generate jobs in the United States and helping to attract Canadian capital and money to the United States. The Minister of State for Finance (Mr. Bussieres) knows full well that that drain of capital from Canada as a result of the National Energy Program is very much at the root of, and is responsible for, the high interest rates we are bearing in Canada now. Because of that drain of capital as a result of Canadians being driven out of Canada by their own government, we have had to maintain interest rates in this country which are higher than those in the United States in order to attract back some of that money so that our dollar does not drop through the floor.
If hon. members opposite think interest rates are too high and would like to bring them down, the quickest and best thing they could do would be simply to erase the National Energy Program and the last budget.


Some hon. Members:: Hear, hear!


Harvie Andre: Then interest rates would go down by at least three or four percentage points. All they have to do is to reverse what they have done and we would have a three or four percentage point drop in interest rates.
I have not spoken of the jobs which have been lost through this National Energy Program. There has been a colossal loss of jobs, tens of thousands of jobs, not just in western Canada but all across this country. According to a study by Foster Research, for every dollar of capital spent in Alberta on oil and gas, only 29 cents is actually spent on products from Alberta; 42 cents of that dollar is spent on products from Ontario; 13 cents is spent on products from Quebec; and 16 cents is spent on products from the rest of Canada. Therefore, because our exploration effort is being cut in half as a result of the National Energy Program, and because Canadians are drilling twice as many wells in the United States as in Canada, the amount of capital which would have been spent in Canada is at least $10 billion a year less than would have been the case under this budget. The number of jobs thereby lost is horrendous.
1 wonder how many people know that the industry which purchases the largest number of trucks is the oil industry. 1 wonder how many of the workers in Ste-Therese who were laid off at the truck plant realize they were laid off because of the national energy policy of the Minister of Energy, Mines and Resources. 1 wonder how many realize that, in fact, many of the jobs lost in the auto industry are directly as a result of the national energy policy. I am quite certain they were not told that by their Liberal representatives.
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There has been a tremendous loss of opportunity to this country in terms of jobs and investment which would have come in. 1 am speaking about conventional oil and gas development, and I have not spoken about the megaprojects. I am referring to the loss at Cold Lake and the probable loss at Alsands. The Economic Council of Canada, which is not a Progressive Conservative Party organ, stated that the only good thing that the Canadian economy has going for it, heading into the 1980s, is the development of the megaprojects. Where are those megaprojects?


Ian Gardiner Waddell: That's a myth, Harvie.


Harvie Andre: The hon. member says it is a myth. I invite him to read the report of the Economic Council of Canada. The hon. member should accuse it of putting forward myths. However, that is what it states in the report. The reality is that there has been an incredible cost to Canada as a result of the National Energy Program and the taxes which were proposed.
Has the consumer gained? Have we at least protected the consumer? Has the consumer in Canada received cheaper oil and gas as a result of these energy programs? I will read the promise given by the Prime Minister (Mr. Trudeau) on February 12, 1980. He said, "The Liberal price hike will be less than half what the Tories plan to inflict on you. We will negotiate an increase of less than 14 per cent."
Has that promise been kept? Not according to every single outside observer who has looked at it, not according to the facts, and not according to the people who must buy gasoline and heating oil. They did not impose an 18-cent-a-gallon excise tax on gasoline. They imposed a 20-cent-a-gallon petroleum compensation charge on gasoline and heating oil. We were not going to tax heating oil. Those in Quebec and Atlantic Canada who use heating oil to heat their homes this winter will pay 20 cents a gallon more that would have been the case under a Conservative government. That is the way they keep their promises; no 18-cent tax but a 20-cent tax. They are marvellous promise keepers. You can put that in the same category as no price and wage controls. Consistency in truth is not something that hinders a Liberal very long.
These two taxes, the natural gas and gas liquids tax, were imposed through the National Energy Program. 1 know the socialists, the Liberal Party west, would recognize and support the rationale given by the minister that it was necessary to impose these taxes because the foreign multinationals were draining the country dry, taking the revenues from our national resources out of the country.
In 1982 and 1983, according to the budget presented by the Minister of Finance on November 12, the petroleum and gas revenue tax will raise $3 billion. The natural gas and gas liquids tax will raise $1.5 billion. Between the two, they will raise $4.5 billion. In the entire period between 1970 and 1980, the sum total of all dividends, interest and profits taken out of Canada by the foreign multinationals did not equal $4.5 billion. Therefore, the government is taking out more in one

February 18, 1982
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year than was supposedly taken out over the last decade. That is the rationale given for this policy.
Only the most obtuse, myopic or doctrinaire socialist could accept what has happened without feeling some remorse. Walking in downtown Denver today is like walking in downtown Calgary four or five years ago. There are geologists, engineers, Canadians anxious to get going, to get drilling and anxious to work.
One company alone, not that big a company in terms of the oil business, transferred 70 engineers and geologists out of its Calgary office to Denver. Every one was a Canadian. They had to go there because there was no work in Canada. There was nothing for them to do in terms of employing the skills for which they are trained. They are finders. They want to find oil and gas. That is what they are trained to do and want to do. We have lost them. They have gone.
One engineer or geologist working at his occupation generates 12 other jobs. That is the spin-off. From that one company, we have lost for Canada 8,400 jobs. That company represents less than 2 per cent of the Canadian industry. That is a typical story right across the country, and nobody cares.
There is something else 1 want to talk about with regard to the natural gas and gas liquids tax in particular. This bill establishes a precedent that 1 find absolutely incredible. It is something 1 will want to deal with very extensively before we complete all stages. 1 refer to the provision "whereas the rate of tax can be set by regulation".
If that is permissible, the next logical step is that the Income Tax Act will say tax rates will be set by regulation, the Excise Tax Act will say that the tax rates will be set by regulation and in fact the Crown will assume to itself the right to set all taxes. The historical rationale behind Parliaments, the reason for the Magna Carta, that the Crown shall not tax without the approval of Parliament, shall have been violated. This is a precedent that should terrify anybody but the most doctrinaire socialist who believes the government should do whatever it wants, whenever it wants, because the government knows all and has all wisdom, intelligence and so on.
This will be a matter that I and my colleagues will want to pursue with some vigour. This House would be committing a tragedy and leaving a legacy for the nation, in terms of this procedent if we allow it to pass, where the Crown by regulation can set tax levels. The power to tax is the power to destroy. To put the power to destroy in the hands of the Crown without a parliamentary check-and there would be none under this precedent-is so extreme that it is almost incomprehensible that something like that would be contemplated.
In conclusion, 1 hope with the passage of time, the 15 months, there will be enough sincere, concerned Canadians who will look at the National Energy Program objectively, will look at what has happened, at the fact that so many Canadians have been driven out of the country, so many billions of dollars have left, at the jobs we have lost, and say that maybe there is a problem. If for no other reason, they should look at what has happened to world prices. Much of the national energy policy
was based on the supposition, admitted reasonably based at the time, that world energy prices would increase at inflation plus 2 per cent.
We now know that was a wrong assumption. That assumption was falsely based. It is quite one thing to have a PGRT and NGGLT at these levels when you have a commodity increasing at inflation plus 2 per cent. However, when you have a commodity decreasing, as is the case today, then these taxation levels are punitive and destructive. The destruction is all about us. Those of us in the west can see it more closely at hand. I can assure the House that people in the rest of the country are suffering as well, albeit second-hand, but many of the unemployed in central Canada are unemployed as a result of that consequence.
As has been recommended by a number of people, including myself in other speeches, let the government declare the national energy policy a victory, let them pat themselves on the back, let the minister keep his A-l rating in the Ottawa Citizen. Then let us get after changing these dumb parts of the national energy policy and get the country back to work again, because that is really what we have to get after.
I hope more than just a few of us examine this precedent of taxation by order in council. If we allow that to happen, 1 am afraid one of the most fundamental freedoms in a democracy, freedom from arbitrary taxation levels by the Crown, will have been destroyed. If we are to fulfil our responsibilities as representatives of the people, we must not let that happen.


Leonard J. Gustafson: Mr. Speaker, I would like to say that I am pleased to rise and speak to Bill C-93. However, I cannot say that in view of the economic difficulties we Canadians find ourselves in today. Our serious economic difficulties are not only a result of a poor budget, probably the worst in Canada's history, but also a result of a national energy policy that has been even more disastrous.
The bill we have before us which proposes changes to the natural gas and gas liquids tax, the petroleum and gas revenue tax, along with the introduction of an incremental oil revenue tax, causes me concern. It is the impact of this bill which particularly concerns me.
For three years and more western Canadians have experienced a boom. However, in the last couple of years the boom has been reversed because of the national energy policy.
I would like to deal with that aspect today.
First, I would like to talk about the impact of the budget upon western Canada. It has driven out capital and provided no inspiration for development in any area. The budget has also had a negative impact on farmers and the agricultural industry in general. The national energy policy has caused the greatest impact.
We have sat in the House for several days and witnessed the Minister of Finance (Mr. MacEachen) brought to task over a budget which has been detrimental to our economy. In the last few weeks very little has been said to the Minister of Energy,
February 18, 1982

Mines and Resources (Mr. Lalonde), who is really responsible for a major cause of Canada's economic crisis today. The first priority for Canada's development should have been energy. Canada has an unequalled amount of natural resources compared to virtually every country in the world. Our country is one with vast opportunities, technology, engineers and production capabilities.
The Minister of Energy, Mines and Resources, under the supervision of the Prime Minister (Mr. Trudeau) and his government, introduced a national energy policy which literally laid the oil industry in western Canada flat on its back. This message was made clear by the results of the byelection which was held in Alberta yesterday. The government cannot remove $52 billion from an industry in one part of Canada during the next four years and expect people to like it. It cannot place the responsibility of the tax load of the whole country on one industry and expect that industry to continue.
I can illustrate with figures what has happened to the oil industry in western Canada. I live in southern Saskatchewan where the oil fields of Weyburn, Estevan, Radville and Midale have been affected. Oil fields all across Saskatchewan and Alberta have been affected in the same way as a result of the tremendous impact on the economy of Canada.
1 will now illustrate some examples of what has happened. The economy in western Canada was buoyant two years ago. In my area of southern Saskatchewan there were 15 oil rigs at work. This is a lot for a small field like Estevan. Today, that number is down to one or two rigs which are drilling. Exploration in western Canada fell substantially during the year, with an estimated 6,650 wells in completion during the year, which is down from 8,938 in the year 1980. Expenditures on exploration and development declined by an estimated 22 per cent. We lost 180 oil rigs as of December 1, 1981, and that has probably climbed to over 200. In Saskatchewan and Alberta there were 454 oil rigs when the government started meddling in the national energy policy. We are now down to less than 250 oil rigs, of which 50 do not have any work today. In other words, more than 40 per cent of the rigs have either moved to the United States or are idle.
The Minister of Employment and Immigration (Mr. Axworthy) talks about creating jobs for Canadians while at the same time his government brings in a national energy policy which steals jobs from Canadians, robs them of their homes and puts them on the unemployment line. The impact on the oil industry in western Canada can also be related to eastern Canada through the spin-off effects. For example, a small General Motors dealer told me that two years ago he sold 50 GM trucks to the oil industry. He sold four last year. This means that jobs were lost to people in Ontario who worked in the auto industry and industries related to steel. It has cost Canadians a great deal.
In my area people who once had jobs are now unemployed. We did not know what unemployment was in southern Saskatchewan. There always was a job for a farm boy in the oil fields. In fact, the oil companies could not get enough help in
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southern Saskatchewan. However, there is unemployment there now.
Another impact on all of Canada has been the outflow of capital. The Canadian Petroleum Association has estimated it to be something over $7 billion. This relates directly to the national energy policy. They have lost confidence in Canada, a country which has all the potential of being the greatest in the world in every aspect. But we have an economy which is flat on its back. How did this happen?
I have with me an article entitled "Centralized Power Keeps Economy in Trouble" which appeared in the Ottawa Citizen.
It concerns what happened in Russia over 60 years ago when certain people in the government were bent on centralizing power and strength in one area. The result was a sad and dismal record of people in that country lining up to get food because of socialistic, nationalizing policies.
After losing the byelection in Spadina, what did Mr. Coutts, the so-called favourite son of the Prime Minister, have to say when speaking to the Ontario Liberal Association? He said we must do in four or five industries what was done by the national energy policy. Can hon. members imagine what would happen to this country if the people of Canada allowed the government opposite to continue in the direction of nationalizing industries? Mr. Coutts mentioned the farm machinery industry, the auto industry, the forest industry and so forth. 1 do not have the article before me, but he mentioned five major industries which he thought should go in the same direction of centralized power and control, but that would do nothing but drive capital out of the country.
Today it was said in the House that the Conservatives have no solutions to the high interest rate problems we have today. I say the Conservatives do have some solutions. We would invite capital back into this country. We would bring about investor confidence in the economy of this country. We would see lower interest rates which might be at least as low as those in the United States. We would see a strengthened Canadian dollar. Capital would not flow out of the country, and therefore it would not be necessary to keep interest rates so high. High interest rates are stifling the economy of this country. High interest rates are robbing people of their homes and jobs and all the things young people want to see in the expanding economy we should have. High interest rates have deprived us of these things.
I want to read into the record some figures because it seems that Mr. Trudeau has two fuel pumps.


Mr. Deputy Speaker:: Order, please. It is the practice of the House to refer to hon. members by their titles or their constituencies.


Leonard J. Gustafson: Thank you, Mr. Speaker. It seems that the Prime Minister has two fuel pumps. He has one fuel pump for an election, the less-than-18-cent-increase fuel pump. The other is the fuel pump from which the people of Canada are taking their fuel now. The Minister of Energy, Mines and

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Resources is at that pump, and fuel from that pump costs us about 80 cents a gallon more. In Toronto, Ontario the price to the consumer on January 1, 1979, was 99.9 cents. On August 31, 1981-and the price is probably up ten cents since then- the price was $1,728, an increase of 72 cents a gallon. In St. John's, Newfoundland during the same period of time the price went up 83 cents a gallon. In Halifax, Nova Scotia, the price went up 74 cents a gallon. In Saint John, New Brunswick, the price went up 72 cents a gallon. In Charlottetown the price went up 88 cents a gallon; in Montreal, 81 cents; and in Saskatchewan, 72 cents. Do hon. members remember the fuss about the 18-cent increase? Now it is 80 cents a gallon and climbing. That is the result of the national energy policy. I said earlier that the national energy policy will take $52 billion out of western Canada over the next four or five years, and hon. members wonder why there is a reaction like the one yesterday in an Alberta byelection!
I want to say something else about the direction the government is taking toward centralization and nationalization. I come from the province of Saskatchewan where we have what is called the Crow rate. The Minister of Transport is trying to pluck that rate, and we have a very, very serious situation.


Ian Gardiner Waddell: More than pluck.


Leonard J. Gustafson: Our economy is flat on its back now. Farmers are paying the highest fuel prices in the history of farming. The price of diesel fuel is up 65 cents a gallon. That situation is about the same in all provinces. Machine costs have increased 100 per cent over the last three years. The cost of production is the highest it has been in the history of the country, and the Minister of Transport is suggesting that the Crow rate should go and that when farmers are already faced with increased costs they should be asked to pay that added expense.


Lorne Edmund Nystrom: Shame. That is as bad as the Tories.


Leonard J. Gustafson: The farmers cannot do it.
What has brought all this about? Let us take a little history lesson. I hear members of the New Democratic Party shouting down at the other end. I wish they had shouted for a victory for the Tories when the Tories were in power, and had left us there instead of defeating us.


Lorne Edmund Nystrom: You would have got rid of the Crow.


Leonard J. Gustafson: The NDP-Libera! coalition must bear the responsibility for imposing the national energy policy on the people of Canada.


Ian Gardiner Waddell: Hear, hear!


Leonard J. Gustafson: Let us look at the history of the NDP on this matter of a coalition. I was not going to mention this, but because members of the NDP have become so upset, I should just bring this to their attention. Hon. members will recall the debate about the Constitution, although we have not heard
much about it lately. However, it is very important to Saskatchewan farmers that they be able to own their farms.


Lorne Edmund Nystrom: Hear, hear!


Leonard J. Gustafson: That is a very important part of farming. One headline read: "Property clause must go: NDP".


Mr. Kristiansen:: Mr. Lougheed too.


Leonard J. Gustafson: The NDP made a deal with the Prime Minister. The NDP could not support the Prime Minister's constitutional proposals unless the right to own property was removed. We must thank the NDP for that. We have much to thank the NDP for, including that coalition. The Liberal-NDP coalition also defeated the Conservative Party.


Mrs. Mitchell:: Now, now, be nice.


Mr. Evans:: It was the people who defeated the Conservative Party, not the NDP and the Liberals.


Leonard J. Gustafson: Now a member of the Liberal Party tells us it was the people.


John Leslie Evans: It was two years ago today. Do you remember?


Leonard J. Gustafson: I think the Liberals got 136 votes out in Alberta yesterday.


John Leslie Evans: How many did the Tories get?


Leonard J. Gustafson: I think that is what the Liberals got.


Gordon Edward Taylor: One hundred and thirty.


Leonard J. Gustafson: Even less, 130.
This Liberal-NDP coalition has brought to an end one of the biggest booms that ever existed in western Canada.


Lorne Edmund Nystrom: Yes, Sterling Lyon.


Leonard J. Gustafson: That coalition has brought western Canada the national energy policy, an increase of 83 cents a gallon and a tax load increase of $52 billion.


Lorne Edmund Nystrom: Tell us about Sterling Lyon.


Nelson Andrew Riis: How did the Tories do in that byelection?


