1982-04-26

ROUTINE PROCEEDINGS


Mr. Gordon Taylor (Bow River):: Madam Speaker, 1 rise to move a motion under the provisions of Standing Order 43. The Liberal Government of Canada seems hell bent on bankrupting small business. First, we had the national energy policy, and then the November 12 budget. One small-business man is now being prosecuted-persecuted would be a more accurate word-and other prosecutions are in the offing, for advertising in imperial measurement, a language his clients understand. This is even more totalitarian than in Moscow where a business may advertise in any language and in any measurement. Therefore I move, seconded by the hon. member for Red Deer (Mr. Towers):
That this House deplores such prosecutions based on laws passed by order in council and urges the government to straighten out its tangled priorities before the patience of the people reaches the breaking point.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


EXTERNAL AFFAIRS
Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, under the provisions of Standing Order 43 I move, seconded by the hon. member for Kingston and the Islands (Miss MacDonald):
That this House convey to the British government an expression of our approval for the manner in which the Royal naval task force, including the Royal Marines, carried out their operation in South Georgia over the weekend with a minimum of bloodshed and casualties thereby restoring, at the least possible cost in human suffering, the situation in that area that existed prior to the Argentinian aggression in the South Atlantic.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


INDIAN AFFAIRS
Hon. Flora MacDonald (Kingston and the Islands):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. In the four years between 1976 and 1980, 1,810 Indian women lost their Indian status under Section 12(l)(b) of the Indian Act, which clause has been declared discriminatory by the United Nations Human Rights Commission.
Given that the Charter of Rights and Freedoms is designed to do away with such discriminatory legislation, but that the allowable period to effect such a change is another three years, I move, seconded by the hon. member for Peterborough (Mr. Domm):
That the government immediately introduce legislation to remove Section 12(1 )(b) from the Indian Act, so that Canada will not suffer the shame for another three years of this abuse of the human rights of Indian women who marry non-Indians.


Madam Speaker:: Is there unanimous consent for this motion?
Some hon. Membeers: Agreed.


Some hon. Members:: No.


FREEDOM OF INFORMATION
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, this morning the Canadian Bar Association held a press conference at which it denounced the stalling of the government on freedom of information legislation and urged quick passage of this legislation, so essential for participatory democracy. In view of the fact that the paper prepared by the Canadian Bar Association lawyer, Murray Rankin, totally destroys the foundation of objections to the federal legislation, I move, pursuant to the provisions of Standing Order 43, seconded by the hon. member for Selkirk-Interlake (Mr. Sargeant):

April 26, 1982
That the House commend the Canadian Bar Association for its outstanding efforts on behalf of all Canadians for effective freedom of information legislation and urge the government to stop stalling and pass this long overdue legislation, removing Crown privilege, and including the fundamental principle of independent judicial review.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


BIRTHDAY CONGRATULATIONS TO SPEAKER OF HOUSE-MOTION UNDER S.O. 43
Mr. Henri Tousignant (Parliamentary Secretary to Minister of Public Works):: Madam Speaker, under the provisions of Standing Order 43, I wish to ask the unanimous consent of the House to present a motion on an important and particularly pleasant subject.
Madam Speaker, we must confess that curiosity got the better of us and we found out that today our distinguished Speaker is celebrating her thirty-second birthday. 1 am sure that all hon. members will join me in offering you, Madam Speaker, our best wishes for health and happiness, and, in view of your sparkling youth, a large and happy family.


Madam Speaker:: I can only thank the House for such thoughtfulness.


Some hon. Members:: Hear, hear!


INDUSTRY
Hon. Roch La Salle (Joliette):: First of all, my very best wishes, Madam Speaker.
I rise on a matter of urgent and pressing necessity, under the provisions of Standing Order 43.
Whereas three months ago, the Minister of Industry, Trade and Commerce agreed to re-examine the feasibility of reintegrating leather footwear within the global quota, and whereas the survival of the footwear industry depends on a positive reply by the minister, I move, seconded by the hon. member for Perth (Mr. Jarvis):
That the House unanimously invite the minister responsible to announce his decision this week, in order to put to rest the increasing anxiety of thousands of employees in the Canadian footwear industry.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE ECONOMY
Mr. Gordon Towers (Red Deer):: Madam Speaker, in view of the statement made by the Secretary of State (Mr. Regan) that in order to bring down high interest rates the Prime Minister (Mr. Trudeau) will try to persuade the President of the United States to ease up on interest rates, I move, pursuant to the provisions of Standing Order 43, seconded by the hon. member for Simcoe North (Mr. Lewis):
That the Government of Canada accept its own responsibilities and opportunities to fight high interest rates at home, that it stop blaming others, and that it stop putting on a show of the mouse twisting the elephant's tail.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE PRIME MINISTER
Mr. John McDermid (Brampton-Georgetown):: Madam Speaker, on the weekend, in Belleville, the Leader of the Liberal Party of Ontario, David Peterson, said:
The Prime Minister is a millstone around our necks.
Since the Ontario Liberal leader's brother sits in this House as the hon. member for Willowdale (Mr. Peterson) and his wife has a position in the Prime Minister's office, I am sure the following motion will receive unanimous support. I move, pursuant to the provisions of Standing Order 43, seconded by the hon. member for Prince Edward-Hastings (Mr. Ellis):
That the Prime Minister assure this House that the Peterson family feud which affects him directly will not place in jeopardy the job of Heather Peterson in the Prime Minister's office or the leadership ambitions of her husband, the hon. member for Willowdale.


Some hon. Members:: Oh, oh!


Madam Speaker:: The hon. member for Kamloops-Shuswap.
April 26, 1982


GOVERNMENT INVESTMENT IN BRITISH COLUMBIA COAL DEVELOPMENT PROJECT-MOTION UNDER S.O. 43
Mr. Nelson A. Riis (Kamloops-Shuswap):: Madam Speaker, first of all I wish to extend my congratulation to you.
I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. As hon. members of the House are aware, the British Columbia northeast coal development consortium issued a $350 million debenture to investors of this project. Among them the federal government has been placed low on the list of creditors. Therefore I move, seconded by the hon. member for Burnaby (Mr. Robinson):
That the government clearly outline what specific safeguards exist for Canadian taxpayers for this project that is having its economic viability called into question virtually daily.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


THE LEADER OF THE OPPOSITION
Mr. Roger Simmons (Burin-St. George's):: Madam Speaker,
I rise under the provisions of Standing Order 43 on a matter of urgent and pressing necessity. In view of the fact that a prominent Tory member, one who has "difficulty not telling the truth", stated that his leader "will have a difficult time holding on to his job if he doesn't call a leadership convention before the scheduled review in January 1983", and that "there seems to be a consensus that he's going to have a difficult time to win that majority", I move:
That the Tory party members reconsider their desire for a leadership convention and work together in support of their dynamic leader.
I know the hon. member for Cariboo-Chilcotin (Mr. Greenaway) will want to second the motion.


Some hon. Members:: Oh, oh!


Madam Speaker:: Order.


FINANCE
Mr. Joe Reid (St. Catharines):: Madam Speaker, we in the back benches also extend our congratulations to you.
The combination of a vigorously pursued high interest rate policy by the government and a regressive anti-business budget
Oral Questions
has further weakened the industrial productivity of the country. Industrial production has fallen for the eighth consecutive month and is now at its lowest point since 1978. In view of our staggering unemployment situation, I move, seconded by the hon. member for Cambridge (Mr. Speyer):
That the Meach Lake musketeers adopt the employment priority put forward in the letter of the "Gang of Ten" by scrapping the November budget in favour of one which would allow industry to expand, grow and, above all, provide jobs for Canadians.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.


RAILWAYS
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Madam Speaker, last year I had occasion to call the Minister of Transport (Mr. Pepin) the worst thing to happen to passenger trains since Jesse James. This has proved to be only true. Having robbed the people of Saskatoon, Edmonton and Jasper of transcontinental train service, it turns out that the minister's new intercity schedules are not living up to expectations, according to briefing notes prepared for the Prime Minister (Mr. Trudeau), and that a review of the minister's disastrous and stupid cutbacks may well be in order. Therefore 1 move, seconded by the hon. member for Dauphin (Mr. Lewycky):
That this House calls on the Minister of Transport to reinstate the Super Continental passenger train, to order new transcontinental train equipment, which he has not yet done, and to use new light rapid comfortable trains already on order to improve service between the cities in western Canada.


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


Some hon. Members:: Agreed.


Some hon. Members:: No.



ORAL QUESTION PERIOD


Miss Pat Carney (Vancouver Centre):: Madam Speaker, my first question is directed to the Minister of Finance who, after studying the entrails of the Canadian economy, at Meach Lake, apparently could not bring himself to face the Canadian public and dispatched the Minister of Justice to announce that

April 26, 1982
Oral Questions
there would be a new budget in the fall. Considering the fact that Liberal government economic policies have created record unemployment, rising bankruptcies, the highest borrowing costs in the industrialized world, and eight consecutive months of decline in production, why wait for fall? Why does the minister not abandon his current budget and bring in a new one now?


Hon. Allan J. MacEachen (Deputy Prime Minister and Minister of Finance):: Madam Speaker, the normal time for bringing in a budget is in the fall.


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: That was precisely the question answered by the Minister of Justice. He was making clear what was quite obvious, that there is a period each year when a budget is brought in, and the normal cycle was what the minister was referring to in his answer.


DATE OF BUDGET PRESENTATION
Pat Carney: Madam Speaker, my supplementary question is for the Minister of Finance. In view of his answer, and in view of the fact that there is to be no budget legislation before the fall, why does the minister add to the confusion by indicating that the Justice minister was making a routine statement about the budget? Will or will there not be a budget in the fall?


Allan Joseph MacEachen: Madam Speaker, there is no problem in replying to that question. If the hon. member had read the paper on the budget process which was recently tabled in the House, she would have learned that that is the attitude of the government. In the normal event, the budget will be introduced in the fall.


THE ECONOMY
Pat Carney: Madam Speaker, my supplementary question again is to the Minister of Finance. His alter ego, the Secretary of State, announced that the Liberal government plans to stick by its current economic policies to fight inflation. While inflation rates are declining in the United States and the United Kingdom, they are accelerating in Canada. One of the reasons is that the government keeps increasing the price of fuel oil and continues to increase interest rates, which are two of the biggest components of the cost of living. How can Canadians lower the rate of inflation when the government itself keeps increasing prices through higher interest costs and energy costs?


Allan Joseph MacEachen: Madam Speaker, the hon. member is aware that we have followed a policy which has resulted in lower energy prices than in any other country in the world. We have not agreed to go to world prices, while every industrialized country in the world has moved to world prices. We have taken a different view in order to protect Canadian consumers from international prices.


EFFECT OF INFLATION ON WORKING POOR
Flora Isabel MacDonald: Madam Speaker, my question is for the Minister of Finance. Given the difference in Canadian and American inflation rates-Canadian rates are almost double-I will pose to the minister the situation of a Canadian family which earns $12,000 per year, one of the working poor. Were that family living in the United States its cost of living increase would be $50 per month less than it is in Canada. The Secretary of State indicated that the problems facing Canadians are wholly due to international situations. If this is so, how does the minister explain to a family such as I have mentioned why they are $50 per month worse off in Canada because of inflation than their counterparts in the United States?


Allan Joseph MacEachen: Madam Speaker, knowing the Secretary of State as well as I do, and knowing his deep understanding of the economy, I do not believe he would say that our problems were solely due to international events.
Obviously, what is happening in our traditional markets and what is happening to American interest rates are all factors which affect Canadians very adversely. That is a fact of life. But it is true that the performance of the American economy on the inflation front is better than Canada's. Not only is the cost of living index in the United States much lower than ours, the average wage settlement at the present time is from 4 percentage points to 7 percentage points lower in the United States than in Canada. That is why, if we are to remain competitive and create more jobs in Canada, as is our principle objective, we must do everything possible to reduce our inflation rate even further.


Flora Isabel MacDonald: The minister will also recognize that those income figures which he cited do not really apply to the working poor, most of whom are non-unionized and therefore have very little in the way of collective action on their behalf.


INCREASE IN UNEMPLOYMENT
Flora Isabel MacDonald: Madam Speaker, how does the minister explain to low income families whose job security is precarious at any time, why the number of employed has fallen more sharply in Canada during the current recession than it has in the United States? Why should these people have to face both higher prices and fewer job opportunities than their counterparts south of the border?
April 26, 1982


Allan Joseph MacEachen: Madam Speaker, the hon. member began her series of questions on comparisons between Canada and the United States and asked me to address my concerns to the working people of Canada-


Flora Isabel MacDonald: Working poor.


Allan Joseph MacEachen: -and those in receipt of social benefits. Since taking on this job it has been my objective not to do anything to disturb the social programs which have been in existence in the country.


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: In fact, very early in the mandate of this government, we brought in a very substantial increase-


Flora Isabel MacDonald: A cutback of $5.9 billion.


Allan Joseph MacEachen: -to the guaranteed income supplement in an effort to help those who needed help most. That is our policy. Despite the difficulties and despite fiscal restraint, we have maintained and strengthened our social programs.


Mr. Nielsen:: What restraint?


Allan Joseph MacEachen: That cannot be said about policies in the United States. In that country, as the hon. member knows, very large cuts have been made in social entitlements. That is not a policy that I would like to follow.


Some hon. Members:: Hear, hear!


GOVERNMENT INTEREST RATE POLICY
Hon. Edward Broadbent (Oshawa):: Madam Speaker, I have a question to ask of the Minister of Finance, as well. The Government of Canada may be content to wait until the fall to make any change in financial policy, but I want to let the minister know that Canadians who are losing their homes, their jobs and their businesses, want action now.


Some hon. Members:: Hear, hear!


John Edward Broadbent: In that light, following news reports of the session the cabinet held at Meach Lake on the weekend, I would like to ask the minister a question. Is it the case that, in spite of people losing their homes, jobs and businesses, the government has no present intention of changing its disastrous, high interest rate policy?


Allan Joseph MacEachen: Madam Speaker, as the hon. member knows, we are not following a high interest rate policy. No one in this government advocates high interest rates.


Flora Isabel MacDonald: Don't choke.


Allan Joseph MacEachen: Every possible step is being taken to reduce the level of interest rates in Canada. Every possible step has been taken to help home owners meet-
Oral Questions


Some hon. Members:: Oh, oh!


Allan Joseph MacEachen: -the very heavy burden of high interest rates. But the hon. member knows as well as I do, and maybe better because he is a graduate of the London School of Economics-


Some hon. Members:: Shame.


Allan Joseph MacEachen: -and I am not, that there is an inevitable relationship between the level of inflation and the level of interest rates. There will be no deep impact on bringing down interest rates unless the inflation rate is brought down. That is why I find it offensive that the hon. member is always referring to the government's high interest rate policy. There is no such animal.


John Edward Broadbent: Madam Speaker, I hate to upset the Deputy Prime Minister, but the Prime Minister said last Thursday that we did have a high interest rate policy in Canada.


REQUEST THAT GOVERNMENT REDUCE INTEREST RATES
John Edward Broadbent: 1 would like to ask the
minister a supplementary question because I listened with care, as I always do, to the explanation of the Deputy Prime Minister of the reason for high interest rates. The Prime Minister gave a similar explanation last week to the hon. member for Etobicoke Centre when he said that the reason for high interest rates in Canada "was because inflation was high and people were only lending their money at higher rates of interest".
If we dropped the prime rate in Canada by three percentage points, we would still have a prime rate which was 2.5 percentage points above the rate of inflation. Under such circumstances people would perhaps still be able to keep their businesses and more Canadians would be able to hold on to their jobs. If that would be the case, why does the government not drop the prime rate?


Some hon. Members:: Hear, hear!


Allan Joseph MacEachen: Madam Speaker, as the hon. member knows, the prime rate generally moves in line with the bank rate which is set every Thursday as the result of an auction, when individuals and financial institutions-


John Edward Broadbent: It will always be done that way, Allan.


Allan Joseph MacEachen: -bid for treasury bills. The rate that is set on every Thursday is a market response based upon what is happening in other markets, particularly in the United States. I do not believe that artificially bringing down the bank rate would do very much. It might have a very short-term impact. It would have immediate repercussions on the exchange rate.

April 26, 1982
Presence in Gallery
It would have an additional impact on inflation, which would be bound to increase. Then the rate would probably go up higher than it had been when the hon. member's not very ingenious suggestion had been implemented.


John Edward Broadbent: If I had not seen the disastrous effects of the London School of Economics on the Prime Minister, I might suggest that the Deputy Prime Minister take an additional course in economics at that institution.


REASONS FOR NOT REDUCING INTEREST RATES
John Edward Broadbent: Madam Speaker, I have a supplementary question for the Deputy Prime Minister. We could have a drop of three percentage points, which would mean that thousands of Canadians could keep their jobs. Canadians would not have to continue losing their homes because of higher mortgages. We could get some stimulus in the economy. Why will the Government of Canada not take such action in full recognition that exchange controls of some sort may be necessary? The Americans did not hesitate to put such controls on their economy during the past two decades to protect it. Why does the government not give us a low interest rate policy, and bring in exchange controls if necessary to protect jobs?


Allan Joseph MacEachen: Madam Speaker, I suppose there are people listening to the hon. member who think his policy may work. I do not know a better way to convince the hon. member than to take an illustration from the most recently elected socialist government in the world, namely, the Government of France.
In order to protect the French franc from even further devaluation, to protect its currency and protect its workers from imported increased inflation and further unemployment, that government recently allowed its short-term interest rates to go up over 20 per cent. That was not done because the Government of France was stupid or because it was hidebound by ideology, but because it took into account the best interests of the French workers, which we are doing in Canada as we develop and implement our economic policy for Canadians.


PRESENCE IN GALLERY OF PARLIAMENTARY DELEGATION FROM SPAIN
Madam Speaker:: I have the honour of drawing the attention of the House to the distinguished presence in our gallery of a delegation of Spanish parliamentarians headed by the Speaker of the Senate, Senor Cecilio Valverde.


Some hon. Members:: Hear, hear!


ADMINISTRATION OF JUSTICE
Mr. Chris Speyer (Cambridge):: Madam Speaker, my question is directed to the Minister of Justice. The minister will know that he initiated the uranium cartel prosecution based upon the results of the Bertrand report and upon the sworn affidavit of Mr. Orest R. Samitz, a combines investigation officer who believed that there was a conspiracy to fix the prices of uranium. On Friday afternoon last the Supreme Court of Ontario decided that Crown corporations were immune from prosecution. The shocking implication of this is that the courts of this country do not have jurisdiction over potential illegalities or criminal offences of Crown corporations. Since there is no accountability by the criminal courts of this country with respect to Crown corporations, will the minister make the Bertrand report public? Also, will he release us from the gag rule which has been an impediment to free speech since 1976?


Hon. Jean Chretien (Minister of Justice and Minister of State for Social Development):: Madam Speaker, this morning we decided to appeal the decision of the Supreme Court of Ontario, and the case is now before a higher court. As for the Bertrand report, there were, of course, two things we could do: either take legal action, which we have done, or refer the report, as was done in the case of the oil companies, to the Restrictive Trade Practices Commission. In this case, which concerns the uranium question, we decided to bring the matter directly before the courts, where it is now. After the decision by the Supreme Court of Ontario on Friday, counsel for the Canadian government decided to appeal.


POSITION OF MINISTER
Chris Speyer: Madam Speaker, in this particular prosecution the conduct of the Minister of Justice has been absolutely disgraceful.


Some hon. Members:: Oh, oh!


Chris Speyer: It has been absolutely disgraceful.


Mr. Clark:: Like Jack Austin?


Chris Speyer: Where is the fairness in having private corporations prosecuted in circumstances where public corporations, Crown corporations, are immune from prosecution? Secondly, prior to the prosecution being initiated, was the minister not aware that Crown corporations could not be prosecuted because they were immune, and is that why he did not charge the officers of the company?
April 26, 1982


Joseph Jacques Jean Chrétien: Madam Speaker, I have answered this question several times before. At the Department of Justice, on the advice of counsel who had served as such on the Bertrand Commission, we decided to take both the private sector and public sector people to court. That is what we have done. A decision was handed down by the Ontario Supreme Court Friday, and, Madam Speaker, I cannot change the laws of this country. The case is before the Ontario Court of Appeal, and we have followed the procedure prescribed by the laws of Canada. When we receive a report from the Director of Investigation and Research, either we take legal action or we refer the case to the Restrictive Trade Practices Commission. We have taken one of these options. The court has handed down a decision, and we are appealing that decision because, at the time, we decided that legal action had to be taken against both private and public sector companies. The entire matter is now before the courts, and it is not up to me to comment on court decisions.


INDUSTRY
Roch La Salle: Madam Speaker, my question is directed to the Minister of Industry, Trade and Commerce. I am sure the minister realizes that all industrial sectors are facing considerable problems, but the fact remains that one specific sector, namely the footwear industry, is not asking for government subsidies but only for a minimum of protection to be able to survive.
The minister has said several times that he intended to make a decision after a reasssessment of the feasibility of reintegrating leather footwear within the global quota. After this exercise, is the minister today in a position to give us the assurance that he will announce his decision this week?


Hon. Herb Gray (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: Madam Speaker, I can assure my hon. colleague and all hon. members of this House that we have an abiding interest in the welfare of this industry and its employees. That is why cabinet is now considering the representations it has received, but I am not in a position to advise the House whether a decision will be announced this week.


Roch La Salle: Madam Speaker, it seems that according to the information obtained from members on the government side, the minister is giving the matter serious thought. This question is extremely important because of the negative consequences involved for the industry. The footwear industry cannot wait much longer, as the minister is aware. In the
Oral Questions
interest of thousands of workers who are living in an atmosphere of almost intolerable uncertainty, could the minister at least tell us when he intends to announce his decision and explain why, after so many weeks, he is still unable to respond positively to recommendations made by the industry, which is not asking for money or subsidies but only for a decent measure of protection on the part of the government?


Herbert Eser (Herb) Gray: Madam Speaker, quotas are a form of subsidy which is paid by all Canadian consumers. However, we have kept a quota system in order to protect our footwear industry. We announced our policy last fall, and it is because we are taking the concerns and representations of the industry seriously that we are giving very serious thought, as the hon. member just said, to these representations. I am hoping to obtain a review at the cabinet level as soon as possible.


THE ECONOMY
Mr. Claude-Andre Lachance (Rosemont):: Madam Speaker, my question is directed to the Minister of Finance. In view of the soon irreparable structural damage being done to Canadian industry and workers by abnormally high interest rates, which are the direct result of the rigid monetary policy being followed in order to fight inflation, could the Minister of Finance inform the House whether he intends very shortly to make some changes in the policy being supported by the Bank of Canada and, more specifically, to recommend that the Governor of the Bank of Canada consider devaluating the Canadian dollar, which according to most independent economic analysts would have the immediate effect of drastically reducing interest rates without necessarily leading to a substantial increase in interest rates over the long term?


Allan Joseph MacEachen: Madam Speaker, similar questions were put earlier in the question period by the Leader of the New Democratic Party.


Charles Joseph Clark: And by many others.


Allan Joseph MacEachen: The hon. member asks about the impact of a devaluation and whether indeed it would lead to any real relief from the interest rates. Obviously all of us are concerned about the damage that high interest rates are creating. As the hon. member may recall, that subject was thoroughly considered at the First Ministers' Conference. At that time the Prime Minister indicated that in present circumstances such a policy would likely lead to even greater inflation and probably even higher interest rates if an artificial reduction in interest

April 26, 1982
Oral Questions
rates led to extreme pressure on the currency. For these reasons, Madam Speaker, I have not found it possible to adopt that policy. I believe it would be more harmful than helpful for the Canadian economy. Indeed, it would have unpredictable consequences for all of us. That is the view of the government on the hon. member's question.


NUCLEAR ARMAMENTS
Miss Pauline Jewett (New Westminster-Coquitlam):: Madam Speaker, my question is directed to the Prime Minister. In his absence I wonder if I could address it to the Secretary of State for External Affairs. As the minister will know, Canadians across Canada are becoming incredibly concerned about the nuclear arms spiral. Indeed, on Saturday last over 30,000 Canadians marched peacefully through Vancouver and held an enormous rally. It was really a spectacular rally, protesting the nuclear arms spiral.


Erik Nielsen: What did you do?


Pauline Jewett: Above all, they were asking for a nuclear arms freeze, to allow negotiations to catch up. Could the minister tell us if the Prime Minister-if the minister knows his mind on this-is thinking seriously of following the lead taken by a great many distinguished Americans and others, and which has been urged upon the government by the people of this country, to press as vigorously as we can, in the United Nations and elsewhere, for a mutual freeze, a global freeze, on the production, testing and deployment of nuclear weapons and their delivery vehicles?


Hon. Mark MacCuigan (Secretary of State for External Affairs):: Madam Speaker, the Government of Canada shares the concern which the hon. member has expressed, and which the protest to which she referred has obviously expressed, about the spiralling arms race. We have just received a report of the Standing Committee on External Affairs and National Defence regarding our position on UNSSOD II. We are continuing to consult and prepare for that conference. I think Canadians will be satisfied with the position we will take publicly at that conference with respect to the arms race.
I am sure what the hon. member really wants is that we take an effective position with regard to arms control and disarmament, and not go for any quick fix, which would not be successful. If it were just a freeze, it would remove the possibility of negotiations with the Soviet Union; if it were a freeze without the necessity of their making any concessions it would certainly not motivate them to further negotiations.


Pauline Jewett: Madam Speaker, I am glad the minister did not say what the Prime Minister is thinking, because he obviously does not know. Surely the Prime Minister is looking
more seriously than the minister at the utility of a nuclear freeze now and, indeed, at why other countries are pushing for it.


TESTING OF CRUISE MISSILE
Pauline Jewett: Madam Speaker, specifically on the question of testing the Cruise missile, it is not quite clear to me yet whether the government is postponing any testing of the Cruise missile until after UNSSOD II and, indeed, until after we have seen what consequences might flow from UNSSOD II.


Mark R. MacGuigan: Madam Speaker, in case I did not make it clear in my first answer, the reply I gave was a reply on behalf of the government.
The question about the Cruise 2 tests has to be answered with a distinction. There is a framework agreement under which various kinds of arms tests will be able to be established under joint Canadian-U.S. control, tests which may take place on Canadian territory. The negotiations on that agreement are going forward. An agreement may or may not be reached before UNSSOD II.
With respect to the sub-agreement under that framework agreement which would authorize tests of the Cruise missile, we will not be going forward with that agreement before UNSSOD II.
I might add that even if we did, and if there were a general disarmament agreement at UNSSOD II, that would take priority over any bilateral agreement we had with another country.


METRIC CONVERSION
Mr. Bill Domm (Peterborough):: Madam Speaker, government policy concerning forced metric was clearly stated at the weekend by the Minister of Consumer and Corporate Affairs when he said "Nothing will be imposed on any group against their will".
Independent retailers are now receiving notices of court hearings and being threatened with fines and prison terms for printing Canadian measurements on their products, and to date all cases, to my knowledge, have been adjourned until at least August of this year. My question is directed to the Minister of Justice. Given the fact that all manufacturing industries can use either metric or imperial without threat of prosecution and given the fact that all newspapers and radio and television outlets can advertise in imperial measurement free of prosecution, how does the Government of Canada justify taking some independent retailers to court for printing imperial measurements on their in-store merchandise when it is clearly documented that the working group on scales in the retail food industry does not wish to go metric at this time?
April 26, 1982


Joseph Jacques Jean Chrétien: Madam Speaker, this is a problem for the Minister of Consumer and Corporate Affairs, and I will refer the question to him.


ADVERTISING ISSUED BY METRIC COMMISSION
William Henry (Bill) Domm: Madam Speaker, condemnation of metric by force and the elimination of imperial measurement has been recorded by the governments of Prince Edward Island, Nova Scotia, British Columbia, and by the soon-to-be-elected P.C. government of Saskatchewan-


Some hon. Members:: Hear, hear!


William Henry (Bill) Domm: -not to mention municipal governments from coast to coast. Would the Minister of Justice or his designate look into the possibility of fining or locking up the offices of the Metric Commission, or taking to court the executive director of the Metric Commission, for allowing Government of Canada printers to print false advertising in a current brochure put out by the Metric Commission which says, "Canada is joining the United States in using metric"? This propaganda is being handed out in grocery stores all across the country-


Madam Speaker:: Order. It seems that the question has been asked.


