1982-11-04

MOTIONS UNDER S.O. 43   HUMAN RIGHTS SOVIET AUTHORITIES URGED TO FREE ANATOLY SHCHARANSKY

["I cannot allow debate. Anyway, the motion has now been passed by the House and it is past 2.15 o'clock. Oral Questions.", 'November 4, 1982\n20390______________________________________\nOral Questions']
Hon. Flora MacDonald (Kingston and the Islands):: Madam Speaker, 1 rise to move a motion under the provisions of Standing Order 43. The harassment and imprisonment of Anatoly Shcharansky have been the subject of previous emergency motions in this House. Mr. Shcharansky, a leading Soviet refusenik and internationally renowned scholar, has been on a hunger strike for several weeks, as a means to obtaining his freedom. His rapidly deteriorating health now places his life in very grave danger. Therefore I move, seconded by the Hon. Member for Don Valley West (Mr. Bosley):
That this House urge Soviet authorities to immediately grant Anatoly Shcharansky the freedom for which he is so valiantly struggling, thus ending his hunger strike and the grave threat to his life. The Soviet authorities should do this, both for humanitarian reasons, and in accordance with the terms of the Helsinki Final Act.


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


Some Hon. Members:: Agreed.


Madam Speaker:: The House has heard the terms of the motion. Is it the pleasure of the House to adopt the said motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, I rise pursuant to the provisions of Standing Order 43 on a matter of urgent and pressing necessity. Whereas our colleague, the Hon. Walter Dinsdale, a Member of this House from Brandon-Souris for
over 30 consecutive years, suffered a serious stroke this past summer, I move, seconded by the Hon. Member for Oxford (Mr. Halliday) and the Hon. Member for Beaches (Mr. Young):
That this House convey to the Hon. Walter Dinsdale our very best wishes for a complete recovery and a successful return to the House.


Some Hon. Members:: Hear, hear!


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


Some Hon. Members:: Agreed.


Madam Speaker:: The House has heard the terms of the motion. Is it the pleasure of the House to adopt the said motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Mr. Arnold Malone (Crowfoot):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. Since there is one acre of agricultural land for every citizen on earth, and whereas we in Canada enjoy the luxury of three acres of agricultural land for every Canadian, but because we are destroying our food producing lands at a rate whereby we will be left with only three-quarters of an acre of farm land per Canadian citizen by the year 2005, and since Canada has no co-ordinated effort toward preservation of agricultural lands, I move, seconded by the Hon. Member for London-Middlessex (Mr. Bloomfield) and the Hon. Member for Humboldt-Lake Centre (Mr. Althouse):
That this Parliament encourage the Minister of Agriculture and the Minister of the Environment to cause appropriate consultation with provincial governments and Canadian soil scientists, bearing in mind the provincial nature of this issue, and seek their co-operation to establish an umbrella agency whose objective is to preserve and improve agricultural lands in Canada.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


EXTERNAL AFFAIRS
[Stage Direction]
November 4, 1982

Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. In view of the deplorable practice of this Liberal Government of naming unemployed and unemployable ex-Cabinet Ministers to ambassadorial posts abroad, as illustrated by the appointments of one ex-Minister, Mr. Edgar Benson, to the bucolic charms of Eire, and of another, Mr. Don Jamieson, to the hallowed halls of Great Britain, I move, seconded by the Hon. Member for Don Valley West (Mr. Bosley):
That this House regrets the dismantling of the merit system in the Department of External Affairs and the elbowing aside of professional diplomats in such appointments in the interests of the Liberal Party of Canada.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


REFUGEES
Mr. Dan Heap (Spadina):: Madam Speaker, I rise on a matter of urgent and pressing necessity occasioned by the news in the media that over 600 refugees in Canada, many of them from El Salvador, have recently been cut off from receiving any public assistance. This underlines the fact that the Government normally takes a year or a year and a half to process their applications. Very many of them have been refused effective permission to work to maintain themselves and their families, and the Government has failed to acquaint its own staff fully with special provisions for Salvadoran refugees. Therefore I move seconded by the Hon. Member for Cowi-chan-Malahat-The Islands (Mr. Manly):
That the Government instruct all of its staff fully on the special provisions for Salvadoran refugees, give them temporary permission to work while they await the Government's decision on their fate, and add the necessary staff to the Refugee Status Advisory Committee to speed up the processing beyond the present timing of a year and a half.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