Leonard J. Gustafson: These are the kinds of problems we have when government and power are centralized.
There was a great deal of talk about Canadianization. The Conservative Party believes that Canadians own the resources and that benefits from them should accrue to the Canadian people. But what has been the result of this policy, Mr. Speaker? If you were to go to Williston, North Dakota, you would find that most of the men working in the oil fields are Canadian. Last spring 1,000 loads of oil-related equipment crossed the border at Crosby, North Dakota, within a 24-hour
February 18, 1982

period. The Liberals and the NDP in this House cheer about that.
Just two years ago United States investors were putting their money into Canada; today, Canadians are investing in the United States because they have lost faith in this Liberal administration. They have lost faith in this Liberal-NDP coalition.
It might be well to point out something that is positive, although there is not too much to be positive about in the way the Liberals have been handling things in this country. Our economic situation is the result of a colossal blunder, but the budget promises no hope of recovery and absolutely nothing will happen as a result of the National Energy Program. There must be a complete turnaround in thinking and I hope the Liberal and NDP backbenchers will wake up in time to restore confidence to the people and investors of this country.
Last weekend the NDP made it clear that it did not want to defeat the government. It made it clear that it is the Liberal Party of western Canada. I suggest it is time the people of Canada called for responsibility from the coalition that exists in this House and in the country.
The national energy policy has affected the megaprojects. The Alsands project could have had spin-off benefits amounting to billions of dollars; it could have created jobs in Ontario, Quebec and all across the country in the auto and other industries. But those projects are at a standstill. Nothing is happening and nothing will happen. The same thing holds true with the Cold Lake project; nothing is happening and nothing will happen. What positive approach can we take, Mr. Speaker? We must call on the government to reverse its policies. I realize that a lot of apologies would be called for and that it would have to back off from some of its proposals. Ten backbenchers have started to squirm about jobs.
I believe that there will be jobs. Canada is a country of potential and we should capitalize on that potential. Jobs will be created if we put the oil industry and the manufacturers of eastern Canada back to work; if we allow capital to flow into the country instead of watching it flow out; if we bring interest rates down and operate in a businesslike manner.
A great deal more could be said about this bill, Mr. Speaker, and I should like to make some comments about natural gas. In the short period that this party was in power-and people will never forget it, especially when they see the results of this national energy policy-we recommended the sale of natural gas to the United States and that the proceeds be invested in oil exploration in this country. That would have led to a boom in Canada but the NDP and the Liberals opposed it. As a result, today there are trillions and trillions of cubic feet of natural gas in western Canada; well after well is capped and there is a glut of natural gas. At the same time, we are buying oil from Mexico at the highest price we have ever paid. Just a few weeks ago the Prime Minister tried to sell some of our other commodities to the Mexicans but did not succeed. Is it right that we should spend taxpayers' money buying oil when we already have it in Canada? This keeps men and women,
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boys and girls, from getting the jobs and the homes that they need so badly.
The chaotic situation of the economy in this country should weigh heavily on the conscience of every Liberal backbencher, Mr. Speaker. It is too bad that the Minister of Energy, Mines and Resources is not in the House today so that he could hear some of the recommendations put forward by this party to correct the serious mismanagement of the National Energy Program.


Some hon. Members:: Hear, hear!


Ian Gardiner Waddell: Mr. Speaker, I should like to begin my remarks on this budget measure by referring to the speeches of the last two members of the Conservative Party who spoke-the two hon. members from Denver. We heard a lot of rhetoric and very little reality from them except for the suggestion by the hon. member for Calgary Centre (Mr. Andre), with which 1 agree, that there is a danger of taxation by order in council. He said that he would raise that matter again when we reach clause by clause consideration of the bill in committee.
The hon. member for Calgary Centre said that this taxation is doctrinaire socialism. Mr. Speaker, when the OPEC countries increased the price of oil from $2 per barrel to $34 per barrel, that was a windfall for them. When the price of oil in Canada is $18 or $19 per barrel and, with the agreement of the producing provinces, particularly Alberta, is to be increased to about $66 per barrel by 1986, someone is going to get a windfall and the consumers will pay for it. It makes sense to split the take-industry receives some, the federal government receives some, and the provincial government receives some. It is not doctrinaire socialism; it is the reality of the situation. The Conservatives would have had to do the same, and were in the process of doing the same thing with the short, beloved Clark government which came to its demise two years ago today. Its demise was not caused by Liberal members or members of the NDP, but by the Canadian people.
Let us not hear this nonsense about the removal of the property clause from the Constitution; I am tired of it. I suspect the hon. member for Yorkton-Melville (Mr. Nystrom) who served on the constitutional committee is tired of hearing it as well. No one in the NDP would say that farmers cannot own their farms. We believe that farmers should own their farms. The property clause was removed because it was a mischievous one. 1 understand it was removed on the request of some provincial governments which were worried about, the use of the clause to stop provincial legislation, such as Prince Edward Island, a great socialist province. Let us not hear any more of that rhetoric or rhetoric about a Liberal-NDP coalition.
Let us look at the facts. As the hon. member for Skeena (Mr. Fulton) indicated in a motion under Standing Order 43, the Conservative Party has voted with the Liberal Party more than has the NDP. this idea of a coalition is nonsense. I

February 18, 1982
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repeat that it was Canadians-pardon the expression-who threw the bums out; it was not the other way around. To say otherwise is really idle rhetoric. 1 think the Conservative Party is tearing itself apart. The hon. member who spoke, was he pro-Crow or anti-Crow? He was pro-Crow, but the hon. member on my right was anti-Crow. Was he pro-Joe or anti-Joe? I suppose he is not telling. It is rather sad to see the party tearing itself apart when there is so much room for ammunition to throw across the floor.
Another myth is that somehow the boom was ended in western Canada by a coalition of Liberal and NDP ideas. 1 remind the House that the NDP is not in power in British Columbia, Alberta or Ottawa. A likeminded government is in power in Saskatchewan, and its economy is relatively healthy.
The final myth is the entire Conservative position. What is its position with respect to energy? It is that we should let foreign capital come in and make Canada a big Bermuda. Surely there is a fundamental flaw in the position. If the hon. member listened to his own words, he would see the flaw. The fact is that foreign capital will come in and, when investors do not like it here or find greener pastures elsewhere, they will go to Denver or Indonesia.


Leonard J. Gustafson: Do you want a banana republic?


Ian Gardiner Waddell: As the hon. member is heckling, Canada will then be a banana republic. It is the banana republic strategy; it is no strategy at all.


Lorne Edmund Nystrom: It is the Conservative strategy.


Ian Gardiner Waddell: That could be. I listened to the comments of the Conservative energy critic and one of his distinguished colleagues who is a member of the energy committee. Its strategy seems to be to solely let foreign capital come in. It is willing to repeat past mistakes and continue that way, but I do not think it will hold up.
I should like to make some reference to the separatist victory in the provincial byelection in Alberta yesterday. As a western Member of Parliament, I should like to make a couple of comments about it. Basically I see it as a collapse of the Social Credit Party in Alberta and as an indication of disappointment and disillusionment with the Lougheed government. It is an attack on the Lougheed government as well as on government in Ottawa. Ottawa has not been listening to the problems of the people of that area. As I deal with the budget provisions in my speech, I hope to show where improvements could be made to those policies. I wish people in eastern Canada would really try to understand some of the problems of western Canada. I understand the difficulty of understanding when one hears idle rhetoric such as the allegations of the last two speakers. If westerners could be faulted at all, I suppose we could be faulted for not articulating our position clearly. The position certainly exists, and the east is not listening.
There are perhaps three traditions in western Canada which are never reflected in the eastern press or in the words of
eastern members of the House. There is a sort of wild, anti-Ottawa, populist tradition which fluctuates up and down; perhaps it is somewhat redneck. It was reflected in the byelection.


Mr. Shields:: Mr. Speaker, I rise on a point of order. Would the hon. member clarify what he means by eastern press? Was he referring to the press of Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland, or was he talking about the press of Ontario and Quebec?


Ian Gardiner Waddell: Mr. Speaker, I am from Vancouver and any press east of Cranbrook is eastern press, such as The Calgary Sun and so on. Perhaps I will give the hon. member an example. Recently an article appeared in the Toronto Star, a very good newspaper, which referred to this nonsense about all the power in Canada suddenly moving to Calgary and that Calgary would surpass Toronto in the near future; it was absolute nonsense. I am glad to see Calgary and the province of Alberta growing, but in the near future it will not surpass the power and influence of Toronto. In my view that is stupid journalism.
I should like to return to what I was saying about traditions in western Canada. The first tradition is that rather odd populist tradition about which I talk. It is reflected in this separatist victory, and I think it is an aberration which will go away. It is not similar to the situation in Quebec which I think is a more fundamental problem.
The second tradition is the Conservative tradition, the legitimate Conservative and private enterprise tradition of the west. This tradition has been reflected in many speeches, sometimes with less rhetoric, by hon. members on my right. Those speeches are worth listening to, although I disagree with them in terms of the Conservative position. It is a legitimate tradition, but it is not the only tradition of the west.
The third tradition is that of socialism and co-operation. It has existed in western Canada for some time and it is a growing tradition. It is reflected in the governments of Manitoba and Saskatchewan and in the opposition of British Columbia. It has a different focus; perhaps it is a little more people-oriented in a different sort of way. It believes that government is not the big bad wolf. It believes in government initiative and direction. It believes in co-operative federalism between federal and provincial governments. It is somewhat populist and anti-Ottawa. It is looking at decentralization and participation in government in different ways. It is looking at reform of existing political structures. I am a member of that tradition because I like to think it is the way of the future. There is a sense of outrage in the west, as the hon. member for Kootenay West (Mr. Kristiansen) indicated.
There has been a housing crisis in Vancouver for three years. Just last week there were reports in Ottawa that vacancy rates were low and that housing prices were rising; I bet we will now see some government action on housing. Although we yelled and screamed about the housing crisis in British Columbia, the whole crisis was ignored by Ottawa.
February 18, 1982

We have seen government members rise and dismiss our objections regarding the Crow rate as reactionary. It is easy for the Prime Minister (Mr. Trudeau) to do that. It sounds good and the whole eastern press-this time east of the Lakehead-picks it up and indicates that it is reactionary. But they have not examined the real situation. Westerners feel that is part of the bargain of confederation. If you change the grain rates, you have to change a lot of other things as well; for instance, some of the bargains that westerners made with the national policy of eastern Canada, the tariffs, the anti-Crow position, and so on. This should not be dismissed so easily.
I want to say something about the National Energy Program. This program is a limited success. It is perhaps the only success of this government. The direction of the program is correct. I said that in this House in June, 1980, before the program was introduced. The public want more. The committee to Canadianize released a poll showing that the public supported public ownership of the oil industry. I think the public is in favour of greater Canadianization. You have to distinguish the vocal critics from the majority of the people of this country. The hon. member from Calgary reflects the oil industry. Of course, Imperial is not very happy about this program. It does not want to give up any of its profits. The crucial point is that oil is a strategic commodity. That is where the National Energy Program and the Conservative Party differ.
This is not putting westerners in their places. The oil is there in the west. The same problem will arise with Newfoundland and with the north when development starts up. Oil is a strategic commodity and has to be developed through public direction. You cannot have a few cowboys being totally free to run the industry. That does not stop private initiative in the industry, but you have to have some overriding direction.
There are problems with the National Energy Program which are not helped by this bill. The program has not attracted small Canadian industry to the frontier. It has attracted big corporations and foreign-owned corporations. The government will have to take another look at that.


Mr. Kelly:: What is your evidence?


Ian Gardiner Waddell: I suggest to the hon. member that he talk to his own Department of Energy, Mines and Resources and he will get the evidence.
The second problem is the slow rate of Canadianization. We now have an industry which is 60 per cent to 65 per cent foreign controlled. The government has said it is not going any further with Canadianization. The government has stopped the procedure. That is the problem with the Liberals; philosophically, they cannot complete a progressive program. I hope some day there will be a realignment in this country between a conservative group and a progressive group.


Mr. Crosby:: There is; it is the Progressive Conservative Party.
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Ian Gardiner Waddell: Not a Progressive Conservative group. But 1 think the realignment will come about.
The third problem with the National Energy Program, and 1 think the hon. member from Saskatchewan who preceded me is right about this, is that the little guys are not being helped. There seems to be evidence that drillers and small companies are not being helped. Perhaps that is the reason the Conservatives did not do very well in the byelection. Premier Lougheed has not protected small drillers, neither has the National Energy Program. The government of Saskatchewan took some steps with respect to royalties. That government is rebating and reducing royalties to help small drillers. That sort of thing should be looked at. I hope members opposite will not call me a doctrinaire free-enterpriser for saying that.
In my opinion, it is a false premise that the National Energy Program will take us to self-sufficiency. Right now we import 20 per cent of our oil. The established remaining reserves of conventional oil in western Canada amount to about five billion barrels. We have about ten years of reserves at the present rate of consumption. The Hibernia reserves are projected to come on stream in 1986, which will bring in an additional 1.5 billion barrels of oil. But there will be delays with this project. Hon. members are aware of what happened the other day and the tragedy that ensued on the oil rig there.
The Beaufort Sea has a potential of about ten billion barrels of oil, but that oil will be hard to extract. We have not yet recovered a drop from there. That Arctic islands, especially the Cisco find offshore Lougheed Island, is very promising. There is a potential five billion barrels in the north. However, we have no way of getting that oil to market. The tar sands projects are delayed. There are technical problems today with both Suncor and Syncrude. The Alsands project is not finance-able. That is why the companies are coming to the federal government for welfare. They want both the federal government and the government of Alberta to bail them out and subsidize the program. That is not at all promising. Cold Lake is a better project. Maybe we can get 450,000 barrels from the tar sands by the early 1990s. Drilling for gas has declined in western Canada whereas drilling for oil has increased.
Let us try to deal with the facts, not rhetoric. It seems to me the problem with the National Energy Program is that it concentrates on the supply side. Instead, we should be looking at the demand side and putting some money into the area of conservation and alternate energy. When we reach the energy security legislation I propose to go into greater detail about how we can conserve and move to alternate energy instead of spending $4 billion in PIP grants.
Specifically, I want now to give some of our positions on Bill C-93. First, it deals with offshore. That point has to be addressed. It is a very difficult problem. Hon. members might note that the Ottawa Citizen took me to task in an editorial. It can be found in "Quorum". The Citizen took Premier Peel -ford and me to task for trying to "exploit" the Hibernia crisis because we complained about overlappingjurisdictions. I think it was a pretty shameful editorial. In fact, I think it was a low blow.

February 18, 1982
Taxation


Some hon. Members:: Oh, oh!


Ian Gardiner Waddell: 1 do, and 1 suspect the hon. member over there agrees with me. He has a right to ask questions about Hibernia and about safety. He has asked questions and so have his colleagues. 1 have a right to ask questions too.
There are nine conflicting jurisdictions in the federal government. Two inquiries are under way, and with the Americans joining in there will be a third. Both the federal government and the Newfoundland government are trying to shirk responsibility for the accident. What about the American government? Who has jurisdiction? I think that is a legitimate point to raise. I think the editorial in the Ottawa Citizen is pretty disgusting. The editorial is also inconsistent.
When Bill C-48 was being debated, editorials and news reports in the Ottawa Citizen said that we should be looking into all these matters of oil spills, safety and so on. But when we start asking questions about them, the Ottawa Citizen criticizes us. Journalists have every right to criticize us; politicians are fair game. But in this case I think the criticism is wrong and the writers have been inconsistent. I have a perfect right to say that.
Basically, the provinces should have jurisdiction over offshore, but we should have interlocking jurisdiction. Under Section 91 of the British North America Act, the federal government has jurisdiction over navigation, ports, defence, external affairs and fisheries. Unless we amend the Constitution they will remain, no matter which way we decide about the offshore.
1 do not agree that we should spend three years on this matter by going to the Supreme Court of Newfoundland and then working up through the Court of Appeal. Let us go now if the governments cannot decide. I would prefer a negotiated settlement, but if the governments cannot decide the matter should be referred immediately to the Supreme Court of Canada. The disaster in Hibernia shows that we have to solve some of these problems. And if the Ottawa Citizen wants to criticize me for this, it can do so.
As a westerner 1 know how control of our resources has fueled our growth. I think that is something that should be considered soon. Meanwhile 1 think the minister was right to include in the bill the clause on the offshore because if they are subsequently changed by virtue of agreement with the provinces or by virtue of the Supreme Court decision, it is important that we have them there.
With respect to Clauses 4 and 5, Mr. Speaker, the tax on domestically consumed natural gas, we are happy that the government for once listened to western Canada and did not put a tax on export gas. Western Canadians said, how come they are going to put a tax on the export of our gas and not on electricity from Quebec or Ontario? It was hard to explain that, so the government quite properly, after questions in this House, withdrew that proposal and then proposed a tax on domestically consumed gas.
The problem with that, and I say this to the minister, is that it is a regressive tax. Hon. members recall the Liberals promised in the 1980 election that we would have lower energy prices. In fact, they gave us higher energy prices. They argue that they had to raise prices, but if you do that you should redistribute some of the extra money. If you are going to tax low-income people, the old and the poor, as you do with this tax, you should give them some of it back in the form of a cost of living tax credit. I think that makes sense.


John Leslie Evans: We did give it back, lan.


Ian Gardiner Waddell: I do not think it has been given back. Total energy costs, as measured by a component of the CPI, have gone up 46 per cent since 1980 under the Liberals. Natural gas prices went up 28 per cent in 1981. The present cost to consumers for oil and gas will double by 1986. I hear from my riding about increased hydro and gas bills, and I suspect other members from British Columbia are hearing it. It is regressive and is hurting older people and those on fixed incomes.
Now, Mr. Speaker, the petroleum and gas revenue tax, the PGRT, is a very complicated matter but 1 will try to make it as simple as I can. Simply put, it is a royalty. It has a certain advantage because you put it on at the wellhead and you cannot deduct this tax here or this expense there. The Conservative government was going to put the tax on at the refinery, the infamous 18-cent-a-gallon tax which some commentators said was responsible for our being here today in these particular positions. The problem with the tax is that it seems to be hurting some of the small producers. As I said previously, it may be the obligation of the federal or provincial governments, following Saskatchewan's lead, to alleviate that problem somewhat. Rather than just export our gas, I suggested a gas bank, because we may need it since we have been converting to gas in eastern Canada. In any case, 1 will have detailed questions on that when we deal with the bill.
Now, Mr. Speaker, I have alleged, and it has never been denied, that there has been a windfall gain for the oil companies for one quarter of 1981 in which no higher taxes were levied. What happened was that the government boosted the price by $2.50 a gallon for the three months from October 1 to December 31, 1981, but the taxes did not come in until January 1. So a government which says they talk tough to the oil companies to turn around and give them a windfall creates a bit of a credibility gap. I hope to explore that when we go into the details of the bill. 1 see the minister nodding, and 1 will put those questions to him or the Minister of Finance (Mr. MacEachen).
I would like to conclude my remarks, Mr. Speaker, by saying something about the myth of the megaprojects. This great spin-off of jobs, and so on, is a myth. There are a lot more jobs in all kinds of other projects. I was counsel to the Mackenzie Valley pipeline inquiry and used to hear these great stories about all the jobs that a megaproject like a pipeline would create. However, when you got into it and examined the witnesses, you found there were a few construction jobs for basically foreign welders who travel around the
February 18, 1982

world doing that. There were some jobs for small construction companies, and there were a few security jobs after it was built. And you were paying $10 billion to build it.
So we have to have a debate in this House, I hope soon, on what I call the myth of the megaprojects. I know the government likes these projects. 1 suspect Canadians have bought the myth that we have to get these megaprojects going to produce jobs, but 1 think it has to be looked at very carefully. The hour for that debate is coming because we are going to look at the Alsands project in some detail.
Finally, Mr. Speaker, 1 would like to warn the government that they are running the risk, in the agreement with Alberta, that the Canadian price of oil may be more than the world price by 1985. There is a glut on the market, world prices are falling, and there is a clause in the agreement that our price be no more than 75 per cent of the world price for old oil, and no more than 100 per cent for new oil. However, that does not include all the special taxes and levies, so it is possible-and this would be most ironic for a Liberal government elected two years ago today partly on a promise of lower energy prices, certainly less than world prices-that they may have put us in a position where we will go beyond world prices. If that happens then there will have to be a renegotiation of the agreement with the producing provinces.
Having given that dire warning, and having dealt, 1 think, with the many aspects of this bill relating to energy, I will sit down and let the government ponder those allegations.