Joseph Jacques Jean Chrétien: Madam Speaker, I heard the question. I think it was more of an argument than a question. This problem is the responsibility of the Minister of Consumer and Corporate Affairs, and I will discuss the matter with him.


ASTRA TRUST
Joseph Lloyd Reid: Madam Speaker, my question is directed to the Minister of State for Finance. The federal government incorporated Astra Trust Company, a trust company which operated in southern Ontario, under pressure from several Niagara and Ottawa politicians, including former members of Parliament of Liberal persuasion, and when the Astra Trust Company was in financial difficulty, that same government advanced an $8 million loan to bail it out. That bailing out did not happen. Astra Trust collapsed. The Canada Deposit Insurance Company has received and returned practically all its moneys which were placed on deposit as guarantees. The federal government got back its $8 million, but what about the hundreds of depositors who deposited their money in good faith with the Astra Trust Company, who now get zilch?


Hon. Pierre Bussieres (Minister of State (Finance)):: Madam Speaker, the hon. member will recall that the incident
Oral Questions
and the company to which he is referring are connected with other companies that fall under provincial jurisdiction. As far as the company under federal jurisdiction is concerned, those who suffered losses were compensated by the Canada Deposit Insurance Corporation, as the hon. member said, and he also knows perfectly well that legal action is being taken against certain shareholders of this company and that the courts are to judge the charges brought against them.


Joseph Lloyd Reid: Madam Speaker, the minister well knows that the other related companies were companies subsidiary to the Astra Trust Company and that the Astra Trust Company was the parent corporation, which made it possible for the deposits to be taken.


MINISTER'S STATEMENT
Joseph Lloyd Reid: Madam Speaker, in addition to that there was a recent federal court decision to the effect that the depositors would not be allowed to sue the Superintendent of Insurance or the Minister of Finance for negligence in the operation and control of the Astra Trust Company. Is the Minister of State for Finance really saying that because he and his government have recovered all the moneys the government advanced, those depositors will be left with nothing? Is the government saying, "I'm all right, Jack, but you will have to look after yourself'?


Pierre Bussières: Madam Speaker, I think the hon. member is somewhat confused. If there are depositors who suffered losses through the subsidiary companies which fall under provincial jurisdiction, he should find out what the provincial authorities intend to do to compensate these people for their losses. As for the company which was under federal jurisdiction, as I said before, under the deposit insurance guarantees, these depositors were compensated in accordance with the provisions of the Canada Deposit Insurance Act.


ADMINISTRATION OF JUSTICE
Hon. James A. McGrath (St. John's East):: Madam Speaker, my question is directed to the Minister of Justice, and it is supplementary to that of my colleague, the hon. member for Cambridge. Now that the minister has decided to appeal the decision of the Ontario courts on the uranium cartel with respect to immunity of prosecution of Crown corporations, I

April 26, 1982
Oral Questions
want to ask the minister why he instructed counsel to seek immunity for Crown corporations in the first instance.
Second, now that the minister has decided to appeal that, to be consistent will the minister lift the gag rule imposed on public servants, and will he release the Bertrand report?


Joseph Jacques Jean Chrétien: Madam Speaker, I believe the statement made by the hon. member to be false. I have never instructed anybody and Crown corporation counsel manage their own files. They use these facts in their files which militate in favour of their case. Neither myself nor my department has been in touch with counsel for the Crown corporations involved. I have chosen the same counsel as the Bertrand Commission and appointed him government counsel in this matter, and he is the one who laid the charges before the courts.
As for the second part of the question, Madam Speaker, the proceedings before the American courts are not yet completed, and it is to safeguard Canadian interests involved in the legal action in the United States that we have put certain restrictions on the papers to be published in Canada. We have said that the papers required to lay charges in Canada would be available to our counsel, Mr. Brown, and to counsel for the defence.


REQUEST THAT BERTRAND REPORT BE RELEASED
James Aloysius McGrath: Madam Speaker, I have a further supplementary question. If, as the minister states, Crown corporations are masters of their own destiny, why did he, as Attorney General, not lay charges against the directors of some of these Crown corporations in the first instance? Also, why does the minister insist on imposing the gag law on public servants in Canada? This has nothing at all to do with the U.S. courts. Why does he not release the Bertrand report so that people in this country can judge for themselves?


Joseph Jacques Jean Chrétien: Madam Speaker, I said that the prosecutions in the case of the uranium cartel had been instigated after the Bertrand report. That report recommended to the government that it prosecute the corporations and not the individuals that the hon. member would like me to prosecute. In order to make sure that I would follow the advice of the Bertrand Commission as quickly as possible, I hired the same counsel, Mr. Brown, from Toronto. He acted as counsel for Mr. Bertrand and is acting as counsel for me at this time. I do not think I could have done better than to make sure there
was a lot of continuity between the Bertrand report and the prosecutions.
As far as the other part of the question is concerned, I have answered that many, many times in this House.


LEGAL ADVICE RESPECTING CROWN CORPORATIONS
Charles Joseph Clark: Madam Speaker, I should like to put a question to the Minister of Justice. When the government was preparing action against some of the people involved in the uranium cartel, did it receive any legal advice at that time suggesting that Crown corporations would be found to have Crown immunity from prosecution?


Joseph Jacques Jean Chrétien: Madam Speaker, the legal advice I have received is the same legal advice as in the Bertrand report. In order to implement the recommendations in the best way possible, we have asked the same prosecutor, the same lawyer that Mr. Bertrand had hired, to be our prosecutor. At that time the legal advice we received from the Bertrand report and from our legal adviser was that we had to prosecute the list of people and corporations mentioned in the Bertrand report. We decided to prosecute every one of the people and corporations mentioned, not one more and not one less, but exactly those recommended by the Bertrand report.


REQUEST THAT BERTRAND REPORT BE MADE AVAILABLE TO HOUSE OF COMMONS
Charles Joseph Clark: Madam Speaker, I have a supplementary question for the Minister of Justice. Because he refused to answer that direct question on whether or not the government knew in advance, or was warned by its legal advisers in advance that the Ontario court would grant the Crown the immunity that it has, and since he said that his advice was based upon the Bertrand report and that that report might or might not have warned that the consequence we saw on Friday would occur-all this makes it absolutely imperative that the minister stop hiding the Bertrand report. The House of Commons and the people of Canada have the right to know if the Government of Canada is trying to hide something that should not be hidden. We can begin to know by seeing the Bertrand report. Will the minister make that report available to the House of Commons?


Joseph Jacques Jean Chrétien: Madam Speaker, I believe that the position is very clear in this regard. The Act of Parliament provides two options when we receive a report from the Director of Investigation and Research: either to lay charges as recommended by the director, which we have done in this case, and, moreover, as an additional precaution, we have
April 26, 1982

hired exactly the counsel who worked for the Bertrand Commission, or else to refer the problem to the Restrictive Trade Practices Commission, which the director did not recommend. We have done exactly what the act provides, and the reports from the Director of Investigation and Research are not supposed to be made public under the act passed by Parliament.


LEGAL ADVICE RESPECTING CROWN CORPORATIONS
Charles Joseph Clark: Madam Speaker, we do not know what illegalities are being covered up. We do not know what options that were available to the government and are being covered up. We do not know why the Minister of Justice refuses to make the Bertrand report public which he admits he has the power to make public. The only reason he is not doing so is because he has decided to hold secret this document which should be a public document.
Let me return to the question he evaded earlier. At the time the Minister of Justice or anyone else in the government was deciding to bring action against some of the people involved in the uranium cartel, did they receive legal advice at that time from anyone-from the Bertrand report or anywhere else- that Crown corporations, including the shell corporation controlled by the Government of Canada, might be able to claim Crown immunity from prosecution successfully? Did he receive that warning in advance?


Joseph Jacques Jean Chrétien: Madam Speaker, I have said that I followed exactly the legal advice that was given to the Bertrand Commission and to myself as Attorney General of Canada. It came from the same prosecutor. I am not surprised that the Leader of the Opposition does not know much about the law, because he did not stay in that faculty very long.


SPRAYING OF PESTICIDES AT GAGETOWN, N.B.
Mr. Jim Fulton (Skeena):: Madam Speaker, my question is directed to the Minister of National Health and Welfare and concerns a long held principle of medical science in Canada, and that is, to err on the side of caution.
I know that minister is well aware that there was no monitoring of the spraying of Agent Orange at Gagetown, New Brunswick, in 1966-67. In view of the irrefutable proof that the Department studied the wrong people recently, in that three out of the four communities studied were upwind of the spraying, would the minister tell the House why she will not support a thorough, independent medical inquiry into the Gagetown spraying and into the medical linkage of birth defects to the present spraying of fenotrothion?
Hon. Monique Begin (Minister of National Health and
Welfare): Madam Speaker, several well conducted long-term
Oral Questions
animal studies have been performed on this pesticide which demonstrate the absence of a carcinogenic hazard.
I want to repeat to the hon. member that the way he phrases his question does not help anybody. I am not aware of the facts that he tries to establish.


James Ross Fulton: I am very surprised at that, Madam Speaker.


REGISTRATION OF PESTICIDES
James Ross Fulton: Madam Speaker, I will put my supplementary question to the Minister of State for Science and Technology and Minister of the Environment who, I know, is aware of this very serious problem. For 20 of the last 30 years the federal government has funded the bug spraying program in New Brunswick. Scientists in the minister's department know very well what the impact of this spraying has been on bird populations. It is obvious that the Department of National Health and Welfare is covering up a very serious medical problem. I wonder if the minister would comment on the recommendation given to him by Dr. Ross Hall, the consultant he hired, in a report that is unanimously supported by the minister's advisory council, which calls for the stripping of the powers of pesticide registration from the Department of Agriculture?
Since at least six further studies are required to re-register fenotrothion for this year's spraying in New Brunswick due to the IBT fraud, will the minister intervene on environmental grounds, not just medical, and stop this year's spraying in New Brunswick until the studies can be completed?


Hon. John Roberts (Minister of the Environment and Minister of State for Science and Technology):: Madam Speaker, I do not think there is anything I can add at the present time to the answer given by my colleague.


PENSIONS
Hon. Stanley Knowles (Winnipeg North Centre):: Madam Speaker, I should like to direct a question to the Minister of National Health and Welfare. Before doing so, I should like to thank her for the various greetings she sent to me a number of times while I was in hospital. I may say that many others did the same, and I should like to say a special thanks to you, Madam Speaker.
My question this afternoon relates to my concern about the unfairness of the plan respecting old age pensions under which certain women-there are some men but it is mostly women- between the ages of 60 and 65 can get a pension provided they are married to someone who is 65 or over. However, persons between the age of 60 and 65 who are single, whose husbands died before that age, are not allowed any such pension. Will the minister seriously consider a plan to change that, so that

April 26, 1982
Oral Questions
persons between the ages of 60 and 65 who are in need will get that kind of pension?


Some hon. Members:: Hear, hear!


Hon. Monique Begin (Minister of National Health and Welfare):: Madam Speaker, as the health minister I think I can say in the name of all of us, that I rejoice that good medical care and great courage have returned the hon. member to the House.


Some hon. Members:: Hear, hear!


Monique Bégin: That being said, I do not like to receive his questions. I will have to answer what he underlines, which is a serious problem. I would just like to put it back into perspective, without denying the problem. The spouse's allowance was implemented a few months before the time my predecessor hoped to have a form of guaranteed annual income for all Canadians in need. In that context, spouses, under the age of 65, of pensioners would have been the first Canadians to enjoy what would have gone to all Canadians in need, whatever their age or cause of poverty. Unfortunately, we all know of the failure of the federal-provincial conferences on social security in those years.
We then, all of us in this House, remedied part of that injustice so that when the pensioner died, the spouse continued to receive the pension. However, in these economic times, we cannot extend that benefit to those in need below the age of 60. That is the dilemma we are facing. But the whole issue of housewives, particularly those younger than 65, who do not receive a pension, is addressed in the green paper on pension reform which will be out within a few weeks.


PROVISION OF PENSIONS FOR THOSE WITHOUT OTHER INCOME
Stanley Howard Knowles: Madam Speaker, because of the interest of the minister in this problem may I ask &wsl753;-l if she will give her help and the best attention she can to making improvements in that plan, even if it means some money from this country, to provide pensions for those between 60 and 65 who have no other incomes?


Some hon. Members:: Hear, hear!


Monique Bégin: I am deeply worried about the problem of the 60 to 65 age group, in particular the women. I discussed this more than a week ago with the French Minister of National Solidarity, Madam Nicole Questiaux, who just undertook to lower pensions to age 60 for some in France. I have checked this again and that is the question, if we have some more money to add to the GIS, should we not instead start lowering the eligibility requirements for those who need it most below the age of 65? I for one am not yet convinced that we can do that until we have raised everyone over 65, most of whom are
women or single pensioners, above the poverty line once and for all. So the step the hon. member recommends would become the second step for the future.


PETITION
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the two hundred twenty-ninth report of the Clerk of Petitions stating that he has examined the petition presented by the hon. member for Spadina (Mr. Heap) on Friday, April 23, 1982 and finds that the petition meets the requirements of the Standing Orders as to form.	,



ROUTINE 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. 2,639 and 3,969.
I ask, Madam Speaker, that the remaining questions be allowed to stand.


Mr. Anguish: 1.	Since October 2, 1980, what was the total cost incurred by the government as a result of its efforts in London, England to secure the passage of the proposed Canada Act, 1981 by the U.K. Parliament?
2.	For the same period, did the government hire on a permanent, temporary or contract basis any person to work at or in concert with the Canadian High Commission in London and, if so, what was his/her name?
3.	For the same period, were employees of the government re-deployed to work at or in concert with the Canadian High Commission and, if so, in each case (a) what was the (i) name (ii) salary (iii) amount of expenses (iv) function or job description (b) was the employee a Canadian or a non-Canadian?
4.	For the same period, did the government, through the offices of the Canadian High Commission or in any other way, sponsor meetings or social functions in London with members of the U.K. Parliament, officials of the U.K. government, officials of British political parties and/or members of the British press and, if so (a) on what date (b) what were the names and titles of the persons who attended (c) what was the cost to the government?
5.	Was the hon. member for Hochelaga-Maisonneuve asked to perform duties on behalf of the government during April and May, 1981, in London and, if so (a) what were the duties (b) at what cost?
6.	Did the government retain, directly or indirectly, the services of any consultant or firm of consultants in the United Kingdom with respect to securing the passage of the proposed act and, if so, what were the names of the consultants and what amount was paid or is payable for their services and expenses?
April 26, 1982


David P. Smith: 1. Since many officials and ministers often combined work in London with respect to securing passage of the Canada Act 1982 with other official business, it is not possible to determine with any degree of accuracy the total cost incurred in London to secure the passage of the Canada Act 1982.
2.	Yes. L. Burton, S. Burke, N. Burpee, L. Cyr-Mowers, M. Fitzhenry, L. Giroux, J. Manthorpe, A. Stacey, A. Stankovic.
3.	Yes. (a)(i) Reeves Haggan; John McNee.
(ii)	Mr. Haggan is classified in the public service as an EX-3. His salary is in the range of $54,700 to $64,300. In addition, the application of foreign service directives for salary equalization on foreign postings resulted in a payment of $16,200 for the period November, 1980 to April, 1982. Mr. McNee is classified in the public service as an FS-1. His salary is in the range of $21,177 to $29,204.
(iii)	Mr. Haggan's expenses from November, 1980 to March, 31, 1982 were $28,338.47. Mr. McNee's expenses were $10,648.34.
(iv)	Mr. Haggan was minister and special advisor to the High Commissioner and was head of the patriation task force from November, 1980 to April 8, 1982. Mr. McNee acted as second secretary from May 11-July 10, 1981 and from October 30-December 15, 1981. He was seconded from his position at the Canadian Embassy in Madrid, Spain.
(b) Both are Canadian citizens.
4.	Yes. (a) During the period October 1980-March 1982.
(b)	Members of Parliament, Peers, journalists and officials who accepted the hospitality offered by the High Commission did so with the full understanding that their names would not be made public.
(c)	Hospitality expenses during the period October 2, 1980-March 29, 1982 totalled 19,947.70 British pounds.
5.	Yes. (a) The duties included representing the Minister of Justice at a seminar on the Canadian Constitution at All Souls College in Oxford University. In addition, his duties related to his position at the time as Parliamentary Secretary to the President of the Treasury Board. He also assisted the High Commission in explaining the role, the work, and the report of the Special Joint Committee of the Senate and the House of Commons on the Constitution of Canada.
(b) $3,750.00.
6.	Yes. (a) B. Donoghue; D. Scott, (b) 12,466.62 U.K. pounds.


Mr. Cossitt: 1.	If persons are arrested for immigration infractions at the port of Lans-downe, are such arrests made by (a) immigration officials (b) Ontario Provincial Police from Gananoque or Brockville in the constituency of Leeds-Grenville (c) officers of the Royal Canadian Mounted Police detachment in Brockville in the
Energy Administration Act
constituency of Leeds-Grenville and, if so, what would be the merit in transferring authority to the Department of Employment and Immigration at the port of Lansdowne outside the area of Leeds-Grenville to the port of Kingston?
2.	Was it customary for immigration at Lansdowne, the Ontario Provincial Police at Gananoque and Brockville and the RCMP at Brockville to maintain close liaison with the immigration centre located at Prescott in the constituency of Leeds-Grenville and, if so, what advantage could there be in placing immigration at Lansdowne, under the authority of the port of Kingston, outside the constituency of Leeds-Grenville, which has never been involved with Lansdowne?
3.	Would such a move involve delays in processing and additional costs and, if so, what are all the details?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: 1. Persons arrested for immigration infractions are arrested by immigration officers; RCMP and the OPP may subsequently lay charges if a violation of the Criminal Code is involved.
2.	There was and is no specific close liaison between the immigration personnel at Lansdowne with that of immigration at Prescott other than that normally experienced between all immigration points of service. Naturally, it is customary for all immigration points of service to maintain a good liaison with all enforcement agencies within their area of operation. There are several advantages in placing Lansdowne under the authority of the port of Kingston. Staff from Lansdowne will be immediately available for secondment to the Kingston inland centre during low traffic periods, affording better utilization of human resources at minimal costs and, thus, providing developmental exposure to border staff at a more complex inland office. The Ontario Provincial Police at Gananoque and Brockville and RCMP Brockville do maintain a liaison with Lansdowne. However, in most cases the OPP and RCMP contact Ottawa District office of CEIC to seek guidance on immigration cases.
3.	Such a move would neither involve delays in processing normal cases nor additional costs.


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


Some hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Friday, April 23, consideration of the motion of Mr. Lalonde that Bill C-103, to amend the Petroleum Administration Act and to enact provisions related thereto, be read the second time and referred to the Standing Committee on Energy Legislation.
[Stage Direction]
April 26, 1982
Energy Administration Act
Donald W. Munro: Madam Speaker, when I called it four o'clock on Friday I was in the course of trying to determine the factor for converting barrels into cubic metres or vice versa. As I recall, I was being assisted by a member other than the hon. member for Trinity (Miss Nicholson), but I see that she is credited on page 16578 of Hansard with having provided the conversion factor. Be that as it may, I think it is worth while knowing what that factor is.
Can I ask for order, Mr. Speaker, please? There is more than one conversation going on at that end of the Elouse and I find it a little disconcerting.


The Acting Speaker (Mr. Blaker):: I appreciate the hon. member's point. Perhaps, since he has brought his difficulty to the attention of the Elouse, he can now have the attention he wishes.


Donald W. Munro: Thank you, Mr. Speaker. I do believe the curtains were put there for a purpose. However, I will endeavour to override with my strident tones the conversations taking place.
I was about to say I thought it fortunate that I am covered by parliamentary immunity when 1 started talking about barrels and cubic metres and so on, because the notion of converting from one to the other is a dangerous operation these days. I learned, for example, that a carpet merchant on the west coast who displayed carpets at so much per square metre, but also had the temerity to advertise them simultaneously at so much per square foot or square yard, is now appearing before a judge because he has broken the law. So it is fortunate that we in this House are covered by parliamentary immunity and can still seek the conversion factor where necessary between barrels and cubic metres.
1 find it very helpful, when looking at a bill as complex as this one, to go through it extremely carefully and break it up into its various parts to determine just exactly what the thrust of the bill is. This bill now before us is in effect a copy, with certain important downward changes in tax limits, of the first 40 pages of the bill which caused the bells to ring, Bill C-94, with the exception of page 32 which has already appeared in Bill C-105. That is the iniquitous proposal which would authorize the Minister of Energy, Mines and Resources (Mr. Lalonde) to spawn as many Crown corporations as he and his officials see fit, independent of Parliament. Even the annex in Bill C-103 has been transcribed faithfully-in cubic metres, mark you-from the earlier bill. The main intent of this bill is described in the explanatory notes. The purpose of this bill is, we read:
-to impose a charge on the export of crude oil and certain petroleum products, to provide compensation for certain petroleum costs and to regulate the price of Canadian crude oil and natural gas in interprovincial and export trade.
There are two purposes of this bill, one, to raise funds and the other, to regulate. Prior to having the bells to ring, we sought in our discussions, to have Bill C-94 broken down into
uniprinciple bills. Yet here we have one with two principles, to raise funds and to regulate.
One of the purposes of this bill is to raise funds, and as a result it deserves to be dealt with in a manner quite different from a regulatory bill. Because this bill has two principles, to raise funds and to regulate, I find it rather intolerable. In fact, it is an affront to Parliament to have these two particular principles in the same bill. At least though we were able to have the matter split from Bill C-94. Which in itself was an even more monstrous piece of legislation.
There are several kinds of taxes to be raised. I would like to deal with them separately if I can, not only to get them clear in my own mind, but also to keep them clear in the minds of all other Canadians who will have to pay some of those taxes.
First, the explanatory notes state that there is to be an oil export tax. That tax has been in effect for almost 18 months, in fact, since the October, 1980 budget. Its collection at current levels is in the first place to be retroactively legitimized and legalized. That is one of the first things Bill C-103 will do. It will legalize taxes now in place which have been in place since October, 1980. This export tax is, of course, levied at the international border. It forces the price of Canadian oil on the foreign market to higher and higher levels. Legally this oil export charge could be assessed at $8 a barrel but at the present time it is being levied at the rate of $25 per barrel. This is the first legalization procedure through which Bill C-103 takes us. It will legalize the current surcharge up to $25 a barrel. The limit that is placed on this particular levy in the bill, the limit to which the minister can go, will be $55 a barrel with increases at the discretion of the governor in council. I leave you, Mr. Speaker, to inquire how long our offshore markets will last if we double the current export tax level from $25 a barrel to $55 a barrel.
The other comment I have on this oil export charge is that nowhere does the bill specifically require the government to set up a fund into which the tax proceeds are to be fed; nor is there any clear statement as to "the certain petroleum costs" that are to be compensated from it. I find it rather odd for the bill to say that it is in order to compensate for certain petroleum costs and then not specify what those costs may be.
I still hear conversations going on in loud voices and in a very rude manner from the other side of the House.


Some hon. Members:: Oh, oh!


Donald W. Munro: On past experience, funds collected by this government, which has so many rude members who talk loudly in this House while others are trying to have themselves heard-


The Acting Speaker (Mr. Blaker):: Order, please. May I draw to the attention of the hon. member for Cochrane-Superior (Mr. Penner) that the hon. member for Esquimalt-Saanich (Mr. Munro) wishes to address him and he would like his attention. The hon. member for Esquimalt-Saanich.
April 26, 1982


Donald W. Munro: Thank you, Mr. Speaker. On past experience, funds collected through taxes for certain purposes have all too often been funnelled off into the Consolidated Revenue Fund, there to be used for general purposes. We shall have to do everything possible in the consideration of this bill in committee to ensure that the oil export tax- sometimes, Mr. Speaker, I do wonder about the courtesy extended the members in this House.


The Acting Speaker (Mr. Blaker):: Order, please. The Chair has no choice at this point. The hon. member for Esquimalt-Saanich has three times brought to the attention of the House and the Chair that he is unable to direct his remarks to the House because of the noise factor. I have to agree with the hon. member. If hon. members in the area where I am pointing feel it is necessary to carry on conversations, I would request them either to lower their voices or to solve the problem in some fashion in which the hon. member for Esquimalt-Saanich can be heard. He has brought the matter to the attention of the Chair three times.


Donald W. Munro: Mr. Speaker, I appreciate that. I suppose it is because of the conformation of the House in that particular corner which causes these echoes to occur here.


Some hon. Members:: Oh, oh!