CORPORATE SHAREHOLDING LIMITATION ACT
Mr. Don Blenkarn (Mississauga South):: Madam Speaker, I rise on a matter of pressing and urgent necessity. One of the serious impediments to confidence and job creation in our country has been the continual war between the provinces and the federal Government. Yesterday in the Senate, the Government introduced a Bill which once again escalates this distrust and lack of confidence. I therefore move, seconded by the Hon. Member for Fundy-Royal (Mr. Corbett):
That the Prime Minister immediately on Motions following the Question Period today explain fully to the people of Canada and to the House the reason why this piece of legislation was introduced without discussion with provincial governments and exactly what is the danger to the peace, order and good government of Canada that this Bill attempts to prevent.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: 
UNEMPLOYMENT INSURANCE
Mr. Thomas Siddon (Richmond-South Delta):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of pressing and urgent necessity affecting some 120 unemployed carpenters in Richmond, British Columbia. These carpenters, who were formerly employed by Citation Cabinets, have been disqualified from receiving unemployment insurance benefits although they were laid off after the plant re-opened following the strike.
Whereas these employees have paid into the Unemployment Insurance Fund, and whereas they are now having to turn to provincial welfare benefits to sustain their families, I move, seconded by the Hon. Member for Surrey-White Rock-North Delta (Mr. Friesen):
That the Minister of Employment and Immigration be directed to approve the immediate payment of unemployment insurance benefits to the 120 unemployed carpenters recently laid off in Richmond, B.C.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.
November 4, 1982


SCIENCE AND TECHNOLOGY
Mr. Lome Nystrom (Yorkton-Melville):: Madam Speaker, in light of yesterday's release of the Report of the special federal Government Task Force on Micro-electronics and Employment with its farreaching recommendations on the implications for workers of advanced technology, and in light of the effect that advanced technology is having and will continue to have in areas like trade, jobs, industrial relations and economic development, I move, seconded by the Hon. Member for Regina East (Mr. de Jong)-and 1 appeal to all three parties to support this motion:
That this House establish a special House of Commons Committee on the social and economic impact of technological change in Canada.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


PETRO-CANADA LEASING OF EUROPEAN OIL RIGS
Mr. Joe Reid (St. Catharines):: Madam Speaker, every time that we buy a gallon of gasoline at a gasoline service station we are making a donation to Petro-Canada. It is our dollars that it uses to build or lease offshore rigs and vessels. Showing its usual insensitivity to the difficulties being faced by the Canadian shipbuilding industry and to Canada's staggering record unemployment, Petro-Canada recently announced that it will use more of our dollars to lease European oil rigs rather than do business with Canadians. I therefore move, seconded by the Hon. Member for Fundy-Royal (Mr. Corbett):
That the Minister of Energy, Mines and Resources remind Petro-Canada of its own high priced ads and urge that company to take a chance on Canadians by doing business with its owners.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


THE ADMINISTRATION
Mr. Gordon Taylor (Bow River):: Madam Speaker, I rise on a matter of urgent and pressing necessity under the provisions of Standing Order 43. Quietly, subtly, inch by inch, the Right Hon. Prime Minister of Canada and his Liberal hierarchy are
getting control of every segment of Canadian life: through NEP and Bill C-48, energy; through the CRTC, telecommunications; through the taxpayers money, the arts; through Canagrex, the food industry; through bills like Bill C-137, the workers; through definition of a letter, the mail; and on it goes. Therefore, I move, seconded by the Hon. Member for Leth-bridge-Foothills (Mr. Thacker):
That this House urges every organization and all individuals in Canada who value their freedom and their liberties to rise up and demand the resignation of this dictatorial Government.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


HUMAN RIGHTS
Mr. Robert Wenman (Fraser Valley West):: Madam Speaker, I rise, pursuant to Standing Order 43, to speak on a matter of continuing concern. The abysmal record of the Soviet regime in respect of basic human rights, as per the United Nations Charter and the 1975 Helsinki Accords, continues unabated. The world demands and expects nations to respect the conventions of documents they have signed; deeds, not words, are the hallmark of international trust, justice and fair play.
Given the imprisonment or forced emigration of virtually all members of the Helsinki Watch Group in the Soviet Union, I move, seconded by the Hon. Member for Laurier (Mr. Berger) and the Hon. Member for St. John's West (Mr. Crosbie):
That this House condemn the continued abuse of human rights and violations of the Helsinki Final Act in the Soviet Union in contravention of recognized international obligation.