The Acting Speaker (Mr. Blaker):: The Chair will recognize the hon. member for Athabasca (Mr. Shields). Having been recognized, he might like to defer his opportunity to speak because we are approaching five o'clock and private members' hour. However, if the hon. member wishes to proceed for a moment or so, of course he can.


Jack Wendele Shields: Thank you, Mr. Speaker. I am glad to have the opportunity to speak on Bill C-93, and I hope the previous speaker will be in the House when 1 start my speech because I have a few brief comments to make in reply to his remarks.
With that I would like to call it five o'clock.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Blaker):: It is my duty, pursuant to Standing Order 40, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Parkdale-High Park (Mr. Flis)-Air Canada-Mandatory retirement age-Request that pilot be reinstated; the hon. member for Prince Edward-Hastings (Mr. Canada Assistance Plan
Ellis)-National Harbours Board-Purchase of equipment manufactured in Japan, (b) Request for tabling of memoranda; the hon. member for Richmond-South Delta (Mr. Sid-don)-Industry-Canadian content in manufacture of mining equipment, (b) Contract awarded to Japanese company.
It being five o'clock p.m., the House will now proceed to the consideration of private members' business as listed on today's Order Paper, namely, private bills, notices of motions (papers), public bills.


PRIVATE MEMBERS' MOTIONS FOR PAPERS
[Stage Direction]
Notices of Motions Nos. 22, 35, 1, 48, 28, 43, 5, 54, 69. 34 and 84 allowed to stand by unanimous consent.

Mr. Hal Herbert (Vaudreuil) moved:: That an humble address be presented to His Excellency praying that he will cause to be laid before this House copies of all correspondence, memoranda, records of telephone conversations and other communications between the Department of National Health and Welfare and the appropriate ministers of the governments of the provinces relating to the standards for programs and the conditions for federal participation in a revised Canada Assistance Plan.
He said: Mr. Speaker, in this federal government structure there are many sacred cows. Certainly the Canada Assistance Plan is one of those sacred cows. Any suggestion concerning the existing legislation or its administration which might be considered critical is immediately implied to be a criticism of the objectives of the plan itself.
I hope to allay any fears that I am in any way criticizing the objectives of the Canada Assistance Plan. However, the Canada Assistance Plan is financed by the federal government on roughly the basis of 50 per cent of the costs incurred by the provinces. I say "roughly", because the federal government itself imposes the terms and conditions under which it will make the payments. The provincial governments render an invoice, in effect, to the federal government, and the federal government pays according to the amount of invoice submitted. This year, the amount estimated to be paid by the federal government was some $2 billion. However, just last week in the House, the Minister of National Health and Welfare (Miss Begin) told us that the amount which was to be paid this year had increased by some 19 per cent, 19 per cent being approximately $400 million. Therefore, the payments this year from the federal treasury will be of the order of $2.4 billion. If one multiplies that by two and then adds some more, the "some more" being the additional amounts paid by the provinces, one can see that we are looking at an expenditure in the social service field considerably in excess of $5 billion.

February 18, 1982
Canada Assistance Plan
It is interesting to note that during this year, the Quebec province share of the $2.4 billion which is being paid out of the federal treasury is of the order of $700 million, or, per capita, between $160 and $170. One can compare that with the other provinces. The next highest province is the province of Newfoundland, at $96. One notes that the per capita payment in Ontario is $77. These figures, incidentally, were produced by the department for the benefit of a committee which was looking into the Canada Assistance Plan earlier in 1981.
For the record, I would like to look at the two parts of the program. I will divide it into what I shall term as the social assistance programs, which are payments to persons with no other source of income, such as the disabled, single parents with children, those whose unemployment insurance payments have run out, and so on. The federal government has a very direct interest in these particular social assistance programs because it has a tremendous influence on the need at that level. It does have that influence because of federal programs such as the old age pension at one end of the age scale, and the family allowances program at the other end of the age scale.
I referred earlier in my remarks to sacred cows, and I want to interject at this point to say that one of the sacred cows is the subject of universality. That irritates me somewhat. There seems to be all-party support for universality, but there is certainly nothing universal about the programs as they are presently applied, for example, to the old age pension. The major benefit of the old age pension program goes to those who receive the supplement which, of course, is income tested. In the case of the child tax credit, it goes to those with the greatest need, whereas family allowances, of course, are paid to everyone right across the board.
The point I am making is that universality is an excellent objective and one which I would strongly support; but from all practical points of view, we cannot infer that our programs are universal, for the reasons I have stated. I have often made two suggestions. One may not be popular with all my constituents, but I do not mind as 1 have made this public. I suggest that we should stop increasing old age pensions and increase the supplement by an additional amount. Thus, if we were to index, we would index only on the supplement plus the old age pension and, of course, we would have some additional funds so that we would be able to increase the amount of the supplement.
At the other end of the scale, I have suggested that we completely eliminate the family allowances scheme and that we fold the total amount of this program into the child tax credit. While I am referring to the child tax credit, one of the urgent things we must do is to substantially reduce the limit up to which a child tax credit is paid.
1 shall put on the record what may be a somewhat amusing story, but in a certain sense, I think, it is also critical. I was astonished last year to receive from my accountant, who looks after my individual tax returns, a document under which my wife was able to sign her name and apply for a relatively small refund, but, nevertheless, a refund from the federal government under the child tax credit plan. Of course, Your Honour
is aware that I have two children. However, I found it rather ridiculous that I was in the position of receiving a child tax credit. Furthermore, the amount was not very much because 1 was obviously right at the top of the scale. I do not need to disclose what the salary scale is for Members of Parliament because it is public knowledge. However, because 1 was at the top of the scale, the child tax credit was quite small. One could imagine my feelings, almost amounting to anger, or my intrigue when from my accountant I received a bill for preparing that return amounting to some $40, which was more than four times the amount of the child tax credit!
Just to complete this little story, the bill which I received from my accountant for the preparation of my tax return was deductible. Therefore, I put it in, and because I paid taxes at approximately 50 per cent, 50 cents on the dollar, I therefore saved $20 out of the federal treasury. Therefore, the federal treasury paid $20, I paid $20, and my wife received $10. That was a pretty good deal, and 1 have put this story on the record because I think it is time that we looked at the administration of these programs. I think I have made it clear here that 1 am not criticizing the program itself.
The other part of the Canada Assistance Plan on which I wanted to spend some time is the social service area. This includes the personal services or welfare services, including day care, homemakers, counselling services, child welfare, etc. I have suggested that we should get out of social services and do so by transferring the tax room to the provinces.


Margaret Anne Mitchell: Never!


Harold Thomas Herbert: I heard the word "never" from the NDP.


Margaret Anne Mitchell: What happened to health care when you did that?


Harold Thomas Herbert: First of all, this is the position of the Quebec provincial government. They believe that since they administer these programs, they should have full control over them, finance the programs themselves and should not have to go cap-in-hand to the federal government. If you look at these programs in detail, you find that there is a tremendous variation from province to province. The federal government simply says, "Send us the bill and we will pay 50 per cent".
I have already mentioned the amount per capita in Quebec. The split in that province for social assistance programs, is approximately $94 per capita this year. Those are the programs in which the federal government has a tremendous influence, as I have already explained. The payments for social service programs or welfare services over which the federal government exercises no influence whatsoever approximate to $44 per capita in the province of Quebec.
Many of the programs shared under CAP are delivered by non-governmental organizations such as Children's Aid Societies, which are given enforcement responsibility for functions such as the apprehension of children. In some provinces,
February 18, 1982

particularly Ontario, municipalities play a significant role in the delivery of both social assistance and social services.
Many groups maintain that they have insufficient information about what is cost shareable under the CAP. For example, the Canadian Rehabilitation Council for the Disabled had argued that voluntary organizations and disabled individuals need to be better informed of the potential benefits available through CAP so they can lobby their provincial governments effectively. Municipalities in Ontario, charged with the delivery of general welfare assistance and many social services, complain that they do not know whether the rules governing their funding are provincial or federal.
Municipalities may not even be privy to the contents of the federal-provincial agreements. This is the subject for discussion this afternoon. As a result, they do not know whether the rules regarding services are needed to conform with Canada Assistance Plan requirements or are simply rules established by the provincial government.
Health and Welfare Canada occasionally issues guidelines on what is cost-shareable in terms of dollars and specific criteria. It is these guidelines that present problems of understanding the limits of CAP for the public and social agencies. These guidelines have not generally been made public.
The special committee to examine federal-provincial fiscal transfer payments recommended that, and 1 quote:
-the Minister of National Health and Welfare have a Canada Assistance Plan manual compiled to include all guidelines, notes and administrative directives, and that this manual be made public, with appropriate provision to respond to questions by the public on its application.
Objections at the provincial government level are based on the totally unacceptable assumption that the release of these documents would facilitate their municipalities in making interprovincial comparisons. It should be noted that even under the proposed freedom of information act, items which could be detrimental to federal-provincial relations can be exempted from release.
1 had put a notice of motion for the production of documents on the Order Paper. In November of last year I received a copy of the latest signed agreement between the government and the province of Ontario under the Canada Assistance Plan. It is a very voluminous document. I would suggest that no one rush to get a copy. First, it includes the memorandum of agreement made on March 28, 1967. pursuant to part 1 of the Canada Assistance Plan. Attached to that document is a listing of amendments. For example, I will refer to the last three in the pile. There is one made October 31, 1979, listed as Amendment No. 34. Amendment No. 35 is dated September 15, 1980, and Amendment No. 36, the last one in the pile that I was given, is dated February 20, 1981.
All these documents provide is a listing taking off certain locations, certain institutions that are no longer to be financed under the Canada Assistance Plan, and adding on other institutions and listings. This is interesting reading. 1 have no idea whether it is an issue in the respective provinces, but if any provincial social welfare groups have need of this document, I
Canada Assistance Plan
will be very pleased to supply them with a copy. Of course, it is now in the public domain.
I should also advise them that the documents in the other provinces under Motions Nos. 74 to 82, which are the corresponding agreements in the nine provinces, other than the province of Ontario, have been delivered to me. They are in my possession and are available to anyone interested in seeing them. Unfortunately, they do not include the real information, the regulations. These are in the hands of the Minister of National Health and Welfare.
I would like to read three short extracts from a letter from the Department of National Health and Welfare for the benefit of members of the special committee on federal-provincial fiscal transfer payments to which I referred earlier. I quote:
-shareable welfare services under the plan are being provided in all provinces, to a greater or lesser degree.-
Provincial definitions of "social services" may not necessarily be consistent with CAP's definition of "welfare services".-
Provinces may provide services which arc recognized welfare services for cost-sharing purposes under CAP, e.g., daycare, but if CAP requirements arc not met, sharing is only partially available or not available at all.
The important sentence reads as follows:
-the provinces arc not required to submit detailed information on individual services-
Enough is enough. Whether the members of this House agree with my attitude toward the division of social services and social assistance programs is irrelevant. 1 accept and recognize that there is unlikely to be any major change in this regard. 1 put my opinion on the record for what it is worth. However, I believe that the information on the type of programs that are being funded, the extent to which they are being funded, and the criteria under which they are being funded should be available for all members of the public in order that they can compare. The provinces may be somewhat afraid because they realize that this could lead to additional claims. It could lead to pressure from the public to provide in one province the kind of service that is provided in another province.
The reason I have brought this motion forward is that I believe the information should be on top of the table. Whatever we as individuals may desire to do in changing the administration or the legislation, the fact that the program exists means, in my opinion, that the public should have full access to all the information which will enable the public to make maximum use of the program while it is in force and in the fashion in which it is in force.
1 have brought this matter forward for debate simply because I recognize that what I am asking for, which is the discussions which are presently under way, is not likely to be provided before the expiry of the period at which time a new agreement has to be signed. It is just as well to allow interested members to express their opinion on what they would like to see in the revised Canada Assistance Plan which will become operative at the start of the next fiscal year.

February 18, 1982
Canada Assistance Plan


Howard Edward Crosby: Mr. Speaker, the motion brought before the House by the hon. member for Vaudreuil (Mr. Herbert) raises two questions of real concern and interest to all members of the House. First, there is the matter of the free flow of information and the need for freedom of information legislation which would allow Members of Parliament, and all Canadians, to have access to any information from the government necessary to make a study, form an opinion or evaluate a government program. I am always willing, as I am sure are many other members, to support the need and desire for freedom of information legislation to allow this information to flow without the need of special or formal steps to be taken within the procedures of Parliament.
As you may know, Mr. Speaker, there is a piece of freedom of information legislation before the House in the form of an access to information and privacy act. However, that bill has been delayed in committee and the minister in charge has indicated that he may withdraw the bill. This is, indeed, unfortunate, because without the freedom of information legislation, which would require the government to produce information which ought to be made available for the study and assessment of government programs, we will have to continue to use these parliamentary devices to obtain that information. There is a general solution available to the problem of government information being unobtainable. That is the channel we should follow in order to obtain information. We cannot do this until legislation is presented and enacted by the House.
The second matter which the motion brings forward is the status of the Canada Assistance Plan. I would like to make some general remarks about the Canada Assistance Plan and the social services program which is based on that legislation.
I worked for some years in provincial government administration and 1 remember the state of social services legislation which existed in provinces like Nova Scotia, even as late as the early 1950s. At that time, there was a mass of provincial legislation dealing with such programs as mothers' allowance under which support was provided for unwed mothers, mothers who were separated or widowed and those who had no other means of support. There was also the blind persons' allowance and a myriad of provincial legislation which provided necessary welfare benefits.
I know the same was similar in other provinces. During the 1950s, the provincial and federal governments attempted to bring some order to this morass of provincial and federal welfare legislation. What eventually emerged was the Canada Assistance Plan which became a statute of the Parliament of Canada. There was similar legislation under various names in most provinces.
The purpose of this legislation was to codify in a very clear and formal way the base for social services. The Canada Assistance Plan, which was enacted in 1966 or 1967, became the base for our modern and current social service system. Unfortunately, 15 years later that social service system is in jeopardy as a result of the financial policies which were
brought forward by the Canadian government in the budget of November, 1981.
1 would like briefly to illustrate the effect of the budgetary provisions which were introduced by the Minister of Finance (Mr. MacEachen). As I have said in the House and elsewhere, the minister has proposed to transfer the federal deficit to the provinces. The result will be that those provinces which are now in a deficit position will simply not have sufficient funds to contribute to those social service programs, educational services and health services. They will not have the financial ability to maintain these services.
I would like to pay particular attention to that fact because it is supported by the Economic Council of Canada. The Economic Council has said that this is the thrust of the budget provisions with respect to the reduction of the federal deficit. The Economic Council of Canada has confirmed that this will flow through to the provinces in the form of cutbacks on the available funds for health, educational and social services. We must be wary of this and bring it to the attention of Canadians.
I would like briefly to talk about those services which are available and will be until March 31, 1982 under the Canada Assistance Plan and supporting provincial legislation. There are a wide variety of services available and I would like to indicate the effect of those services. According to my statistics, which relate to 1978 and 1979-the numbers are probably much higher for the current fiscal year-approximately $1.6 billion was spent under the Canada Assistance Plan. There were 1,547,000 Canadians who received benefits in all the provinces and territories of Canada under programs which were included within the Canada Assistance Plan. These programs constitute a broad range of social service programs under the Canada Assistance Plan. We should not forget that the Canada Assistance Plan and its services are in addition to programs such as old age security and many other programs which are funded through the provinces and the federal government.
The programs we are talking about in relation to the Canada Assistance Plan deal primarily with assistance to persons in need. These programs include welfare services for those needy persons or those likely to become in need, as well as work activity projects.
If we look at what is occurring in our cities, towns, villages and rural areas, we will see people who, for various reasons, cannot provide for their own welfare. In some cases, they may have reached the age where they can no longer work to support themselves, there may be people who are mentally or physically disabled, or there may be cases where there are children whose parents are not able to provide for them. I am sure that all Canadians recognize that there are many people who find themselves in these unfortunate circumstances in our society.
1 believe that the role of the Canada Assistance Plan is clearly established. I cannot believe that any Canadian-
February 18, 1982