Donald W. Munro: I do hope they will heed your admonition, Mr. Speaker.
My comment about the various sections of the bill causes me at this stage to leap over one of the tax levies in the bill. I will return to it in due course because it is a highly specialized one and it applies to a particular class of user. But the more important one and the next one I wish to examine is called the petroleum compensation charge. It may be that a number of those listening-and I hope some people are listening-are wondering why I am going over this matter by laying out a series of charges this bill will bring into being. But I want to make it clear that in the end the Canadian consumer, whether he drives a car or heats his house, is the one who will be paying these various charges. 1 am therefore breaking the bill down in this way to demonstrate that.
This petroleum compensation charge is levied at the processing level but it eventually works its way through the system. Owners of cars eventually pay for it whenever gas is pumped into their cars or oil is put into their furnaces. Canadians in the end pay this tax. The proceeds are intended to bridge the gap between domestic oil and offshore oil.
We may ask ourselves in 1982, since we have been talking about energy for as long as I can remember in this House and seeking self-sufficiency for just as long, why we are importing offshore oil? I have wondered about this for a long time. Here we see one of the major accomplishments of the bell-ringing operation early last month. Bill C-94, about which we were protesting so dramatically, set the charges for this petroleum compensation level at a maximum of $125 per cubic metre. Bill C-103 drops that limit to $75 per cubic metre. In other words, the bells rang and the government listened. It was a good thing that the government dropped the $125 charge contained in Bill C-94 to the $75 one in Bill C-103. Again I
Energy Administration Act
revert to more meaningful terms when I say from $20 per barrel to $12 per barrel. I guess it was worth keeping the bells ringing after all.
My second comment on this tax and its purpose is to draw the attention of the House to the fact that today we are needlessly importing 300,000 barrels of oil per day while cheaper domestic oil is locked into the ground. I do not know what madman devised the tax to pay for the importation of something which could be produced at home more cheaply. I just do not understand that type of reasoning. I would not be surprised if some Liberal members on the other side examined the bill and had difficulty understanding it. I suspect they have not examined it.
I do not think any apology is required for repeating something that was said by the hon. member for Calgary Centre (Mr. Andre) when he spoke to the bill last Wednesday. As reported at page 16480 of Hansard, he indicated that the misguided practice of importing and locking in 300,000 barrels of oil in Canada is costing Canadians $20 million per day. I questioned him at lunchtime as to whether he was sure about the figure. It is an outrageous figure, it comes to $7 billion per year which is being collected, from Canadians who are listening as well as those who are not listening, in order to pay for oil which we already have. Of course, we have to pay in United States funds, which puts a great strain on our exchange rate and the rate of inflation. I wonder whether Canadians have thought about its particular impact on the Canadian rate of exchange. A drain of that sort in United States funds, which have to be bought at 18, 19 or 20 per cent, is certainly considerable.
Why are we spending $20 million per day to import a product which we can produce in Canada and which will create jobs in Canada, rather than creating them in Venezuela, Saudi Arabia and Mexico? In any event, jobs are not being created in Canada, either in the east or in the west. Hon. members opposite still do not understand the idea that to choke and throttle the west is to choke and throttle the east, because the pipes and trucks are manufactured here. For one job lost in the west, two jobs are lost in the east. I see my hon. friend opposite giggling and waving; he just happens to fall in between.
Another tax to which I would like to refer is a specialized one. It is called the transportation fuel compensation recovery charge. It is a long title which is supposed to be self-explanatory, but it is not quite. It appeared in the previous bill in this form, but as it contained certain peculiarities in its presentation, I decided to leave my consideration of it to this point. As its title almost suggests, this charge is to be levied on marine vehicles and aircraft fuelling in Canada but consuming their fuel on offshore routes. The bill provides only an upper limit of levy but gives no hint what the levy will be as of tomorrow or what the levy is today, for that matter. I suspect it is being

April 26, 1982
Energy Administration Act
levied today. All of this is to be decided, as in some of the other instances, by the governor in council with the advice of the Minister of Energy, Mines and Resources and the Minister of Finance (Mr. MacEachen).
The ceiling is set at $350 per cubic metre or $55 per barrel. Here again Parliament is being asked to turn over to two ministers of the government the power to set the levels of taxes. I think that principle is wrong. If the government wants to phase it in, it should be phased in in statute law as it indicated in other portions of the bill it is doing on the retroactive aspects of it. But I think the future aspects of it should be phased in by statute as well, and not left to the ministers or to the government to decide. Of course, these provisions like the others are retroactive. The levy has been collected since the budget of November 1980. Currently they run at $78 for marine diesel on the east coast and, peculiarly, at $47 for the same fuel on the west coast. There is no explanation here or anywhere which I have been able to discover as to why there is a differential in the charges for marine fuel on the east coast and on the west coast, with a high preference on the west coast for marine fuel being consumed in an offshore voyage. This is one matter which ought to be clarified by the minister in committee.
The charges for aircraft fuel and whether they vary across the country, I have been unable to discover. 1 hope there is ample opportunity in committee to inquire more closely into these matters.
There is one aspect of the bill which 1 think deserves some comment at this particular stage. 1 am wondering whether the definition of "offshore" on page 9 of Bill C-103, which is relevant to this particular levy, has been inserted in order to stake a claim for offshore jurisdiction. Clause 13(2) on page 9 reads in part as follows:
-"offshore area" means Sable Island or any area of land not within a province that belongs to Her Majesty in right of Canada or in respect of which Her Majesty in right of Canada has the right to dispose of or exploit the natural resources and that is situated in those submarine areas adjacent to the coast of Canada and extending throughout the natural prolongation of the land territory of Canada to the outer edge of the continental margin or to a distance of 200 nautical miles from the baselines from which the breadth of the territorial sea of Canada is measured, whichever is greater;
It looks as though in the course of time this definition may be used to assert a claim over these particular areas. We have heard of the claims being made by the province of Newfoundland to certain areas out to sea. This particular clause of Bill C-103 is one which I am sure members from Newfoundland will look at most carefully. The question that must be asked is whether the federal government has decided to insert this clause in order to acquire title by definition in a statute dealing primarily with other matters rather than by proceeding directly by statute to make this claim. I do not know the answer but I believe we should inquire into this matter more thoroughly in the days ahead.
On page 23 of the bill we see a new clause, in two parts, outlining Canadian ownership provisions. This includes a
petroleum ownership charge, which is a levy, and a Canadian ownership account, which is a fund into which the proceeds of that levy are to go. Presumably, future and past acquisitions are financed through that account. For example, there was the purchase of the non-Canadian firm Petrofina. Petrofina was a refining and distribution system which had no petroleum resources-only outlets-but we are expected to believe that through the purchase of outlets the government was contributing toward energy self-sufficiency in this country. I believe it was a highly questionable acquisition because it was obviously done for visibility.
As well, there is the purchase of Pacific Petroleums and Merit, two refiners and distributors in the west which have visible outlets-all displaying white and red signs-and Petrofina in the east with blue and white signs which now have become red and white. Although this is visible evidence of the distribution of products, there is certainly no evidence whatsoever-and therefore no justification for these acquisitions- that they contributed, one drop of petroleum to Canada's selfsufficiency.
It is worth remarking that the bells rang for those 15 days in our favour and for the benefit of Canadians. In Bill C-94, the petroleum ownership charge was to have been as high as $25 per cubic metre, whereas the new bill, C-103, has reduced that levy to $7.25 per cubic metre. That is, from $4 a barrel to $1.15 a barrel, the current rate. Once again the bells won that concession. While other aspects of this bill deserve comment, I think I have exposed enough concerns in order to reach some conclusions.
I do not wish to take up more time of the House because other members wish to speak, but I just repeat that these are some matters which must be kept in mind and considered. I have dealt with these levies separately, remembering that these separate levies should be added to the 60 cents per gallon at the pump which we are now paying the federal government. We are now paying over $2 a barrel for our gasoline. If these extra levies reach their maximum, the cost of regular gasoline will rise from $2 per gallon to $2.96 per gallon. Presumably this is working toward energy self-sufficiency. However, in the process we are importing 300,000 barrels a day and paying $20 million a day for it.
I have not touched upon the issue of home heating oil. The Conservative government had proposed an increase of 18 cents per gallon of gasoline for our cars. We are now faced with a levy of something in the order of 52 cents a gallon, which is almost three and a half times more. With respect to heating oil, our party had made it quite clear that Canadians would be enjoying a heating tax credit. The levy which we have been discussing in this bill will apply just as heavily and onerously to heating oil as it does to automotive oil.
On the strength of that comment I can draw my remarks to a close because I believe the message I wanted to make is now clear. We will be paying almost triple the amount we are now
April 26, 1982

paying for our gas and we will be paying heavily as well for our heating oil. Next winter will be a hard one for those hit with those increases, Mr. Speaker.


Nelson Andrew Riis: Mr. Speaker, 1 am very pleased to speak to Bill C-103 this afternoon. I carefully listened to the comments of the previous speaker and I share a number of his concerns. Various members of the New Democratic Party have had an opportunity to discuss a number of aspects of Bill C-103, particularly with respect to a number of clauses which we would like to see amended. Since the bill will proceed from this second reading stage into the appropriate committee for intensive study where some amendments will hopefully be made, I would like to take this opportunity to sum up a number of concerns which our party has and conclude this debate on Bill C-103 so that we may debate some other bills which form part of this over-all energy legislation.
When Bill C-103 is reviewed, it can be seen that it is not an energy bill, petroleum administration bill or an energy security bill. Although it is entitled the Energy Administration Act, it is not really that either. It is more like a tax bill and could even be described by some as a desperate tax bill. This bill which deals with the very critical, crucial and strategic energy sector will result in Canadians paying more tax than ever before.
When one considers that the Canadian taxpayer will be the loser, I believe it is a fair question to ask who the winners will be. When one reviews Bill C-103 closely we see, as is the case with other energy bills, that the major winners will be the oil companies operating in Canada, most of which are foreign controlled and owned. Those companies will be the primary beneficiaries of Bill C-103. Those Canadians who will be paying these additional taxes on gas and heating fuels are those who can least afford it. That is why these taxes are regressive. Those are the people today who are on fixed incomes and those who find themselves unemployed or about to be unemployed as a result of the policies of the federal government. Those on fixed pensions or fixed incomes of one kind or another are being pressed to the wall. We do not see legislation coming in which will give an energy tax credit to people in need. We do not see legislation coming in to give some assistance to those people who depend for so much of their livelihood on energy. I am thinking here of the farmers, the food producers of the country, when it comes to Canadians generally.
Perhaps the media is not paying much attention to bill C-103, but the people of Canada certainly should be. However, they have essentially given up in their frustration and anxiety. They have been duped by the federal government. They were duped back in 1980 during the federal election when the Prime Minister (Mr. Trudeau) went from one end of the country to the other promising Canadians that the price of gasoline would be going down and that the Liberals would not tolerate increases in the prices of gasoline, diesel fuels or heating fuels. A little over two years ago, he promised Canadians that the
Energy Administration Act
Liberals would not tolerate significant increases in these very critical areas. We now know that that was certainly a falsehood and that, indeed, the price is now higher, I suppose, than almost anyone believed possible in two short years.
While prices at the pumps are going up and while prices are going up for home heating fuels, we sit in this House and debate bills which will give billions of dollars in the next handful of years, not to Canadian consumers but, rather, to the oil companies. We are also going out of our way to announce a number of tax concessions, not to Canadians, not to consumers and taxpayers but, rather, to the large oil companies operating in Canada which, as I said earlier, are primarily foreign controlled and foreign owned.


Mr. Deans:: So they can sell us back our oil.


Nelson Andrew Riis: So they can sell us back the oil that rightfully belongs to us. We wonder why Canadians have essentially given up. We wonder why Canadians feel they have been duped by the federal government. Well, it is perfectly clear. There is certainly no question in our minds in this corner of the House as to why that attitude exists today.
Essentially, this bill can be broken down into six different components. Let me take just a moment or two in which to identify these components, and then 1 want specifically to refer to a number of them. First, Bill C-103 will raise the oil export charge ceiling, will confirm the charges imposed since May, 1979 and will therefore give authority to turn over 50 per cent of the resulting revenue to the producing provinces. That is one of the aspects of Bill C-103. It will establish the transportation fuel compensation recovery charge. It will establish a blended price for oil. It will establish the authority for, and then the termination of, a special compensation charge relating to the cut-off of Alberta oil last year. This legislation will end the Petroleum Compensation Board and allow for the continuation of its work to be done in an expanded way by the Department of Energy, Mines and Resources. It will also establish the Canadian ownership special charge and the Canadian ownership account.
The petroleum compensation charge will be a mechanism whereby the blended price of oil will be developed. It will be charged at the pumps so that all Canadians depending upon gasoline for transportation will pay it. As I say, that is a very regressive way of taxing people. It is intended to compensate refiners who are now forced to import expensive foreign oils while oil wells are capped out in western Canada.
I think the question we must ask is why Canada is not selfsufficient in oil today.


Ian Deans: Lack of effort.


Nelson Andrew Riis: We are self-sufficient when it comes to energy per se. However, when it comes to this very strategic energy resource, we are continually dependent upon imports from foreign countries. Why is this? I suspect that when we answer the question we then bring into question the integrity of the major oil companies operating in Canada today. This is

April 26, 1982
Energy Administration Act
because back in the early 1970s we were exporting half our daily production. The oil companies told the federal government that we had enough oil in the ground in reserve to last at least 300 years. Therefore, they asked: "Why not export oil? Why not export half of what we produce on a daily basis?"
If that had been a fact, then perhaps the case could be made. But in 1973, at the outbreak of the OPEC crisis, we had to realign those particular figures, because then the oil companies told us that we did not have enough oil for 300 years; rather, we had enough for only 11 years. They said we needed to get out and explore for new oil and develop new reserves.


Ian Deans: A "minor miscalculation".


Nelson Andrew Riis: As my colleague, the hon. member for Hamilton Mountain (Mr. Deans) indicates, it was a minor miscalculation-about 280 years out. However, that was because at that time this country depended, and virtually still does today, upon information from the foreign oil companies to enable us to plan for the future. What country in the world would tolerate that? What oil producing country in the world would tolerate being dependent upon foreign producers for its data base? Only Canada, once more leading the world in this rather exotic fashion.
Back in 1973, we found out that we had enough oil for only 11 years. Some of the oil companies came to the federal government and to the Canadian public and said: "We need to explore; but, of course, we will not pay for exploration ourselves as we cannot afford it. Our profits are minimal. Therefore, we need support from the Canadian taxpayers." That is what they are stating today. Hon. members have seen the commercials on television and the newspaper ads stating the concern of the oil companies, such as Gulf and Imperial Oil, for the future oil security of Canada, and that they need support in their exploration for new oil. Bill C-103 will be one more step toward giving the oil companies $6.5 billions to assist them in their exploration.


Ian Deans: We cannot afford it.


Nelson Andrew Riis: We certainly cannot afford $6.5 billion to assist in exploration. We are saying to the oil companies that for every dollar they spend up there in the frontier areas and for every dollar they spend exploring for oil offshore, the Canadian taxpayers will pick up 93 cents of the tax, and that we will ask the companies to pick up 7 cents of the tax. We are saying to the oil companies that if oil is found, however, we want a cut of the action. We want some of the equity as a result of this investment. We are saying that we will invest 93 per cent but that we want 25 per cent equity. Can one imagine any business operator running his or her business under those conditions, 25 per cent of the action for 93 per cent of the risk? Yet that is what we are being asked to support here in the House. It is absolute madness. I suspect that if we are to be paying 93 cents on the dollar for 25 per cent of the action, we should probably add on the extra 7 cents, pay a dollar for a dollar, and get 100 per cent of the action. That would be a much more sound business arrangement.
But we know the scenario. The oil companies need support, so they will ask the taxpayers of Canada to help them out. We will find more oil, we will have a surplus of oil, and we will then be asked to give permission to export oil because of this surplus. We will then find out that our figures were incorrect and that we have another problem. We will find that we need to explore for more petroleum opportunities, the oil companies will come to the Canadian government to ask for more support by the taxpayers, and we will give it. Then there will be a surplus of oil and we will be on the old treadmill all over again.
That is the kind of madness that Canadians are no longer prepared to tolerate. They are no longer prepared to support this kind of mentality. I think the recent Gallup poll very clearly indicates that fact. In a very extensive Gallup poll, Canadians were asked, "Are you interested in having Petro-Canada as the dominant oil industry in this country? Are you interested in self-sufficiency by the year 1985, where more than 75 per cent of the oil industry would be Canadian controlled?" The answer was overwhelmingly yes. Seventy per cent of Canadians said that is what they want. That is why I suspect my friends in the Tory party are not responding very positively to the wishes of Canadian citizens. The taxpayers of Canada want this madness to stop.
Let us talk for a moment or two about the refiners who are receiving these compensation charges because they have presumably been forced to buy at excessive world prices and must therefore be compensated. If you look carefully at the figures, Mr. Speaker, you find that many of the refiners are being overcompensated between $7 and $12 a barrel. In other words, they are not able to buy cheap oil on the spot market of the world and are compensated on the average price of landed oil in the port of Montreal.
In a sense, many of the refineries in central Canada are making money to the tune of $7 to $12 per barrel. When you consider the amount of oil being moved through the central Canadian refineries, it means that some people are making virtually windfall profits. Who is paying for these windfall profits? Who is paying for this illogical compensation payment? Once again it is the taxpayers of Canada. They are paying certain refineries in central Canada more money than they require to compensate for the purchase of foreign oil. Very clearly, we need a more accurate system of calculating this compensation rate. That is one thing we will be advocating and speaking very loudly about when this bill goes to committee.
What is sad for a member of Parliament from western Canada is the fact that we are now shutting in wells in western Canada. This is because the refineries in central Canada are not required to buy western oil. This is being done to the tune of about 30,000 barrels per day of production. Each day 30,000 barrels are locked into the ground as we import expensive foreign oil. Some people say that by the end of the summer it will not be 30,000 but 300,000 barrels per day.
April 26, 1982

That is a tragic situation when you consider the economic problems facing much of the oil industry in western Canada, with special emphasis on the small operators within the industry, the service industries and so on. The big companies are able to take care of themselves, but the small independent entrepreneurs in western Canada are being pushed to the wall. This is because we have a weak federal government that is only asking eastern refiners to give preference to western Canadian oil. If we are going to be locked into this kind of compensation payment, we need to do more than ask the refiners. Indeed, we should require the use of Canadian oil wherever and whenever possible.
The issue is that this whole matter is extremely costly to Canadians. Canadians find it frustrating to know that if they cross the border they can pick up gasoline significantly cheaper than in Canada. While it might appear their prices are going to stabilize or drop a bit, ours are guaranteed to increase. Canadians wonder why they are paying more than they have to in terms of compensation rates to the refiners and why they are paying the oil companies billions of dollars per year. Why are we not prepared to change the tax structure which will result in a more equitable tax flow from the oil companies? These are questions that members opposite have not had the opportunity to respond to.
The present rate of compensation to importers of foreign oil is $17.32 per barrel. Who pays? The consumers of Canada. In 1981-82, compensation charges cost the consumers $5.16 billion in one year. This present year they cost the taxpayers close to $3 billion. It will cost the consumers of Canada $3 billion when it should not be costing them anything. We can and ought to be delivering oil to the eastern refineries, something we would be doing if we had the foresight and planning that this industry requires. The present petroleum compensation charge per barrel of crude Canadian oil is $6.30, again coming from Canadians paying their heating bills.
It is clear that based on the Gallup poll which I referred to earlier, and based on the kinds of charges that are being levied against Canadian consumers and passed along primarily to the oil companies, there is only one way to go. The people of Canada must become a more major player in this critical and strategic industry. The only real way to do that would be through public ownership of a major sector of this industry.
If we are going to pay out $6.5 billion in the next five years to the oil companies, perhaps we ought to ask ourselves what would be the price to buy Imperial oil. How much would it cost Canadian taxpayers to purchase Canadian Imperial Oil? The charge would not be $6.5 billion, but $4.5 billion for the largest oil company operating in this country. That would certainly put us in the driver's seat of this strategic industry. It would go a great distance toward returning to the people of Canada the benefits from this industry.
We do not want to be duped again by the government suggesting that PetroCan is a major player. That is the impression one gets. We know the major player in the oil industry is Imperial Oil. In terms of Canadian owned industry, it is not PetroCan that leads the pack; there are five ahead of it on the
Energy Administration Act
list. Dome Petroleum and others are ahead. When you see the fancy ads and the rhetoric of the federal government regarding PetroCan, Mr. Speaker, you must be very careful.


John Horton McDermid: Dome is Canadian.


Nelson Andrew Riis: I appreciate that. I said that Petro-Canada is not the largest Canadian oil company operating in this country. Dome Petroleum is the largest, and there are other Canadian owned oil companies with it. What is disappointing is that the present government apparently has no plans to make PetroCan the major player in the league.
The Canadian ownership special charge that was intended to provide the capital to purchase oil companies in order to expand the amount of Canadian ownership has been reduced from a possible maximum of $4 per barrel to $1.15 per barrel. That means the takeover money that was supposed to be coming from this special levy simply will not be available. The strategic industry to which this bill is addressed will continue to be dominated by foreign oil companies. Decisions regarding this strategic resource will continue to be made in the board rooms of foreign countries around the world. I cannot imagine why anyone would suggest that is in the best interests of Canada's future.
I want to refer to a couple of critical clauses of this bill that need to be changed. One allows the federal government to set the price of oil in the territories. Time and again the Prime Minister (Mr. Trudeau) has said that, in his estimation, the concept of federalism is dead in this country. Most members of this House do not feel that way. In fact, federalism is something we want to nurture, encourage and support. The way to do that is not by saying to those who live and govern in the Territories that when it comes to setting the price of oil, we have no faith in them, that we will set the price here in Ottawa because we know what is best for those living in the Northwest Territories and Yukon. It seems to me that a much more positive step, a step that will recognize the concept of federalism that will or ought to exist in this country, is to negotiate a price for oil found in the territories of Canada. This is something that we will be advocating, Mr. Speaker, when the bill gets into committee.
We were very disappointed to find that the draft of Bill C-103 had been altered by the time it got to the House. In the draft it was made very clear that once the pricing arrangements had been made between the federal government and the provincial governments, if there was a difficulty or an impasse, then the federal government would have the final word; they would have paramountcy in this particular matter. In the concept of federalism and recognizing the realities of Canada, we have no difficulty with that; we have to accept it. In the end, if a price has to be determined, we have to accept the responsibility for setting that price.
Nevertheless, in the draft legislation, if a number of members in the House stood up and wanted to debate that issue, so that it became a clearly understood issue in Canada, then that

April 26, 1982
Energy Administration Act
option would be available to them and there would be a debate, although limited in time; but at least, it would be an issue to be placed before the people of Canada. Bill C-103 eliminates that option. The Liberal government is saying: "Listen, we want the opportunity to set this rate arbitrarily or unilaterally, if necessary; we do not want to discuss it in Parliament; we do not want to have even half an hour's debate on it in Parliament". To me, Mr. Speaker, that is undemocratic; it is not operating in the spirit that Canadians have grown to love over the years and it is certainly working against the very principle of a democratic society and parliamentary government.
I am looking forward to getting into committee and asking the members opposite to explain why it is they want to stop debate on such a critical issue, why they will not allow us to debate it, and what made them change their minds on that original draft proposal.
There are some clauses one could identify, Mr. Speaker, but previous speakers in the New Democratic Party have identified the areas of major concern to us. There are some areas we feel are appropriate and there are some steps in the legislation that we feel are good, that need to be taken; but certainly a great deal of fine tuning still remains.
I suppose that my personal disappointment, Mr. Speaker, when it comes to Bill C-103, is that because of the number of points that my colleagues and I have raised, it demontrates very clearly that the people of Canada have lost faith in their political leaders. It demonstrates very clearly why the people of Canada have lost faith in the Liberal government. At a time when every single Canadian is feeling the pinch as a result of high energy prices, whether they be putting diesel fuel in tractors or in boats or simply filling up an automobile at the pump when going to and from work, or paying the heating bills at the end of the month, the people of Canada would like to see a government that has some courage and is prepared to stand up and say: "Enough of this; it is time that we got control of this very strategic industry". It is not like copper; it is not like the cedar industry; ii is not like the apple industry. This particular industry provides the very framework for western culture, for our way of life. It is simply not another resource to deal with; it is the very basis of our western North American Canadian culture.
To permit foreign countries and foreign companies to have the say in how this resource is developed, quite frankly, Mr. Speaker, is almost unbelievable. There is virtually not a single country in the world that is a producer of this strategic resource that would allow this to occur, but we are one. It is amazing how we continue on, by duping the Canadian public, by misleading them in election campaigns, by carrying out extensive advertising campaigns, giving the people the impression that we are rushing headlong into obtaining control over this very strategic industry, when in fact we are not. In this party, Mr. Speaker, we feel that it is our role to speak out against such inappropriate legislation and attempt in whatever way possible to communicate to the people that this particular approach must change.


Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, like other speakers before me, I totally agree that the proposed new title of the bill before us-the Energy Administration Act-is a deceptive misnomer. Although energy and administration are involved, this is really a tax bill; or, indeed, it is a highway robery bill. The word "energy" simply indicates from which source the government plans to reap these taxes; and the word "administration" is simply a more palatable word for unlimited power to spend money.
The Minister of Energy, Mines and Resources (Mr. Lalonde), when speaking to the bill, made a number of astonishing statements. Perhaps even more astonishing was that he made these statements with a straight face. Even though we are nearly at the end of the month, I had half expected him to conclude his remarks by saying "April Fool"! But he did not, so he was obviously very serious when he said:
Our oil and gas pricing schedule, as created in consultation with the provinces, reflects the sense of realism and fairness which characterizes our energy program.
In no sense whatever is the price Canadians now pay, or will be paying, for their gasoline and oil either realistic or fair. It is abominable. And because it is, I suppose in a twisted way it actually does reflect the government's energy program. So the minister was right in that sense.
The minister went on to say that the government's pricing system has three essential advantages over what was proposed by the previous Progressive Conservative government. Let us examine that statement. The Clark government, on the record, proposed that an additional tax of 18 cents a gallon be levied on gasoline only, not on home heating oil. During the election campaign, the Prime Minister (Mr. Trudeau) and members of his government toured the country promising Canadians- cross their little hearts-that under a Liberal government the tax increase would not exceed 14 cents a gallon.
Mr. Speaker, I know we have to be careful what we say in the Flouse of Commons. We could say that they are "playing with the truth" there. I am reminded, and I believe I mentioned this before, that a great statesman in the British House of Commons once questioned one of the speakers there, mentioned the word "lie" and was made to retract, and justly so. However, he then said: "Mr. Speaker, I will not use that word but I will say that the speaker was guilty of a terminological inexactitude".
I suppose that this statement we are dealing with here was sent around the contry over television and radio and this was why the Prime Minister and the group across the way were returned to office in 1980 because the people believed them. First of all, the people thought that 18 cents a gallon was absolutely horrendous and the idea of 14 cents a gallon looked pretty good. Time and again I have mentioned it to people who are unhappy now and I have said: "It serves you right; you thought 18 cents was a tremendous amount and now you have a much higher tax than that." So Canadians to their sorrow have learned that Liberal promises are not written in stone and always right.
April 26, 1982

Under this government the price of gasoline has risen, as we are all well aware, to almost $2 a gallon. Of this amount nearly $1.35 is siphoned off in taxes by the federal and provincial governments-two-thirds of what we are paying. It is almost in the same category as whisky. I am one who says we can tax alcohol in that form reasonably heavily because it is a luxury pure and simple. Perhaps in some people's minds it is a medicine, but I do not buy that too often!
Through individual taxes provincial governments create their share of the burden, and for that they provide many services, including highways and so forth. However, through its tax grab at various levels the federal governments is the real oppressor and the real culprit.
When praising the federal pricing system the minister said that it ensures that prices rise gradually and predictably so that consumers and the Canadian economy in general are given time to adjust. It has been pretty hard to adjust to these prices in the time given to us. In the short time since this government was returned to office and after the government's promising lower prices, the cost of gasoline and home heating oil has risen rapidly and astronomically. I can assure the minister that not a single vehicle owner or home owner has yet adjusted to the shock, and I do not know if consumers ever will. Now throught this bill the minister and the government are seeking authority to raise these prices even higher.
The minister made much of the fact that the price of crude oil is lower in Canada than elsewhere. One of our speakers-I believe the hon. member for Calgary Centre (Mr. Andre)- pointed out that the Canadian consumer does not use crude oil. Canadians use the products of crude oil, and it is the taxes on those products which are crippling consumers. Perhaps we should be devising some sort of small refinery in each of our homes; then we could buy crude oil and refine it ourselves. That way we could circumvent these terrible taxes.


Donald W. Munro: Don't you believe it!


Stan Darling: That is quite right; we should not believe it because the government opposite would tax it even on that basis. As I said before, the taxes already being imposed and the increase being proposed amount to nothing more then highway robbery.
If this bill is passed-and I assume it will be-and the government is allowed to impose on gasoline whatever amount of tax it wishes, there will not be anyone left in the country able to afford to drive or, probably, to heat his home.
In the bill the government is seeking authority for the Canadian ownership special charge to allow it to expand its ownership in the oil and gas industry. This charge, which amounts to four cents a gallon, or jj&OO million a year, is now being used to pay off the purchase of Petrofina. What do the ads say? "It's ours". We certainly paid a price for it because the government bought the company at about four or five times the market value. Anyone who watched the stock market saw the astronomical jump in the price of shares of Petrofina. Someone must have had some inside information. I suppose
Energy Administration Act
some were lucky guessers; it was like the Ouija board! A lot of money was made on that. Many of us are well aware of the controversy still surrounding the purchase of that company.
The government, which should have hung its head in shame at the time of the purchase because of the conditions of the purchase, once again gives an indication through this bill of its contempt for the taxpayer. First, it used tax dollars to buy the company at an inflated price in a questionable deal, and now it wants to soak the taxpayer even more to complete the deal. When the purchase is complete, the government plans to use the money collected through the special charge to finance additional purchases of some other oil companies. Again, I presume the government will pay probably two or three times what those companies are worth. If the method of buying Petrofina is any example, Canadians certainly-and understandably-are very reluctant to give the government any money for future deals of this description.
The government promises that any future purchase would only be undertaken after Parliament has had a chance to debate the matter through-and this is a lovely phrase-a negative resolution procedure. The very phrase is indicative of the nature of this government's backhanded and underhanded regard for Parliament and, by extension, for taxpayers. Under the negative resolution procedure, the time for debate in this House and in the other place is limited to three hours in each chamber. Debate would take place without reference to legislation planned, without spelling out the mandate of the new corporation to be created and without any limits being placed on government. And, in a move undoubtedly unconstitutional, if this House did not approve the move and it was approved in the other place, the government would consider the division as consent and go right ahead with its plans.
Another power play for the government in this bill is the petroleum compensation charge and related spending. The government is now collecting about 24 cents a gallon at the pump, or a total of about $3 billion. Every time a Canadian buys a gallon of gasoline, heating oil or diesel fuel, 24 cents of the price paid per gallon is used to subsidize oil imported from Venezuela, Mexico and other offshore sources. This would be understandable if we had none of our own oil here in Canada, but we do. It has been estimated that because of the government's oil import program, 300,000 barrels of non-subsidized Canadian oil is left in the ground each day. That situation is beyond belief. Canadians are paying up to $20 million a day to import the oil we do not extract from our own sources. And because we are not using our own oil, Canadian companies are losing millions of dollars. Some are reducing their operations and, yes, some are even going bankrupt. This has contributed to unemployment and adds significant stress to an already very troubled economy. The problem does not end there. The government, already deeply in debt, has to borrow funds to pay for oil imports, and this only adds to the nation's economic mess.
Is all this bothering the government? Not at all. In this bill the government wants the authority to raise the compensation

April 26, 1982
Energy Administration Act
charge to $7.5 billion per year without coming to Parliament for approval. This is an outrage.
The government says its underlying goal is to Canadianize our oil and gas industry. Well, if this blundering is the way this government works to achieve that goal, the word "Canadianize" may soon be synonymous with "vaporize". Label it "Canadian" and see it vanish!
The transportation fuel recovery charge is yet another form of tax contained in this bill. The government is imposing a special tax on diesel fuel used by Canadian ships engaged in international trade. If the National Energy Program was devised as a means of helping Canadians, why in the world is the government imposing a tax on fuel for Canadian ships which will raise the cost well above prevailing United States prices? The National Energy Program is a prize, all right-a booby prize!
The situation with respect to airline fuel tax is even stranger. The tax on international flights was withdrawn when it was found to be in violation of international agreements but, because the government had already collected the tax, through the bill it seeks authority to legalize the collection of that illegal tax. This is an amazing situation, one which clearly illustrates how this government operates.
Returning to the petroleum compensation charge for a moment, a method of operation this government frequently employs, the compensation charge was originally established to create a special fund to subsidize Syncrude production to domestic levels. To keep Canadian prices down we were prepared to pay producers for their loss, and the charge was to cover the subsidy. The charge was not considered a tax; it was money being collected for a special fund. However, when the federal government chose to try to bring the government of Alberta to heel and began importing costly offshore oil, the minister, through a ways and means motion, raised the price of the compensation charge. The legality of this method of increasing the charge was in dispute, but the government paid no attention.
Now, through this bill, it again seeks to legalize and expand on an illegal act. Accountability, like Canadianization, is a word whose meaning has been drastically altered under this government. In matters of energy, as indeed in many other areas affecting the lives of Canadians, the government has promised the moon and delivered instead a black hole. What matters to the people has become anti-matter to the government. Perhaps scientists seeking to make contact with alien life forms would do well to focus their efforts and attention on the other side of the House. The government, in the street vernacular, is doing its own thing, in its own space. The people of Canada should unite in an instant to send the government and this bill into a more appropriate place-into space.
As we are all well aware, the bill is going to legitimize taxes which the government has been collecting illegally. As I mentioned before, I believe that out of every dollar the consumer pays for gasoline, 30 cents goes to the producer, the
service station and others and 70 cents goes to the provincial and federal governments.The federal government takes the lion's share and now it is going to avail itself, through this bill, of the opportunity to take more.
I think that most Canadians are aware of the bell ringing that went on for two weeks. There was some criticism of this party by certain people in the country but not the majority. The calls and letters that I received from my riding and adjacent riding, which is held by a Liberal cabinet minister, were from people who were screaming blue murder or patting us on the back. They were telling us to keep it up and show the government that it cannot be as autocratic and dictatorial as it wants to be. The ringing of the bells saved the taxpayers of Canada a sizeable amount of money.