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


Some Hon. Members:: Agreed.


Madam Speaker:: Is it the pleasure of the House to adopt the said motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
An Hon. Member:: Madam Speaker-


Madam Speaker:: I cannot allow debate. Anyway, the motion has now been passed by the House and it is past 2.15 o'clock. Oral Questions.

November 4, 1982
20390______________________________________
Oral Questions



ORAL QUESTION PERIOD


Hon. Jake Epp (Provencher):: Madam Speaker, I would like to direct my questions to the Minister of Consumer and Corporate Affairs as a follow-up to questions directed by my Leader yesterday to the same Minister. The Minister will recall that in yesterday's exchange he was asked why Bill S-31 was presented to the Senate and not to the House of Commons, and whether that matter could be discussed.
In view of the consternation the Bill is creating among the people whom it will directly affect, namely, the people of the provinces of Canada, I would like to ask the Minister whether there was any consultation with regard to the nature and spirit of Bill S-31 prior to its presentation in the Senate. Additionally, in view of the consternation which has developed with regard to Bill S-31, could he tell us whether he has held any consultation with the provinces subsequent to the time it was introduced in the Senate, and whether he could report on such consultation, if it took place?
[ Translation]


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: Madam Speaker, I do not know what consternation the Hon. Member is referring to. In fact, 1 believe this bill has been well received by all business circles across Canada. I also think that has been the case among the provinces, which clearly recognize the primacy of the Canadian Government in the transportation sector covered in this bill.


Arthur Jacob (Jake) Epp: Madam Speaker, I do not think the Minister would really want to follow up by saying that it was well received by business, or that he would want to leave the impression that the provinces are in agreement with Bill S-31, nor is anyone arguing about primacy. What a person is arguing about here concerns the co-operative federalism which the Prime Minister once declared dead and tried to resurrect two weeks ago, and which now the Minister, by his actions, is saying is of little consequence in practical terms for the Government. That is the issue.


Some Hon. Members:: Hear, hear!


APPLICATION TO HYDROELECTRIC LINES
Arthur Jacob (Jake) Epp: I would like to ask the same Minister a supplementary question with regard to the legislation which goes into the transportation aspects and what he calls the federal primacy, and no one is arguing that point. For example, hydroelectric lines are not directly mentioned in the Bill and are not dealt with as being pipelines. However, the Minister has referred to Part III of the National Energy Act which in fact includes hydroelectric lines. Are hydro lines included under the provisions of the Bill? Are hydro lines
which are to be used for the purpose of exporting electrical energy to another country, included in the Bill as they are in Part III of the National Energy Act?
[ Translation]


André Ouellet: Madam Speaker, I may remind the hon. member that our reasons for introducing this legislation were to prevent any future conflicts with the provinces. We thought it was vital to act now, in order to prevent any erroneous interpretations or being obliged to correct situations that might arise later on. To my knowledge, we have had no reactions to the bill, except for one from a minister. Only one provincial minister has commented to date on the bill and that was the Minister of Transport from Quebec. I do not know whether the hon. member has received instructions from the Parti Quebecois to ask questions in the House today, but as far as I know, that is the only government that has reacted to the bill until now.
We do not want any fights with the provinces. That is certainly not our intent. The bill clearly establishes the rules for the future and safeguards the primacy of the federal government in this area in clear and carefully defined terms. The hon. member asked a specific question regarding power transmission lines. I may point out that if he reads the bill carefully, he will find that these lines are not affected by the bill. If he wants us to add an amendment, this will be considered at the appropriate time.