certainly not any Member of Parliament-would be in favour of abolishing any of the programs which have been proven to be essential and necessary. There should be no question of abolishing or cutting back these programs, but rather how these programs can be rendered more effective and efficient. If there are to be any savings or cutbacks on the use of public funds, they should be used to make these programs more effective and efficient.
It is easy to speak with conviction on these matters when you are from the maritimes and a province like Nova Scotia. The services, which are included in the Canada Assistance Plan and supporting provincial legislation, are absolutely essential although a great drain on the revenues of the government. 1 have statistics which demonstrate this fact clearly. In Newfoundland, for example, 17.9 per cent of all provincial expenditures are for social service programs. In the province of Nova Scotia, 20 per cent of all government expenditures are on social services. For the province of New Brunswick, the figure is 19 per cent. These provinces also spend a great deal of their available revenue on education and health. In Newfoundland, approximately 46 per cent of total government revenue is spent on education and health. In Nova Scotia, it is 42 per cent.
It does not take a great deal of imagination to realize that the Atlantic provinces spend a vast amount of their available revenue on programs which are related to education, health and social services. At the same time those provinces have to incur deficits which ultimately have to be supported by taxes. If these deficits are increased it is not hard to see that those provinces will be financially unable to continue those services at the level which was enjoyed in the past.
We are at a point in our history when we ought to be improving those services and ensuring all Canadians have a decent way of life and a decent lifestyle. As I have said, we know there are many Canadians who simply cannot do it on their own and need help.
When we talk about social services and programs and the financial ability of provinces to provide those programs to their people so there will be equality across Canada, it is interesting to note how the provinces spend their money. For example, it will surprise no one that the province of Alberta is number one on the list of per capita expenditures. The government of the province of Alberta spends $3,135 per person on government services. It is also interesting to note that the poor little province of Prince Edward Island is next on the list. The province of Prince Edward Island spends $2,618 per person to provide services to the individuals of that province.
Statistics such as these demonstrate graphically that the province of Alberta, with its great wealth and resources, is able to spend $3,135 per person for government services, and it is easy to see how that province can afford that kind of money, but we must ask ourselves how the province of Prince Edward Island, which is next on the list, at $2,618, can afford to maintain those services. Bearing in mind that this province has
Canada Assistance Plan
a budgetary deficit and bearing in mind that it has a permanent government debt, I can tell hon. members that if there is any cutback in transfer payments to that province, it will not be able to maintain the services, and that if this province has the desire to maintain services, it will only do so through increased taxation. This is a very serious situation, and it is not helped-it is rendered more extreme-by the budgetary provisions. The message we as members of the House of Commons have to get out to Canadians is how budgetary provisions and government financial policies affect the services Canadians require.
Let me talk very briefly about the system in use under the Canada Assistance Plan. As I have said, it covers a variety of services which are directed to persons in need, and those persons quite often are senior citizens, disabled persons and the young. The method by which those services are delivered is through provincial social services departments and the municipalities, which maintain departments to provide social services. In most cases there are financial tests which are the bases for administering those services. In some cases the financial tests are quite difficult; that is to say, people who may feel they need government assistance are not able to get it because they do not qualify under the financial test.
This raises a matter which was discussed earlier and referred to as the matter of universality in government programs. It is true that in bringing in old age assistance and many other assistance programs, the federal government established the principle-if we can call it a principle-of universality; that is to say, if there is assistance available to persons of a certain age-in the case of old age assistance the age is 65 and over-it ought to be given to all persons who reach that age and ought to be universally applied and should not be based on any kind of need or means test. Even though universality is a matter of principle which commands broad support, there comes a time in our history when we cannot afford that kind of program; that is to say, our desire to provide assistance to a group of persons without reference to their special financial needs affects our ability to provide effective services to those who really require the services. As has been pointed out, I think it is true that we must review the principle-if we can call it a principle-of universality. We must make sure people are not being deprived of necessary and essential services merely because we are trying to conform to a principle which can no longer be practically applied.
I agree that we ought to examine universality and consider tests and methods which will identify those in our society across Canada who need service at public expense. We ought not to waste our financial capability by providing services to persons who do not really need them.
In my view-and I am sure in the view of most members of the House-there is no way the federal government ought to get out of the field of providing social services. That would be a tremendous danger, not just to the individuals who might be affected but to the whole fabric of Canadian society. In addition, it would contradict the very idea of the constitutional changes which have finally been approved in the House. It

February 18, 1982
Canada Assistance Plan
would contradict the idea that Canadians right across the country ought to have equal services. The new constitutional provisions indeed indicate that the government ought to direct its attention toward the removal of any causes of regional disparity. It ought to take action which will allow people in the maritime area to enjoy the same level of service and standards as those enjoyed by persons in central Canada and western Canada. If the federal government at this stage of our development were to vacate the field of social services, that would be a disaster. The federal government has that obligation, the obligation has been accepted and this is no time to reject it.
I am afraid there is some truth to the suggestion that the federal government is getting out of social services because I have indicated-and I do not want to repeat it-that it has been demonstrated by this budget that the federal government is in fact reducing its assistance to the provinces in the way of transfer payments and in the way of support for established programs. This indeed could lead to withdrawal of social services and services which are now being provided in the educational and health fields. Again we must be on guard to ensure that the federal government does not go too far down this road because that would have a disastrous effect and would destroy the equality we are trying to achieve in Canada for all Canadians.
I want to touch very briefly on some of the developments in the social assistance field. I am pleased to note that a study was undertaken in the province of Nova Scotia of the plight and of the situation of unwed mothers.


Margaret Anne Mitchell: What about unwed fathers?


Howard Edward Crosby: What about unwed fathers? I include unwed fathers too, if they are supporting children, but the point is that when we are speaking about unwed mothers, we are usually speaking about particular situations in which people have become the mothers of children and are not able to care for them. Nobody likes nomenclature which has the effect of casting aspersions on female persons or anybody else in society, but I have important things to say, and I want to communicate them and get a point across. If everybody in the House and across Canada understands what we mean when we say, "an unwed mother", that is good enough for me. When a better terms comes up, I will use it, but right now I am talking about unwed mothers and the fact that services have been provided to them in the past, and I am happy to see that the whole situation is being reviewed and has been reviewed in the province of Nova Scotia. A 325-page study report has been issued entitled "Vulnerable Mothers, Vulnerable Children". I want to point out to my friends to the left in the New Democratic Party, who think they have a monopoly on concern for the people of Canada, that there are other people who are concerned. The government of the province of Nova Scotia is concerned. There are even people in the federal government who are concerned about these problems, and they are doing something about them. They are looking at the situation. As pointed out in that title, "Vulnerable Mothers, Vulnerable Children", we are interested in children. We cannot have
children in this country in need and not being helped and assisted because that would simply mean greater problems down the line, not to mention the humane side of it, which is reason enough. I want hon. members in the New Democratic Party to know that we are aware of these situations. We want to see them dealt with.
There is another point I want to make just to indicate how government policies can have an effect on social services. Recently the Government of Canada indicated it might be cutting back on requirements for eligibility for unemployment insurance. This comes up all the time and plays into the hands of reactionaries who say unemployment insurance is regressive, discourages work, encourages fraud on the government and so forth. That may be so. There certainly are people who are abusing the unemployment insurance program in Canada, but let us not cut off the arm just to remove the lump that causes the disease on the arm. Let us deal with the problem. The government should be careful about changing the criteria of eligibility for unemployment insurance, however, because it could mean that more people would need welfare, and it has been indicated very clearly that the provinces do not have the financial capacity to deal with this.
We owe it to the people of Canada to deal with the problems inherent in the Canada Assistance Plan. It is the instrument that is to be used to deal with very serious problems, and so we should examine it very carefully and try to improve it. We cannot improve the welfare of people by cutting back on necessary services, however. That is the message this party wants to get across, Mr. Speaker. It must be realized that these services are essential not only to the people who receive them but to the nation as a whole. For that reason we all ought to support this motion.


Margaret Anne Mitchell: Mr. Speaker, I am pleased to speak on the Canada Assistance Plan and how it can be improved to meet the needs of the people. Like my colleague to my right, I should like to challenge the hon. member for Vaudreuil (Mr. Herbert) on what I believe was his statement concerning abolishing the Canada Assistance Plan and the federal responsibility for social services. This would be a very serious mistake. Even changing the method of funding to the block method, as is the case with health care services, would be a mistake because there would be less opportunity for the government to make sure that the system is just and equitable for those people who need the service.
I should like to review some of the background of the Canada Assistance Plan, Mr. Speaker. It was developed in 1966 under a federal-provincial agreement, and it can be terminated by any province on one year's notice. The cost of social services is shared 50 per cent by the federal government and 50 per cent by the provinces. I believe that in some cases a province can bill the municipalities for 25 per cent of their share.
In 1980-81, S2.2 billion was spent on social services funded by the Canada Assistance Plan. This provided services for 2.8
February 18, 1982

million poor people in the country or about 12.4 per cent of the population. Just the very poor people in Canada qualify for social services, Mr. Speaker. This includes 639,000 poor families, or one out of every ten families in the country. It also includes 826,000 single people. We know, of course, that many of these are elderly and that many of the elderly are women, so about 31.4 per cent of single people are poor. There is a tremendous need for services in the country, Mr. Speaker, and it is growing every day as a result of lay-offs and unemployment.
When we say $2.2 billion, it sounds like a great deal of money, and of course it is, but a lot of it is used for administration programs and personnel in the social service field. The average welfare cheque for a family of two in British Columbia, a parent and child, is $595 per month. Of this, $300 is used for shelter and $295 for food, fuel, clothing and everything else. Shelter for an average family in Vancouver costs in excess of $300 per month, so little is left for food and the other services that are needed by a family. No matter how we look at it, the level of social assistance falls well below subsistence needs in the country today, and as parliamentarians we must come to grips with this problem.
The National Council on Welfare has stated that last year the poverty level for a single person was $5,928 but Mr. Speaker, the actual welfare payment was only $4,500. For a parent and one child the poverty level was $8,595, yet in my province of British Columbia, in many cases the welfare cheque for that family was less than $7,000. The average income for women last year was $10,860, well below the $25,000 for men.
These figures show that there should be a major review of income support and the welfare system and, of course, the Canada Assistance Plan must be upgraded. We need federal leadership in this field and we need a greater investment of the welfare dollar in the programs of prevention.
I should like to summarize several criticisms of the Canada Assistance Plan including some made by the Minister of National Health and Welfare (Miss Begin). There are major discrepancies in income support levels and in the access to and quality of social services in different provinces. Some provinces receive less benefit from the Canada Assistance Plan in proportion to their needs than others, particularly the Atlantic provinces. Because a province has to spend a dollar in order to receive a federal dollar and some Atlantic provinces do not have that initial dollar to spend, they are unable to extend services to meet the need which, in many cases, is greater than in other provinces. The CAP guidelines are restrictive and some programs are not fully cost-shared. Some provincial governments could do much more under the guidelines if they accepted their full responsibility. There is a lack of control, accountability and responsibility for federal spending on the program.
In a presentation to the federal-provincial fiscal arrangements task force on the Canada Assistance Plan the minister said that CAP was conceived in the sixties-now we are in the eighties-and asked how the plan can better address the social
Canada Assistance Plan
and economic realities of our time. She said that the level of social aid in almost all the provinces does not lift people over the poverty level; that this is unjust and must be corrected. I should like to know what steps the minister has taken in this regard.
She went on to point out the great inequalities between the different levels of services within the provinces and between the provinces and the federal government. She made the important point that usually the working poor have no place in welfare programs; that they are not included in those which we share and which are strictly for the poor-that is for people who, for one reason or another, are unable to work or are outside the work force or earn very little on a regular basis and, of course, are forced to apply for social assistance. On the broader scale, she said that another problem with CAP is that it does not include, in the usual sense of the word, any equalization, any principle of redistribution; the provinces that are poor have difficulty finding the front-end money to start programs in the first place.
That is what the minister said, and I think we should hold her accountable for making some changes in the directions she mentioned. She should do that or else come and join us in this party and continue to be a more aggressive advocate for change.
I should like to give an example of the negative kind of applications of CAP funds which provinces have been known to introduce. I believe that any changes we make to the Canada Assistance Plan should include some kind of veto system to ensure that 50 per cent of the cost of certain programs which have a negative impact on people, should be disallowed. There should be a method of policing this as far as the provinces are concerned.
1 should like to refer to an example in my province of British Columbia. In October of last year the categories of employables and unemployables were changed by the minister of human resources. Of course, there has always been a rather judgmental and punitive approach to single people on welfare, but it was extended to include single parents with an infant child or two children over the age of 12 years. It was decided by the minister of welfare that the best way to force these unworthy people off the welfare rolls was to cut back on their payments. Of course, jobs were not available, and there were no jobs suitable for mothers with several children who perhaps had never been in the work force or did not have available daycare. Those considerations were ignored, and the welfare payments to those mothers were reduced by $55 per month or $660 per year. It is a punitive provincial policy. There is no way that the federal government and those of us in Parliament should allow Canada Assistance Plan funds to be used in this manner by provinces.
I should like to refer to another example in British Columbia. Recently the minister of human resources reduced funding for rape centres which are extremely important and much needed in various areas of the province. The reason or

February 18, 1982
Canada Assistance Plan
the excuse for cutting back on funds and refusing to fund these essential centres was that the centres would not provide the provincial government with specific personal records. In this case the province really breached the whole concept of confidentiality. It is another reason for the federal government's requiring certain standards in general programs across the land which provinces could not treat in a negative way.
Now I should like to look at our concerns respecting how most of the welfare dollar, or the subsidies through the Canada Assistance Plan covering a range of social services, is geared in almost a negative direction. Most of the social services budget in the provinces is used for what I would call hard core social services which are necessary. They are crisis-oriented. They provide band-aids and, of course, essential financial support. They are very costly services. For example, there is basic income support, but a very high proportion of money goes into institutional care because problems have gone on for too long, families have broken up and other serious problems have developed. Also a very high proportion of the child welfare budget is going to remove children from their homes rather than keeping them there, in which event we are required to pay for very expensive institutional group care or payments to foster parents. In the long run, neither of these do very much to help the persons who are involved. The income support system requires an entire review and major change. The whole question of social assistance should be taken out of the human resources field and integrated with unemployment insurance and various computerized cheques which go out to people. Of course, this would only be the first step toward moving into an integrated system which, hopefully, would become an adequate guaranteed income system. If we took the responsibility for cheques from the social welfare system, those workers could become more involved in the area of prevention.
1 hope the federal government gives active leadership and takes a look at putting some teeth into CAP regulations, so that there will be more emphasis on prevention, self-help and positive support programs to break the welfare cycle, to prevent poverty, and to help people realize their potential in a more positive manner. There should be a much greater investment in self-help programs in local communities, to develop the potential of people and to assist them in developing their own community services. There should be more investment in training and in paraprofessional service roles. For example, we could use people in the communities, many of whom have experienced poverty. There should be programs to strengthen families and to keep children in their homes. We should think of the number of young teenage mothers at the present time. This number has increased at a critical rate during the past few years. If ever they required help and support from the community, indeed it is now; it is very much a priority. We must become involved while they are young and before their young children are damaged. We should provide support in health and educational opportunities as well as needed job training. Also, we should think about the working poor who are struggling, some of whom have large families, to survive on barely minimum wages. We should provide them with a
system wherein they could retain their independence and receive some help with the provision of daycare or supplements to their family income, in order to prevent them from saying that it is much easier to go on welfare than to keep working. It is not easier on welfare, but certainly it is not easy to work at low wages with a family. We must become serious about what 1 would call social investments, which will prove less costly in the long run.
1 should like to refer to a specific example concerning people who live in a public housing neighbourhood in my riding. This is what I would call a community development program. The Canada Assistance Plan has a category for community development, but I challenge someone to show me how many provinces are actually using it. This is the type of thing we must stress. We must build on the strength of people and open up opportunities in local communities. The example to which I refer is a movement started close to ten years ago by some mothers on welfare. They refused to be regarded as victims or second-class citizens. They insisted on their rights, rather than being just passive recipients caught up in the welfare cycle. They organized and participated in a lot of local action activities on behalf of their children. Then they began to think of ways in which they could expand as a co-operative community in order to provide their own services, to train their own people, and to heck with the welfare department. They felt that they had many talents and could do many things themselves, and they soon proved it. First, they organized a food co-operative in which they used a lot of their own people. They trained some of them who gained expertise and developed new skills. Along with some mothers in other housing projects, they convinced the minister of human resources to provide what they called an opportunities allowance of an extra $100 per month to do community work in the interests of their own communities. Also they helped to develop daycare and childcare services. They developed the concept of a co-operative community. They realized that if they could establish a food co-operative, the same could be done for various services. Thus they received a three-year LEAP grant, which is the kind of grant that should be available through the Canada Assistance Plan. In this case they received it from the old Canada manpower department. They trained some of their people in child care and developed daycare centres. Other people were trained in providing services for senior citizens and have gone on to work as homemakers in paid capacities. Eventually they obtained their own building, into which they moved their services. It was operated by a local board and they hired as many people from the community as possible. They introduced special pre-employment training programs, of which quite a number of Indian women who had no job experience took advantage.


The Acting Speaker (Mr. Collenette):: Order, please. The hour provided for the consideration of private members' business having expired, I do now leave the chair until eight o'clock.
At six o'clock the House took recess.
February 18, 1982



COMMONS DEBATES AFTER RECESS

[Stage Direction]
The House resumed at 8 p.m.
Mr. Deputy Speaker:: I see the Minister of Transport (Mr. Pepin) rising on a point of order.


Jean-Luc Pepin: Mr. Speaker, may I have the unanimous consent of the House to return to tabling of documents?


Mr. Deputy Speaker:: The Minister of Transport has asked for unanimous consent for the tabling of documents. Is there unanimous consent?


Some hon. Members:: Agreed.


An hon. Member:: No.


Yvon Pinard: I apologize for interrupting the hon. member, and I shall be very brief. If it pleases the House to give unanimous consent, I should like to ask the member for Vancouver-Kingsway (Mr. Waddell) why he objects to the Minister of Transport (Mr. Pepin) tabling a document in the House, for the purpose of informing Parliament before making a public announcement?


Mr. Deputy Speaker:: The President of the Privy Council (Mr. Pinard) would require the unanimous consent of the House in order to put a question to the hon. member.
Is there unanimous consent?


Some hon. Members:: Agreed.


Mr. Deputy Speaker:: Would the hon. member for Vancou-ver-Kingsway (Mr. Waddell) care to respond to the question?


Ian Gardiner Waddell: Mr. Speaker, I hesitate to give unanimous consent because we feel on this side of the House that perhaps we had been somewhat inadvertently misled in the House the other day when the President of the Privy Council (Mr. Pinard) stated that there were to be no announcements made on this terrible disaster.
But then the Minister of Transport (Mr. Pepin) and and the Minister of Energy, Mines and Resources (Mr. Lalonde) announced an inquiry would be established.
I will be finished in a moment, Mr. Speaker.
We wanted an announcement made on motions in the House so there could be reply from the other parties and we could have a better working of Parliament.


Mr. Deputy Speaker:: Order, please. It is clear that the hon. member does not give unanimous consent. In the circumstances, I will recognize the hon. member for Athabasca (Mr. Shields).


Ian Gardiner Waddell: Mr. Speaker, I just wanted to comment that I am prepared to give unanimous consent.
Tabling of Documents


Mr. Deputy Speaker:: Order, please. The hon. member does give unanimous consent?