Mr. Collenette:: Rubbish! Absolute nonsense!


Stan Darling: Prove it. Read the bill. That monstrosity, Bill C-94, with about 148 pages, would have empowered the government to collect up to 98 cents per gallon of gasoline. At least now the government has agreed to reduce that to 52 cents per gallon. There is no question that this party made a worthwhile effort on behalf of the Canadian people. The majority of the people are now wringing their hands and asking why they ever believed the government when it was running around at election time saying it was going to keep the price of energy down below the 18 cents per gallon that the Conservative government had advocated.


Mr. Jim Hawkes (Calgary West):: Mr. Speaker, occasionally in this House there is some value in repetition. Today all Canadians have the right to ask if Liberal members of Parliament will vote for the 52 cents per gallon tax on gasoline. They were elected because they told Canadians that 18 cents per gallon was too much. Will they vote today for a tax of 52 cents per gallon on gasoline? That is the question.

Today, all Canadians have the right to ask if Liberal members will vote for an increase in the tax on gasoline, of 52 cents a gallon and not 18 cents.

Today all Canadians have the right to ask if Liberal members of Parliament will vote for a 52 cents per gallon tax on gasoline. They were elected because they told Canadians that 18 cents per gallon was too much. Will they vote today for a tax of 52 cents per gallon on gasoline?

Today, all Canadians have the right to ask if Liberal members are going to vote for an increase in the tax on gasoline of 52 cents, not 18 cents per gallon, but 52 cents per gallon.

Today all Canadians have the right and the obligation to ask if the Liberal members will vote for an increase in gasoline tax of 52 cents per gallon. They told Canadians that they were elected because they said 18 cents per gallon was too much.
April 26, 1982

Today, will the Liberals stand up in this House and vote for an increase in gasoline taxes of 52 cents per gallon?

Today, everyone in the province of Quebec has the right to ask if Liberal members are going to vote for an increase in the tax on gasoline of 52 cents a gallon, not 18 cents, but 52 cents a gallon.

It is too bad that every television set in the nation will not be tuned in for the vote today. All Canadians have the right to watch Liberal members of Parliament. Will they stand up in the House today, and at report stage and at third reading stage, and vote to increase the gasoline tax by 52 cents per gallon when they won an election claiming that 18 cents a gallon was too much? Will they stand up in the House and vote for a tax increase of 52 cents per gallon? All Canadians have the right to watch and listen and look at their behaviour.

Today, all Canadians, and everyone in the province of Quebec have the right to ask if Liberal members are going to vote for an increase in the tax on gasoline of 52 cents, not 18 cents per gallon.

Today in this House, as the day goes by, as we get closer to the vote, we are going to witness one of the most hypocritical actions ever perpetrated on the Canadian people when members of the Liberal party stand in the House and vote for an increase in gasoline taxes of 52 cents per gallon. They went to the Canadian people and said that 18 cents was too much. Was 18 cents too much?


Mr. Irwin:: Go on to the next paragraph.


Frederick James (Jim) Hawkes: Did the hon. member for Sault Ste. Marie (Mr. Irwin) stand on a platform and tell his electors that 18 cents per gallon was too much? Is the hon. member for Sault Ste. Marie going to stand in the House today and vote for an increase of 52 cents per gallon? How is the hon. member for Sault Ste. Marie going to explain that to his voters?


Ron Irwin: Go back to your French for a little variation.


Frederick James (Jim) Hawkes: A little French, says the hon. member for Sault Ste. Marie, for a little variation.

Are the Liberal members from Quebec today going to vote for a tax increase? An increase that is not going to be 18 cents but 52 cents per gallon, and that is the truth.
Later today all of those members from Quebec will stand in this House and vote for one simple tax, 52 cents a gallon. Before the bells rang it was 98 cents a gallon, and I hope Canadian taxpayers understand that 16 days of bell ringing saved them 46 cents a gallon. I hope Canadians understand that the Liberal Party of Canada later today will drive the final nail into the coffin of their integrity. When they stand in
Energy Administration Act
this House and vote for a single tax which will increase the price of gasoline 52 cents a gallon after promising the electors to keep it below 18 cents a gallon, their integrity goes out the window. Win an election, break your promise, and look at yourself in the mirror each morning. Ask yourself about your own personal sense of integrity. Is that what politics in Canada is all about?
I could stay on that theme, Mr. Speaker, and in some ways I would like to stay on that theme, for whatever time is allowed me, because that is the fundamental principle in Bill C-103. The integrity of democracy is being challenged by this legislation. It is not right or good for our democracy when politicians go on public platforms and make clear and consistent statements to the voters about their intentions, and then go back on their promises when they win the election. Repeated behaviour of that kind undermines the integrity of the democratic process. It makes each and every Canadian less willing to cooperate with their government. It makes the continuation of our democracy less certain in the long term. It is that kind of behaviour which lies at the heart of the feelings of alienation in western Canada, and it lies at the heart of a growing and strengthening separatist movement. If you cannot trust your government, if we do not have a system which holds politicians responsible for their promises, then the integrity of the people who live in that region of the country will produce a political system which they can trust.
As 1 sat in committee with the Minister of Energy, Mines and Resources (Mr. Lalonde) the other day, I was bitterly and deeply disappointed at his lack of comprehension of that fact. As I stand here today to debate Bill C-103,1 do so with a sense of sadness about a National Energy Program which has been an absolute unmitigated disaster for all Canadians. Not just Canadians who live in the west, but all Canadians.
We have a government which said it would keep the price of Canadian oil at a level which would never exceed 75 per cent of the world price. If you are a lawyer and read the fine print, Mr. Speaker, you might be able to argue that that promise has been kept. But if you just apply a little common sense, you know it has not. The application of that common sense begins by simply getting into your car anywhere in Canada and driving south across the American border, going to the nearest service station and buying gasoline. American gasoline is sold at world price and it is cheaper than Canadian gasoline. The minister and other Liberal members of Parliament will stand up on public platforms and say they kept our price at 75 per cent of world price, yet gasoline is more expensive in Canada than it is in the United States.
How can that be, Mr. Speaker? The simple explanation is that two-thirds of what we pay is taxes, one-third is for the gasoline. The price of gasoline in Canada is about $2 a gallon; if all taxes were dropped then the consumer could buy gasoline for somewhere between 65 and 70 cents a gallon. That is the reality of the NEP. The Liberal party was elected in February, 1980 and gasoline was about $1 a gallon; today it is $2. The price has doubled and the difference, Mr. Speaker, is taxes.

April 26, 1982
Energy Administration Act
What else have they accomplished? Seventeen billion dollars has left Canada since the introduction of the NEP. Think of that! Seventeen billion dollars which could have been used to create jobs for Canadians, to keep our interest rates down and to build hospitals! The NEP has chased $17 billion out of this country. It has chased out of Canada almost half the drilling rigs, the trucks, tractors and diesel engines, all of the equipment which is needed to drill an oil well. Is it surprising, Mr. Speaker, to find that these people left with their money and equipment?
In October, 1980, we had probably the finest pool of trained talent in that industry which existed anywhere in the world. Then because of an ill considered policy and a minister who does not know what he is doing, we have chased these trained people, equipment and jobs out of this country. This nation is poorer because of it, and our unemployment rolls are growing daily.
Never in the history of this nation has an individual been so misguided and so harmful to our nation than the current Minister of Energy, Mines and Resources. What is so tragic is that so many Liberal members of Parliament have had faith in his judgment and in his statistics when they should not have. But as a consequence of that misplaced faith, their constituents are suffering.
I want to give Liberal members of Parliament an example of the consequences of that misplaced faith. One of the taxes to be found in Bill C-103 is the 48-cent a gallon levy for the petroleum compensation charge. For members of Parliament who want an explanation of some of the 12 ways in which taxpayers' money is wasted through that charge, I invite them to read the April 6 transcript of the Standing Committee on Public Accounts. There are two sets of minutes for the two meetings which preceded the one of April 6 if hon. members really want to comprehend the background. By reading those minutes, hon. members will find out that in 1978 the compensation charge, which the government sought and which it obtained from Parliament, was at the rate of $1 per barrel. That was four years ago. If hon. members look at the bill that is before us today they will find that the government wants the authority to charge $12 per barrel. That is a 1,200 per cent increase in taxes in four years. It makes our inflation rate at 11 per cent or 12 per cent look insignificant when one realizes that the government itself wants to increase the tax rate 1,200 per cent over a four-year period of time.


Ron Irwin: What about the increase in the heritage fund and the gas profits?


Frederick James (Jim) Hawkes: The hon. member for Sault Ste. Marie would like a diversion. He would like a lecture on the Alberta heritage fund.


John Horton McDermid: What is the government doing with its tax grab?


Ron Irwin: It is being used for health services.


Frederick James (Jim) Hawkes: Today, of a $30 charge for a tank full of gas, the federal government takes $10. On average, for every tank full of gas sold throughout Canada, the Alberta government gets about $2. The money is used for hospitals, for education and for the training of people. But in Alberta we understand one simple fact-and we have done so since our province began. If you are going to do a good job of helping those who cannot help themselves, for instance, our senior citizens and the handicapped, first you have to have some income. Therefore, to raise money to help those in need income has to be generated. A sane and sensible public policy begins with that understanding. You cannot help anybody if you do not have the resources, the people or the facilities. There has to be a healthy economy in order to help those who need help.
The oil import compensation charge will be written up by historians as a classic mistake in government policy. The charge today is about $6.30 a barrel, which translates into 24 cents on every gallon of gasoline. It is a flat rate. The tax is the same on a barrel of light crude as on a barrel of heavy crude. How many people in this chamber, and I wonder especially how many Liberal members of Parliament, know that in Alberta alone there are 81 grades of crude, each priced differently. The light crudes are more expensive; the heavy crudes are cheaper. The reason for that is that a barrel of light crude will produce more gasoline and more aromatics, which are used in the plastics industry, and less asphalt. A barrel of heavy crude works in the opposite fashion. Aromatics and gasoline are worth more in the marketplace; asphalt is worth less. But when a flat rate tax is imposed on a barrel of crude, regardless of its quality, its value on the marketplace is distorted, and it is distorted very badly. All of a sudden, the heavy crudes are not competitive with the light crudes. It is an interesting fact that the heavy crudes require more money, more equipment and more people.
When that oil compensation charge is imposed, Canadian jobs are lost to the benefit of foreign imports. We told hon. members opposite about that but they did not believe us. The facts today indicate that we were right. An NDP member mentioned that 30,000 barrels of oil a day are shut in, but the figure is closer to 350,000 barrels a day, quickly rising to 450,000 barrels a day. That shut-in crude is of all grades, but it is the heavy oil, the low quality oil-the employment kind of oil-that is the most frequently shut in. That is partly as a result of the oil import compensation charge.
If hon. members would refer to the evidence before the Public Accounts Committee hearing in early April, hon. members would find that the Minister of Energy, Mines and Resources also proposed a flat rate compensation principle. A great deal of the oil that is imported from Mexico is called Mayan crude. When a barrel of Mayan crude is brought into Canada, the oil company receives a subsidy from tax dollars of $17.30 a barrel. When that amount is deducted from what is actually paid for the Mayan crude, hon. members will find the refiner, whether it is Imperial Oil or Petro-Canada in Montreal, can buy Mexican crude at 40 per cent less than what Canadian crude of equivalent quality would cost.
April 26, 1982

The government is using your tax dollars and mine, Mr. Speaker, to encourage oil companies to buy crude oil from Mexico, Venezuela and Nigeria, while leaving Canadian oil in the ground and Canadians out of work. If the oil is not pumped and no one is searching for it, who will buy cars and trucks?
When we stop and think about the petroleum compensation fund and put it in our own context, how would tobacco growers in the Niagara Peninsula, for example, feel if the federal government said that it would put a tax on their tobacco, that it would collect the money and give it to tobacco growers from Virginia? How would they feel if the federal government said that it would tax their tobacco and give the money to American tobacco growers, so that their tobacco could be sold in Canada at a price lower than tobacco grown in Canada? How would they feel if the government said that they could leave their tobacco in the sheds to rot?
On the other side, how would Canadian car manufacturers feel if the Minister of Industry, Trade and Commerce (Mr. Gray) came forward and said that the government would put a tax on all cars produced in Canada amounting to $2,000 per car? How would they feel if the government said that it would take the money and give it to dealers who import Volvos and cars from Britain and Italy, so that foreign cars will cost consumers less than Canadians cars? Would hon. members opposite rise and vote for such a piece of legislation affecting tobacco farmers or car manufacturers? What if it were done with the shoe industry? The government could put a special tax on Canadian made shoes and make them more expensive. It could take the proceeds and give them to those who import shoes from Italy or Spain, which would make Italian and Spanish shoes cheaper than Canadian ones. How many hon. members opposite would rise to support the Minister of Industry, Trade and Commerce on such a policy? Yet this is what they intend to do some time this day with Canadian produced oil. They will rise in the House and support the Minister of Energy, Mines and Resources on a piece of legislation which has that principle built into it.


Ron Irwin: Explain why the oil companies are buying offshore steel.


Frederick James (Jim) Hawkes: The hon. member for Sault Ste. Marie might be interested in knowing that oil companies in Canada are laying off staff across the nation. Also he might be interested in knowing that they are not buying pipe from the steel mills in Hamilton or cars from the manufacturing centre in Windsor. They are not buying diesel engines, fan belts or spark plugs because they are reducing the size of their staff and their activities. They have taken their money and put it in the United States. They are buying fan belts, spark plugs, cars and trucks in the United States of America. In Canada we are buying oil from Saudi Arabia, Venezuela and Mexico. We are buying lots of it because the federal government in its wisdom decided to tax Canadians from coast to coast. It decided to take the money and make the oil from Mexico, Venezuela and
Energy Administration Act
so on cheaper than Canadian oil, so that oil companies will buy abroad and consumers will pay the price. If hon. members opposite would vote for such legislation in terms of tobacco farmers, shoe manufacturers or automobile manufacturers, then they should rise in the House and vote for it on the oil side as well. But if they would not, they should think twice about standing in the House and voting in such a way when it comes to the commodity called oil.
I heard much talk by members of the New Democratic Party today about public ownership of the oil and gas industry, not private ownership. I should like to talk about hospitals and medical care and public ownership. When hon. members of the NDP rise in the House or in committee and say that $5.5 billion for Petro-Canada is not enough, then Canadians should be asked whether they want their tax dollars used to buy service stations or hospital beds. That is the reality of the choice. If they seek permission to tax, then they should have the courage to lay out the choices for spending. The choice which the Liberal government is making, and the choice which the NDP is supporting, is to take tax dollars from Canadians to buy service stations rather than hospital beds. Anyone who reads the daily newspapers will know that the medical system in the country is facing day by day an increasing sense of crisis. The trained people who make it go-the nurses, the doctors and the technicians-are unhappy because the amount of money for the system is inadequate. But Liberal members rose and voted to cut $5.7 billion worth of spending for that purpose; they stood the other day in the House and said: "Take that money and give it to the board of directors of Petro-Canada to buy service stations and oil wells". They have not asked Canadians if that is the choice they would like the government to make. Do Canadians want to be taxed to buy service stations or to provide medical care? That is the essence of the choice.
The NDP want the ownership charge in the bill to be used to make Petro-Canada larger and larger, but the reality is that the exploration end of the oil and gas industry requires money, people and equipment. All those commodities are in short supply in the world, but all those commodities in the industry are movable. Money and trained people can move to any nation; the equipment is mobile and it can be moved to any nation. It is not a great deal different in the health care system. The equipment is stationary but the trained people can move. They can want Petro-Canada to be as big as they want, they can take money from Canadians in the form of taxation and put money into it, but they are wasting money unless people will work for the company. We are not talking about untrained people. We are talking about geophysicists, tool pushers and people who have spent years obtaining the necessary experience to perform in the industry. When they are in short supply around the world, they choose to work for private sector companies. If we put our money into Petro-Canada we will not be able to hire enough skilled people; we will waste our dollars on unskilled people.

April 26, 1982
Energy Administration Act
OO)
When we remove that money from our health care system, we will lose our trained medical people; they will leave Canada to go to other countries. At the same time as we will have an inefficient and costly oil and gas industry which will not work, we will have created an unworkable health care system. That is the nature of these Liberal government policies which it has proposed over and over again in the House. It is time for the government to begin thinking and learning. It is time for those Liberal members to tell the Minister of Energy, Mines and Resources to come to his senses before it is too late.



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 York-Sunbury (Mr. Howie)-Pipelines- Delay in construction of TQM natural gas pipeline, (b) Prime guarantee; the hon. member for Mississauga South (Mr. Blenkarn)-Committees of the House-Appearance of Minister of Finance before Standing Committee, (b) Request for verification of rumour; the hon. member for Red Deer (Mr. Towers)-Agriculture-Beef stabilization program, (b) Request payments not dealing with supply management.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that Bill C-103, to amend the Petroleum Administration Act and to enact provisions related thereto, be read the second time and referred to the Standing Committee on Energy Legislation.
Mr. Ralph Ferguson (Lambton-Middlesex):: Mr. Speaker, it never ceases to amaze me when I listen to debates in the House to see how quickly times change. It was only a year ago that we heard members opposite asking us why we were not raising our oil prices to world levels in order to commence development and to achieve an agreement with Alberta. Now that they recognize that we have an agreement which was made after more than a year of negotiations-an agreement which the Conservatives were not able to arrive at-they are the first to criticize it. They are criticizing an agreement which is not
only a benefit to the petroleum industry but to Canada as a whole.
The Conservative party wants to know what we are doing with the taxes which were raised as a result of that agreement. I should explain initially that 67 per cent of the cost of hospitalization insurance comes from federal coffers. The government provided for 59 per cent of medicare and 35 per cent of extended health care, and when you consider that in Ontario the federal government pays part of the cost of Grade 13 in the secondary schools and research in the universities, the amount rises to more than 62 per cent.
The government pays 50 per cent of the cost of crop insurance; the other 50 per cent is paid by the producers themselves while the provinces administer this plan. The government pays 50 per cent of the cost under the Canada Assistance Plan. Is the Conservative party suggesting that we should do away with these programs? Do they suggest, as one member did this afternoon, that the provinces should build the highways and make all the material improvements and that the federal government should neglect the welfare of Canadians? Should we neglect our senior citizens who helped build this country?
I feel I must comment on a point which was made about gasoline prices being cheaper in some areas of the United States than in Canada. The Conservatives conveniently forget to point out that our dollar is valued at approximately 18 cents below the American dollar and that the American gallon is approximately 20 per cent less than ours. Conservatives members forget to mention these facts when making their speeches.
Another assertion made by Conservative members is that Canadian drilling rigs have moved south. However, these rigs began to leave in September of 1981, before the National Energy Program was announced. The reason they moved south was that we had literally thousands of gas wells in western Canada shut-in with no markets or pipelines to hook on to those wells. As a matter of fact, there are gas wells in my own constituency which were discovered in 1977 and only this year have they been able to be hooked up to the main transmission lines which are less than five miles away.
When the hon. member for Vegreville (Mr. Mazankowski) spoke in this debate on April 22, he made reference to fertilizer and the fact that the price of natural gas has a direct impact on the price of fertilizer. I should remind him that fertilizer prices this spring, especially in my area, are less than they were a year ago. Prices a year ago, as indicated in one particular analysis, were $250 per tonne; at 8-32-16. Those various components reflect the percentage of nitrogen, phosphorous and potash in each tonne. That particular analysis a year ago was $250 cash per tonne, picked up at the local warehouse. This year I have received quotes of $236 per tonne. Today, nitrogen prills containing 45 per cent urea costs $296 per tonne. Our invoices show that we paid $310 per tonne a year ago. These certainly are not increases by any stretch of the
April 26, 1982

imagination. They are, rather, adjustments in the price reflecting the demand and supply situation in Canada and reflecting the surplus of many raw material products which we have.
The hon. member for Vegreville also mentioned that these products could be bought cheaper in the United States. He indicated that it was $30 to $60 per tonne less in the United States. I must remind him that the currency exchange for that particular analysis priced at $236 per tonne which 1 mentioned earlier would amount to $47 per tonne on exchange alone. Obviously, it would be cheaper in the United States.
I would also point out that the federal government does not set retail prices of gasoline or diesel fuel. The federal government establishes the price paid by refiners for their crude, and it should also be borne in mind that the federal government has no jurisdiction over resources in a province but only over interprovincial and international trade.
The blended price at the beginning of this year is 70.6 per cent of the world price. The old price was 54.4 per cent of world price. The newly discovered oil, tar sands oil and imported oil are blended with that old price to arrive at the blended price. This is a price which we negotiated for more than two years and it is one in which we intend to continue.
When we compare our price per barrel, it is still lower than that which was proposed by the opposition. We are still lower in our wellhead natural gas price than the opposition would have been had they continued with their proposed price structure as contained in their 1979 budget.
We achieved an agreement with the provinces whereby the percentage share for the Government of Canada rose from 11 per cent to 25.5 per cent. The province receives slightly over 30 per cent while the oil companies get 44.3 per cent of the wellhead price. Certainly this is an achievement. Our government recognized that we were faced with an oil and gas industry which was very heavily foreign owned and controlled at the end of 1980. Fully 72 per cent of oil and gas revenues ultimately accrued to foreign owned companies or foreigners. Furthermore, 78 per cent of these revenues were accounted for by foreign controlled companies in Canada. This compares to a level of 52 per cent in the United Kingdom and 10 per cent to 15 per cent in the United States.
There have been many comments with respect to the present level of the petroleum compensation charge. I would remind hon. members opposite that one year ago the Alberta government was cutting production. This necessitated the rise in the petroleum compensation charge. Now, at a time when the market demand has slowed, the Conservatives are complaining about the cutbacks. Not only is the level of foreign ownership and control very high but a review of the major oil industry competitors clearly indicates the dominance of foreign companies in Canada's oil industry. Eleven of the 15 largest oil and gas producers are foreign owned and controlled, with the top eight positions being held by foreign companies. Not only was the domination of foreign companies pervasive, but it seemed likely that the situation would become almost worse.
Energy Administration Act
Future major oil supply in Canada would not be from traditional sources in the western Canadian basin but, rather, oil supplies would be increasingly diverted from massive oil sands plants on exploration sites in the Arctic and on lands well offshore. These future sources of energy supply required vast sums of money and a great deal of technical know-how. Foreign companies were, and in many cases still are, in the best position to take advantage of these future opportunities. However, it is only with the participation of the Government of Canada, along with that of the provinces, that development of our resources can continue, particularly in the area of the heavy tar sands, where we see that the companies are backing off, not because of any actions by either the provincial or federal levels of government, but because of the glut of oil on the world markets and because the return that they expect from their money is not there.
Given this situation, the following questions must be asked: What government in the developed world would tolerate the large degree of foreign participation in an industry as significant as we have here in Canada? Have we Canadians an obligation to ensure that this industry stays under Canadian control?


John Horton McDermid: Where were you when they asked you for help in the first place?