REQUEST THAT MINISTER CONSULT PROVINCES
Arthur Jacob (Jake) Epp: Madam Speaker, I should like to put a supplementary question to the Minister, whose defence is personal attack. He can do that, but if it is the level to which he has to resort, it is, of course, just the voice of the desperate. We will leave it at that.
The Minister says he wants no fight with the provinces and that he wants to avoid any future difficulty. He knows that the legislation can be made retroactive through court action, however. The Minister knows that, so what is he trying to prevent? He says it is not directed at the provinces, but it is, whether one wants to talk about Northlands Rail, about B.C. Rail, or about the transportation system in the potash industry-the list goes on and on.
When will the Minister sit down with the provinces to look at these specific issues, if he says he does not want any fight and wants co-operative federalism? He knows very well that what he has embarked upon is the very fight that he claims to want to prevent.
Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): Madam Speaker, the Hon. Member could ask this question a dozen times. In his first question he indicated that there was consternation; there is none, Madam Speaker. Only
November 4, 1982

one statement has been made by a single provincial Minister thus far. I have received no indication from those who have read this law and understand what it is-


Mr. Broadbent:: Did you ask the others?


André Ouellet: I have received no indication, at all, of major objections to it.


QUEBEC INVESTMENT IN CANADIAN PACIFIC LTD.
Hon. Allan Lawrence (Durham-Northumberland):: Madam Speaker, I should like to put a question to the Minister of Consumer and Corporate Affairs on the same subject. If this Bill is passed into law, can he tell us whether it will prevent the Caisse de Depot et Placement du Quebec from expanding their investment in Canadian Pacific Ltd?
Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): The answer is yes, Madam Speaker.


POWER CORPORATION INVESTMENT IN CANADIAN PACIFIC LTD.
Allan Frederick Lawrence: Madam Speaker, I have a supplementary question for the Minister. Has he personally, or indirectly through his Department, received any indication from Mr. Paul Desmarais and Power Corporation that they wish to expand their investment and ultimately control Canadian Pacific Ltd.?
Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): The answer is no, Madam Speaker.


REASONS FOR NOT ACTING AGAINST PRIVATE COMPANIES
John Edward Broadbent: Madam Speaker, I have a question for the same Minister. As the Minister well knows, the federal Government already has constitutional authority to regulate firms engaged in interprovincial transportation activity. Why is the Government now introducing a measure that would restrict provincial governments from ownership in such sectors when it has taken no steps at all to stop private companies from becoming as large as they want in the same sectors?

Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): Madam Speaker, I think that we have here a very important interpretation and basic philosophy. The free movement of goods and services in Canada and the primacy of the private sector have always been protected. This has always been to the advantage of Canadians, and we believe in maintaining this approach.


John Edward Broadbent: Madam Speaker, the insensitivity of this Government to the provinces and to other ways of doing things, is truly remarkable.
Oral Questions


TREATMENT OF MULTINATIONAL CORPORATIONS
John Edward Broadbent: Madam Speaker, I should like to ask the Minister why he thinks it is appropriate to trust the Exxon Corporation, which is owned and controlled outside Canada and which happens to control Imperial Oil which, in turn, controls Interprovincial Pipelines. Why is it more appropriate to trust this multinational with our national interests than the provincial governments of Canada which are elected by Canadians?


André Ouellet: Madam Speaker, the Canadian Government can, of course, act far more readily to control private enterprise in certain cases. We can pass appropriate regulations applying to private enterprise. If, however, we must introduce regulations to counter action taken by provincial governments, we then have a federal-provincial conflict on our hands. That is why today, while there is no conflict, while the situation is relatively calm and it is easier to intervene since there are no structures to dismantle, that is why we want to establish a set of very clear regulations marking the primacy of the Canadian Government, in order to avoid future conflicts with the provinces.