Ian Gardiner Waddell: Yes, Mr. Speaker.


Mr. Deputy Speaker:: In that case there is unanimous consent for the minister to table documents.



ROUTINE PROCEEDINGS


Jean-Luc Pepin: Mr. Speaker, I thank hon. members for giving me unanimous consent.
Pursuant to Standing Order 41(2) I am pleased to table two documents. The first is an order in council appointing Chief Justice Hickman under the Inquiries Act as commissioner to inquire into and report upon the loss of the semi-submersible and self-propelled drilling rig Ocean Ranger. His terms of reference are described.
The second is an order in council appointing Chief Justice Hickman as commissioner under Section 548 of the Canada Shipping Act for the same purposes. It reads:
-lo be a Commissioner for the purpose of holding a formal investigation into the circumstances attending the loss of the semi-submersible self-propelled drill rig Ocean Ranger on the continental shelf of Canada on or about February 15, 1982 with the loss of all of her crew members.
The government thought that both acts could be used in order to allow the commissioner the broadest possible powers of inquiry.


Mr. Deputy Speaker:: Order, please. I must call to the minister's attention that the rules of the House permit only the tabling of documents. He is not permitted to make a statement under this Standing Order.


Ian Gardiner Waddell: He could, on motions.


Mr. Deputy Speaker:: If the House wishes to revert to motions, the minister may make a statement on motions. Is there unanimous consent?


Some hon. Members:: Agreed.


Some hon. Members:: No.

February 18, 1982
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GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Bussieres that Bill C-93, to amend the statute law relating to certain taxes and to provide other authority for the raising of funds, be read the second time and referred to the Committee of the Whole.
Jack Wendele Shields: Mr. Speaker, 1 have a number of replies to make to the hon. member for Vancouver-Kingsway (Mr. Waddell) who preceded me in this debate. My replies are to his seemingly not too well thought out comments. I think that the episode which just occurred showed that my hon. friend from Vancouver-Kingsway is all show and has very little substance.
Today we witnessed all the Liberal members of the House walking in with red carnations in their lapels. This was the celebration of the second anniversary of the Liberals' coming to power and running Canada and the Canadian economy.


Michael Holcombe Wilson: Into the ground.


Jack Wendele Shields: On December 13, Mr. Speaker, the Liberals and the NDP joined together to defeat the Conservative government. I would like to read into the record the motion which was amended and supported fully by the NDP, just to remind people across Canada what the NDP did by throwing out the Conservative Party.


Ian Deans: We did the country a service.


Jack Wendele Shields: The motion reads:
-this House condemns the Government for its budget which will place an unfair and unnecessary burden of higher gasoline prices, higher fuel oil prices, anti higher taxes on middle and lower-income Canadians, and this House unreservedly condemns the government for its outright betrayal of its election promises to lower interest rates, to cut taxes, and to stimulate the growth of the Canadian economy, without a mandate from the Canadian people for such a reversal.


Ian Deans: Why not move it again? We will support it, it is equally applicable.


Jack Wendele Shields: Mr. Speaker, my hon. friend from the NDP says to move it again and they will support us.


Ian Deans: The two of you make a great pair.


Jack Wendele Shields: If I may refresh his memory, it was just last Friday that our House leader approached the NDP House leader with a motion of non-confidence and asked for their full support so that we could attempt to defeat this government. What happened? We in the House know as well as he knows that it was the NDP who went shuffling off to the Liberals and
said: "Be careful, they are trying to defeat the government." He knows full well we had an opportunity to defeat the government last Friday with NDP support, but where were they?


Michael Holcombe Wilson: They could not face the vote.


Jack Wendele Shields: They looked at the polls, Mr. Speaker, and their pollsters told them, "Do not have an election now because the NDP is down the tube." That is what he found out, so let us hear him scream now. That is exactly what happened, and he knows it. We wanted the NDP's support last Friday and where were they? They could not make it. Their excuse was that the official opposition were going to use that day and take away their rights, because they wanted to debate the Crow rates. I would like to remind the hon. member that the Crow rate and the attack on it would have gone down the tube with the government, but they did not have the guts to put principle before expediency. Political expediency, that is what happened with the New Democratic Party.


Ian Gardiner Waddell: How about speaking on energy, Jack?


Jack Wendele Shields: All show and no substance, Mr. Speaker. Let us look at the motion and see where we are on the "unfair and unnecessary burden of high gasoline prices". The price of gasoline has increased by 75 cents. That is what this Liberal government did with the help of the NDP, this party of principle. Higher fuel oil prices is what we have today. Unemployment at an all-time record high is what we have today. All this because the NDP, the party of principle, supported the government in a mealy-mouthed way because they thought they could gain seats. They are a party of principle only if they can gain seats.
Now, Mr. Speaker, I want to speak about the budget as it relates to the borrowing bill. The money borrowed to run the government affects every area of our economy. It is spent in every department. Let us look at what happens. In 1980 our economy experienced zero growth, the worst performance in 26 years. Productivity fell by V/2 per cent and housing starts fell to their lowest level in 13 years. While the first half of 1981 saw reasonably healthy economic growth, the economy is now in severe recession. Severe recession? It is moving toward a depression of unparalleled proportions, something we in this country have never seen before. What has the government continually been told, Mr. Speaker? In October, Statistics Canada warned as follows:
Signs that a slowdown in economic activity will extend over the second half of 1981 proliferated in July as the Canadian composite leading indicator fell for the second consecutive month, and the weakness that characterized several components in June broadened and intensified in July.
Six days before the Minister of Finance (Mr. MacEachen) brought in his budget, Mr. Speaker, Statistics Canada said this on November 6, 1981:
-market slowdown in activity could develop into a recession during the coming months. The sharp decline in indicators of economic activity has already led firms to cut production, and lay-offs have become widespread.
February 18, 1982

Again on December 7, 1981, Statistics Canada said this:
The third quarter downturn of real GNP will not be reversed in the near future. The index and its components indicate that the negative forces accumulating in the economy continued to spread and intensify. The outlook for all major components of final demand remains dim.
That was when the Minister of Finance was contemplating changes in his anti-growth budget, a budget which was stifling initiative in Canada. Statistics Canada was saying, in other words, that unemployment is going to get worse; bankruptcies are going to become commonplace; farmers are not going to get the prices they need for their commodities and will go under; small businessmen are going to suffer and go out of business; the young people coming out of our universities and technical colleges have absolutely nothing to look forward to in the form of jobs because there are none. All this because of the budget and the national energy policy proposed and implemented by the government. This is what they said as recently as last month:
-the marked slowdown in the economy currently under way will not likely be reversed for the first quarter of 1982.
In other words, there is not a hope unless the government does something by the end of March, 1982. It goes on:
The filtered composite index fell 2.6% in October, one of the largest declines since the 1975 recession. The downturn was generalized among all the components, including those,... which have the longest leads in signaling a turning point. .. . the weakness in the manufacturing sector broadened in reaction to the slackening of final demand.... the speed of descent will not be substantially attenuated before the end of this quarter.
There is not a great deal of hope that it will be stopped then. Well, I can go on and on. Certainly we know what they have done. They are ruining our economy, a system where men and women could look around and say: "1 can do." We in Canada were blessed by God Almighty with an abundance of resources. We have an abundance of fresh water, an abundance of people who have the foresight and drive to go out and do something, to say "I am going to do it." But we have not been blessed with a type of government which recognizes that in the Canadian people. Over the past 14 years, we have not been blessed with a kind of government which recognizes the freedom of the individual, allowing that individual to proceed on his own, allowing him to take the risks, allowing him to work and save, and thereby contribute to the growth of the country. Instead, we have had a government which has very systematically stated, "We will intervene in the economy. We will control the economy. We will do it in such a way." The government then starts using phrases such as, "It is for the people of Canada." Well, are the risk-takers not the people of Canada? Are those who want to go out and build something with their own two hands not the people of Canada? No, no.
It reminds me of the story, which 1 am sure all hon. members of the House have heard, about the little red hen baking the bread. Finally, after all the interventions and all the government interference, it sits on the fence and crows away. Everyone wonders, why does this little hen not bake any bread now? No one is baking bread. Why? That is what is happening.
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Today I received a phone call from a gentleman in Grand Centre. Many hon. members may not know where that is. It is in northeastern Alberta, right in the heart of the Imperial Oil project; the Imperial Oil project that was, that hopefully will be, but which is indeed stalled because of a national energy policy brought in by this government. This man listed off small businesses which have gone down the tube and are going down. J & J Drive-In Restaurant was started by two brothers who decided that they would pool their money and work long hours frying hamburgers and French fries to sell to the public. However, they were going to build something for themselves and their children. What are they doing now?


Ian Gardiner Waddell: They have a health food restaurant!


Jack Wendele Shields: They have boarded it up. They have shut it down. Oh, the hon. member for Vancouver-Kingsway (Mr. Waddell) interjected. I do not know what he said, but he is all wind and no substance anyway, so it is really not important.


Ian Gardiner Waddell: I came back to hear you, Jack!


Jack Wendele Shields: Yes, I am sure 1 pegged the hon. member by saying he is all wind and no substance. He makes the most idiotic statements in the House about his party never having a part to play with the Liberal government, and by propping up that socialist government which goes under the guise of Liberalism.


Ian Gardiner Waddell: Hurt a guy! That hurt!


An hon. Member:: Oh, oh!


Jack Wendele Shields: The NDP come in and talk about Canadian ownership. I would like to refer back to the energy policy for a moment. It is very clear that Canadians right across the country, from coast to coast, would like to see more Canadian ownership. That is very clear. I do not think that there is a man or a woman across the country who would not agree that a vital industry like the oil industry should be owned by Canadians or that we should encourage every Canadian to go out and get a piece of that action. However, we are not talking about Canadian ownership, ownership by individuals, when we are talking about nationalization. Clearly, the national energy policy was a clear grab and a move on an industry which was healthy, and it was, in effect, nationalizing. The government was saying, "We are going to go in. We will take it over. We will control it." Can one imagine the complexity of developing the Beaufort Sea, the complexity of building islands where there are no islands, and drilling for oil where, hopefully, oil and gas would be found? Can one imagine the bureaucrats and politicians in the Department of Energy, Mines and Resources sitting here and trying to direct that activity from Ottawa? It is absolutely ludicrous to think that any hon. member in the House would subscribe to the idea that the bureaucrats sitting in Ottawa can direct these most complicated, clearly innovative developments which are going on in the Beaufort Sea, in the offshore, or indeed the tertiary recovery, the megaprojects in northeastern Alberta or the coal deposits in Alberta and British Columbia.

February 18, 1982
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The more that the government bureaucrats become involved in the day to day operation of these enterprises, the further they go down the tube. However, what do we hear from the New Democratic Party? Hon. members in that party say, "We want more intervention. We do not want you people out there who have the initiative, the drive and the desire to do something or to do anything because big government will do it in the name of the people."
I want to tell Your Honour that I am sure that we would consistently hear the same kind of rhetoric as we hear from the NDP if we were in Poland, Czechoslovakia, Russia or Cuba, because that is the ultimate result of a government, which is hell-bent on an election, going in and taking over what is going on in the country.


Ian Gardiner Waddell: Next, Alberta!


Jack Wendele Shields: My NDP friend down there said, "Next, Alberta."


Nelson Andrew Riis: How many Tory provinces are there?


Jack Wendele Shields: I think the New Democratic Party should pick up the papers and do a little bit of reading.


Ian Gardiner Waddell: Hey, Jack, they are the enemy!


Jack Wendele Shields: Then maybe they would understand a little bit more about Alberta and they would understand that a clear message was being sent to the government, which they support, this government that they are in bed with, this government which is touting Ed Schreyer, the good old NDP premier-


Some hon. Members:: Order, order!


Jack Wendele Shields: -to be the next leader of this party.


Nelson Andrew Riis: We are not the government; it is those guys over there!


Jack Wendele Shields: The NDP is supporting the government. They say they are not the government. They are the government, as clearly as the government that sits across there, because when the chips are down, the NDP is there to do the pairing. We will see tomorrow night, when the time comes for a vote of confidence in this House, how many of the NDP will conveniently not be in their seats. We will see how many of the NDP will be conveniently out of the House or somewhere else in Canada, and not here voting to destroy the present government.


Some hon. Members:: Oh, oh!


Jack Wendele Shields: We will see, because there will be lots of pairing going on. I guarantee that no hon. member from the Conservative Party will be pairing with hon. members opposite. So put your money where your mouth is, boys. Through Your Honour, I would suggest that my hon. friends in the little red rump down there show up tomorrow night for the motion which will be before the House. We will see.
The hon. member for Vancouver-Kingsway was speaking about the national energy policy and how the government should take over more and should become more involved, and that this government was not going far enough, and so on. I have in my hand a letter from the Chamber of Commerce at Fort St. John. The hon. member for Vancouver-Kingsway may not know where Fort St. John is located. Fort St. John is in northern British Columbia. I do not know if the hon. member has ever taken the trouble to go up and see the pioneering kind of spirit which arises in that community. However, this letter is from the Chamber of Commerce at Fort St. John. Maybe my hon. friend, the hon. member for Vancouver-Kingsway, could answer this letter, which states:
Dear Sir:
Northeastern British Columbia is, and apparently will be, one of the areas of Canada hardest hit by the national energy policy.
Since the announcement of this policy last fall, the Fort St. John & District Chamber of Commerce has viewed with concern the decline in drilling activity in this region-


Ian Gardiner Waddell: That's what I said in my speech, Jack!


Jack Wendele Shields: It continues;
-and the announced reduction of exploration plans over the next few years.
As the representatives of the business community in this area which up until last fall probably had the most buoyant economy of any place in the nation, we feel that we must bring to the attention of the elected representatives of the entire nation our concern.
Oh, listen to the hon. members squeaking now. Do not squeak, my hon. friends. I would suggest they do not squeak. Why do they not leave the protection of Ottawa? Why not get on a plane, go to Fort St. John and talk to the members of the Chamber of Commerce, those in the community, the rig workers who are today on welfare because of the absolute stupidity of this government?
The NDP supports this government right down the line. I continue the quote:
Our corner may be a small one in relationship to Canada as a whole but our needs and wellbeing are the needs and wellbeing of Canadians.
It is signed by Ivan G. Strome, President. Maybe the hon. member would like to read that. I would be happy to pass it over to him. I would like him to go there and talk to those people.


Nelson Andrew Riis: Who signed it?


Jack Wendele Shields: One of the members asks me whose side I am on. I am on the side of the ordinary Canadian.


Nelson Andrew Riis: I asked who signed the agreement?


Jack Wendele Shields: The members of the NDP know about signing any form of an agreement with a government hell-bent on an election and taking over and controlling the oil industry. The more we delayed, the more they delayed in Alberta, the more the premier would delay, the worse it would get for every industry in this country. We were pushing this country into a recession. The premier of Alberta, although not satisfied with
February 18, 1982

the type of agreement, did eventually sign. He looked at Canada and realized that we had to get the economic wheels going again. It is my view that he was willing to sacrifice something to get that to happen. However, it did not happen and is not happening. We have unlimited numbers of small businesses in the oil patch, and the western basin going out of business.
The members of the NDP alluded to the separatist vote. We even had one member cross the floor before this evening's session suggesting that we were not doing our job in Alberta because in a provincial byelection we allowed a separatist to be elected. 1 say to those across the way that we are trying to do our job. However, we cannot do our job and fight Liberals and stupid Liberal policies at the same time.
That is a clear warning. I know some of those people who voted. They would have voted for the Western Canada Concept, not because they do not love their country and not because they do not see the blessings this country has from God Almighty who looked down upon our country, blessed us with resources and gave us people with initiative. These are the people who dirtied their hands. They broke the soil and built something with their own hands so that when they leave this world, they will have something to pass on to their children.
This government with its energy policy and budget is stifling that kind of initiative. It sickens me to sit here and listen to the tripe that we get day by day from the government benches about what they are going to do, how they are going to make the economy go again, how they are going to stimulate the economy and create jobs. My God, all you have to do is to leave people alone, get out of their daily lives, and allow them to do the work they want to do.
I talk daily to men who want to accomplish something. They are willing to work 14, 16, 18 hours a day in order to build something. They are being stifled by the government. How in God's name can someone start a business today with interest rates on borrowed money running around 20 per cent? That is the rate on a normal bank loan. How in God's name can anyone get a Small Business Development Bond? They are only available for businesses in dire straits. Imagine a direct government policy not to help healthy small businesses develop through the Small Business Development Bond. We are not going to help a small enterprise grow and create jobs through this bond. Only those in dire straits, those going belly-up are going to be helped. My goodness, it defies logic.
Today, the second anniversary of their election, the Liberal members walked into this chamber wearing red carnations. Believe me, I would have been happy to wear a red carnation today had this government brought in policies recognizing the need to encourage development of the individual so that by his sweat, tears and dirty hands he can build a business which he can pass on to his children.
I would have been happy to wear a red carnation had I not read in the paper today that housing starts are at an all-time low and, for the first time in Canada in 25 years, people are having to double up. Young people getting married today cannot look to the future in the same way as those who
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married ten or 15 years ago. They knew that if they worked hard some day they could own their own homes. What is happening now? These young married couples must now live at home with mother and father, they must live with their in-laws. That is no kind of future for our children.
I would have been glad to wear a red carnation today if the unemployment rate were at a tolerable level. We talk about the unemployment rale reaching 9 per cent. There are over a million people unemployed in Canada. There is no need for that with our abundance of resources. We have the technology, understanding and desire to get this country moving.
I would have worn a red carnation today had this government shown that it is willing to cut back on the expenditures it is making daily. The spending of the government is out of hand. It prints money like it is going out of style. The government is growing.
Every time the government makes an announcement, it costs the people of Canada another half a million dollars. What is that with a deficit of $17 billion? A billion dollars staggers me. I have no way of comprehending what it is. All I know is that the people of Canada are carrying this burden on their backs. They are frightened.
People right across this country from British Columbia to Newfoundland are frightened about the erosion in their standard of living, their opportunity to make a living, the future for themselves and their children. Can you imagine that in our Canada which is blessed with an abundance of resources? Our Canada has the kind of people who want to accomplish something.
There is no reason for the situation we are in today. We do not have to track U.S. interest rates. We do not have to confiscate through the national energy policy in the name of so-called Canadianization. All we have to do is to encourage Canadians to go out and buy, work and take over some of the oil industry that is here. Will that Canadianize it? That is not Canadianizing. It is not one man taking steps to become an owner.
It is my hope that my remarks tonight will cause some members to think. 1 hope it will help some members to talk to their constituents and help encourage members to visit an unemployment insurance office to ask those people who are unemployed the most resounding question which is most often asked-why? They are not blaming anyone; they are just asking why this is happening in Canada, a country with the great wealth and population we have. How can the government allow this to happen? The answer is there, Mr. Speaker, if we are willing to take the time to find it.
I would suggest to the Liberal government that if it allowed members of the House, for even half a day, to participate equally with them in drafting a policy to attack the economy, they would be astounded at the results. I do not believe for one moment that all the talent in the House is in the Conservative ranks. I am sure the New Democratic Party believes that all the talent is in its corner. They do have some talent, and there