Ralph Ferguson: I submit that we have an obligation and that this bill provides the basis of fulfilling that obligation. Certainly, what government would have allowed such dominance in its strategic industry which, in Canada's case, is responsible for about 10 per cent of the country's gross national product?
These are the types of questions which the Canadian government had to face in relation to its own economy in the fall of 1980. Its response to the Canadianization objectives and policies was embodied in the National Energy Program of October, 1980. The government stated that it believed that:
-a larger national public sector presence in oil and gas is the only equitable way to meet quickly our goal of increased Canadian ownership. Judging from the results achieved to date by Petro-Canada, it is also an effective way of encouraging the rapid energy development necessary to meet our security needs.
For these reasons, the Government of Canada intends to acquire several of the large oil and gas firms.
This would ensure that the firms stay within the control of the Canadian people, which would be in their best interests. The National Energy Program also stated:
In adopting a program of enlarging the public sector, the government is anxious to ensure that the program is self-financing, and imposes no additional burden on general government revenues. Therefore, the government will establish a Canadian Ownership Account, to be financed by special charges on all oil and gas consumption in Canada, to be used solely to Finance an increase of public ownership in the energy sector. The charges will be set at levels that make this program totally self-financing. The actual rates and the dates of implementation will be determined by the progress of the acquisition program. The charges will be kept at moderate levels in the early years, to limit the impact on consumers.
While the Goverment of Canada is determined to increase Canadian ownership and control, it does not wish the result to be increased concentration of power in the hands of a few large Canadian companies. Competition is the

April 26, 1982
Energy Administration Act
lifeblood of the industry, and the consumer's best protection. A concentrated Canadian industry is an unsatisfactory replacement for a concentrated foreign-owned industry. The intent of the program is to increase the number of Canadian participants. Therefore, the government will be vigilant about ownership trends in the industry. The Petroleum Monitoring Agency will play a key role, through its function of advising Parliament on the size, financial position and ownership of the oil companies.
In slightly more than a year since the announcement of the National Energy Program, great strides have been made toward Canadianization. The eighth, fourteenth and eighteenth largest oil and gas companies have been switched from foreign to Canadian control. The level of Canadian ownership, measured by upstream production revenues, has increased by over 6 per cent as a result of some $7.5 billion in mostly private sector acquisitions. We have been able to make this achievement. Petro-Canada, the nationally-owned oil company, now has refining and marketing facilities across Canada, after its recent acquisition of Petrofina which, incidentally, will be paid for later this year.
While we are generally pleased with the progress to date, we realize that there is a great deal yet to be accomplished. It is for this reason that we are proposing the establishment of a Canadian ownership charge and Canadian ownership account. The Canadian ownership special charges, used initially to help finance Petro-Canada's acquisition of Petrofina, would provide for a special charge on domestic petroleum received for processing or consumption in Canada, and foreign petroleum and petroleum products imported into Canada. The charge is currently $7.25 per cubic metre, or approximately $1.16 per barrel, which is the ceiling set by this bill. No greater increases are even authorized by this legislation.
The Canadian ownership special charges would also provide for special taxes increasing the natural gas and gas liquids tax, which is a tax on marketable natural gas, propane, ethane and butane. Increases on the natural gas tax are now 14 cents per gigajoule. Increases on the tax on propane, ethane and butane are $3.55, $2.60 and $3.95 per cubic metre respectively. These amounts are the ceilings set in the bill for the increases. They will not be applied to exports of natural gas or gas liquids. No further increases are authorized by this legislation.
I should also like to point out that under the incremental oil revenue tax, an agreement was reached with the provinces last January which decreases the tax paid by smaller producing wells by 5 per cent for every barrel less than 20 barrels per day. Therefore, a small, very shallow stripper well which produces one barrel per day would, in effect, pay a 5 per cent incremental oil revenue tax. This has a tremendous impact in putting drilling rigs back to work in Alberta, where approximately 40 per cent of the wells fall into this category and account for approximately 10 per cent of the production.
In addition to that, the petroleum gas revenue tax, as raised earlier in the year, is the really ineffective tax of 12 per cent, a reduction from the 16 per cent, a reduction related to a resource allowance. However, in the future, the use of any funds from the Canadian ownership account for other acquisitions would have to be authorized by the governor in council, acting on the recommendation of the Minister of Energy, Mines and Resources and the Minister of Finance. Such uses will be subject to a negative resolution of Parliament.
However, it should be made clear that the direction of the Canadianization thrust has been toward the mobilization of predominantly private Canadian investment by existing companies, pension plans, insurance funds and from individuals. To a great extent, this policy has succeeded since all but one of a dozen acquisitions to date have been by private companies. I should make a small correction, because the Ontario government took part in the acquisition of a private company when it bought 25 per cent control of Suncor. Therefore, really all but two of the acquisitions to date have been by private companies. Furthermore, the federal government is acting as a catalyst for the establishment of a cooperative energy corporation which will bring into the oil and gas sector the savings of millions of Canadian co-op members.
A misconception which we have heard, particularly from abroad, is that the government is creating an unattractive environment for foreign firms which will reduce the value of these firms, allowing them to be purchased at "fire sale" prices. This is an absurd allegation. Canadian companies have paid prices well above market value for foreign-owned assets. Furthermore, foreign-owned oil and gas subsidiaries trading on Canadian exchanges have done no worse than their Canadian-owned counterparts.
Another misconception was the belief that Canadianization policies for the energy sector will be applied in other sectors of the economy, specifically, in the minerals sector. The government has already stated that this will not be the case, and the evidence on the difference in the foreign ownership and control situation in the two industries is a major reason for the difference in policies.
Finally, the objective of Canadianization does not mean that foreign investment and ownership in the oil and gas business is no longer wanted in Canada. Canada is well known for its exciting geological potential. The combined financial and fiscal incentive package offered by the government makes Canada one of the most attractive countries in which to invest. For example, a foreign investor operating in the north or offshore will, after tax deductions and incentive payments, be spending only 53 cents of every exploration dollar.
In fact, a recent comparison made by Petro-Canada of rates of return expected by a foreign investor from a representative pool of new oil shows the following: Canada lands 27.7 per cent, United Kingdom 24.4 per cent, United States 21.6 per cent and Norway 18.3 per cent. I repeat, these calculations are for foreign investors. The figures show that we have created an environment which, when compared to other locations, will be attractive for foreign investors. The government welcomes their participation and asks only that they take into account the legitimate aspirations of Canadian investors and other Canadians to own a share of this vital sector and to exercise some control over decision-making in their own petroleum industry.
April 26, 1982

This view is widely supported by the vast majority of Canadians. Indeed, it is one of the most popular programs established by the Canadian government in many years. The results of a poll done by the Canadian Petroleum Association last year indicates that 84 per cent favour the government's move to make the oil and gas industry in Canada at least 50 per cent Canadian owned. This is a remarkable figure. It indicates the desire and the determination of Canadians to achieve that control so that we are no longer at the mercy of the foreign-owned companies.
With respect to the Canadian ownership special charge, I would like to mention the significant change that was made to these provisions as they appeared in Bill C-94. The legislative authority that appeared in Bill C-94 to raise the Canadian ownership special charge above the present level has been removed. Under the new amendments, the existing Canadiani-zation charge can be decreased but not increased beyond that level by order in council.
The change is as follows. The ceiling on the Canadian ownership special charge on petroleum has been lowered from $25 to $7.25 per cubic metre. The ceiling on increases to the excise tas on natural gas has been lowered from 60 cents to 14 cents per gigajoule, and the ceiling on increases to the excise tax on natural gas liquids has been lowered from $17 per cubic metre to $2.60, $3.55 and $3.95 on ethane, propane and butane respectively.
I would like to leave hon. members with one thought. The government believes that it has created a framework which will both allow significant participation by Canadians in their own oil and gas industry and encourage continued active involvement of those foreign companies which have contributed to the development of this important industry. I am confident that this can be done.
In closing, it should be very clear that in its program to date the Government of Canada has shown it has a flexibility to negotiate, compromise and arrive at an agreement with the oil-producing provinces of this country. It is willing to negotiate with the oil-producing wells to ensure that the incremental oil revenue tax is not an overbearing burden and will not make the production of oil from such wells uneconomic. It has shown the flexibility to make adjustments in many areas. I am confident that as the world energy scene changes, the minister and this government will adapt to those changes in a way that is beneficial, not only to all Canadians and the provinces, but to the industry as a whole.


Hon. J. Robert Howie (York-Sunbury):: Mr. Speaker, the bill before us seeks to amend a 1975 act of Parliament which imposed a charge on exports of crude oil and petroleum products to raise revenue to support the one-price oil policy, which I feel was a good policy, and to attain energy goals.
The measure now before us legalizes the petroleum compensation charge which is currently levied at $6.30 a barrel and which has resulted in an increase in the price of gasoline at the pumps by about 24 cent a gallon. About $1 a barrel or four cents a gallon of that amount has received legal authority. In this bill, the government seeks to give itself the right to
Energy Administration Act
increase the tax to $12 a barrel, or another 24 cents a gallon at the pump.
The second major tax contemplated in the bill is the Canadian ownership charge. It was instituted to raise money to enable Petro-Canada to purchase Petrofina. In this case the levy is $ 1.15 a barrel or about four cents a gallon at the pump.
Since February, 1980 we have experienced a 99-cent increase in the price of a gallon of gasoline, of which 60 cents is directly attributable to federal energy taxes. Home heating oil, which incidentally was exempted from the Crosbie 18-cent a gallon tax, has increased about 66 cents and, while there are undoubtedly other factors involved, the principal thrust of this increase is federal taxes.
As we all know, during the past year there has been a world overproduction of oil and this has caused world prices to fall sharply. The taxes which the government has been adding to the price of gasoline at the pumps during the past two years is supposed to pay for the increasing subsidy the government has been paying on the one-fifth of our oil requirements which could not be supplied by Canadian sources and which must be bought offshore, generally supplying the oil needs of eastern Canada.
The subsidy was necessary so that all Canadians could enjoy the Canadian price. However, if the cost of foreign oil we are subsidizing is falling, the taxes needed to pay for the subsidy should also be decreasing, not increasing. In other words, the price we pay for gasoline at the pump should be coming down, as it has been doing in the United States and in most other countries, not going up.
Indeed, at many points along the Canadian-American border the price of gasoline charged at the pumps in the United States is lower. In many cases so is home heating oil. I suggest that the difference in the value of the dollar does not fully compensate for the magnitude of this difference. The Americans significantly are paying the world price, and I have to ask what we are paying. Increasing energy costs are percolating through our economy, causing serious dislocations.
The inflation rate has risen from 9.3 per cent in March, 1980 to 11.6 per cent in March, 1982. In the past year alone, fuel oil costs have risen by 29.6 per cent, transportation costs by 16.4 per cent, fresh fruit by 28.7 per cent, processed vegetables by 18.8 per cent, communications by 18.7 per cent and owned accommodation by 16.6 per cent.
The purchasing power of the 1971 dollar in March, 1982 was 39 cents. In the past 11 years, the consumer price index has risen by 156 per cent. Food prices have risen by 204 per cent and housing costs by 148 per cent. The 1981 average annual inflation rate of 12.5 per cent was the highest in 33 years. Wages are not keeping pace with inflation. The average wage earner in Canada has lost $285 in annual purchasing power since the February, 1980 election and $635 since the fall of 1977. As we have all been reminded by recent events, short periods of time can cause great changes in political fortunes and in political perceptions. This bill reminds me that just over

April 26, 1982
Energy Administration Act
26 months ago the Liberal party was elected nationally on the platform that higher energy prices were unnecessary and that they could manage the economy better than the Clark government.
Now, 99 cents a gallon later, people are beginning to recall that during the term of office of the Clark government, inflation remained stable, jobs were being created at the rate of 30,000 a month, and the purchasing power of wages rose. Under the self-proclaimed economic miracle workers now in office, we have seen 33-year record levels of unemployment and inflation, declining real wages, the biggest tax burden since the war, the gutting of the passenger rail system, and proposals to reduce the financial commitment to equalizaton, health and post-secondary education.
The 18-cent election issue has come home to roost and it is costing Canadians their economic well-being.


Some hon. Members:: Hear, hear!


The Acting Speaker (Mr. Blaker):: Is the House ready for the question?


Some hon. Members:: No.


The Acting Speaker (Mr. Blaker):: The hon. Parliamentary Secretary to the Minister of Energy, Mines and Resources (Mr. Dingwall).


Mr. Dingwall:: 1 have a few remarks on the particular piece of legislation before us. My colleague for Bow River (Mr. Taylor) and I had an understanding that certain speakers would follow one another and I guess there was a mix-up. Perhaps, Mr. Speaker, I can allow my colleague to speak now and then regain the floor, if I have the unanimous consent of the members.


The Acting Speaker (Mr. Blaker):: Does the House consent to the hon. parliamentary secretary ceding his place, without loss of his right to speak again later, to the hon. member for Burin-St. George's (Mr. Simmons)?


Some hon. Members:: Agreed.


Roger Simmons: Mr. Speaker, Bill C-103, which is now before the House, is a piece of legislation about which I would like to say a few words. I address my remarks today particularly to the question of oil export charges, this being the subject of Clauses 4 through 11 of the bill.
First of all, I would like to review briefly the historical background to these oil export charges. In doing so I hope to be able to point out how these oil export charges fit into the framework of longstanding Canadian oil export policy, how the federal government has responded to the needs and interests of the provincial governments, has responded to the regions of Canada as well as to the needs of the oil product industry, in terms of introducing, negotiating and administering those oil export charges. Oil export charges are big business. I understand that in the fiscal year 1981-82 the National
Energy Board collected charges amounting to $700 million- big business indeed.
Members of the House will note from Clause 7 of the bill before us that the National Energy Board, on behalf of the minister, actually administers and enforces the part of the Petroleum Administration Act that I am dealing with. I would like the House to note that the board has carried out this task since 1974 and has done so with great efficiency, using a minimum of human and financial resources in the process. The 1981 National Energy Board report will give some details concerning the board's involvement in the administration of this part of the act.
Members of the House will recall that the taxing of domestic source oil exports started back in October, 1973. Shortly before that, the Government of Canada had requested the Canadian oil industry not to increase further crude oil prices, which had been rising for about a year as prices in the United States and overseas increased. However, the opportunity-price in export markets continued to rise as a result of international events. The National Energy Board required and still requires that export prices should be just and reasonable in the Canadian public interest.
The board set an export price for October, 1973 which exceeded the domestic price. The government therefore acted to obtain for Canada, to obtain for Canadians, the difference between the domestic price and the available export price by means of a tax. The authority for this tax from October, 1973 to March, 1974 was the Oil Export Tax Act. Incidentally, this particular act was administered by the Department of National Revenue. The National Energy Board became responsible for administration of oil export charges as of April, 1974.
Understandably, the producing provinces were seriously concerned that the federal government should be appropriating revenue, part of which they thought should properly accrue to them, the producing provinces, in the form of royalty on higher export prices. This is something to which the opposition has frequently drawn attention in the past, arguing that the federal government was insensitive to provincial interests.
I want to take a moment, Mr. Speaker, to remind the House that all of the revenue collected by the federal government under the oil export tax in respect of exports from October, 1973 to January, 1974 was paid to the governments of the provinces from which the oil was deemed to have come. This meant that the provincial government benefited not just to the tune of a deemed royalty, perhaps one-fifth of the value of the oil export, but rather they enjoyed 100 per cent of the revenue from those export sales.
The circumstance for February and March of 1974 was different. As a result of the agreement reached at the first ministers' conference in January, 1974, the federal government had by early 1974 undertaken an obligation to shield the import-dependent eastern part of the country from dramatically rising international prices, a policy that has worked very
April 26, 1982

much to the benefit of the people in my riding of Burin-St George's and the people of Newfoundland and Atlantic Canada generally. The government provided this shield against dramatically rising international oil prices, by means of the oil import compensation program which continues in effect as a means to achieve a single oil price across Canada at levels much below those prevailing internationally.
Because of this large new financial obligation undertaken by the Government of Canada-undertaken, by the way, with the full agreement of all provinces-the producing provinces agreed that the federal government could keep half of the royalty from export tax revenue accruing from exports made in February and March, 1974. The other half, like the revenues from the period October, 1973 to January, 1974, was to be paid to the governments of the provinces from which the oil was deemed to have come. Again, these governments, it goes without saying, benefited to a much greater extent than would have been the case under then prevailing royalty regimes.
The authority to apply a charge on oil exports from April, 1974 until now stems from the Petroleum Administration Act, Part I. This is the portion of the legislation which Bill C-103, the bill we are dealing with here, seeks to amend in some important respects. All of these revenues from April, 1974 until October, 1980 accrued to the federal government.
I think it is worth while to remind ourselves again that it was by agreement with the producing provinces that all of the revenues between April, 1974 and October, 1980 would accrue to the Government of Canada. The agreement was secured at the March, 1974 first ministers' conference when it was also agreed to increase Canadian crude oil prices by what was then the very large amount of $2.70 a barrel effective April 1, 1974. I believe it is worth stressing that the federal government's access to those revenues was not achieved by a unilateral act of the Government of Canada but, rather, by agreement with the provincial governments concerned. That was the situation prevailing up until the announcement of the National Energy Program on October 28, 1980.
That briefly is the history of the oil export charge during part of which time all the revenues accrued to the federal government and during part of which time the revenues were split between the federal government and the governments of the producing provinces from which the oil was deemed to have come.
The National Energy Program documents noted that virtually all of the crude oil now exported from Canada is heavy crude oil. This oil is surplus to Canadian needs simply because Canada does not have the refinery capacity to use it. The National Energy Program includes measures to build an upgrader in Saskatchewan to turn this heavy crude oil into a product which can be processed in Canadian refineries. Incidentally, progress toward achievement of this objective of building a heavy crude oil upgrader in Saskatchewan has, according to the project's proponents, been somewhat hampered by the absence of definition of the fiscal regime which will apply to the enhanced oil recovery required to provide a
Energy Administration Act
stable, long-term feedstock supply for the heavy crude upgrader.
The National Energy Program went on to express the expectation that other upgraders would be built in either Saskatchewan or Alberta and that existing refineries would be modified so that they can use an increasing proportion of this heavy oil. Therefore, it was expected that there would be a progressive diversion of these export volumes into the domestic market. In the meantime, in the view of the government and as expressed in the National Energy Program, it seemed only fair to examine how the revenues from crude oil export charges should be shared among governments.
As I have noted, between April, 1974 and October, 1980 neither the Alberta government nor the government of Saskatchewan gained any benefit from the higher earnings which were available on crude oil exports as opposed to those on crude oil sold in the domestic Canadian market. The Government of Canada therefore indicated its intention to share with these two producing provinces 50 per cent of the export charge revenue on crude oil exports found by the National Energy Board to be surplus to Canada's needs and which are now subject to oil export charges. The program proposed that sharing would begin effective November 1, 1980.
Perhaps there are those in the House who would like to pursue that aspect of the National Energy Program in more detail. If so, I refer them to the program, and particularly to pages 36 and 37 of it which outline the proposal of the Government of Canada to share the oil export charge revenues with the two producing provinces of heavy crude, Saskatchewan and Alberta.
It is worth noting, especially for the benefit of detractors of this legislation or people who are detractors of the National Energy Program, that here is an example of an important initiative taken by the Government of Canada as part of its National Energy Program to share the revenues on a 50-50 basis with the producing provinces of Saskatchewan and Alberta.
The government has now presented the House with legislation intended to put this provision of the National Energy Program into effect. That, in essence, is what Bill C-103 is all about. It is to give effect to this important revenue-sharing provision. Clause 10 of the bill before us provides that the minister may make expenditures out of the Consolidated Revenue Fund for payment of such amounts as are authorized by the governor in council to be paid to a province or its agent in respect of exports of oil from that province during the year. I am sure the House welcomes the provision that the federal government is making, despite its own heavy fiscal burdens and responsibilities. It is a provision to divide crude oil export charge revenues in this way with the governments of the provinces from which the exported oil comes in the first instance.
Having spent just a little time on the history of this oil export charge and having spent just a little time outlining the objective of the legislation before us, I want to comment on the way in which the oil export charge is set. The charge is fixed

April 26. 1982
Energy Administration Act
by the governor in council on the recommendation of the Minister of Energy, Mines and Resources, taking into account, among other things, the advice of the National Energy Board.
Essentially export charges reflect the difference between the Canadian price for particular grades of crude oil and oil products and the export market price prevailing at the time. The charges which have eventuated from this procedure are set out in Schedule I to the bill for the period from May, 1979 onward. It was, of course, from that date, May, 1979, that the charge necessary in order to capture for Canada the difference between the available export price and the domestic price exceeded the maximum amount of the charge authorized by Parliament in the Petroleum Administration Act. The original maximum was $8 a barrel, or just over $50 a cubic metre. The government of the day, which was not this particular administration but the one which preceded it, found that the necessary level of these charges exceeded the amount authorized by Parliament. The exporting companies were notified by the government of the day, the administration led by the Right Hon. Leader of the Opposition (Mr. Clark), that parliamentary authority would be sought at the earliest opportunity for such a higher level of charge, and meanwhile the companies were asked to remit-and they did, of course-at the higher level pending the setting in place of the appropriate legislation.
As I have just said, these charges from May, 1979 are set out in the schedule which is on page 39 of the bill before us. I want to point out that the administration of the Right Hon. Leader of the Opposition in 1979 followed exactly the same practice as the Liberal government before it in respect of the item before us now.
The level of the crude oil export charge has an obvious impact on the ability of producers to sell their oil in export markets. In setting the export charge the government has to achieve two basic objectives. First, it has to establish an export charge so that the export charge in total is just and reasonable in the Canadian public interest. That means putting it as high as is reasonably possible.
Second, it has to ensure that the export price is competitive and that oil surplus to Canadian requirements is fully taken up in the export market and is not shut in in order that the development of Canadian heavy crude oil reserves is not impeded. There is currently a problem of shut-in heavy oil production in western Canada and this is a matter of serious concern to the government.
As hon. members know, the Minister of Energy, Mines and Resources (Mr. Lalonde) acted vigorously to deal with the problem of shut-in heavy oil production in western Canada. At the beginning of April he announced an action program which included measures intended to secure an export market for as much heavy crude oil as the National Energy Board found to be surplus to our own refinery requirements. The action program included a clear declaration that the Canadian export price would continue to be strongly competitive, that Canadian supply would be reliable, and that the National Energy Board
would be prepared to receive applications for longer term export licences.
In an effort to ensure full dialogue and information on this very important subject and this very important bill, the Minister of Energy, Mines and Resources announced an action program on April 1. I presume hon. members already have copies of this and, if not, they are readily available. The document is entitled "Securing Markets for Western Canadian Crude Oil-Program of Action." Among other things, the program includes the assurance that Canadian heavy crude oil exports to the United States will continue to be competitively priced by adjusting the export charge as required. It makes the provision that applications to the National Energy Board for the export of crude oil for terms of up to one year would be welcome. The policy remains to export heavy crude oil that is surplus to our domestic needs. In short, that particular program addresses in a very tangible way the problem of shut-in heavy oil production in western Canada.
I have gone into this matter of the purpose of the export charge, the way in which it is set and the objectives which the government follows in some detail because of the importance of the export charge in aggregate terms and because it has been the focus fo some attention relative to the problem of shut-in heavy western Canadian crude oil. I am satisfied that the government has shown the right degree of sensitivity to industry and producing province interests in dealing with this aspect of our national energy policy. As I said at the beginning of my remarks, I believe the government has to show, and shows, a great deal of sensitivity in dealing with these difficult on going policy and operational problems.
Members will be aware that Part I of the Petroleum Administration Act provides for charges which are applicable also to refined oil products derived from Canadian crude oil. The purpose is to ensure that the people of Canada, rather than the exporting company, generally an oil refiner, benefit from the difference between Canadian and international oil prices when the product is refined from low-priced domestic crude oil and sold into a high-priced export market. This aspect of the oil export charge program has been successfully implemented for a number of years.
Members may be wondering how exports of oil products derived from imported crude oil are treated. So far, the oil export charge has been applicable only to domestic crude origin oil products. The government has, however, fully safeguarded the Canadian public interest by requiring companies which import foreign crude oil, and receive import compensation for it, to refund the full amount of the import compensation embodied in any products which are derived from such foreign crude oil and are subsequently exported. I can assure the House that the Canadian public and fiscal interest is fully safeguarded by this procedure.
Members will, however, have noted that Clause 5 of Bill C-103 makes provisions that a tariff of charges in respect of any or all of the various kinds or qualities of oil be set, regardless of the source of that oil, meaning whether that oil is of domestic or imported origin. This would give the government the
April 26, 1982

flexibility, should the need arise, to provide for an export charge for all oils crossing the border to export, rather than having two systems, one of export charging and one of import compensation refunding as at present. 1 for one welcome this provision as giving the government a sensible degree of flexibility.
It is, of course, understood that, if oil products are exported from foreign crude oil, then if an export charge is levied the exporter would not also have to refund the import compensation. One way in which this flexibility could be employed would be to enable a third party-an independent oil company, for example-to export foreign origin oil products to the United States without having to identify the original importer of the crude oil and pay back the compensation through that original recipient of compensation, as is presently the case.
The House has a complex piece of energy legislation before it. This is undeniable. However, I think the House should note that the Petroleum Administration Act has been in effect since 1974, with some relatively minor amendments made in 1978. The powers it provides have been used by the Progressive Conservative party when in office as well as by successive Liberal governments. The Petroleum Administration Act under governments of two different party stripes has served the taxpayers of this country very well. It has stood the test of time.


John Horton McDermid: Oh, oh!


Roger Simmons: I am sure my hon. friend would find it convenient to take issue with that particular statement. I would remind him that in doing so he takes issue with the actions of the administration of which he was a member. The Progressive Conservative administration used without any change at all the Petroleum Administration Act which had been implemented by the former Liberal administration of 1974.


John Horton McDermid: You did not give us a chance to change it.


Roger Simmons: The hon. member is still fighting the election.


John Horton McDermid: Who brings it up all the time?


Roger Simmons: The people of Canada spoke very clearly in February, 1980.


John Horton McDermid: Tell them that today in Saskatchewan, Alberta and British Columbia.


Roger Simmons: If anyone did not give the Tory administration a chance, I submit it was that administration itself. It had just about a year to do something. That is the plea; that is the mea culpa we hear now-that they never had time. They know full well-and they would be more appreciated by the Canadian people if they owned up to it-that they did not change this piece of legislation because it has served this country well since 1974 and will continue to serve it well with some refinements as proposed in Bill C-103. This act, Mr. Speaker, has stood well the test of time. My hon. friend may not like that, but it is true.
Energy Administration Act
The changes in Part I of the Bill before us, to which my comments have been directed, seem to me to be both sensible and very desirable. They legislate charges beyond the scope of the original bill which started with the Progressive Conservative government in May, 1979. They provide for appropriate use of metric units and add some flexibility in terms of adjustments to the charge even for part of a month. They enable the charge to apply to foreign crude products, and provide that a government can make payments out of oil export charge revenues to provinces or their agents. All of these changes are necessary and in the public interest.
So there it is, an eminently sensible bill. A bit complicated, perhaps, but out of necessity because of the nature of the subject it deals with. It is sensible legislation based on fairness and the principle of sharing, a principle which we on this side not only espouse but do something about in our legislation. The sharing in this case is between the Government of Canada on behalf of all the people and the governments of Saskatchewan and Alberta on behalf of their people. This legislation preserves the essential spirit of the Petroleum Administration Act of 1974, which enjoyed the active support not only of the government which brought it in in 1974 and of the current government, but which also enjoyed the active support of the short-lived Tory administration in 1979.
There is nothing sinister, underhanded or conniving about this particular bill, Mr. Speaker. That must disappoint my hon. friend but it is true. It is just a straightforward bill which sets about bringing the legislation in line with reality. It sets about updating a mechanism which has served us well since 1974 and now, with some refinement, can continue to serve us well. What we have in Bill C-103 is of considerable benefit to the taxpayers of Canada, and those taxpayers of Saskatchewan and Alberta. Can there really be anyone in this House who opposes such sharing? Can there really be anyone here who would dare to oppose such fairness in revenue sharing?
The argument was that the government's omnibus bill, which was earlier before the House, had lumped together too many things. They said it included measures which members would want to support with those which they might want to oppose. This bill presents no such dilemma, Mr. Speaker. No one is caught here in the conundrum of saying; "Well, I want to vote for this part but I cannot vote for that part". Here, Mr. Speaker, the issue is very clear-cut and simple, and it is this: Do we as members of this House support sharing oil export revenues with the producing provinces? That is the essential issue. Members either support that or they do not. Members can come up with all kinds of reasons, excuses or canards as to why they would like to support it, but, however, they are going to be clearly on the record on this one.
The challenge is to put your money where your mouth is. Either you support the initiative taken by this government to

April 26, 1982
Energy Administration Act
share on a 50-50 basis these revenues with the producing provinces, or you do not support it. Do members of this House believe the people of Canada should benefit financially from oil exports? If members believe that, it is clear where their vote will be when the question is called on this particular piece of legislation.
This is a good piece of legislation, Mr. Speaker, because it seeks to embody a principle, as this government has so often done in legislation, which is the cornerstone of the Liberal party and of this particular government-sharing among Canadians the benefits we reap from the extraction of our resources. That, when all the i's have been dotted and the t's have been crossed, is the clear issue which remains. Let no one try to befuddle that. The issue is not whether we should have an export charge, which we have had since 1974; anyone who opposes that concept is about eight years too late. The issue is whether some members of this House can put aside their partisanship, their natural propensity to give it to the government every time they have a chance, their natural temptation to exercise the opposition mentality which says: if the government proposes it, I am "agin" it. It is time to put all that aside and answer two basic questions: do I as a member of this House believe that the people of Canada should benefit financially from oil exports? The answer to that is an unequivocal yes. I am sure I speak for every member of this House; the answer must be an unequivocal yes or that member has no business being here. The second question is: do I support the concept of sharing export oil revenues with the producing provinces? The answer to that question is also an unequivocal yes. I believe it ought to be and is an unequivocal yes for every member in this chamber. If it is not, then that hon. member has no business being here. The entire Canadian experience has no meaning if we do not believe in the concept of sharing, sharing the benefits which derive from the extraction of resources across this country.
For those reasons, and for so many other good reasons that I could state if time were available to me, I want to say that I am going to support this bill with a heart and a half and I would expect that every other member in the House will do likewise.


Gordon Edward Taylor: Mr. Speaker, in listening to the address of the hon. member for Burin-St. George's (Mr. Simmons) I had difficulty deciding in which country he was living and which bill he is discussing. The issue, as I see it, is entirely different from the one he outlined to the House a few moments ago.
The issue in this bill is whether or not the people of Canada are going to pay more than 50 cents a gallon extra for their gasoline and whether the government will do this without reference to the Parliament of Canada. That is one of the reasons why the bells rang. These things should be decided by the Parliament of Canada and not by the cabinet of the country. The issue in the mind of the hon. member for Burin-St. George's is very confused. Either he has the wrong bill or the wrong country.
For a few moments I want to deal with some of the points that he made concerning the benefits that the people of Canada from coast to coast are receiving from the National Energy Program and the energy legislation. Instead of just talking theory, I will try for a few moments to describe to hon. members the situation out west where the oil is produced. Over the last two years there has been a tremendous change in the oil industry. It has gone from being a buoyant industry to an industry that is now sliding down, down and down. First is the matter of investment money. People are not prepared to invest their money in the oil industry given the uncertain terms resulting from the policies being followed by the administration in Ottawa. For example, all hon. members have to do is to look at the type of legislation that is being brought forward. One piece of legislation enabled Petro-Canada on behalf of the government on behalf of Petro-Canada to expropriate part of the oil findings of another company after it had spent money finding oil, and at the same time paying nothing at all to a company that had spent a couple of million dollars only to come up with a dry hole.
The oil industry was buoyant two years ago. It is now depressed. Things are as bad now as they were at any period in our history. Rig after rig, many employees and pieces of equipment have left the country. People have not left the country because they were rich or because they could not do well here. The multinationals can look after themselves. But the independent companies are the ones suffering. The independent operators have left the country because they could not make a profit. The oil industry is slowly dying. Money is drying up and there is no incentive to find oil or gas. The policies of the government have driven out the independents. The energy program and federal legislation are the main culprit in this gigantic exodus of industry, expertise, equipment and people from Canada to the United States. We had a tremendous network of expertise, equipment and men which had been built up by the small companies starting from scratch and developed into network of large companies. A tremendous group of people were developing the industry and making a profit. But when the profit disappeared, the small independents were unable to stay in business and had to leave.
The policies which the hon. member for Burin-St. George's mentioned and which he praised so highly, have driven these people out of the country. Our expertise has left. Our rigs have left. Do not kid yourself by saying that they were the rich or the stingy who wanted to hog more and more. All they wanted to do was what they did for several years, namely, make a living and contribute to the country. They are just as anxious to contribute to the country as is any other person in this land of ours. The suggestion that this is a wonderful program just does not bear examination when one takes time to look at the results of it. People should look at the results of a program and the legislation, not just the administration of it. The results show a sad picture indeed.
If hon. members visited almost any town in Alberta or Saskatchewan, they would be able to find out how the people feel. The industry is drying up. There is no incentive to drill. In
April 26, 1982

fact, there is no incentive at all. Elon. members can quote all the figures they like, but I tell them to look at the lists of unemployed. This energy program not only affects the people of Alberta and Saskatchewan but it affects all Canadians. Eastern Canadians and central Canadians went out west, got jobs and then found their jobs gone as a result of the National Energy Program. This has greatly increased the unemployment lists and the applications for unemployment insurance in the city of Calgary. The increase in applications for unemployment caused the government to send more and more administrative people from eastern Canada to Calgary. I can speak about the situation in Calgary, but I suppose the same is true for the city of Edmonton. There are masses of applications for unemployment insurance. If nothing else tells this government what is wrong, surely that tells the government things are not buoyant any more. People are not investing any more and they are leaving the country.
People who have never before been unemployed in their lives before who are now unemployed. The effects of this energy policy are being felt in small towns by restaurant owners and by hotel owners. Everyone is being affected. The National Energy Program and the energy legislation have created a depression. If that is the kind of result which the hon. member for Burin-St. George's was talking about, the result of a program which was supposed to benefit the people from coast to coast, he had better tell me who it is benefiting in Alberta, Saskatchewan, or the maritimes. It is benefiting very few people in central Canada.
The situation became so bad that the government of Alberta decided to do something about it because the agreement and a number of other things had resulted in havoc, depression, unemployment, a lack of investment, and people leaving the country. This is not theory, this is reality. People are still leaving the country. The government of Alberta decided that it would have to do something to keep the industry from deteriorating any further. During the last two years under the Liberal administration of the federal government the industry was sliding, so the Alberta government came up with a program. It said that it would contribute 8 per cent of the government's cash flow over the next five years and that it would cut down the profit of government to see if it could get the industry moving, get jobs created, get people working and increase the net worth of production. The government of Alberta also said that it would raise the basic price to cover exploration, investment and development costs and that it would increase that amount by reducing the amount of royalties. The amount was $1.7 billion over five years, or an average of $340 million per year, which the government of Alberta would put into the industry to help it keep its head above water. This is what the Alberta government did.
When we talk about sharing, we must remember that the Alberta government is giving up some of its revenues to keep the industry moving and to provide jobs so that wives and children will not have to depend upon welfare. It will provide
Energy Administration Act
$1.7 billion over a five-year period. It plans to do the same for the gas producing industry, which will cost $2 billion. It extended the holiday for royalty payments for new wells, costing $1.5 billion, and set up $250,000 in grants for service and maintenance work this summer. It is putting money into the pockets of people now, not months ahead or five years from now. The government of Alberta has taken a positive step. In the meantime, world prices of oil have declined and world demand for oil has reduced. These factors must be looked at as well.
The Alberta program will not solve the problem of the sharp cutback in Alberta production because of federal government subsidies which make it cheaper for eastern refineries to buy foreign crude. That is another matter about which people are not happy. I do not think people in Ontario either or in Quebec can understand why we are importing crude from Mexico while wells are closed up in Saskatchewan and Alberta. Men have been laid off, the industry is depressed, but we put money into the pockets of those who keep people in jobs in other countries.
It is difficult to understand the thinking of a government which does that type of thing. It talks about importing crude and keeping our own wells tied up and our industry depressed. It will not even allow the export of Alberta light crude which would put people to work. The $1.7 billion over a five-year period will help get industry moving again, as long as the federal government does not try to hog some of it. This point is very important in the minds of industrial people in Alberta today. While Premier Lougheed was doing something positive to revive the oil industry, to create jobs and to provide some profit, the federal government has decided to take it away.
What is the federal government doing? It is providing $4.9 billion in additional capital to Petro-Canada and another $5 billion in compensation payments related to world price. The Alberta government amends the damage of the National Energy Program and the agreement, but the Government of Canada continues to fill its coffers under the leadership of the Minister of Energy, Mines and Resources (Mr. Lalonde). Had the government been sincere when the Alberta government made its offer, it would have said, "We will do the same thing. We will also give up some of our profits and some of our excess money so that it can be put into the industry to keep jobs". This is what the Government of Canada should have done. Now the people of western Canada are afraid that the federal government will hungrily grab from the industry part of what the Alberta government put out to help it survive and keep its head above water.
Certainly the Government of Canada is looking for trouble. The people of western Canada are reaching the breaking point. Their own government has gone the second mile in trying to keep the industry in business and to stop bankruptcies. Heaven knows, there have been enough bankruptcies already! The Alberta government is attempting to stop them, but if the federal government steps in and starts grabbing some of the money there will be trouble.

April 26, 1982
Energy Administration Act
Ottawa's priorities seem to lie in other areas. A few days ago the Minister of Energy, Mines and Resources said that the total additional capital provided by this bill, that is the Petro-Canada amendments, would be $4.9 billion. He went on to say that the new capital ceiling it authorized was $5.5 billion, but that because $500 million had been subscribed under the present act, and since a further $100 million had been provided with respect to the interest in Panarctic Oils, the total of new capital funds available was $4.9 billion.
Then on April 6 the same minister said that they wanted to strengthen and expand Petro-Canada and increase its activities. He should not have much trouble when he is using public moneys as he is. The value to Petro-Canada of the Petrofina levy is $800 million a year out of the pockets of people, not out of the pockets of any government. It is coming out of the pockets of people who are depressed, people who are unemployed, people who are wondering from where they will get enough to feed their children. When the government grabs $800 million per year, it does not take long before it turns to billions. It will be taken from the car drivers of the country, not to produce or to create jobs, but to pay for Petrofina which was bought at a ridiculously high price. The shifting of ownership and control of the industry to Ottawa is only part of the game. It appears to the people of Canada who look at this that there is a shifting. Conventional people in Alberta could not find work and had to leave the country. Now it is being shifted to Petro-Canada. I am not opposed to Petro-Canada, but I am opposed to the centralization of power in the hands of this government. The primary objective of the national energy policy has always been to transfer the benefits from Alberta oil and gas to the politically powerful regions which maintain the central government in power. It does nothing for producers or the producing regions.
The transfer of this $5 billion in benefits from Alberta to a single central province was made specific in a speech which the Minister of Energy, Mines and Resources delivered to the Langelier Liberal Riding Association in Quebec City on June 1 of last year. The minister said something which the people of Canada and the people of Quebec should know about. When discussing the oil import compensation program, he said:
Under this program we have paid oil importers in the East-most of whom, as you know, are centred in Montreal-a subsidy which they will continue to receive and which is equal to the difference between the cost of a barrel of imported oil and the cost of the same barrel of oil when it is produced in Canada.
In other words, he is taking money from the rest of Canada and paying it to the importers in the city of Montreal. It is true that by this simple mechanism he has contributed generously to locking in 400,000 barrels a day of Alberta crude oil and robbing the people, government and corporations of the province of the jobs, revenues and opportunities that would result from the production of this crude oil. But the dollar losses in Alberta have popped up as dollar benefits elsewhere, such as to the people around Montreal. I wonder how that sounds to the people of Ontario, Manitoba, the Maritimes and
the rest of Quebecers. I do not think it will suit them very well. These are the minister's own words, when he talks about taking this money and continuing to put it into this particular area. He said further to the same group:
We have made a considerable financial investment in this program-
They certainly have.
-one which, over the course of the years, has amounted to several billion dollars and which represents a direct subsidy to the consumers of Eastern Canada, the majority of whom are Quebecers. It is not difficult to imagine the additional burden which would have to be borne by the budget of every citizen and every family in Quebec, were it not for this subsidy.
Those were the words of the minister of energy who is supposed to be representing Canada. He is taking money from one part of Canada and concentrating it in another specific part of Canada. It is true that the minister is Robin Hood; he is robbing the people of one part of Canada and giving it to- or what he calls sharing it with-people in another part of a province. The minister went on to say:
Thus, between 1973 and 1980, Quebecers have received five billion dollars in payments under this program, or $835 per capita.
Those were the words of the Minister of Energy, Mines and Resources. This means that the two million people of Alberta donate to the six million in Quebec what amounts to some $3,000 to an average family there.
We in our province do not object to sharing. We have shared from the beginning. What other Canadian province has sold its non-renewable energy products, its oil, for less than it could get in other markets? Albertans have lost $18 billion in order to provide a better price for Canadians. They have shared as much, or more, than anyone else in Canada. When Albertans hear the minister making these comments and see those programs being implemented, it is no surprise that there is bitterness in our country. It is no wonder that Western Canada Concept is making progress. This government has the audacity to say that western members of Parliament are creating separatism. It is policies such as these which are creating separatism. Anyone who will be affected by these policies will not like them. While Quebecers will certainly accept the money if the government pours it into their province, they do not appreciate a policy such as this any more than anyone else. Quebecers want to contribute the same as the rest of Canada.
The Alberta government has released $5 billion of urgently needed stimulus for the benefit of all Canadians. The Government of Canada is doing its utmost to commit twice that amount of money for its own political purposes. What a shame!


Claude-André Lachance: Mr. Speaker, I shall, if I may, make a few preliminary remarks concerning the parliamentary events that made it possible for the House to examine Bill C-103 at 6.35 p.m. today, although normally, the House would have adjourned at 6 p.m., to resume sitting at 8 p.m. This goes to show, Mr. Speaker, that Parliament works when parliamentarians want it to work.
April 26, 1982

I had an opportunity to speak in the debate on a motion by the Right Elon. Leader of the Opposition, the day after the parliamentary impasse ended. We were discussing plans for parliamentary reform in terms that showed that hon. members who spoke in the debate felt a real urgency that the work of the Elouse should be as relevant as possible.
Today, I would like to take this opportunity to express once more the hope that very soon, Parliament, either through referral to the Committee on Procedure and Organization or in some other way, will be able to formulate concrete proposals to ensure that, in the future, the House of Commons will not be reduced to the pitiful exercise that paralysed it for more than two weeks.
At the time, I also said that some good would come out of all this, and today, an agreement made by the three House Leaders has made it possible to reach a consensus on a package of extremely complex legislation-which sparked the deadlock in the first place-and split the original bill into eight separate bills, so that each party and each member of the House could make a real contribution to the legislative process, which is the responsibility of this House, and in turn, allow the government which, we presume, is here to govern, to apply time allocation, a system not frequently used in this House but common practice in other countries and in other jurisdictions, especially at Westminster, the model for our Parliament.
Mr. Speaker, I am very happy to be speaking in the debate today, because I find these parliamentary events extremely important, and because I hope that in the future, without resorting to dilatory tactics like those used originally to split the bill, we will be able to work together in the same spirit and reconcile parliamentary responsibilities with the role of government, which is to govern. I now conclude these marginal notes on the events that have taken place in Parliament, which are, I feel, important because since this agreement we have been working in an orderly fashion, bills have been subjected to thorough debate, they have been voted on sincerely and conscientiously by members on both sides of this House, and finally, they have been the subject of a debate the public had a right to expect in the circumstances.
Mr. Speaker, it is often said that money is the life-blood of wars. 1 think it is probably a truism to say that energy is the motor of society as we know it today. Whether it is used to run our factories or our cars, during this century, cheap energy has enabled so-called industrial societies to prosper, to develop and to enable its citizens to live richer if not better lives, and has made it possible to achieve during this century a rate of growth hitherto unknown in the history of man.
Cheap energy-there you have a paradox, Mr. Speaker. The debate on Bill C-103 is an opportunity to point out how extraordinary it is that, today, people are complaining because
Energy Administration Act
the price of energy or perhaps I should say energies, is at the centre of public attention, while for 50 years we ignored the entire question and were using resources which are, by definition, mankind's capital reserves, namely, our non-renewable resources. In 1973, the first energy crisis occurred when the Organization of Petroleum Exporting Countries decided-1 may add that it probably had every reason to do so-to draw the best possible benefits from the income constituted by the price paid for oil, especially since most of these countries had no other resources. Oil is taken from the desert or the ocean floor and may come from developing countries that must use this resource windfall to promote the development of their own society. Is it therefore so surprising that, after this psychological and economic shock, Canada, so richly endowed but also dependent on foreign sources of oil and gas, should want to develop its own national energy policy? The cynics among us would claim that an energy policy is long overdue. But, and I say it once again, before 1973 energy was cheap and in abundant supply, and we took advantage of it, in an almost orgiastic consumption of oil and gas, without worrying about who was going to pay the bill and where the energy was coming from.
At the end of the sixties, I remember reading in the papers about the most far-fetched projections that Canada would be self-sufficient in oil and gas for at least 100 or even 150 years. The fact that known reserves were diminishing proved nothing, since in any case, there was an arbitrariness about the whole issue, and the oil companies with their vast monopolies could, in fact, say what they chose to whom they chose. What a shock, after 1973, when we realized that Canada did, in fact, have the capability of being self-sufficient in energy but that we would have to pay a high price to attain that self-sufficiency. Why have a national energy policy? Because I think that Canadians realized at a certain point in their history that it was important and even imperative for us as a society to be able to exercise some control over our own destiny. That is more or less the philosophy underlying the national energy policy, and I support it. I do not think any members in this House could be opposed to this concept.
We want to achieve energy self-sufficiency in Canada and we have the means to do so, even where oil is concerned, but we still have to implement a consistent policy to deal with all the problems which this goal raises with respect to supply, compensation, prices, taxes, charges, allowances, research and development, as well as frontier production. So, we have a national energy policy, and it was announced by the Minister of Energy, Mines and Resources (Mr. Lalonde); but now, several months later, a year and a half to be exact, we are still discussing in this House how to implement this policy. Implementing a national energy policy is not an easy exercise because you essentially have to rely on unpredictable factors over which you have no control. While it is true that 18 months ago we could forecast, because of events which have

April 26, 1982
Energy Administration Act
occurred since 1973, a regular increase in the cost of hydrocarbons, while we could expect OPEC to go on controlling supplies and the industrialized countries to take some time to adapt to the higher cost and the relative scarcity of these energy supplies, while we could forecast that these same countries would need some time to make the necessary changes to their energy structure, especially at the industrial level, unfortunately, the situation and the projections which we had made did not quite follow the expected pattern. Are we to blame anyone or any government for the fact that fuel prices, and especially oil prices, have dropped in the past year? I do not think so. This occurred because of a combination of circumstances. However, the fact remains that in view of the national energy policy, this drop in black gold prices, if I may use this expression, has lent support to those who still believe that we are living in an area where the development of frontier resources must be left in the hands of entrepreneurs, even though the Canadian people may now want these resources to be developed through a national oil corporation.
I would like to say a few words about this national oil corporation, about Petro-Canada. There are those who say that we did not need it. They may be right in a certain context, but the fact remains, Mr. Speaker, that a modern state like Canada, which wants to have the means to implement a consistent energy policy and to achieve self-sufficiency, which, as everyone must admit, will require tremendous investments and sacrifices if we want to meet this objective by 1990 as projected in the National Energy Program, must necessarily have some levers. And Petro-Canada is nothing else but a lever to allow Canadians to play an active role in applying the principles contained in the National Energy Program. Some might retort that Petro-Canada will use public funds to compete with companies that must go to the financial markets in order to explore, develop, produce the oil and gas needed. That is true. But is there anything wrong, Mr. Speaker, with the reason why we proposed the establishment of Petro-Canada, that Canadians should be directly involved in oil exploration and production? A joint rather than an exclusive interest. Personally, I see nothing wrong, Mr. Speaker, with the fact that through a tax levied on a litre of gas Canadians are involved in the purchase of Petrofina and the establishment of an entity capable of participating with other members of the industry in the implementation of our energy objectives. I see no reason why I should object and I do not think Canadians generally see anything wrong with that. If we can rely on surveys, because we have to use some reference standard, a majority of Canadians feel that Petro-Canada is an asset to our society.
Mr. Speaker, I shall not burden you with the detail of the proposals in Bill C-103, a near-labyrinth, nor with arguments about figures of royalties, charges, rebates and fiscal incentives. All that language, Mr. Speaker, is for experts, it is
beyond my comprehension, and it would be presumptuous on my part to propose changes to any provision of the legislation. Again, Mr. Speaker, I take this opportunity to indicate as a Canadian and a legislator that the principles behind our National Energy Program are worthwhile. The proof of this is the fact that certain oil and gas producing provinces, current or potential, as Nova Scotia, after long negotiations entered into agreements, and those agreements as always are beneficial to both parties. Presumably, in this case parties of either side represent a segment of the interests involved. We signed an agreement with Alberta, something our colleagues opposite cannot claim to have done. We signed an agreement of benefit to Canadians. There is no doubt about that. Again, some circumstances somewhat hampered the smooth progress of discussions and negotiations that already had been going on for a very long time. However, at a meeting I was privileged to attend in Paris at the International Energy Agency, non-Canadian-Canadians were present but in this case they were not Canadians-energy experts urged us as members of Parliament not to be lulled into complacency, because although they have now plummeted, oil prices will inevitably go up again. They will have to, because it is a non-renewable resource, each additional drop of which is a little more costly, since the means used to develop this resource are becoming increasingly costly, nature having unequally distributed its wealth.
We began our exploration in locations of easier access, but now we have to explore deeper offshore and develop heavy oils, oil sands and shales. Therefore the costs will increase, the costs per barrel will necessarily go up. Therefore, there is no room for complacency, since present conditions are cyclical. I admit that our life has become more complicated, that some of the premises on which we established our projections for our National Energy Program are undermined, but I do not think that they are inconsistent with that cyclical consideration of the principles underlying the National Energy Program whose philosophy is to provide Canada with a concerted policy for the development of those energy resources.
I am particularly interested in one aspect of the bill and was rather anxious to hear the previous speaker, the hon. member for Bow River (Mr. Taylor) deal with the compensation for petroleum imports which, as things stand at present, are more costly than Canadian petroleum. This is a basic decision, Mr. Speaker, which each of us must make to the best of our knowledge and which does not merely apply to energy resources but to many sectors of our community. And those considerations are based on the fact that the Canadian economy, geography and community are diversified. Sometimes, beef producers walk on the inside and all other Canadians subsidize them through export or consumer prices so that they can produce at a reasonable price. Sometimes, industrialists take advantage of the situation through subsidies, tax allowances, and a particular area of Canada benefits by it. On

April 26, 1982
another day, it is energy which is somehow to be shared. And one day it could be electrical power in Quebec and I swear to you that the debate will be a fierce one.
As my hon. colleague from Newfoundland was saying a while ago, if Canada is to survive, it is essential that we should set national standards, and if we accept the need for national standards, this holds true for the energy industry as well. I admit that we could carry on a very long controversy over this. Some could ask: Why should one litre of gas cost 40 cents in Montreal and why not 25 cents in Calgary? Why not? I suppose this point could be argued. Why not 18 cents in British Columbia and why not 27 cents in Newfoundland when the offshore oil starts flowing? I, for one, claim that all Canadians should as much as possible be treated on the same footing in this respect; hon. members certainly realize that I am eluding even the issue of oil and gas as a contributing factor to industrial production, for here again a region of the country should not be favoured at the expense of another just because geography has given the former a head start. I believe that, as a matter of principle or given national standards, all Canadians should pay the same price for hydrocarbons, whether they live west or east of the so-called Borden line, and the principle is so self-evident that I unreservedly support the proposal for a financial compensation which the hon. member for Bow River opposed so forcefully a while ago. Surely he will say: "But, of course, the interest of the hon. member for Rosemont (Mr. Lachance) is clear: being from Quebec, he will benefit from this compensation." And he would be right. 1 come from Quebec, and my province is among those which have benefited greatly from this very real, and 1 repeat, very real generosity of the people of Alberta in sharing the great wealth they have under their feet. In fact, I believe that it is part of the Canadian genius to find the means of sharing among Canadians in spite of the ups and downs brought about by a policy focusing on past events. Sharing is a characteristic of Canada and must remain so if we are to continue to live as Canadians for a while, in spite of marginal movements such as the Western Canada Concept, and I can testify that if one province is familiar with marginal movements, it is certainly Quebec, because we who believe in Canada, in sharing, in generosity, have had to fight-I was going to say since 1967, but this goes back much further-against a kind of narrow approach, a restricted vision of human potential, an unfavourable perspective of Canada as a whole, an egotistic and egocentric view. We have lived this experience and we still live it in Quebec. No one should blame us for such a movement, which is entitled to exist and which I respect as such, but which I believe to be marginal, and my colleagues will correct me if 1 am wrong, but I do not believe I am. However, that some people would believe that the national energy policy and the compensation it provides is too much of a sacrifice for Alberta makes me wonder.
I ask myself these questions because I infer from the agreement signed by the Alberta premier and the Canadian government-and I repeat that I am not an energy expert-that both
Energy Administration Act
parties find it mutually beneficial. I repeat that if event-related and therefore temporary factors cause implementation problems, it is always possible for intelligent people to make adjustments. As evidence of this, I understand that Alberta has just introduced a reduction in its royalties to give some breathing spell to the oil and gas companies, and I also understand that the Canadian government has undertaken negotiations to promote the sales of accumulated stocks since Canada, being a producing country like all the others, is finding it more difficult than usual to sell its production. As a result, the government is attempting to dispose of the surplus production, which amounts to tens of thousands of barrels-I shall let adepts in this matter determine the exact figure-but I do not see how such technical considerations, which only require minor adjustments, and this issue is brought up every day in the newspapers, how such adjustments, which are a characteristic of a mature and sophisticated society, would run counter to the principle underlying the National Energy Program, which is to concentrate and focus our resources toward an objective which all the hon. members and presumably all Canadians support, that of energy self-sufficiency. Some may say that we shall never reach self-sufficiency, but that point can be debated some other time, in another place.
The fact remains that we have provided ourselves with a number of tools, whether through a national petroleum board, tax incentives to research, agreements signed with producing provinces or compensation which makes it possible for refiners to pay for imported oil a price equivalent to the price they would pay if they got their oil from Canadian producers. All these tools are worth while. The fact that last year was not a good year as far as exploration is concerned had certainly something to do with the National Energy Program. But I think nobody would suggest that it had nothing to do with current factors such as a falling price for oil and the U.S. government's policy of deregulating the industry which may appear attractive in the short run, but which may prove in the long run detrimental to Canadian interests. Mr. Speaker, all this bill is doing is to establish and integrate our objectives. And as such, as my hon. colleague from Newfoundland said, I can find nothing odious about this bill unless one does not accept its underlying premise.
Clearly, if we refuse to accept, as implied by the hon. member for Bow River (Mr. Taylor)-although I would not like to put words in his mouth-the principle that the same basic price should be paid in Montreal as in Edmonton, certainly we cannot approve this legislation. If, on the other hand, we have another concept of Canada, if we accept the principle of providing ourselves with the means, the tools needed, not as a government but as a society, as a people, to have our say in the development of those resources-because

April 26, 1982
Energy Administration Act
they do not belong to Shell but to the Canadian people, they do belong not to the government of Canada but to every Canadian. Therefore, let us have our say in the development of those resources! Of course, we can suggest certain amendments to the implementation of those objectives. But as far as principles are concerned, who can object to Canada no longer having to depend on OPEC or Mexico or Venezuela or any other country that might some day dictate to us not only the price to pay for oil, but the quantity to buy as well?
True, we now have a surplus. But who knows what will happen two years from now? Maybe we will have another shortage. This is a volatile market, Mr. Speaker, and the message I got from those meetings in Paris with the International Energy Agency, is that every country, especially those who have the extraordinary good fortune of having ample reserves, must have as a first priority to ensure that those resources are available to the people, to the most productive among them and that those resources are not used to the benefit of this or that group, but to the benefit of all. And I feel that such is the thrust of the National Energy Program. And this is why the bill in my view deserves our support. And I shall support it, not as an expert, not as a member from the West but from Quebec who admittedly benefits from this situation but first and foremost as a Canadian.


Mr. Don Blenkarn (Mississauga South):: Mr. Speaker, the hon. member for Rosemont (Mr. Lachance) feels that the concept and philosophy of this bill are to ensure security of supply. I suggest to him that the philosophy of this bill is to give those in the ivory towers here in Ottawa control of an industry so that they can use that industry as a source of taxation. We now have a great milch cow for the country; it is called the oil industry. In the hon. member's province 70 cents of every dollar paid at the pumps is taxation. I suggest to him that more is paid in taxation on this liquid product than on the liquid products normally found in bottles-wine and alcohol- and I suggest to him that the real philosophy behind this bill is a philosophy of tax and tax more and more. The philosophy is to make sure we have more government to put up with in our lives, more bureaucrats and more people suggesting how we should do our thing.
The hon. member for Rosemont mentioned polls with respect to Petro-Canada. I suggest to the hon. member that he look at the polls, even in his province, which indicate the hon. member should be more concerned about the economy of the country than he is. Those polls indicate that the government of which he is a supporter would not be the government if we had a proper poll in the country.
To read this bill is to read the clause at the bottom of page 21. To put this bill in its proper perspective I think I should read into the record Clause 35(4) as follows:
Where it is shown to the Governor in Council by the Minister that it is in the public interest to do so, the Governor in Council may, by order, conditionally or unconditionally, retroactively or prospectively, and either generally or in respect of a single transaction,
(a)	exempt any petroleum or petroleum product from the charge imposed
thereon in respect of a month or part of a month under this Part; or
(b)	reduce any charge imposed in respect of any month or part of a month
under this Part.
That is this bill. The government can, retroactively or prospectively-


John Horton McDermid: Or seductively.