February 18, 1982
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is considerable talent on the Liberal side. There is all this talent sitting in the House of Commons while the government is being run by a close-knit, select few.
I have participated in committees and 1 have tried to have some input on the national energy policy when the bill was in committee, I do not have to tell you, Mr. Speaker, because you have been here longer than I, that it is useless. One sits in those committees, which are mainly composed of government members and, in most cases, are chaired by a government member. It is a process whereby if there is any possibility that they might lose a vote in committee, the government members leave the room in order to destroy the quorum so that a vote cannot be taken. Opposition members who go into committee try their best to have the government at least attempt to change legislation and alleviate the impact it might have on people. However, it is an exercise in futility.
During the two years that I have been here, the only committee which I have seen make any progress was the constitutional committee. It was held in the open, in front of television cameras for all Canadians to see. Canadians could see positive suggestions being made and who was making them. It did not matter who was making these suggestions because we were working as a group. This would never have been accomplished had we not fillibustered in the House. What a waste!
I would like to give my opinion on an issue which I feel is very urgent. It is the byelection in Olds-Didsbury in southern Alberta where a member of the Western Canada Concept was elected. To my knowledge, it is the first time that an avowed separatist candidate will be sitting in the Alberta legislature. This alarms me. 1 am alarmed that people whom I know, including some of my relatives, who live in the Olds-Didsbury area may have voted for the Western Canada Concept. In other words, they are saying that there is no use. They have tried, they have signalled Ottawa time and again that it is not allowing them to do what they want. But the bureaucrats and politicians in Ottawa do not understand what is happening in Alberta, and indeed in western Canada.
I will not get into the argument of whether they have been treated poorly in the past. I will not get into the argument of whether the westerner is being treated badly. All that I am saying is that there is a very clear perception in southern Alberta that, according to the government here in Ottawa, Canada is made up of Quebec and Ontario. When one sees the VIA Rail cuts and the attack on the Crow rate, there is no other conclusion to which they can come.
I believe that we must revise the Senate in order to provide the representation which this country deserves before it is too late. The Senate should be reformed to allow perhaps ten elected senators from each province so that our upper chamber will have an input into our government. We must put a ceiling on the number of members who will come into the House of Commons. We must make provisions which would allow members of the House of Commons to participate more actively in government policy making. As the situation exists now, 1 am here to represent my constituency of Athabasca, but my job in
sitting in the opposition is to oppose everything the government introduces. I am sure if I had some input into the drafting of government legislation-even just to give ideas-we could all work much better and provide a more positive view of Canada and its economic direction.
It is my plea to all members of the House that there is talent on all sides of the House and we must all sit down together to attack the most threatening problem facing Canada today, namely, the state of emergency of our economy, before riots break out in the streets and our country destroys itself.


Ian Gardiner Waddell: Mr. Speaker, may l put a question to the member who just spoke, if I have the unanimous consent of the House?


Mr. Deputy Speaker:: In view of the fact that the hon. member's time has expired, it would require the unanimous consent of the House. Is there unanimous consent?


Some hon. Members:: Agreed.


Ian Gardiner Waddell: I thank members of the House and you, Mr. Speaker. I want to ask the hon. member whether he subscribes to the argument that the problem in northeastern British Columbia with respect to gas exploration is that the pre-build of the Alaska Highway Pipeline will now take Alberta gas and destroy those traditional B.C. markets, which would therefore make it pointless to go ahead and increase the drilling in the area which the hon. member spoke about?
Also would he agree, that the real problem is tied into the pre-build of the pipeline and not entirely with the National Energy Program?


Jack Wendele Shields: Mr. Speaker, I am glad to see that the hon. member, by his question, is going on record as supporting the National Energy Program.


Ian Gardiner Waddell: That is not what I said.


Jack Wendele Shields: It confirms what I said earlier in my remarks that he is propping up the Liberal Party. There is a coalition; that has now been established.
If the hon. member's allegations were correct, I suggest to him there would be considerable activity in Grande Prairie and in northwestern Alberta generally. There would be considerable activity to develop the Elmsworth natural gas fields. However, as a result of the national energy policy there is virtually no activity in the Elmsworth field. It is absolutely zip. There is no exploration going on to develop the field or to see how large the field is. There are rig workers in Grande Prairie today who are on welfare rolls because they have run out of unemployment insurance benefits. These are healthy and strong individuals who cannot go to the United States to work on the rigs there. Some are on unemployment insurance, and after that they have to go on to the welfare rolls. This is causing untold hardships for those people. Less than two years ago, those men strutted down the street saying, "We are part
February 18, 1982

of a great oil industry in this country." These people are now on welfare, and there are untold hardships for their families and children.


Mr. Cooper:: Any more questions?


Jack Wendele Shields: I hope that has answered the hon. member's question.


David Orlikow: I didn't hear the question.


Jack Wendele Shields: It was stupid to imply that the pre-build of the pipeline is causing the delay in northwestern Alberta and the Peace River block because, for the information of the hon. member, the Great Peace River country takes in Dawson Creek and Fort St. John. It is called the Peace River block. Activity has been reduced in the Peace River block, not because of the pre-build but because of the national energy policy.


Mr. Anguish:: Mr. Speaker, I rise on a point of order to set the records straight. In his speech, the previous speaker mentioned the process of pairing which, if I understand the definition of pairing in the political sense, means that when a member of the government is away, a member of another party conveniently is away also. That is an agreement which is made between different parties in the House of Commons from time to time.


Mr. Deputy Speaker:: Would the hon. member please state his point of order.


Douglas Keith Anguish: My point of order is to set the records straight. My party does not participate in any kind of pairing with any other political party.


Mr. Deputy Speaker:: The hon. member is not making a point of order.


Jack Wendele Shields: Mr. Speaker, my point of order is that we will see tomorrow whether they are pairing.


Mr. Deputy Speaker:: The hon. member is not making a point of order.


Mr. Roy MacLaren (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, during our debate about the borrowing authority bill now before us, we have heard so much about the energy policies of the government that 1 decided to say a word about the three aspects of that policy which other members have already taken as their theme today. I speak of energy security or self-sufficiency; second, Canadianization; and third, the policy of fairness which is embodied in the National Energy Program.
Canadians are today self-sufficient in all forms of energy but one. We are self-sufficient in coal, in hydroelectricity, in uranium and in natural gas as well as various renewable forms of energy. The one energy source where Canadians do not enjoy self-sufficiency for the time being is, of course, oil. During the past year, 79.5 per cent of our oil needs were
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provided from within Canada. During the course of this year, it is estimated that 81 per cent of our oil needs will be met from domestic sources.
The policy of the government with regard to energy security and oil self-sufficiency has two major elements. One is our conservation and substitution program, and the other is supply. With regard to conservation it is, for example, intended that we shall reduce our industrial oil consumption in Canada in the non-transport sectors to 10 per cent of their total energy needs by 1990. 1 am glad to see that Canadian industry has demonstrated during recent years, and especially during the course of last year, substantial progress toward that goal. The goal of self-sufficiency in oil by 1990, which is some 19 percentage points away from us today, can also be achieved through such conservation measures as the home insulation program, which is now running at some $265 million annually. The total amount disbursed under that program has approached some half a billion dollars. The benefits in terms of reduction in domestic oil consumption are evident everywhere. The manifold benefits are also apparent in the macroeconomic picture in terms of reducing our total consumption of oil in Canada. Equally successful has been the industrial conservation program, a program of co-operation between the private and public sectors-


Michael Holcombe Wilson: Quite apparent in Alsands and Cold Lake.


Roy MacLaren: -in terms of identifying additional methods to reduce the consumption of oil in the manufacturing and service industries. It is evident to anyone who looks at that program that it represents another promising form of co-operation between the government and the private sector and one which holds substantial promise for further reductions in oil consumption.
A third conservation area which I might touch on is that of transport. Under the energy security legislation which will be before the House in a matter of days new automobile consumption standards will be set. They will, over a period of time, accentuate the trend already evident, of reduced consumption of gasoline by automobiles.
Those conservation measures are matched by a range of substitution programs which have also had a significant impact of reducing our demand for oil. COSP, the Canadian Oil Substitution Program, offers grants of up to $800 per household. Within the six months since that program was introduced $50 million has been paid to home owners to convert from scarce oil to more plentiful natural gas, electricity or various renewable forms of energy, depending on which region the recipients live.
The off oil utility program provides assistance to the provinces to devise methods to replace costly oil generation of electricity, particularly in eastern Canada.
Further, gas pipeline extensions are now on their way to ensure that a more plentiful form of hydrocarbon energy is available right across our country. The National Energy Program provides incentives for the substitution of oil with natural gas. There is an incentive price. The cost of natural gas is to be

February 18, 1982
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held at two thirds of the domestic price of oil. In addition, the Alberta government has undertaken to offer gas market development incentive payments, which will help to ensure that natural gas in eastern Canada continues to replace oil.
Programs for propane development and for compressed natural gas for use in the automotive industry and especially in fleet operations are already proving to be a substantial success.
I do not doubt that we shall see those two fuels used increasingly in transport.
The new Crown corporation Canertech, based in Winnipeg, which was established as part of the National Energy Program, is already active in working with private sector companies in viable research and development projects in the field of renewable energy. Partly as a result of Canertech, all Canadians will have access to various renewable forms of energy as well as more conventional forms.
These and other programs of conservation and substitution have meant that, in contrast to the annual increases in oil consumption during the 1970s, demand for refined petroleum products was reduced in Canada in 1981 by some 4.5 per cent. It is estimated that during 1982, the demand for refined petroleum products will be reduced by another 3.5 per cent. These figures represent significant progress in terms of ensuring our energy security and oil sufficiency by 1990.
On the supply side of the equation, the government has achieved what the previous government was unable to do; that is, it signed agreements with the principal producing province, Alberta, some six months ago, and shortly thereafter with the other producing provinces, British Columbia and Saskatchewan. Those agreements put in place a framework which will help to provide a dependable supply of petroleum products in the years ahead. When matched with the conservation and substitution programs that I have already outlined, they will help to ensure self-sufficiency by 1990.
The new oil reference price which is available for all oil coming into production from the introduction of the National Energy Program will be approximately at world level. That will help to ensure that there is a price incentive for Canadian oil companies, and indeed for all oil companies, to search out new sources of oil. In addition, if they are active in the Canada lands, petroleum incentive grants of the federal government, replacing the former depreciation allowances, will also encourage more exploration. This is all happening, Mr. Speaker, and it is evident that the petroleum incentive program, which is part of the forthcoming energy security bill that I have mentioned, will-


Harvie Andre: When?


Roy MacLaren: I said a few moments ago that it will be within the next few days. This will ensure that exploration in the frontier regions, the most promising regions of Canada, will go forward at an accelerated pace.
Within the Province of Alberta, the Alberta government will provide petroleum incentive grants identical to those offered by the federal government on the Canada lands.
Reference has been made to the Alsands project which is under active discussion at the moment. I am optimistic about the outcome of the discussions with regard to invitations to others to participate in this massive project which I am confident will be undertaken.
Discussions have been pursued with the governments of Newfoundland and Nova Scotia in an effort to ensure that there will be no hindrance to the development of the promising areas offshore. In that regard, 1 should like to quote from the letter of the Prime Minister (Mr. Trudeau) to the Premier of Newfoundland on February 12 in which he said:
I am sure that you share my hope that we shall arrive this month at a settlement which will reflect the interests and responsibilities of both governments. More than that, it must respond to the pressing energy security and economic development needs of Newfoundlanders and all Canadians.
I am confident that, even with the short time remaining, we can build the framework for co-operation which will ensure the best possible development of our rich offshore oil and gas resources.
That brief quotation sums up the attitude of the federal government to the question of offshore jurisdiction and development. It has been our position that the important thing is to get a regime in place now which is satisfactory to both provincial and federal governments and which would allow early development of those promising new areas of oil exploration.
With regard to the conventional oil lands in western Canada, it has been evident for some time that our current exports of natural gas are well below the amount approved by the National Energy Board. At the present time, less than 60 per cent of the contracts approved by the National Energy Board provide gas to the United States market. In fact, for the past two years or more, the United States market for Canadian natural gas has been soft, and Canadian producers have been unable to find new markets there in competition with domestic suppliers. That situation was evident well before the introduction of the National Energy Program. Indeed, hon. members will recall that before the program was announced in October 1980, the Canadian Association of Oilwell Drilling Contractors had already indicated there was an oversupply in the industry and that the number of drills built was in excess of contemplated needs. In fact, despite that oversupply in the face of the large surplus of natural gas, the number of wells completed in 1981 was less than 1980, but only slightly below the number in 1979.


Michael Holcombe Wilson: What about 1974?


Roy MacLaren: The number was higher than in any other previous year. Today, drilling has again increased in the conventional lands, including Alberta. The level is about 76 per cent of that of a year ago and 80 per cent of the level achieved in 1980.


Harvie Andre: It is what?
February 18, 1982


Roy MacLaren: In the past year, a number of Canadian companies that were facing gas surpluses in this country were attracted to the United States in the hope of achieving success in that market. They were encouraged by the rate of success in exploratory wells there and by world level prices. Many of those companies are now returning to Canada, having experienced high interest rates, poor economic conditions and disappointing drilling results. The situation, in short, is rather different today. An extensive report in The Calgary Herald a few days ago noted that many of the companies that had plunged into the United States have begun to return to Canada.
The Canadianization element of the National Energy Program has been discussed today. This element, as any public opinion poll will indicate, has the broad support of the Canadian people. I should like to spend a moment noting the progress that has been made in this area.
Since the National Energy Program was announced in October, 1980, ten Canadian companies have acquired foreign companies worth more than $100 million each. In total, more than $6 billion has been spent in acquiring previously foreign held oil and gas assets. The vast majority of those deals, contrary to what some people have alleged, were private sector deals. They were not government deals, not nationalization but Canadianization. Of course, there were two exceptions-the Petro-Canada acquisition of Petrofina and the 25 per cent share in Suncor acquired by the Ontario government. All the acquisitions since the announcement of the National Energy Program have contributed to increasing Canadian ownership of upstream production revenues by about 6.3 percentage points. According to Petroleum Monitoring Agency data, to which several references have been made today, the level of foreign ownership of production revenues was 72 per cent in 1980. As of the middle of last month, this figure declined to 65.7 per cent. Those statistics indicate the degree to which there has been a marked change of ownership in the petroleum industry within the last 18 months. I am quite confident that we shall achieve our goal of 50 per cent Canadian ownership of the petroleum industry by 1990.
In discussing the success of the Canadianization program, and against the background of allegations that somehow the program was engaged in nationalization as distinct from Canadianization, or was a government take-over as distinct from a private sector venture, I want to note that not only have there been both private and public sector ventures, but the government recently concluded an agreement with co-operatives in Canada to form new oil and gas ventures. The Cooperative Energy Corporation and the Co-operative Energy Development Corporation provide the opportunity for literally millions of Canadians to participate in their own oil industry. This opportunity has been limited to more restricted numbers of Canadians in the past. For the first time, partly through the vehicle of the new Co-operative Energy Corporation, many more Canadians will have the opportunity to participate in an enterprise which has been closed to them in the past.
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Additional to the acquisition route and the new venture route upon which I have briefly touched, there is another way in which Canadianization in the petroleum industry is going forward, that is, farm-ins by Canadian companies with foreign-controlled corporations. We have seen a number of such farm-in arrangements in recent months. 1 refer the House to the Alberta Energy Corporation, the state enterprise of Alberta, which arranged a farm-in of Gulf Canada lands in western Canada. More recently, both Imperial Oil and Texaco have not only agreed upon farm-ins with various Canadian companies but have repeatedly indicated their interest in additional farm-ins, so as to qualify for the higher incentive grant.
We have had some discussion during this debate about the borrowing authority as to energy prices and fairness. It is our contention that, in the first instance, fairness was introduced in the National Energy Program by the grants which are available to all Canadians to participate in conservation. This route was not open before to those who did not have the resources to make necessary changes to their dwellings or in some cases to their vehicles. Now they have the opportunity to gain the benefits of conservation.
Beyond that example of fairness is, of course, the price agreement reached with the government of Alberta under which the refinery cost of crude oil at Toronto in 1984 will be $52 per barrel. Under the budget of the previous government, the price would have been about $58 per barrel, even under a moderate international price increase projection.


Michael Holcombe Wilson: Mr. Speaker, I rise on a point of order. Would the hon. member table the background information upon which he made that calculation?


Roy MacLaren: Mr. Speaker, I should be pleased to provide the hon. member with the information. Under the Alberta-Canada agreement, the gasoline price in Toronto in 1984 will be in the range of 62 cents to 66 cents per litre. Under the Conservative budget, it would have been in the range of 73 cents to 86 cents, an average of 25 per cent higher. Equally, heating oil prices in Toronto in 1984 will be in the range of 43 cents to 46 cents per litre. Under the previous government's budget, the price would have been in the range of 48 cents to 58 cents, some 19 per cent higher.
Not only are there those considerations of fairness so that all Canadians share in their petroleum industry, and have the opportunity to conserve petroleum and to substitute it with more plentiful forms of energy, but there is also the sharing of the revenue flowing from the petroleum industry. In recent years we have seen the situation where some 45 per cent of the total revenue of the industry went to provincial governments, some 45 per cent to the industry, and 10 per cent to the federal government. Under the Alberta-Canada Energy Agreement and those subsequently reached with British Columbia and Saskatchewan, the situation is markedly different. For example, some 30 per cent of the revenue will now go to the government of Alberta, some 44 per cent to the industry, and 25 per cent to the federal government. Through the new

February 18, 1982
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arrangements and the federal-provincial agreements, all Canadians will have the opportunity to share more fairly and equitably in their own petroleum industry and to benefit from the revenues flowing from the most dynamic sector of our total economy. 1 do not doubt, with regard to the benefits for the consumer, with regard to energy self-sufficiency, and with regard to Canadianization, that the National Energy Program will go down in history as one of the great achievements of government in Canada since the Second World War.