Donald Alex Blenkarn: -or seductively, my friend says-and either generally or in respect of a single transaction, exempt in respect of a month or part of a month or reduce in respect of a month or part of a month. Just that one clause alone should indicate to everyone that this is a bad bill.
Let me get to the question of the whole idea of a Canadian oil price. That idea was first presented by the Hon. Bob Stanfield when the first increase in oil prices took place. He suggested that somewhere along the line we ought to try to minimize the shock of going to world prices. For a period of time bit by bit we worked our Canadian price up very close to the world price. That was the situation until 1978 or 1979. The OPEC people then again decided to go on a rampage, and world prices advanced dramatically. This government went to the country with the concept of a Canadian price. At that point the price of oil in Canada was controlled under the Petroleum Administration Act and was considerably less than the price of oil in other parts of the world. This government said it would continue to keep the price of oil and oil products significantly lower than the price in other parts of the world. As long as that was the case we in Canada had an advantage because we had petroleum and petroleum products available for our industry, to heat our homes and to drive our transportation vehicles at a price lower than that which prevailed in other parts of the world. In a sense we were using our resources sensibly to give our country a competitive advantage.
The national energy policy and the philosophy expressed in this bill ceased to do that. Instead of providing an advantage to Canadians it became the policy to tax Canadian resources and to see if the Ottawa government could get as much money in tax dollars as conceivably possible from the oil industry on oil from the ground or on oil which passed through the refining and processing systems. The provincial governments saw what was happening, and certainly the provinces of Ontario and Quebec and the eastern provinces decided they might as well join in the game because no longer was it the policy of the Government of Canada to produce petroleum products in Canada at a price which would give Canadian industry and Canadian transportation a price advantage over the rest of the world. The policy was clearly a policy to tax, tax and tax. Last year the revenues of the Government of Canada increased 22 per cent in one year. They have increased 40 per cent over two
April 26, 1982

years, and that revenue increase is largely the result of the monster taxes imposed on the oil industry by this bill and related statutes.
This bill deals with two principal forms of taxation and a third form of taxation in terms of transportation fuel. First, it deals with what is called the petroleum compensation fund, which is a tax on petroleum products in Canada. Presumably it is to tax oil in order to collect enough to pay for the cost of bringing down the price of imported oil and to bring about some sort of average Canadian price.
The second tax in the bill deals with some concept which has absolutely nothing to do with energy security but everything to do with socialism, nationalization and seizure of private property. It is a tax on every gallon or barrel-or cubic metre now-of fuel to enable the purchase of new oil companies or to make new oil investments by the Government of Canada. These investments are not to be made by individual Canadians but by the Government of Canada through the Minister of Energy, Mines and Resources (Mr. Lalonde) so that the minister and his advisers, who certainly have no love for private enterprise or the free entreprise system, can become the largest owners and controllers of the oil industry.
If the policy were to produce oil and oil products as cheaply as possible for Canadians-bearing in mind the problem of security-and to average the price down so that Canadians would have a competitive advantage in the world and so that Canadian industry and business and the jobs which could be created would have a competitive advantage, then we could support it, but that is not the policy. This is a policy of taxation to bring in more and more revenue, and it is being sold as a policy of energy security. It is being sold as a policy of Canadi-anization. It is really a policy of control, a taxation policy, and it ought to be viewed by my friends on the government side as exactly that.
If the Minister of Energy, Mines and Resources had come into the House and said,"We feel that gasoline is the same as liquor and we are going to tax it in the same way; we feel that gasoline and home heating oil are the same as wine and we are going to tax them in the same way-get all we can from them and then reduce other taxes", he might not have found an argument. But this has been presented to us as energy security which is good for the country and will make us self-sufficient. We all know that the policy has not made us self-sufficient, has not encouraged drilling, has not encouraged production, has not encouraged jobs-it is a policy designed solely to get as much out of the industry as possible and to put it in the hands of the spenders in government and thus give government control over what goes on.
Early in March when my colleague, the hon. member for Calgary Centre (Mr. Andre) moved the adjournment of the House and the bells rang for 16 days, some people in the
Energy Administration Act
country were concerned. You, Mr. Speaker, and those who were able to help you, sat in the chair and maintained the dignity of this House.
People across the country expressed concern that the Progressive Conservative Party might have foisted an unfair method of debate on the country. It was a significant debate, however, a silent debate, if one ignored the noise of the bell. During that debate Bill C-94 was apparently abandoned and the petroleum compensation charge that had been envivisaged in the original bill was reduced from $125 per cubic meter to $75 per cubic meter or from $20 per barrel to $12 per barrel. That was a pretty sizeable adjustment won by the Progressive Conservative Party toward reducing energy prices for the people of this country. If 16 days of bell ringing could produce an $8 per barrel reduction in taxes, that is significant. Billions of dollars were saved for the taxpayers of this country.
Bill C-94 provided for a Canadian ownership charge of $25 per cubic meter or $4 per barrel. The bill before the House now reduces that to $7.25 per cubic meter or $1.15 per barrel. We saved the people of Canada an additional $2.85 per barrel, and we reduced the charge to less than one third of what had been intended. So I say to you, Mr. Speaker, that the bell ringing was a good exercise in democracy and in keeping taxes down.
My constituents elected me to do what I can to cut down on the cost of government. This is also the case with my colleagues. With this bill we have accomplished that and we hope to accomplish more. But this is a bad bill, Mr. Speaker, because it levies more taxes than it should.
Bill C-93 deals with the PGRT and excise taxes. This bill has the same principle, that is, that the tax limits are upper limits and taxes can be raised to those limits or reduced. They can be fiddled around in any way that the Minister of Finance (Mr. MacEachen) or the Minister of National Revenue (Mr. Rompkey) suggests to the governor in council. For the first time in our history, in Bill C-93 and in Bill C-103, there comes a time when the Minister of Finance-or in this case the Minister of Energy, Mines and Resources-has the right to raise or lower taxes. Through this bill the minister reserves to himself, not to parliament but to himself, the right to levy taxes.
The other day the Prime Minister (Mr. Trudeau) jokingly said that the Magna Carta was sent to four corners of the realm. We should remember what the Magan Carta was all about, Mr. Speaker. It was about the right of the Crown to impose taxes without parliament. The Magan Carta determined that taxes shall not be levied except by the people, represented in their parliament. The whole purpose of parliament, dating back to 1215, is to determine how and by whom taxes may be levied.
On that basis this bill and these provisions are wrong, as it is left to the minister to determine and to present, with a Crown

April 26, 1982
Energy Administration Act
reference, what the taxes should be. They should be presented by ways and means motions and the bill should specify what taxes will be imposed.
If there is to be a further increase in taxes there should be a further bill, which would be voted upon by this House. The idea that a minister of the Crown can advise the governor in council that a tax should be increased and that it would then be done automatically is wrong. It is unparliamentary and it is against the concepts that have governed us since the Magna Carta. These features must be deleted from this bill and from Bill C-93 because they are against the principles on which you, Sir, and I were elected. They are bad law.
If it is the government's intention to impose the maximum amount of tax provided for in these bills, then it should be voted upon by parliament. The people of Canada would then find that 18 cents per gallon was a pretty low increase. The maximum levy provided for in this bill is 70 cents per gallon, with 28 cents being imposed right away and the rest later. If that is what the minister wants to do, then let us find out about it. Let the people of Canada know where they stand. When we pass this bill we ought to know exactly what the levy is. We have no right to vote for taxes in the abstract; taxes that can be increased or decreased and changed at the minister's whim. To impose a ceiling and then say, "No more than that ceiling" is not voting on taxes; it is voting on some sort of crazy discretion that no minister of the Crown has the right to retain to himself.
Let us deal with these taxes further, Mr. Speaker. The question really is whether these petroleum compensation taxes already being collected are needed. The fact is that the government has been collecting more in petroleum compensation taxes than it needs to pay petroleum compensation, well over $1 million more. The truth of the matter is that, buried under the concept of petroleum compensation, is an effort by the Government of Canada to say it is for compensation for foreign oil but to put it in its pocket and use it for some other purpose. So on that very point, Sir, this bill is deceitful and dishonest because the present level of the compensation tax has produced a huge surplus which has been converted to the government's ordinary revenue account. Sir, if it were truly a compensation levy, then it should only be the amount required to cover the import compensation payments and no more.
It has become clear, Mr. Speaker, that the effect of the government's interference in petroleum marketing, particularly with imports and the compensation charge, has been that certain importers of oil have preferred to purchase on the spot market where it is alleged they can buy the oil they want at $25 of $26 a barrel and then receive $17 a barrel or so in compensation and be much better off using foreign oil rather than Canadian. The truth of the matter is, Sir, that in western Canada today between 300,000 and 400,000 barrels of oil a
day are shut in through the brilliance of the people in the minister's office, his ivory tower guys who would bring in foreign oil rather than use our own. For that very reason alone the people who concocted this legislation should be fired.
Let us look at the true economics of the situation. Here we are bringing in nearly 500,000 barrels of foreign oil a day while we leave our own product bottled up in the ground. We charge compensation levies and increase the price to every transport driver and home owner, and then compensate Iraq, Venezuela and Mexico. If we were able to sell a nuclear reactor there, perhaps, we might be able to justify this charge. The fact of the matter is they cannot and will not, and all we are doing is paying for the Prime Minister's trips to see the President of Mexico, and paying a pretty penny at that.
Looking at the question of the Canadianization fund, Mr. Speaker, that fund bothers me as it ought to bother you. Linder this bill we are not paying just for Petrofina, we are allowing the minister to continue forever building up a fund so he can buy shares in other oil companies. The fund is called a Canadianization fund, but that is not what it is. It is not a situation where Canadians as individuals are buying shares in oil companies. It is not a situation where small Canadian companies get a benefit. No. In fact, what happens is that Canadians are being taxed at the pump when they heat their homes or buy fertilizer. For what? So the Minister of Energy, Mines and Resources can own another oil company.
Some people have said this money was going to go directly into oil exploration or building a pipeline to Halifax; some said it was going to go directly into creating new jobs somewhere. But what did the minister do with the money so far? He went out in the market and bought a bunch of whited-out service stations and got himself some new neon signs-


John Horton McDermid: Designed by a guy from Bermuda.


Donald Alex Blenkarn: As my friend says, designed by a guy from Bermuda who probably does not pay any income tax. Well, it is a good place to go. But what did the minister do? He decided he was going to become the new oil entrepreneur. He made sure his company sold gas at the same price as everyone else, but now at least he has service stations right across the country. There is nothing wrong with them, of course, it is local people selling oil and gas and so on, but did we as a nation really need to have a whole new fleet of service stations? Was that a national priority? Was that the kind of thing that Canadians wanted to pay 4 cents or 5 cents a gallon for, so that the minister could have his own gas stations? I say, Sir, they did not. That has nothing to do with energy security; it has to do with propaganda and the government's "visibility", if you want to call it that.
It was back in September, Mr. Speaker, when we finally entered into an agreement with the province of Alberta which provides that the price of Canadian oil was to rise $4.50 a barrel in 1981 and 1982, and $8 a barrel from 1983 to 1986.
April 26, 1982

At no point, however, was the price to exceed 75 per cent of the world price. Well, at that time the people making this agreement had stars in their eyes as to where they thought the world price of oil would go. They thought the world price in 1982 would be $49.22 a barrel, and $57.06 in 1983. Well, Sir, we are well into 1982 and the price is about $39 a barrel and going down. They were out only $10 a barrel. That was how bright they were when they made that deal back in September, only about seven months ago. How much will the government be out by 1983? Will the world oil price be $57.06? It is suggested that some time this year the 75 per cent agreement will come into effect. Some time this year our Canadian oil price will be the world price. That begs the question, where will these taxes take us? Do these taxes take us above world price because there is nothing in this bill which in any way limits the price, the tax or the compensation fund? Old oil will be 75 per cent of world price. However, this bill does not limit any of those taxes. It presumed, and it was wrong, that last year when prices were going up and up. Somewhere along the line the minister and his high-faluting advisers thought they knew it all, that they did not need to worry about the price coming down. Where does this bill take us with its present pricing structure? It breaks the 75 per cent concept. Very soon under this bill Canadians will be paying several times more than people in the United States pay for gasoline and home heating oil and everything else. We are already paying more for gasoline at the pumps than Americans do.
Over Easter I was fortunate to be able to visit Texas. The price of gasoline in Texas is considerably less than it is here in Ontario. My father reports that gasoline in Florida is cheaper than it is in my city of Mississauga. I say to you, Sir, that it was not very long ago when people from Buffalo were swarming over the bridge at Fort Erie to buy gasoline. Very soon Canadians will be the ones swarming over the bridge at Fort Erie to buy gasoline. Where will that take our tourist industry? Where will that take the efficiency of our factories, our plants and our transportation industry?
The bill in terms of the tax policy has not been thought out. The bill has no de-escalation of price in it. It has only upper limits and the great wonderful world in which the government gets more, more and more. Perhaps the oil companies get a little more? Do they? The price is going down for sure, but the taxes do not go down; therefore, the netback to the industry must go down, and that is where we stand.
With respect to the national energy policy and I am reading from a news release appearing on the minister's own stationery, dated September 1, 1981, which stated that for Canadian consumers the bottom line is that they have fair oil and gas prices. Already Canadian consumers are getting fair prices? They are getting "fairly hooked" more than anybody else, certainly more than anybody else in North America. The
Energy Administration Act
industry does not get the money to get on with the job. I thought we would go on to that right now, Mr. Speaker, because you and I know that as a result of this policy, drilling in Canada in 1981 over 1980 is down 25 per cent. Compare that with the 25 per cent increase in the United States. Well completions in 1981 amounted to 7,183 compared with 9,481 in 1980. That is another 25 per cent drop. Exploratory drilling is down 19 per cent. Developing drilling is down 28 per cent. In terms of metres drilled, the decline was from 10.27 million metres in 1980 to 7.64 million metres in 1981. That is another 25 per cent drop.
Two hundred and twenty six drilling rigs left Canada. This was all for the "security of supply," to make sure that we have more expensive oil. It made sure that the industry was less efficient, and the advantage that Canadians had up until 1979 and into the early part of 1980 has dissipated and gone. The advantage which Canadians had over the Europeans has gone. The advantage which Canadians had over Americans in terms of energy, energy prices and energy availability has gone. What do we have instead? We have a tax regime that increased taxes last year by 22 per cent. This regime will increase taxes 40 per cent over the two-year period. Do we see any lessening of other taxes? Not on your life. Income taxes are increased by the November budget for most people earning under $30,000 ayear. Fifty four per cent of people earning under $50,000 a year will pay more taxes. What about corporations? Corporate taxes are up dramatically. I say to you, Sir, that this is a bad bill and it must be defeated.


Mr. Bill Kempling (Burlington):: Mr. Speaker, I have a few words to add in this debate. I was quite taken by my colleague's comments on the acquisition of Petrofina. He expressed views that I find are being expressed across the country.
This bill, as mentioned by others, will establish a new ceiling for the petroleum compensation charge; a new oil export ceiling of $350 per cubic metre; the Canadian ownership special charge; and the transportation fuel compensation recovery charge.
The main concern I have is the amount of taxation being added on to oil and petroleum products generally. I recall, and I am sure you remember the time a few years ago, when the then minister of energy, the Hon. Alastair Gillespie, stood in the House and announced that as part of the conservation program of the government $100 would be added to the cost of air conditioning installed in an automobile. Most Canadians have forgotten about that, I am sure. As a matter of fact, in compiling an automobile price today, I do not believe the dealer even mentions this item. That $100 is added automatically. Any car a person buys with air conditioning in it costs an extra $100 in tax, and that tax goes directly to the government. That $100 was supposedly added for conservation purposes.

April 26, 1982
Energy Administration Act
I want to go through the various charges that have been added on to oil, but at this point I want to tell hon. members what happens after a tax is added and is forgotten about.
Many people, particularly in the automobile industry, engineers and those who know about these things, laughed that the $100 charge would be a conservation measure. They pointed out, quite rightly, that if you drove your automobile with the windows open it would cost more in energy than air conditioning would. Also, if you drove a car with soft tires, it would cost more in energy than a car installed with air conditioning would. But there is a final irony to that particular tax. Some Canadians were so angry at the thought of paying this extra $100 that those who lived near the border went across to the United States into Buffalo, Detroit and other areas where service stations would install air conditioning. They bought it there and they did not have to pay the $100. Then another thing happened-the RCMP became involved. The RCMP made a deal with the guys across the border who were installing air conditioning. They paid them $20 for every Canadian license number which they could give them. Consequently, the fellow heard a knock on his door, and there would be an RCMP officer with a writ of assistance. His automobile was seized, he had to pay a fine plus the cost of the air conditioning, and he suffered much anguish. This went on for quite some time after the tax was put in place.
I should like to look at the various taxes on petroleum products. There is an export charge, a special levy, a Syncrude levy, a petroleum compensation charge, a Canadian ownership charge, a fuel compensation recovery charge, an import charge and a transportation charge. On top of all these are the federal excise tax and the provincial sales tax, except in the province of Alberta. If that is not overloading a product with taxation, I do not know what is. As far as I am concerned, it is part of the cause of the decline in our industry in the past 18 to 24 months.
There were people in the industry who thought that energy prices had to rise. They expected it. They recognized the world price and so on, but they had the feeling that regardless of this they still had it made because we had a great resource and somehow the government would arrange it so that we would always have a competitive advantage in the international field. The reality today, or part of the malaise in the economy today, is that they now realize that they are paying more. They look at the resource we have and see that heavy oil is on the shelf and, that the tar sands development has been put back. They hear the mythical talk about self-sufficiency by 1990. Along with them I do not believe we will achieve self-sufficiency by 1990. Part of the problem is the taxes and what is done with the money.
I want to talk about what happens to tax money, which is an important point. I recall three or four years ago a program called "Enersave" which was put in place by the Department
of Energy, Mines and Resources. I welcomed three young people into my constituency who were heading up the Enersave program. They told the people of my constituency that they worked for the Department of Energy, Mines and Resources, but in reality they did not. They had obtained a grant of $90,000 to go out into the community to advise people on how to conserve energy. This is what it was all about. They were equipped to go into the schools to advise students on how to save energy. They could talk with representatives of school boards and municipal officials on how to save energy. They could talk to architects, engineers and owners of construction companies on the same subject. This is what they were telling me. I inquired as to their qualifications because I felt that if they were advising people on how to do things, they should have some basic knowledge.
This is what I discovered. The young lady heading the project was a professional program conductor. She had operated several LIPs, youth programs and so on. She had operated so many that I assumed she was looked upon by various government departments as a professional program director. She had as her assistants a third year history student from university and a fourth year high school student. I began to talk with them about how they felt when they talked with the man, for example, who designed the building in which their offices were located. I asked them whether they felt qualified to advise this man, who was an architect, on energy conservation matters. They said that they would take a crack at it. I asked them whether they felt confident talking with city engineers and advising them on saving energy for the city and so on. Then we got down to the final point-"What do you really know about the subject?" They held up a handful of pamphlets written by the Department of Energy, Mines and Resources. They had read the pamphlets, and that is all they knew about energy.
Also 1 talked to them about different kinds of oil such as heavy oil, light distilate, sweet oil, sour oil and gas. They did not have a clue. I am not being critical of those students. They were nice, keen, energetic, honest young people who really thought they were out doing something, but as far as I was concerned they wasted $90,000 of taxpayers' money in my constituency. In fact, after returning from a series of meetings at three o'clock in the morning on one occasion, at two o'clock in the morning on another occasion, and at four o'clock on another morning, I telephoned them because I saw that the lights in their office were on. I called them up and said, "If you are talking about conservation, at least turn off the lights in your own office".
The people who pay the taxes collected by the government and dispensed by the Department of Energy, Mines and Resources are the ones who are asking questions which I am at a loss to answer. I should like to refer to a typical letter from a constituent who wrote in reply to an article which he read in
April 26, 1982

the April 15 edition of The Spectator in Hamilton. It was a story about Michael Phelps, executive assistant to the Minister of Energy, Mines and Resources (Mr. Lalonde). The story was that Mr. Phelps had just made approximately $64,000 from the sale of a home he bought less than two years before with the help of an interest-free loan from the Petro-Canada Crown corporation; it gave all the financial details. A spin-off of that was the letter I received from Mr. R. I. Gowland of Burlington who wrote:
Dear Mr. Kempling:
I am inquiring as to my chances of obtaining a $35,000 interestfree loan from Petro-Canada (a Crown corporation). I would be willing to make payments of $31.25 a month for the first year and payments of $62.75 a month for the remainder of the loan.
Those were the terms which Mr. Phelps received in his agreement. The letter continued:
The figures I am quoting are from an article in The Hamilton Spectator April 15, 1982, that Mr. Michael Phelps (executive assistant to Energy Minister Marc Lalonde) received this type of loan in September 1980 and December 1980 from Petro-Canada.
As the mortgage on my home comes due the end of July 1982, the interest rates will increase from the present 10 per cent to 19.25 per cent, on a three year mortgage.
This will almost double my mortgage payments from $400 a month to $800 a month. My remaining mortgage at the present time is about $36,000, this loan would enable me to pay off my mortgage instead of losing my home. I do not want to make a profit from this transaction as Mr. Phelps did, I just don't want to lose my home.
Eagerly awaiting your reply.
Yours truly,
Ronald I. Gowland.
I read that story and wondered how I could answer this gentleman, because as far as I was concerned it was poor business to proceed in the manner of the minister and of Petro-Canada. If this is what is happening to the energy tax dollars which are being contributed by the people of Canada, I think it is wrong and we have a duty to point this out and rectify it wherever possible.
Aside from the Enersave program which I mentioned, where these three young people received a $90,000 grant, there is another Enersave operation in my constituency. Although I had difficulty finding out the background of this operation, I discovered there was a group of people who, supposedly, were representing Energy, Mines and Resources and who advised home owners on how to insulate their homes. They were funded through taxation derived from petroleum. I talked to these people in my constituency, as I usually do, and questioned them as to their competence, background and expertise in this field. I asked the person in charge what knowledge he had about energy and insulation. He did not know anything. He said, "I have a construction man on my staff who is my expert. I am an administrative expert." I then met the accountant and asked him the same question. He said that he
Energy Administration Act
was only in to set up the accounts and knew nothing about energy and insulation. I then met the construction expert. I have a great reverence for age and I respect elderly people but this gentleman could barely walk. He had a cane and had lost an eye. I honestly do not believe that he could climb a ladder to inspect an attic in order to determine what kind of insulation was needed. That was the staff of this organization.
I was quite intrigued by this operation since I come from the private sector where you must be very conscious of any conflict of interest which may arise as a result of which you may be charged with favouritism or fraud. I asked the leader of this operation how he conducted his business. He indicated that they put advertisements in the paper to which senior citizens and others would respond. He said, "These people want to have their homes insulated, and we advise them." I asked him how he gives this advice if he does not know anything about it. He indicated that he takes their names and addresses and sends the construction expert to inspect their homes. I told this person that his expert can hardly get in and out of a car, let alone climb a ladder to look in the attic. He said that they advised these people and told them what type of insulation they should buy. He said, for instance, "We tell them to buy fiberglass insulation." 1 asked him in what manner he gave this advice, and he said that he tells them which company to buy it from.
I said, "Let me give you some advice before you go any further. Do not tell people where to buy their insulation. If you want to give them an alphabetical list of insulation suppliers, that is fine." I indicated that these people should make their own choice so that he will not put himself in the position of indicating the company from which to buy insulation. Otherwise, he will discover many other companies accusing him of taking kickbacks and showing favouritism.
He accepted my advice but not before all the insulation contractors in the Burlington area had surrounded his business one day with all their vans and trucks to force a confrontation. That office closed down shortly after that incident. I understand that that operation had a budget of more than $150,000.
These two examples which I have cited represent $240,000 for projects which really have accomplished nothing. Therefore, when I see another bill which proposes to legitimize an ongoing tax or introduce more taxes, I sense that there is something wrong, or at least that there is a potential for questionable activities taking place. That is my concern.
When I review the CHIP program, which is still in existence in some manner, I believe we can honestly say that it was probably the most fraudulent program ever introduced by the government. Although this is unconfirmed, I am told there are approximately 8,000 pending charges under that CHIP program. These charges arise from a variety of circumstances. For example, there are contractors who did not perform the

April 26, 1982
Energy Administration Act
job but charged for it. There are people who said they insulated their homes but did not actually do so. There are other examples as well.
When this CHIP program was at its peak, I recall distraught insulation contractors asking me for help because they were unable to collect thousands of dollars in accounts receivable. This was due to the fact that people who had their homes insulated would then apply to CMHC to receive money from Ottawa in order to pay the contractor. What happened was that they either did not receive the money or did not pay the contractors. Some home owners would tell the contractors that they had not yet received their money from the government, thus leaving the contractor with nothing. There are also incidents of counterfeit forms being printed. A used car dealer in Toronto would sell CHIP application forms for $5. A contractor would buy a $5 application form from this particular used car dealer, fill it out with his customer and process it in anticipation of receiving his money.
Another printing operation in Montreal sold bogus application forms, but only by the thousand. These forms cost $1 each. Those are only some examples from one of the most fraudulent programs ever introduced by the government.
There is not much left to be said about the UFFI situation. The way in which this program has been handled is an absolute disgrace. The minister has promised to rectify the problem, but it has merely been tossed over to the Minister of Consumer and Corporate Affairs (Mr. Ouellet). He is releasing statements, one of which was a report released last Friday. But people who have their homes insulated with UFFI still do not know what will happen to them.
Like many of my colleagues and many Canadians, I have become most upset about the way in which the affairs of the nation are being conducted. This is particularly true with respect to energy. When the first OPEC increases came upon us, I do not believe that there was any concerned Canadian who would not have agreed that drastic steps had to be taken. I am sure they would have agreed that our objective should have been to become self-sufficient as soon as possible. If the government had come forward at that time and indicated that it would work closely with those oil producing provinces to help them develop the tar sands and their heavy oil and to attempt to make Canada self-sufficient not just by 1990 but as soon as possible, it would have had support. If this were to happen we would not be held at ransom by an offshore country. We should never allow that to happen again. Yet energy self-sufficiency, in spite of these added taxes, is still a myth to many of us. These policies will just continue and I doubt if you will ever see energy self-sufficiency. I doubt if we will see selfsufficiency by the turn of the century. We can look at what is going on in the Beaufort Sea and in Hibernia, off the Atlantic coast. I have no sense of conviction, from what I have read and from what I have been told by people who are knowledgeable in the industry, that we will have anywhere near sufficient
energy from that part of Canada by the turn of the century. Perhaps we will be lucky and technology will be developed to give us that oil off Hibernia.
We have become a little hardened to this whole matter. We have seen bills come forward, such as the omnibus bill, and we saw the massive power it would give to the Minister of Energy, Mines and Resources to do all manner of things, such as power to raise taxes without consultation with Parliament and power to put new Crown corporations in place without consultation with the provinces, while most of the ones already in place are not operating on a profitable or even break-even basis today. Of course, we rebelled, and there was the incident which has become known as "the bells". While we have been criticized for that incident by hon. members opposite, I think hon. members on this side of the House feel that what we did was for the people of Canada.
We have the serious problem of unemployment in this country. What is happening to the oil industry is happening to almost all industries in Canada. Most of the people in the oil industry thought they had a sort of hidden economic advantage with the oil reserves and resources, and that a government with some common sense would help the provinces develop the resources, bringing them to Canadian industry to help get us out of our terrible balance of payments situation, reducing our unemployment and inflation, and curing all the ills which still seem to be upon us right now. However, the reality is that massive taxes are being taken from industry and from the people in general.
This is a vast country. We are a mobile people. When the source of the mobility is taken away; that is, the energy, and it is heavily taxed, then the people are isolated. They simply cannot travel that extra 40 or 50 miles to search out jobs, as they did a few years ago. It is not that long ago that people would travel a couple of hundred miles every day to and from their work. It might be easy to say that they should have moved nearer to their place of work, but they stayed where they were, for various reasons. However, today people say that they cannot afford $2 a gallon for gasoline to drive back and forth from Toronto to Hamilton or Kitchener to Toronto or from Niagara Falls to Toronto. Consequently, they just go on unemployment and look for employment within the area close to home. If they cannot find it, then they become part of the 1,200,000 unemployed in this country. I think that is a tragedy, as is the failure of the government to realize that this is weighing very heavily on all the people at this time.
With the amount of money which has gone into energy, it is almost impossible today to Find venture capital of any kind. There is a very negative attitude in the country, because we do not feel that the government has put programs forward which will ensure self-sufficiency in the foreseeable future. Therefore, people who generally have money available for venture
April 26, 1982

companies are simply not investing it, at least not in Canada. They are finding places to invest it outside Canada.
I will conclude my remarks here by saying I am sorry I cannot support this bill. I wish I could. I wish I could say this is a great bill and that it would help us become self-sufficient by 1987, 1986 or 1988. However, on the basis of this bill and the ones which have gone before it, I really cannot see that we will ever be self-sufficient until we have a complete change of thinking on the part of the people in the Department of Energy, Mines and Resources, and in the government itself.
Mir. Dave Dingwall (Parliamentary Secretary to the Minister of Energy, Mines and Resources): Mr. Speaker, like hon. members who have previously spoken, I appreciate the opportunity to participate in this debate. I believe it is critical that we act swiftly on the important measures contained in the bill and get on with the task of providing energy security, opportunity and fairness for all Canadians, which, in essence, are the major goals of the National Energy Program. This particular piece of legislation really touches on a number of items, five in particular, and I would very briefly like to describe each one.
First, the bill will establish a new ceiling of $75 per cubic metre for the petroleum compensation charge for the refiners and importers, and will broaden the scope for payment compensation to include new domestic oil.
Second, the bill will establish a new export charge ceiling of $350 per cubic metre and will provide us with authority to share one half of the revenue from this charge with the producing provinces. I am certain hon. members will appreciate that particular aspect of the amendment, in that 50 per cent of the revenue of the oil export charge would indeed go to the producing provinces. I do not believe hon. members, whether the hon. member for Calgary Centre (Mr. Andre) or an hon. member from the province of Saskatchewan, would want to see those provinces denied 50 per cent of the revenues generated from that particular amendment.


Mr. Andre:: They should get 100 per cent.