Some hon. Members:: Hear, hear!


J. Robert Howie: Mr. Speaker, I should like to congratulate you on your duties in the chair tonight. It is always pleasing to see the hon. member for Bow River (Mr. Taylor) in the chair.
Bill C-93 implements a number of commitments made to energy producing provinces, provides several technical changes in the federal excise tax system, and seeks to obtain new borrowing powers for the fiscal year 1982-83. In the first part, the government is seeking borrowing authority for $6.6 billion, and this borrowing authority is directly connected with the budget. In light of the current economic situation, I agree with the minister that a review of the budget's objectives is important to provide a background for evaluating the merits of the bill.
In the budget, the government correctly identified rapidly rising inflation as the main problem in the country. Inflation pushes up interest rates, destroys investor confidence and generally slows down economic activity. In turn, this leads to a number of problems such as rising unemployment, erosionsQf real income, and borrowers saddled with the burden of ever-increasing interest rates. In Canada this has been marked by a period of stagflation in which the economy has been stagnant but inflation has continued to accelerate. In dealing solely with the problems of inflation, the government has failed to come to grips also with the problem of unemployment. The government appears to have failed to realize that there are two problems facing Canada and that each of them can be addressed at the same time.
To do this we need policies to restore the level of confidence in our country that will encourage Canadians and non-Canadians to invest in Canada. We must create a climate in which creative and courageous men and women may take risks and realize rewards. We must ensure that the public interest shall be preserved and that both the strong and the weak shall have equal opportunities. The great need at the present time is to build a property-owning democracy where not only do conditions encourage the individual to own the home in which he dwells and the farm fields he cultivates, but in addition allow him to save sufficient income to share in the ownership of the social and industrial future of this great country.
We must embark on a national development policy that will strengthen all areas. Canadians of all groups and regions must have equal opportunities to share in the national prosperity.
This involves an investment, not a mere spending, and the distinction between those two elements is one of the basic concepts that has escaped this government and that has been brought to the attention of the government, not only by myself but by one of the speakers on my left who spoke in this debate earlier.
Canada is one of the most beautiful and blessed of nations, and Canadians have the right, the obligation, and should be given the opportunity to create the world's finest society. It is important that the Foreign Investment Review Act and the capital gains tax be re-evaluated in light of our great need to attract investment in our country. By doing so this will revive our dollar and give us the flexibility to drop interest rates to the level they should be so we can get Canada moving forward again.
To do this we have to maximize the involvement of the private sector because small Canadian business employs more Canadians than any other sector of our economy. We have also to get on with the megaprojects and use them as development tools in all parts of our country.
We have a crisis in housing caused by high interest rates. The Clark government program to permit deductions of mortgage interest and property taxes from income tax, which was opposed by the Liberal and New Democratic parties, was then and is now the right measure to stimulate home building and the building materials industries in Canada today.
If ever there was a time when all governments in the country should be moving in the same direction, it is now. At this moment, federal-provincial relations are probably at an alltime low, with the federal government avoiding cost-sharing programs and local expertise and electing to take unilateral action to dissolve the Department of Regional Economic Expansion and to do its own thing in the development of areas that suffer from regional disparity.
The budget failed to recognize the tremendous importance and the potential of research and development in this country. The high technology industries have become the winners in today's economy. Our government has failed to follow the lead of these enlightened corporations. It has not stimulated industrial research nor has it regained lost markets. It has not moved into new ones nor expanded the great export potential of our country, which is so rich in terms of its natural resources and its educated population.
The budget should have allowed a reduction in taxable income by the excess interest that people are paying who have had to renew their mortgages. It should have allowed farmers a tax credit for the interest paid for seed and fertilizer. It should have allowed the small-business man to pay interest only on his long-term borrowings for at least a year. It should have allowed normal depreciation for new purchases or even accelerated the depreciation.
With huge revenues from the oil pricing agreements starting to flow into federal coffers, we have a rare opportunity to attack our deficit position and our accumulating deficit and at the same time to invest in the development of Canada. We
February 18, 1982

have to maximize our benefits from megaprojects, develop our natural resources, such as forestry, fisheries and agriculture. We have to update our creaking transport system and modernize our ports so that we can move more readily into export markets.
Shrinking space availability on ships registered under flags of convenience calls for an urgent evaluation of the merits of a Canadian merchant marine.
Hand in hand with an industrial strategy to bring about the economic recovery of our nation go training programs to enable Canadians to avail themselves of these opportunities.
It was just 24 months ago that the Liberal Party was elected nationally on a platform that higher energy policies were unnecessary and that they could manage the economy better than the Clark government. Now, 60 to 80 cents a gallon later, people are beginning to recall that during the Clark government inflation remained stable, jobs were being created at the rate of 30,000 a month and that purchasing power of wages rose. Under the self-proclaimed economic miracle workers now in office we have seen 30-year record level of unemployment and inflation, a decline in real wages, the biggest tax burden since the war, the gutting of the passenger rail system and proposals to reduce the financial commitment of the Liberal government to equalization, health and post-secondary education.
One of the crudest things about the current budget is that it penalizes Canadians who are trying to provide for their future and their families. It appears to penalize Canadians who adopt the noble and important concept of providing for the severely disruptive financial burden caused by unexpected dental or medical bills and incapacity due to illness.
It also penalizes the Canadian breadwinner who attempts to provide for himself and his dependants on retirement and after his demise. I am speaking again of the serious retrogressive step being taken by the government in taxing life insurance, dental and medical plans. In my opinion, this is a cruel and merciless tax grab that can cost the government more in social justice payments and unemployment insurance than it can hope to gain from these measures.
I do not often speculate about the future, but 1 do try to learn from the past. One of the things that I learned early on in Parliament was to read the budget papers that are filed with the budget. The Department of Finance analysis of the federal tax expenditures for individuals, which was tabled as one of the budget papers accompanying the November, 1981 budget, identified provisions of the tax system that in effect exclude certain types of income from tax, and the authors of the paper refer to these as tax expenditures because their economic effect makes them equivalent to spending programs.
In his budget speech of October 28, 1980, the minister noted that tax expenditures are expensive and it is incumbent on government to ensure that the incentives are effective and costs justified. In a prophetic statement, he went on to add that he wondered whether the economy might not be better
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served by a tax system with lower rates but with fewer and more selective incentives.
The paper tabled in the House describes tax expenditures as being composed of four different types. The first category includes cases where certain kinds of income are excluded. Examples are one half of capital gains, the full gain realized on the sale of principal residences, and various employment benefits, including interest free or low interest loans from employers. In this same category is included imputed rent on owner-occupied dwellings. That is right. The bureaucrats in the ivory towers of finance have identified the fact that Canadians living in the homes which they own pay no rent, and they feel that this is in fact a tax expenditure.
There are others. The second category deals with deduction tax expenditures and includes unemployment insurance contributions, tuition fees, gifts to the Crown, charitable donations, etc. Exemption tax expenditures include such things as married exemption and exemption for wholly dependent children. Tax credits tax expenditures is the final category and it includes refundable income tested child tax credits and tax credits for investment in machinery and equipment and buildings in certain sectors. I have by no means attempted to identify the very large number of tax expenditures which are discussed in the paper, but rather to attempt to identify the subject matter. Why is it important? It is important because it gives us an idea of the thinking of the senior bureaucrats in the finance department who are charged with the responsibility of making tax proposals to their minister. The November 1981 budget affected nine tax expenditures mentioned in this paper.
The paper admits that many of the tax expenditures serve important policy objectives and do so in an effective manner. It goes on to say that while some may wish that the budget had gone further in the direction of removing tax expenditures and lowering tax rates, it has to be recognized that any changes in tax expenditures must be part of an ongoing process of evaluation and review. It takes into account the prevailing economic circumstances and the capacity of the tax system to deal with large-scale changes. The paper admits that the existence of tax expenditures is important, but it also adds that for some purposes the tax system is a legitimate tool with which to address social and economic goals. In my opinion the ownership of one's home free of imputed rent is a worth-while social goal, and so too is the attempt of Canadians to provide for their dependants through life insurance and medical and dental plans. Tax exemptions for wives and children, tax credits to encourage industries to locate and provide jobs in areas that suffer from regional disparity and exemptions for those over 65 are all measures that are worthwhile and have grown up with our tax system.
I have no quarrel with government departments studying these tax expenditures, reviewing and evaluating them. My concern is that we have to be very much aware that many of the things we value highly and have come to take for granted are being examined by many of the people who have already

February 18, 1982
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identified some of the measures and convinced their minister to propose their elimination in his recent budget. It was an aroused opposition and an aroused Canadian public that forced the Minister of Finance (Mr. MacEachen) to change his mind on some of these proposals, and we witnessed the spectacle of his public retreat. We are now witnessing a very significant delay by the minister on some of the other measures which are repugnant to a large number of Canadians.
I have recognized the philosophy reflected in the budget papers, and I believe that my colleagues in all political parties are becoming aware of it. A large number of letters from my constituents, and constituents of all Members of Parliament, have protested these changes and advocated, as I have tonight, a better way to go. I do try to learn from the past, and one of the lessons I learned long ago when I was growing up in New Brunswick, and one I think the minister should consider, is that while the wheels of justice may grind slowly, they grind exceedingly fine. Abraham Lincoln said you can't bring about private prosperity by discouraging thrift. You cannot strengthen the weak by weakening the strong. You cannot help the wage earner by pulling down the wage payer. 1 hope my message tonight will be seen as a constructive attempt to suggest ways in which the government, by developing our country, can create more taxpayers and thus increase our revenues, reduce our borrowing both in the short and the long term, and eliminate the serious impediment to national growth represented by its high interest rate policy. I have tried to make constructive proposals to move in the direction of attaining that goal.
I hope also that the mandarins will get the message very clearly that this member, and hopefully this Parliament, will not permit the inclusion of imputed rent in any future tax policies or erosion of the noble and important concept that Canadians should be encouraged to provide for themselves and their dependants in so far as they are able, and that the state will treat them with generosity and respect in that worth-while endeavour, and not discourage them with a retrograde tax philosophy.


Mr. Paul E. McRae (Thunder Bay-Atikokan):: Mr. Speaker, I have spoken on budget bills, particularly borrowing bills, many times in the House and 1 do not recall, in the nearly ten years 1 have been here, a borrowing bill on which there were two Conservative speakers in a row who really did not condemn us very strongly for borrowing money. It strikes me as being a very strange phenomenon, and I think perhaps the reason for it is that the money the government is seeking to borrow in the next fiscal year is considerably less than the authority given for the last fiscal year. In the last fiscal year we had authority to borrow something in the order of $14 billion, and of course it must be understood that the authority does not mean you borrow that much. It looks as if we will have borrowed about $12 billion of the $14 billion. This year the authority allows for about $6.6 billion, and given the $2 billion left over, we will be borrowing something less than $9 billion. That is the anticipation. So we can see that the
borrowing authority in this bill is for about $5 billion less than last year.
Now I think it is fitting that we periodically have borrowing bills in the House. Usually it is once a year, but it has been more often when the government requires supplementary borrowing. This, of course, is in contrast with the United States where Congress puts an absolute limit on the national debt and the government can borrow up to that limit. In Canada, when we have to borrow additional sums, the government has to come to Parliament for approval. I think that is a worth-while activity and gives us a chance to debate how the money is spent, the merits or demerits of deficits and their size.
I think I would like to deal with two problems which are usually raised by more conservative speakers with regard to government indebtedness, expenditures and so on. The first, of course, is that government spending is wasteful. It is throwing money away and has a negative impact on the economy. The other is that almost all inflation stems from government spending. Those are the two myths which cloud the conservative mind.
First, I would like to deal with the nature of government spending. There are basically two areas where all governments spend their money. One is on the actual operations of government itself. In Canada, this accounts for roughly one third of all federal government expenditures, going for such things as the post office, national defence, and so on. The vast majority, two thirds of government expenditures, is in the area of what would be called transfers. These are transfers to the people in the form of pensions, family allowances, welfare and so forth. These are transfers to the provinces which, in turn, transfer the money to people and also pay their own costs of operation. They are transfers in terms of paying off debts, again to people. 1 think we should clearly understand the difference between those kinds of expenditures because it is the first expenditure, the cost of operating the government, that actually takes away from the economy of the country. It is the expenditure which takes goods and services out of the economy which could be used, otherwise.
The second category, the transfers, are moneys which are taken from one pocket and put into another pocket, with no net loss in between. The net costs are the costs of providing the service, and that is included in the first category. I think it is good that we understand this and that we look at these two kinds of expenditures.
1 would first like to look at the transfer side, because it is a side which provides two thirds of the expenditures of the federal government.
I would particularly like to deal with one very current aspect, and that is the aspect of the transfers to the provinces and, in turn, to the municipalities. This is an area I think we should really consider. The transfers to the provinces in the year 1981-82 will amount to a little over $13 billion. Also, the transfer of tax points, which was done in the last few years, adds up to something a little over $18 billion. That is, almost
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one third of all the money that the federal government spends goes to the provinces. We should look at the nature of this transfer and the growth of the transfers themselves.
In 1959, the Government of Canada transferred $0.6 billion, or roughly $600 million, to the provinces. The figure which appears in the chart that I have, although it has gone up considerably since then, shows that it rose to $11.8 billion in 1979, which amounted to a 2,000 per cent increase, or 20 times as much. There are all kinds of factors there; but the fact is that the amount of money which was transferred from the federal government to the provinces in that period of time increased by 20 times. If one compares the growth of federal revenues with that of provincial revenues in that period of time, one finds that federal revenues rose from $5.8 billion to $43.5 billion, or an increase by seven and a half times. The transfers from the federal government to the provinces tripled, or grew three times as fast as the revenue of the federal government. Therefore, we see a significant shift from the federal government to the provinces. That is very significant when we talk about federal deficits and about the way we organize things in this country.
When the Minister of Finance (Mr. MacEachen) speaks of his concern about the degree of this transfer, of his concern about the amount of money which is going from federal coffers to the provinces, and when he says we must keep this under some control, he is referring to the fact that those transfers have increased at almost three times the rate of the revenue in the federal government.
Let us look at the revenues of the federal government itself and of the provincial governments when we are dealing in terms of these transfers. In 1959, the Government of Canada had received approximately 52 per cent of all revenues in this country. The provinces and the municipalities received 48 per cent, which was very close to half and half. Half the money went to the federal government and half went to the provinces. It was very close.
Let us look at it in 1979, again which reveals the situation. By 1959, the amount of all government revenues had declined from 52 per cent to 33 per cent. It went from one half to one third of all revenues going to governments in this country. The provincial and municipal revenues rose from 48 per cent, again roughly half, to 67 per cent or two thirds. Therefore, we see this tremendous shift. From a point where federal and provincial revenues were almost 50-50, it went to the point where the revenues to the federal government amounted to roughly one third of all government revenues, and the provincial revenues amounted to two thirds.
1 am not decrying this situation. There is a lot of logic to it. One of the very substantial reasons that provincial government revenues increased over this period was that we expanded our educational institutions considerably. In the latter part of the period, we expanded our medical and hospital facilities even more. These were two of the very large pieces in the extension of revenue.
It is extremely important that the revenue situation be understood by those who claim the federal government is
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destroying this country because it is taking so much out. In the beginning, I said that I wanted to speak about the two major classifications of expenditures of the federal government, the one being the expenditures on goods and services, or operations of government itself, and the other being the transfer to people in provinces and so on. I dealt with the second one.
1 would like to deal with the first one for just a moment because it is important that we take a look at how extensive this is before we condemn government expenditures as being the great crime of our time. Again, I have a chart which illustrates expenditures from about 1953 to 1979. I would like to deal with what is called government expenditures on goods and services; that is, the operation of the government. This chart deals with the government expenditures as a percentage of the gross national product. We see that all government expenditures, as a percentage of gross national product, in current prices, rose from 1953, when it was about 17 per cent or 18 per cent, to approximately 24 per cent by 1978. There was a substantial increase of the portion of the gross national product. What really counts is what governments take away from the economy for goods and services, not transfers. When we break this down, we see quite a different picture if we consider what the federal government's expenditures were in terms of the gross national product, or goods and services. In 1953, the federal government spent approximately 10 per cent of the gross national product on goods and services. I am talking about the post office, national defence spending, the whole business. By 1978, the federal portion had dropped to about 6 per cent of the gross national product. When 1 look at these figures, I find it hard to believe that the great enemy of the people, our economy, our growth and what makes Canada work is federal government expenditures. That has not increased. It has decreased in terms of the GNP.


Lorne Edmund Nystrom: We have to deal with the Liberal Party.


Paul Edmund McRae: I will deal with that on another occasion when I have time.
I would like to go to the second argument that is made basically by the Conservatives. I certainly do not hear it from the NDP. It goes something like this. Inflation is the great evil. Most inflation, and I have heard some people say all inflation, is caused by wasteful government spending. I want to deal with that. I do not have the figures as neatly put together as I would like. They are not available in a neat form.
I would like to deal with a myth. In Canada today credit is extended to Canadians in terms of mortgages, business debt, inventory debt, private debt, industrial debt. It amounts to roughly $250 billion. I do not know why the members of the NDP are so exercised. I am really making a point on their behalf. In round figures, the debt amounts to about $250 billion. The increase in government borrowing this year, given the $6.6 billion plus the $2 billion from the last authority which was not used, let ust say $9 billion in round figures, is less than 5 per cent of the total amount of credit extended in this country. I do not believe that 5 per cent is the single factor
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February 18, 1982
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creating all the inflation in this country. It is only 5 per cent of the factor.
It is important that we see this in its true perspective. The major cause of inflation is not government debt. It is one cause, an expensive one, but it is not the major factor which is causing inflation.
In the few minutes remaining tonight, 1 would like to talk about my concerns in terms of the economy of the future, both the global economy and that of this country. There are many myths. I have dealt with only two.


Nelson Andrew Riis: Mr. Speaker, 1 wonder if the hon. member who is speaking would table the source of his statistics. 1 find them particularly interesting. Would he table the source of the figures he is using?