David Charles Dingwall: Third, it will establish the Canadian ownership special charge and the Canadian ownership account, and will ensure that the charge cannot be raised above its current level without additional legislation.
This bill will also establish the transportation fuel compensation recovery charge on marine and aviation fuel used by carriers in international transportation, with a ceiling of approximately $350 per cubic metre.
Finally, this piece of legislation will give authority for terminating the special compensation charge which was established at the time of the breakdown in negotiations with the government of Alberta.
We have heard a great deal from hon. members opposite, particularly those of the Progressive Conservative Party of Canada who have spoken about the pricing of fuel oils here in
Energy Administration Act
Canada. However, our pricing system has three essential advantages over the regime proposed by the previous Conservative government in 1980.
First, it ensures that the prices will gradually and predictably rise so that consumers in the Canadian economy in general will have time to adjust. Second, it will ensure oil pricing fairness on a national level by providing a blended price to all regions of the country. Third, it will result in a consumer price which has, and will continue to be lower than that paid by people of most other countries. Those are the three succinct advantages of our pricing system over those offered by the Progressive Conservative Party of Canada.
The National Energy Program was drafted with certain inescapable facts in mind. Canada is a country rich in energy, yet we currently import approximately 20 per cent of our oil needs. Conventional oil reserves in western Canada, the mainstay of this country for years, have shown a steady and marked decline in recent years. However, important new reserves of oil and gas are being found. For example, reserves of natural gas have grown from 1.7 billion cubic metres in 1970 to 2.6 trillion cubic metres in 1980. In addition to the oil sands of Alberta, with an estimated 48 billion cubic metres which may be technically recoverable, exploration and development in the frontier regions have turned up promising reserves of oil and natural gas.
Since the National Energy Program was introduced in this House on October 28, 1980, much has been accomplished by this government on energy policy. We even built an important part of the foundation for a more secure energy future based upon a rich endowment in natural resources, independent of the erratic prices and supplies on the international oil market. The energy legislation completes the building of that strong foundation and provides Canadians with the means to take control of their energy destiny.
Canadians from all walks of life can feel a growing sense of optimism and a sense of certainty about their energy in gas-producing provinces. The federal government now has energy agreements that provide fair prices for consumers and businesses and attractive incentives for Canada's petroleum companies to find more oil for Canada.
Those federal-provincial agreements were followed last December with the approval by this Parliament of the Canada Oil and Gas Act, a major and long overdue legislative initiative to manage development of the Canada lands in the frontier and offshore areas. Not only does the Canada Oil and Gas Act provide the federal government with a greater degree of control over the timing, direction and greater development in the northern and offshore lands, it also ensures that the people of Canada are given their rightful and equitable share in the building of their frontier energy industry.

April 26, 1982
Energy Administration Act
1 intend to deal at some length with the petroleum administration act and, in particular, the petroleum compensation charge. First, let me deal with some of the wild accusations made by the hon. member for Calgary Centre. That hon. member has for several weeks now hurled remarks about energy-related matters at whoever would listen, beginning particularly with the Tory strike of Parliament. While he was receiving his salary from the Canadian taxpayer, he was throwing innuendoes all over the place. The hon. member for Calgary Centre has, without question, on many occasions misunderstood the various aspects of energy legislation, or inadvertently confused many aspects of the National Energy Program with every problem Canadians and other countries must face. Unfortunately the hon. member for Calgary Centre has not taken the time to thoroughly study the energy policy or the legislation of this government. On more than one occasion he has made public letters that he has written to various officials concerning government energy laws. For example, Bill C-48, the Canada Oil and Gas Act; the hon. member for Calgary Centre completely misunderstood the purpose of the legislation regarding renegotiation of the exploration rights on Canada lands.
Unfortunately the hon. member continues in the same old ways by throwing all kinds of rhetoric about the energy legislation before the House, Bill C-103. His speeches in the House lacked any kind of positive approach to the development of Canada's energy resources. The only contribution to serve our energy needs has been with natural wind power. It appears that the energy critic for the Conservative party and his colleagues have nothing to contribute to this very necessary debate, other than to throw wild accusations at the minister and attempt to fool the Canadian people, as they tried under the Crosbie budget, and we know what happened there-they failed.
This government has a plan of action for energy security in this country. It is outlined in the National Energy Program, and the various pieces of energy legislation now before the House will put our plan into action. This is one more sign of our commitment to our 1980 election promises, unlike the remarks of the hon. member for Calgary Centre who said in this House "the Liberals have violated every single promise they made during the 1980 election campaign". That is totally untrue.
Let me say to that hon. member that he has a golden opportunity, not only in this House, but within his party, to take the subject matters of energy and energy legislation before other members of his party in May of this year, discuss them at length and formulate resolutions of all sorts on all aspects of energy policy. I challenge the hon. member for Calgary Centre to go to that Conservative party policy convention in May and put forward resolutions, both on the leadership of his leader and on energy policies, and have them voted on. I challenge the hon. member to do that.


Harvie Andre: I challenge you to the same.


David Charles Dingwall: I would now like to make a few remarks about the petroleum compensation charge. Our pricing system is both realistic and fair. It takes into account the inescapable facts I mentioned earlier, particularly the need to provide an attractive incentive to encourage the development of new oil. Our blended pricing system differentiates between the varying developing costs of different types of oil.
Producers of what is commonly called old oil, oil discovered before December 31, 1980, faced comparatively lower costs than those of new oil producers. Therefore, they will get a price that will rise gradually and predictably at a fixed schedule to no more than 75 per cent of the international price.
Producers of new oil, oil discovered after December 31, 1981, synthetic oil and new frontier production, will get a higher price than that at the world level, but which will never rise above those levels. This price will provide a powerful incentive to producers to develop new oil supplies. These prices will in turn be blended into one made-in-Canada price that will apply in all regions of the country, regardless of what kind of oil is used, whether it is domestic or imported.
The petroleum compensation charge, which forms a major part of the bill before us, is extremely important. The program has played a vital role in protecting Atlantic Canada from the sudden shocks of international oil price increases that have characterized the past ten years. Members of the Conservative party may disagree with some aspects of that piece of legislation, but the bold fact remains, it has protected, and rightly protected, those people in Atlantic Canada.
As we know, all of Atlantic Canada's oil is imported. By compensating refiners for the difference between the international price they pay and the lower domestic price paid by refiners in other parts of Canada who have access to domestic production, the compensation program has provided untold economic benefits for Atlantic Canada.
Since the import compensation program was started by this government in 1974, it has paid out nationally a total of $13.7 billion in compensation. Atlantic Canada compensation to date has amounted to approximately $6.5 billion. This is a huge sum of money, but it is money wisely spent. If the compensation program did not exist, $6.5 billion would have been drained from the economy of Atlantic Canada. Instead, this money has stayed in the pockets of Atlantic Canadians to work for them.


Some hon. Members:: Oh, oh!


David Charles Dingwall: The Conservative party in all parts of the country has shunned the petroleum compensation charge. It has closed its eyes to the concerns of Atlantic Canadians, and through its chief energy spokesmen has rejected development
April 26, 1982

of offshore resources in my region of the country. I object very strongly to that type of viewpoint, and that type of attitude.
The offshore resources will offer a significant contribution to Canada's energy security and to the economic development and prosperity of Canadians living in Nova Scotia and throughout the Atlantic area. For Nova Scotians, development of offshore energy resources offers a unique opportunity to build the lasting social and economic structures that can help to shape a prosperous future.
The agreement reached between the Government of Canada and the province of Nova Scotia established a strong, cooperative management regime capable of pursuing and harmonizing these energy and development objects in a manner consistent with the interests and responsibilities of each government and of industry, as well as of Nova Scotians and all Canadians.
In Nova Scotia many onshore opportunities will be provided as a result of offshore oil and gas resource activity. These opportunities will include new jobs and training in new skills, new business opportunities for industry and entrepreneurs, and significant new government revenues.
The Government of Canada's pricing and compensation system will play a major role in stimulating oil and natural gas development off the coast of my province. The compensation system will be the mechanism to ensure that producers of new oil in Atlantic Canada receive the new oil reference price for their production. This price will provide producers with returns that are competitive with returns offered anywhere else in the world. As such, the new oil reference price offers a powerful incentive to producers to explore aggressively for new supplies and develop significant new supplies of petroleum.
The petroleum compensation charge will remove an inequity that characterized the previous compensation system. Import compensation used to be funded from the government's general revenues, which were collected from the taxpayers. This meant that the amount of compensation effectively paid by Canadians bore no direct relationship to the amount of oil they consumed. The petroleum compensation charge eliminates this inequity, because it is a charge placed at the refinery level, which is then passed on to the consumers. Therefore, those who consume the most will contribute the most to offsetting the cost of compensation. However, the government will not, in spite of the innuendo of the Conservative Party of Canada, collect more from the petroleum compensation charge than is needed to cover the import subsidization and the new oil reference price supplements 1 have already mentioned. Mr. Speaker, this is only fair and it is only right.
It was very interesting to hear the Conservative party's energy critic speak in the House on the petroleum compensation charge. On the one hand he tried to have his party under its former leader, Mr. Stanfield, take credit for this program to assist Canadians using imported oil. On the other hand he
Energy Administration Act
blamed the government today for assisting Atlantic Canadians through the same program. So typical of the Conservative members, to speak out of both sides of their mouth, to give one position in one part of the country and yet give another position in another. You have to wonder who is fueling the separatist causes, Mr. Speaker.


An hon. Member:: How about the Minister of Energy?


David Charles Dingwall: With this in mind, Mr. Speaker, may I deal for a few minutes with a major concern regarding shut-in oil.


An hon. Member:: You're speaking out of both sides of your mouth.


David Charles Dingwall: Lately, there has been serious concern in western Canada that the oil import compensation program unintentionally encourages refiners to buy crude on the world spot market, resulting in large shut-ins of domestic light and heavy oil. The argument is that the combination of soft international prices and the compensation paid to refiners using imported oil has effectively subsidized the price of international oil below the price of domestic consumption, resulting in a surge of imports and reduced utilization of domestic crude oil.
Although there have been calls for a major restructuring of our import compensation program, the Minister of Energy, Mines and Resources (Mr. Lalonde) has stated he does not believe it is an important cause of the shut-in situation. Nor is he convinced that a change to the flat rate system of compensation would resolve the problem. Furthermore, current information does not indicate that there has been any surge in heavy or light crude imports. The compensation rates are reviewed regularly and adjusted to take into account fluctuations in the difference between the domestice price and the world price.
This situation has been discussed with the government of Alberta and Saskatchewan, and the minister has issued a statement on measures the government is prepared to take. They include reducing the oil export charge on heavy oil exports to the United States; providing longer term export licences to improve heavy oil marketability; ensuring that heavy oil exports are competitively priced; and asking the National Energy Board to make several important adjustments in its export regulations.
The minister has also made it clear to refiners in Quebec and Atlantic Canada that low-cost spot market oil should not be imported if this reduces the use of Canadian crude oil. He has asked them to limit imports of crude to minimum levels allowed under current contracts and, when renewing contracts, to take into account the likely availability of domestic crude, and to establish import volumes accordingly.
These are the steps, Mr. Speaker, the government is prepared to take at this time. However, our officials will continue

April 26, 1982
Energy Administration Act
to monitor the situation with provincial officials. If these measures do not produce the results we expect, the minister has indicated the Government of Canada is prepared to take further action.
Who are Canada's producers of oil and gas, Mr. Speaker? As of today, 65.5 per cent of all oil and gas production revenues accrue to foreigners, a figure not likely matched anywhere in the world, let alone in the developed world. Most of the largest oil and gas producers in Canada are foreign-owned and controlled. Before the introduction of the National Energy Program there was concern that with the development of expensive and technically difficult offshore and tar sands projects, the degree of foreign control would worsen. What national government, responsible for the well-being of all its citizens, could allow such a situation to continue?
The Canadian ownership special charge is the mechanism that will allow the government to participate more vigorously on behalf of all Canadians in the oil and gas industry. Certainly, this is not the sum total of our Canadianization program. In fact, the greater part of the program is designed to encourage the growth of Canadian private sector involvement in the industry.
The public sector role has been played with extraordinary success by Petro-Canada, the national oil company created by our government in 1976. I will not dwell at length about its achievements, because that is a subject matter for debate on another bill. Suffice to say, however, that since its inception in 1976 Petro-Canada has been the driving force behind 76 of the 128 wells that were drilled in the frontier regions. It was the first large Canadian landholder in the eastern offshore, the first Canadian-owned and controlled operator there, and has been a major participant in every major oil and gas field off the east coast. In its role as head of the Labrador project it is encouraging Canadian companies to get involved in east coast drilling. Despite the claims of some of the more extreme energy spokesmen, Petro-Canada's success rate for discovering oil and natural gas has been every bit as good as that of most companies, and better than many.
In closing, Mr. Speaker, I wish to say that it is very easy for members of the official opposition to criticize and tear down; to allow innuendo to circulate throughout the country; to say one thing in one part of Canada and to say another in a different region, but it is another thing to confront very serious issues, to provide an alternative, a commitment, and an answer to those wrongs, those inequities, and those inequalities. That is what we have attempted to do with the National Energy Program. This bill is part of this package and will implement a program which, I believe, is in the best interests of all the regions and all the people of Canada. I therefore urge all members of the House to support the bill.


Some hon. Members:: Hear, hear!


Harvie Andre: Mr. Speaker, I shall be very brief. It is not my intention to answer all the statements made by the hon. parliamentary secretary. It would take too long to straighten him out. I think he should find some technique other then the over worked strawman technique, where he says that the opposition stands for such and such a thing- although that is not so-and then tears apart the argument. That is a useful debating technique from time to time but, if it is used all the time, credibility suffers.
I should like to straighten the hon. member out on one particular point, and that is the import subsidy. It was the hon. Robert Stanfield who said in November, 1973, that we need a one-price system in this country. The Prime Minister (Mr. Trudeau) said that it could not be done; this is reported in Hansard. A month later he found out that he could, and needed to do just that. I would remind the House that it was the Hon. Robert Stanfield who put forward the one-price system for which the hon. member is now taking credit.
The hon. member has told us not to worry, that the petroleum compensation charge will only be collected in amounts sufficient to pay for import compensation. I would ask him to examine the remarks made by the Hon. Donald Macdonald when he was minister of energy and imposed the export charge on crude oil. The funds were to be devoted to providing import compensation; to subsidize imports, so we would have a one-price system in Canada. Where are those funds today, Mr. Speaker? They go into general revenues.
In the budget of September, 1975, the Hon. John Turner imposed a seven cents per gallon excise tax on gasoline and told us that the money would go toward import compensation only. Where is that money going today? It goes into general revenues. It has disappeared. Now we have the Minister of Energy, Mines and Resources (Mr. Lalonde), and his parliamentary secretary, telling us not to worry, that the petroleum compensation charge is going toward import compensation. When two former ministers of the Liberal government made similar statements and their intentions have not been carried out, why should we take at face value the statement of the present minister?
My friend, the hon. member for Red Deer (Mr. Towers) tells us that if you are lied to once, the liar is at fault; if you get lied to twice then you are at fault. If you are lied to three times, then you are even more at fault. We just do not believe the minister, and we have good reason for that, Mr. Speaker.


Mr. Deputy Speaker:: Is the House ready for the question?


Some hon. Members:: Question.


Mr. Deputy Speaker:: Is it the pleasure of the House to adopt the motion?


Some hon. Members:: Agreed.


Some hon. Members:: No.
April 26, 1982


Mr. Deputy Speaker:: All those in favour of the motion will please say yea.


Some hon. Members:: Yea.


Mr. Deputy Speaker:: All those opposed to the motion please say nay.


Some hon. Members:: Nay.


Mr. Deputy Speaker:: In my opinion the yeas have it.
And more than five members having risen:


Mr. Deputy Speaker:: Call in the members.


Madam Speaker:: I declare the motion carried.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Energy Legislation.

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

J. Robert Howie: Mr. Speaker, the purpose of my question on April 20 to the Minister of Energy, Mines and Resources (Mr. Lalonde) was to ascertain when natural gas will be delivered by pipeline to the maritimes, and what the government is going to do to ensure that it will be a competitive energy form.
The minister indicated that the price to the consumer in the maritimes will be maintained at the same level as the price in Toronto. I would like the minister to give the House an indication of what the Toronto city gate price, generally speaking, will be in relation to other energy forms. Can it fluctuate widely after the expiration of the Ottawa-Alberta energy agreement in 1986 or 1987, and are any safeguards built in with respect to the price change which might take place at that time? Is the minister satisfied that the price of natural gas will compete with oil or electricity in the maritimes, and, for industrial users, will natural gas be able to compete with heavy
16638

April 26, 1982
Adjournment Debate
fuel oils? I would appreciate it if the minister would elaborate on what the government is prepared to do to make natural gas competitive with electricity and oil? If the cost of the pipeline exceeds expectations will it be subsidized?
Finally, is it the policy of the government to use local workers, suppliers and trades people whenever possible, and thereby use this pipeline as a development tool in the Atlantic provinces?
In conclusion, will the minister confirm whether or not there is provision for mandatory review of the pipeline project by the National Energy Board once it is completed to Quebec City, and what if anything is the significance of this provision? I would like to thank you, Mr. Speaker, and the parliamentary secretary, for coming here tonight to respond to my question.


David Charles Dingwall: Mr. Speaker, on many occasions the Minister of Energy, Mines and Resources (Mr. Lalonde) has stated that the extension of the natural gas distribution system to the maritimes is one of the top priorities of the federal government as it is committed to the reduction of oil dependence in the Atlantic region and it believes that a gas pipeline affords one of the best approaches to this objective.
With specific regard to the price of natural gas to maritime consumers, I might direct hon. members to the National Energy Program report. There it is clearly stated:
The gas prices in the National Energy Program should provide a basis for commercial viability of the line and associated distribution systems. The pricing system should establish prices at the city gate in Halifax at the same level as those in southern Ontario and Quebec.
On January 13, 1982 the Minister of Energy, Mines and Resources issued a policy statement on natural gas pricing subsequent to the September 1, 1981 Canada-Alberta agreement on energy pricing and taxation and the National Energy Board's recommendations on developmental prices.
This January policy announcement stated in part that for the purpose of pricing, the existing TransCanada pipelines eastern zone will be extended to include the areas of Quebec and the maritimes which will be served by the trans-Quebec and Maritimes pipeline. City gate prices in markets east of Toronto will be the same as the Toronto city gate price for the same type of gas service. It stated also that to encourage rapid expansion and build-up of new natural gas markets in Quebec and the maritimes, beginning November 1, 1982 developmental prices will be prescribed.
With regard to this second point, the energy minister has stated that this pricing regime, which will be implemented on November 1, 1982, will provide distributors with a limited holiday from payment of certain transmission costs, thereby encouraging eligible distributors to expand gas markets in Quebec and the maritimes quickly and aggressively.
Last month the Minister of Energy, Mines and Resources announced the implementation of the distribution system expansion program, another major off-oil initiative under the National Energy Program.
In summary it can be noted that the government has implemented a number of measures to ensure the viability of natural gas marketing into the maritimes. The Toronto price zone is to be extended through to the east coast so that consumers in the maritimes will have access to gas at prices comparable with consumers in Ontario who, in turn, will get their natural gas supplies at a price equivalent to 65 per cent of the oil price. The developmental price will provide an additional incentive for new customers. The distribution system expansion program will assist distributors in financing facilities into new marketing areas. And the Canada oil substitution program will provide the home owner with a significant part of the cost of converting his oil heating unit to natural gas.
All of these measures are directed toward energy supply security for maritimers at prices on a par with those throughout the rest of Canada.


COMMITTEES OF THE HOUSE-(A) APPEARANCE OF MINISTER OF FINANCE BEFORE STANDING COMMITTEE. (B) REQUEST FOR VERIFICATION OF RUMOUR
Donald Alex Blenkarn: Mr. Speaker, my concern tonight arises from a question I asked last Wednesday of the chairman of the House committee on finance, and economic affairs. I asked a question with respect to the attendance of the Minister of Finance (Mr. MacEachen) at finance committee hearings. At that time I wanted a commitment from the chairman that the minister would appear on April 29 and April 30 and once more in the first week of May.
It appears that, as a result of a steering committee hearing tonight, the minister will appear on April 29 and April 30 but he will not make any commitment with respect to May at all. He wants to continue his practice of being "absent Allan".
We have a committee system in this House whereby ministers are required to appear before committees to justify their estimates. The minister in this Parliament, that is this Parliament commencing as a result of the February, 1980 election, has appeared before the committee to justify his estimates once. That was December 4, 1980 when he appeared on supplementary estimates B for an hour and a half.
The minister has done everything in his power to avoid his estimates or his department being scrutinized, and to ensure that he never has to answer, or say what his policy is, or justify a thing to the committee. If other ministers acted in the same manner as this minister, the committee system would totally break down. I understand the position of the minister, that the committee system is not worth much the way it is organized. We certainly need a change in the system, but no system can work if the minister refuses, with one excuse after another, to appear.
April 26, 1982

The minister was supposed to appear before committee on April 20. He promised to be there on that date. But, just before the meeting, he found a reason to go to Toronto, it was alleged, to inquire of businessmen concerning his iniquitous budget of November 12. There were no meetings with businessmen on April 20. The minister ducked the committee, as he has been ducking the people of Canada. He is a duck of a minister. He is a minister who refuses to account, refuses to explain, refuses to come clean. He files green papers with respect to disclosure and how the budget should be forthcoming. He files other documents in the House but refuses to come to committee and refuses to explain his position.
He is a minister who would like to remain silent. He likes to have his selected few around him so that he can make a press release and say things, such as he said in the House on December 18, that he would take certain questions on the budget to the Standing Committee on Finance, Trade and Economic Affairs. But he never bothered making a reference because he knew there were hon. members on this side of the House who would ask some pretty penetrating questions. The Minister of Finance does not want to explain, does not want to come clean; he wants to hide.
We expect him to appear before the committee on April 29 and April 30. We expect him to come forth the first week in May. Unless we see that, we will have to take action in the House other than the action I have taken tonight.


David Charles Dingwall: Mr. Speaker, the remarks of the hon. member for Mississauga South (Mr. Blenkarn) are totally incorrect. Far from ducking his responsibilities, the Minister of Finance (Mr. MacEachen) offered an alternative date to the Standing Committee on Finance, Trade and Economic Affairs as soon as it became apparent that he would have to postpone his appearance before the committee on the main estimates because of his commitments in another city. Indeed, the minister responded favourably to the committee's suggestion that he appear twice. Prior to the hon. member's question in the House, he conveyed to the committee his agreement to appear on April 29 and April 30, 1982. Contrary to the implication in the statement of the hon. member for Mississauga South, the minister has not refused to appear before the committee with respect to his policy, but has appeared when asked. He recently testified before the committee on Bill C-97 to amend the Federal-Provincial Fiscal Arrangements Act.
As has already been indicated, the minister went to Toronto on the evening of April 20 because he and other ministers were to meet early the next day with representatives of the business community. In fact, there were two meetings, morning and afternoon discussions, with a total of some 40 private sector representatives. The Toronto meetings were the eighth, and ninth in an ongoing set of consultations on the economy with representatives of the private sector.
The Minister of Finance and other participating ministers have found that these meetings provided an excellent opportunity for an exchange of views with the private sector on the
Adjournment Debate
current economic situation. The meetings have covered the difficulties encountered due to the current recession and inflation, with consequential high interest rates. The discussions dealt with how to tackle these problems, with support being given to the broad direction of the current stance on monetary and fiscal policy. If is the government's intention, of course, to continue with consultations on economic matters in the weeks and months ahead.
This commitment to consultation on economic development matters was set out in the budget paper entitled "Economic Development for Canada in the 1980s", as well as being reiterated at meetings currently being held. Additional evidence of the government's intentions in this regard has been provided through the just recently published green paper on the budget process.
I repeat that the remarks made by the hon. member for Mississauga South are totally incorrect and, at best, despicable.


AGRICULTURE-BEEF STABILIZATION PROGRAM. (B) REQUEST PAYMENTS NOT BE LINKED WITH SUPPLY MANAGEMENT
Thomas Gordon Towers: Mr. Speaker, the beef producers of Canada have been going through a very strenuous economic time in the last several months. It was my hope that the Minister of Agriculture (Mr. Whelan) would perhaps have stayed tonight to give some answers to some very pertinent questions. Instead, he has left the parliamentary secretary, who is an hon. gentleman, to answer the questions. I presume I will probably get nothing more than a canned speech.
The beef producers in western Canada are very disturbed. The minister promised eight or nine weeks ago that he would be making an announcement within two or three weeks. He made the same statement four or five weeks ago in Calgary.
On April 2, I attempted to get an announcement from the minister as to what government policy was with regard to stabilization payments and what his plans were. The minister stated that he believed he would make a statement in three weeks. That was on April 2, which is three weeks and three days ago. Although the minister has had three weeks, plus three days of grace, we still do not seem to be receiving any answers. Calls are still coming in every day.
The minister has confirmed that the stabilization pay-out has no connection whatsoever to the apparent proposals the minister has in mind for the beef industry. Therefore, there is no reason whatsoever for the minister to withhold any announcement on the pay-out. Furthermore, after he makes the announcement, I presume he will have to go to Cabinet to get approval.
The minister has the industry in a real quandary. Prior to the end of last year, he sent out a questionnaire. It turned out to be a fiasco. The questionnaire was delivered to only 87,000

April 26, 1982
Adjournment Debate
beef producers; we recognize that the dairy industry contributes approximately 15 per cent to the beef industry. Nevertheless, he sent the questionnaire to only 15,000 dairymen. According to the 1976 census, there are 165,000 beef producers in Canada. This means that a great number of beef producers were overlooked entirely by this questionnaire. This certainly left a question in the minds of beef producers in my province where there are 47,000. Some of them did not receive a questionnaire, while others received two or three. This was nothing short of a farce. Of course, some of the feedlots where large numbers of beef are produced were overlooked entirely. Why has the minister not released the figures on his questionnaire, incorrect as they may be?
1 also understand that he conducted a private poll of his own; there has been no answer to that. Why has he not given us those figures? Why has he not released the Anderson-Vandermeulen report? Why has he not agreed to work with the cattlemen and the industry on future programs? He should take them into his confidence and negotiate a plan with them.
Why does the minister have such a mistrust of Canadian cattlemen? Why does he not accept any of the new proposals that beef producers make? The main question which must be asked is, why; why does he not give cattlemen some answers? They are becoming very disturbed and time is running out.

Mir. Marcel Dionne (Parliamentary Secretary to Minister of Agriculture): Mr. Speaker, I hope that the hon. member for Red Deer (Mr. Towers) will nonetheless accept a reply from the Parliamentary Secretary, considering that the minister has had to leave the House to attend to other business.
The 1981 beef sales stabilization year ended on December 31, 1981. Provisional estimates indicate that no payment is required at the 90 per cent statutory level provided for under the Agricultural Stabilization Act. The market price for beef sold in 1981, valued at $75.03 per hundredweight, is lower than the price established in 1980, that is, $74.37 per hundredweight. In figuring out the support price, the following elements must be included in the cash costs of production: feed
grains, feeder calves, interest on operating capital, and other costs related to veterinary services, public services, insurance, hired labour, litter, and repairs to buildings and equipment.
In 1981, the cost of feed increased 20 per cent because of high prices for grain, interest rates increased 14 per cent and miscellaneous costs, 9 per cent. However, the price of feeder calves, the most important factor for feed lot operators, dropped 7 per cent in 1981, compared with 1980. The drop in price was sufficient to compensate for increases in the cash cost of other aspects of production. As a result, preliminary figures indicate that cash costs for raising slaughter cattle in 1981 are similar to those in 1980.
As the minister indicated in the House on April 2, he met with representatives of the Canadian Cattlemen's Association on February 26, 1982, to discuss possibilities for assistance under the Act. Although final figures were not available at that time, the representatives realized that assistance at the 90 per cent level was not justified, and that is why they subsequently requested assistance at the 95 per cent level.
Market prices have remained more or less unchanged during the last three years: $76.44 per cwt in 1979, $76.37 in 1980 and $75.03 in 1981, thus causing producers to exhaust their reserves in order to survive during this difficult period. The minister and his colleagues are examining the feasibility of offering support payments for cattle sold in 1981, and an announcement will be made shortly in this respect. Mr. Speaker, I may conclude by saying that the minister has always worked in close co-operation with Canadian beef producer associations across the country, and I believe he will continue to do so in the best interests of cattlemen in this country.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow afternoon at two o'clock.


[Stage Direction]
The House adjourned at 10.28 p.m., without question put, pursuant to standing order.
[Stage Direction]
Tuesday, April 27, 1982