Paul Edmund McRae: 1 can table some of them. 1 certainly do not have all the figures with me. I can table two or three of the items. 1 will try to put them together. 1 am pleased that people are interested. 1 think it illustrates some points.
1 would now like to deal more in generalities. I believe 1 have put to rest two myths. One is that government expenditure is terribly wasteful, that the government is throwing money away. The other is that government debt is the cause of all inflation.
There is a more prevalent myth which affects the whole economic world at this point. It is what I call the myth of macroeconomic activity or action, solving problems today the way they were solved in the Keynesian era. I do not think that will work. Those monetary policies will not work. 1 do not believe a reduction of the money supply, increased rates and so on, are having the effects that we had hoped for. On the other hand, I do not think lower taxes and attempts to increase the fiscal means to meet increased demand will work either. There are all kinds of reasons for this. I do not have time to give them now. I would like to continue the next time this debate resumes.
I think we are all satisfied that the monetary policy is not working well. One reason is the side effects it creates. High interest rates are inflationary. A figure was given to me. I will have to qualify it a bit. If the exchange rate was the same as it was in 1975, the additional cost to this country for imports would be about S12 billion a year. If interest rates were the same as in 1975, the additional cost to this country would be approximately $23 billion a year. That factor creates some difficulties.
Let us go to the other side, the one which the NDP praises. Their notion is that by lowering taxes and thereby circulating more money, demand is increased, which really tends to be inflationary. It would not have the effect it used to have. The money goes into savings, luxury goods from foreign sources rather than creating the desired effects. With deficits of $10 billion to $12 billion a year, we should have solved our problem a long time ago, but it did not happen that way. We have to look away from macroeconomics and look at micro, although I do not like that term. We have to look at inflation in terms of
structure, the ingredients and what tends to be inflationary. At one time it may be wages, and at another time, energy. This is what you look at. If you want to cure inflation, you determine the specific inflationary factor and deal with it, but not in a macro way. If I want to stimulate the economy, I would like to create more than that. I do not go to the side that you go to and say, "lower taxes". I say that we should go to a megaproject.


An hon. Member:: You are a socialist.


Paul Edmund McRae: If we go to the megaproject, we can easily measure the number of jobs which will be created according to the number of tons of steel required and the miles of pipe required, and so on.
I believe that this is the direction in which we should head. We should provide stimulation which is structural in nature, where a number of projects can be built, thereby creating jobs.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Jesse P. Flis (Parkdale-High Park):: Mr. Speaker, at the risk of being labelled a one-issue member, I again rise on a matter of human rights.
It is now almost two years since I first began protesting and urging the government and members of this House to take all possible action to eliminate the discriminating practices of mandatory retirement which exist in Canada; practices which, needless to say, are denying many Canadians their right to work and contribute to the general wellbeing of our country.
At this point I do point out that, as mentioned, I have already spoken on this troubling concern on several occasions. My views are well recorded in Hansard. However, I will take this opportunity to express some further concerns as a result of my question to the Minister of Transport (Mr. Pepin) on February 11, 1982, regarding an order in council ordering Air Canada to reinstate Captain Ross Stevenson to his original position as an airline pilot.
As numerous members of the House are aware, the Supreme Court of Canada has recently ruled unanimously that Ontario municipalities cannot impose a mandatory retirement age of 60 on their firefighters, even if that had been negotiated into their collective agreement.
Considering this fact and considering the fact that this case is identical to the case of Captain Ross Stevenson, an Air
February 18, 1982

Canada pilot who was forced to retire because of the collective agreement between the Canadian Airline Pilots Association and Air Canada, there remains no doubt in my mind that the minister should introduce an order in council designed to reinstate Captain Ross Stevenson with Air Canada.
Granted, I can understand the Minister of Transport wanting to leave the decision to the union and the company involved, but 1 cannot understand how the minister can allow a double standard to exist among different groups of workers. This is clearly a time for leadership and the minister should be leading the way for equality within our system. Are we, as members of the House, to ignore that a discriminatory practice exists? I say no to this practice which denies to the individual a healthy self-image as a result of being actively involved in the work force.
The fundamental problem and main obstacle to equality for federal employees is Section 14(c) of the Canadian Human Rights Act which permits age discrimination and denies some Crown corporation employees the right to work beyond 60 years of age. Why is it not possible for all Canadians to work past 60 if they are capable and want to, especially when some are permitted to? Why should the others be discriminated against?
The Canadian Human Rights Act, Section 14(c), is preventing federal employees of Crown corporations from continuing their employment past what is called the normal retirement age. Why are we, as members of the House, allowing this cruel game of semantics to continue within our legal system? Are we not elected here to serve the Canadian people with equality and without discrimination?
Captain Ross Stevenson is a victim of this "fixed" game and three times now he has gone to court to change the rules of Section 14(c) to remove the discrimination which exists; spending thousands of his retirement dollars. Why should Mr. Stevenson be spending his money to do a job which is our responsibility? That responsibility is providing a non-discriminatory system of social justice. This policy of placing thousands of our productive work force "on the shelf' is not only expensive and wasteful, but extremely unjust.
It is morally wrong to reject efficient and willing workers because of their date of birth. All that is required is to delete Section 14(c) from the Canadian Human Rights Act, as recommended two years ago by both Senator Croll's special senate committee on retirement age policies and by the Canadian Human Rights Commission. It is on this note that I urge the House to bring equality to our system by deleting Section 14(c), and to put an end to the cruel semantics game of "normal retirement age" within our legal system.


Robert Theodore Bockstael: Mr. Speaker, first allow me to say that I, like the Minister of Transport (Mr. Pepin), have the greatest respect for the support the hon. member has given his constituent, Captain Stevenson, in this particular case. I know the hon.
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member for Parkdale-High Park (Mr. Flis) is fully cognizant of the facts involved. In a former adjournment debate on November 19, 1981, he referred to previous discussions with the Minister of Transport, stating:
The minister clearly stated that Transport Canada has no retirement age for pilots ... Once the pilot has been issued the licence, he can continue to hold and exercise the privilege of licence, provided he can continue to meet the medical standards based on those set by ICAO-
He was referring to the International Civil Aviation Organization.
-and pass periodic flight testing to demonstrate his competency.
These facts, as the hon. member stated, outline Transport Canada's position in the matter of mandatory retirement.
I also refer to the minister's comments of February 11, 1982, to remind the hon. member and the House that the issue of mandatory retirement is the subject of a collective agreement between Air Canada, the employer, and the Canadian Airline Pilots' Association, which negotiates on behalf of the pilots.
It should be noted that the ruling of the Supreme Court of Canada last week does not apply to those employees under federal jurisdiction.
Since the federal Human Rights Commission has the case of Captain Stevenson under investigation and since Captain Stevenson himself is seeking leave to appeal a previous decision before the Supreme Court of Canada, it would not be appropriate to comment further at this time.


NATIONAL HARBOURS BOARD-(A) PURCHASE OF EQUIPMENT MANUFACTURED IN JAPAN (B) REQUEST FOR TABLING OF MEMORANDA
Mr. J. R. Ellis (Prince Edward-Hastings):: Mr. Speaker, it should be interesting to hear what the parliamentary secretary has to say in response to my questions. My question was a very simple one, asking for three memos. The Minister of Transport (Mr. Pepin) took part in a decision to give jobs to Japanese and not to Canadians. 1 do not think that is the policy of this government, but it almost has to be, since that is the only motivation 1 can see.
The only company in the world which to date has made the type of equipment required for the Ridley Terminals Incorporated stacker-reclaimers at Ridley Island near Prince Rupert is Stephens-Adamson. We understand that company's bid was $1 million lower than that of the Japanese. Its delivery date was two months earlier. The minister says time is of the essence. The delivery could still beat that of the Japanese, even if Stephens-Adamson was given the order today.
Finally, with respect to guarantees in relation to technology and quality, at Westshore Terminals some years ago Stephens-Adamson was asked to guarantee a piece of equipment. The company gave a guarantee. There has been only one fault in that piece of equipment since and that was three years after the Five-year guarantee period.
1 am asking for three memos. Two are from the National Harbours Board. The first one, frankly, is full of falsehoods, and that is the reason I want to have a look at it, and the

February 18, 1982
Adjournment Debate
second is an internal memo. These memos have to do with the decision by Ridley Terminals to buy this Japanese equipment.
Ridley Terminals was created in December of 1981 after two years of playing around, trying to get this job under way.
I know that a letter of intent was given to the Japanese firm at least a week before the board of Ridley Terminals met to consider this decision. I sounds to me as if the intention was to give the contract to the Japanese from the beginning. I have been putting pressure on the minister for some six weeks about this matter, Mr. Speaker, and I suggest to you it is only because I upset the plans that the letting of the contract was delayed for two and a half to three weeks. 1 should like to see it delayed even further.
The second item I want to deal with is the point made by the minister in his answer when 1 put the question regarding the memos. The minister said he had directed that the National Harbours Board should meet with the company to give a full explanation of the decision. That was just not done, Mr. Speaker.
I have a copy of a telex sent to the minister today in which the company says it had been informed of the arrangement to have the meeting, by his office, and had subsequently arranged a meeting in Vancouver on February 8 with the vice-chairman of the National Harbours Board, the acting chairman of Ridley Terminals, and the president of Swan Wooster, which is the engineering consulting company involved, before a full review meeting on February 9. The telex says that they were shocked when the meeting was refused, and more astonishing was that the offer to meet with them was on the condition that they would not use any information to pursue further evaluation. They state that they could not agree to this condition.
All i am looking for is three memos, Mr. Speaker. If the minister or his parliamentary secretary can convince me and Stephens-Adamson that in fact there was a fair evaluation of this contract, then they will hear no more about it-that will be the end of it. But we have not seen the memo, we have not had the meeting and, in fact, we have been stonewalled. The government obviously has something to hide and will not expose the real reason why it gave the contract to the Japanese. It will not explain why hundreds of thousands of manhours, many many hundreds of days of work, have been given to a Japanese firm rather than to a Canadian firm.
The minister mentioned the percentage of Canadian content. The Japanese will not come anywhere near the 50 per cent content while the Canadian firm would have meant 96 per cent. There is a staff of close to 500 in a plant in Belleville which needs this kind of work. It seems to me that the production of three simple memos to explain to some 500 people why work is being taken from them and given to the Japanese is not too much to ask. If the minister and his parliamentary secretary have nothing to hide, then surely these memos should be made available. If they are not made available, then we must assume that the policy of this government is to give work to other countries.


Robert Theodore Bockstael: Mr. Speaker, I want to emphasize that a considerable effort has been made to ensure a high degree of Canadian content in the Ridley Island coal terminal project. Of a total estimated cost of $230 million, over 80 per cent will be Canadian manufactured content.
In the particular case referred to by the hon. member, the purchase of two stacker-reclaimers, the winning bidder ensured 53 per cent Canadian content. As the minister indicated in his answer, this should not be taken as a reflection on the excellent reputation of the Canadian bidder Stephens-Adamson of Belleville, Ontario. Stephens-Adamson has had major recent sales in Canada and abroad, in the face of stiff international competition.
The minister accepted the decision of Ridley Terminals on grounds that this was the technical advice he was given. He was, of course, mindful of the critical timing and magnitude of the northeast British Columbia coal project, and hence the importance of having it proceed on schedule.


INDUSTRY-(A) CANADIAN CONTENT IN MANUFACTURE OF MINING EQUIPMENT (B) CONTRACT AWARDED TO JAPANESE COMPANY
Mr. Thomas Siddon (Richmond-South Delta):: Mr. Speaker, the questions I raised with the Minister of Industry, Trade and Commerce (Mr. Gray) were supplementary to the ones asked by the hon. member for Prince Edward-Hastings (Mr. Ellis). They can be found on page 15046 of Hansard for Tuesday, February 16.
The main question I asked was basically why Canadian content of mining equipment for domestic use had fallen from almost 70 per cent in 1970 to a mere 29 per cent in 1980. In fact, if we look at the figures given by the minister two days ago we see that there would be only 27 per cent Canadian content in mining equipment; those are the figures of Statistics Canada for 1980.
There was a $167 million trade deficit in 1980 in mining equipment, and this includes a total importation of some $330 million worth of mining equipment. If we use the minister's figures, $372 million worth of imported mining equipment came into Canada. This is all part of Canada's current balance of trade deficit of $21 billion in manufactured goods, which is having a negative and devasting impact upon the economy and upon employment opportunities for young people in Canada.
There were two basic questions. Why has the Liberal government allowed this deterioration of Canadian content to such a rock-bottom level of only 27 per cent over the past decade? What specific plans does the minister or the government have now to correct this very regrettable situation?
The minister, known as the guru of industrial strategy, has been making promises for nigh on three years in the House now, but he has yet to produce one positive initiative or one shred of evidence that in fact this devastating trend in manufactured products, particularly in the mining sector, is being reversed. Of course we are talking about the kind of
February 18, 1982

equipment which will be in great demand in the next decade as we develop megaprojects in mining, in particular, and in oil sands, coal and various minerals. We are talking about heavy machinery such as the stacker-reclaimers, to which my colleague referred a few moments ago, draglines, bucket wheels, rock drills, ore trucks, compressors, electrolyte cells for processing, crushers, roasters, flotation cells, process control equipment, and various types of conveyers. There is tremendous opportunity here for Canadian enterprise.
We note that our unemployment now exceeds 1.2 million people, that there is an unemployment rate of 17 per cent in the under 25 age group, and that we are experiencing unprecedented lay-offs. These lay-offs have led to massive applications for UIC benefits and claims, thus contributing to the deficit of the Government of Canada.
Since the November 12 budget there have been 2,200 lay-offs in the mining industry, with an anticipated 8,000 by the end of next summer. In British Columbia alone there have been 120,000 lay-offs, 9,000 of them represented by U1 applicants in my own riding, and the number is growing at the rate of 1,600 per month. This $372 million worth of imported mining equipment would produce something in the order of
10,000	jobs per year for Canadian workers. When we look at the tremendous unemployment rate and the deterioration of our economy and compare it with future potential, we must conclude that something is basically wrong. The government opposite is absolutely inept, and there is no obvious answer as to why it wants to export jobs.
What does the Minister of Industry, Trade and Commerce have to offer besides platitudes? Last year he talked about a mining conference in Vancouver with industrial groups. Such a conference took place a year ago and there has been no progress. He talked about beginning a process; I ask, "Where is the action?" 1 hope in response the parliamentary secretary will tell the House what specific examples the Minister of industry, Trade and Commerce can cite of increased opportunity for Canadian manufacturing to provide the very important machinery required in these industries. For example, 1 refer to the stacker-reclaimers, about which we heard, and the car dumpers being used in coal handling terminals on the west coast which are now being increasingly imported from offshore-the car dumpers from Britain, 1 gather, and the stacker-reclaimers from Japanese companies such as Mitsubishi.
Stephens-Adamson in Belleville could produce stacker-reclaimers containing, not 53 per cent Canadian content, but 96 per cent Canadian content and it underbid the Japanese for the Ridley Island stacker-reclaimer by $1 million with a low bid of $19.7 million. That Canadian firm has been denied the opportunity to produce jobs in Canada, specifically in the city of Belleville, Ontario. Instead we are choosing to export those jobs to Japan.
Fednav Com, which is the company set up to operate the terminal, was set up on a non-competitive basis. Its shareholders are well-connected with the Liberal Party in Montreal, 1
Adjournment Debate
understand. They have no residence in British Columbia. For some reason, which smells of hanky-panky, the contract for this equipment is being let to a Japanese company, and we need to find out why. At Roberts Bank superport, Westshore Terminals, a British Columbia Crown corporation, has just let a contract for $10 million with another company in Japan,
I HI, to supply stacker-reclaimers for that project. Here again, what is wrong with Canadians? Why are we dealing Canadian jobs off to the Japanese, and what kind of hanky-panky is going on here?
I understand that of the so-called 53 per cent Canadian content, much of the steel work is to be done in Korea under contract to some Canadian front company. That, Mr. Speaker, is not Canadian content at all.
Finally, 1 was led to believe that Stephens-Adamson was going to establish a fabrication plant in my riding in Richmond, British Columbia, where the steel and components would be assembled to provide the stacker-reclaimer for Ridley Island. My riding has lost that employment potential, thanks to the regressive policies of the Liberal government opposite. I think the House deserves a thorough and complete explanation of this atrocious situation.


Mr. Gerald Laniel (Parliamentary Secretary to Minister of Industry, Trade and Commerce):: Mr. Speaker, in reply to the hon. member for Richmond-South Delta (Mr. Siddon), I am pleased to say that while it is true that Canada has been supplying a smaller share of its domestic market with mining equipment in recent years, this has been compensated to a large extent by growing exports of Canadian-made equipment. Accordingly, consideration of the issue of Canadian content in mining equipment should take into account both the total performance of the Canadian mining equipment industry, including its exports, and the future industrial benefits represented by projected large scale mining developments in Canada.
This trend of increasing exports, offset by rising imports, reflects a process of rationalization and specialization which the industry has been forced to undertake in order to remain competitive in the international environment.
Nevertheless, the rising share of the Canadian mining equipment market being supplied by imports does represent missed opportunities for Canadian equipment suppliers and a significant demand for new mining equipment, which is expected to result from major resource projects, will present many new opportunities for mining machinery companies.
Accordingly, the Department of Industry, Trade and Commerce has undertaken a series of initiatives to assist Canadian manufacturers to seize these new opportunities. In this regard, follow-up initiatives to the Mining Opportunities conference held late last spring in Vancouver have led to more formal linkages between the procurement activities of mining firms and the marketing efforts of suppliers. The department has also established an office of industrial benefits in order to ensure that Canadian firms obtain maximum advantage from large new resource developments. As part of a planned export

February 18, 1982
Adjournment Debate
market strategy, we have assigned a priority position to mining equipment in several key markets of the world. In this regard, the department has provided assistance under our program for export market development-PEMD-to assist the marketing efforts of 13 companies in some 15 different countries.
Finally, we have also been active in assisting equipment firms to develop new products in order to meet the needs of mining firms in both Canada and abroad. Over $5 million in assistance has been provided to ten firms under the Enterprise Development Program, EDP, to develop a variety of advanced equipment ranging from coal slurry pumps to mine utility vehicles.
It is all right to pinpoint, Mr. Speaker, some of the problems this country has in the field of industrial development or the economy, but it is interesting to find out that action is being taken by this government which will be to the future benefit of the economy.


Thomas Edward Siddon: Let's have the specifics.


The Acting Speaker (Mr. Blaker):: Order, please. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until eleven o'clock tomorrow morning.
At 10.25 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, February 19, 1982