PROPOSED MERGER OF QUEBECAIR AND NORDAIR
John Edward Broadbent: Madam Speaker, the Minister was wrong in principle in his earlier answer. He is wrong in fact in the one he has just given.
Will he confirm that he received from the Minister of Transport in the Province of Quebec a request which was made jointly by the provinces of Ontario and Quebec to move to rationalize their air transportation system by merging Quebe-cair and Nordair, I repeat a request which came as early as August from two provincial governments to take appropriate action to rationalize their airway systems? Did the Government receive such a request in August? If so, will the Government explain what is so wrong in this country about two provincial governments getting control of airlines that will in a regional way benefit their own people?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I might answer this question. Indeed a couple of months ago I received such a suggestion. What was mentioned at the time was not that the Government of Ontario and the Government of Quebec were going to take over whatever would be the result of this operation. It was, as a principle, private sector entities that were supposed to come in, so in that case the present bill would not apply. My friend, the Minister of Transport for Quebec, suffers from a persecution complex. Everything I do seems to hurt him. On the Quebecair situation, a number of months ago the Government of Quebec

November 4, 1982
Oral Questions moved in and acquired shares in a new company which acquired Quebecair.


John Edward Broadbent: What is wrong with that?


Jean-Luc Pepin: There is nothing wrong with that. As a matter of fact, this was approved by the CTC, and the present law is not retroactive, so this acquisition can be considered to be acceptable. Should something develop in terms of a regional carrier that would involve the Province of Quebec and the Province of Ontario, either alone or with private sector entities, there is a possibility under this law to make an exception and pass an order in council to approve that. As the Minister said, I do not think my friends on the other side should get overly nervous about this matter.


WELFARE
Mr. Norman Kelly (Scarborough Centre):: Madam Speaker, my question is directed to the Minister of National Health and Welfare. With the increase in the number of people seeking social assistance, municipalities such as Metropolitan Toronto may have difficulty coping with the added financial burden. Can the Minister indicate to the House any efforts she has under way to deal with the problem of individuals having to turn to welfare?


Hon. Monique Begin (Minister of National Health and Welfare):: I am sorry, Madam Speaker, the microphone did not seem to be working well. 1 understood the beginning of the question to deal with the welfare burden on the municipalities. I would like to reiterate that each time a province puts money into welfare through the municipalities, we automatically reimburse the province by a like amount. If it puts more into the municipalities to ease their burden, we will reimburse the province immediately by exactly the same amount of money. This, of course, increased both last year and this year.


FARM CREDIT CORPORATION
Mr. G. M. Gurbin (Bruce-Grey):: Madam Speaker, my question is to the Minister of Agriculture and, I suppose, he will have the same feelings as we do on this side of the House regarding the most recent budget. It is clear that the influence of the Minister of Agriculture on the new Minister of Finance is the same as the influence he had on the former Minister of Finance, which is absolutely zero.
The Minister of Agriculture announced on October 1 that the Farm Credit Corporation interest rates for the next six months would be 15% per cent. The Bank of Canada rate is
now 11V2 per cent. I would like to ask the Minister if he has done anything specific to keep his promise to consider implementing the Conservative Party's AgriBond concept, or to provide low interest outside capital to the Farm Credit Corporation so that farmers can have interest at reasonable rates for long-term financing?


Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, the Hon. Member said something about "zero". The calculations he has done, I am sure, have amounted to zero because, if he had looked at the figures, he would have found out how much money we have loaned at subsidized interest rates. The former Minister of Finance allowed us to subsidize interest rates to the tune of 5 per cent, which will cost $5.4 million in interest rates. This will mean that we are going to be loaning farmers-and you will hear more about it later today-about $700 million. We will be recouping our position in long-term mortgages from some 20 per cent to 40 per cent of all mortgages just in one year. So, when he says we have no influence on the Minister of Finance, either the previous one or the present one, he is not stating the real facts to this House. The Hon. Member's question was so long I have forgotten what it was.


Some Hon. Members:: Oh, oh!


Gary Michael Gurbin: We are used to that kind of response from the Minister of Agriculture. For the Minister's information, if he will look at the figures that the Canadian Federation of Agriculture has produced, he will find that interest rate subsidy program he is talking about, which is not long-term financing at reasonable rates for agriculture, stands to help approximately 500 farmers when, really, 10 per cent of the agricultural population, or 20,000 farmers, are in serious financial difficulty.


AGRICULTURE
Gary Michael Gurbin: My supplementary question is as follows. The Minister of Agriculture has, every three weeks now for the last year, promised to produce a red meat strategy. Today, in Regina, Ministers of Agriculture from nine provinces, national farm organizations, and national producer organizations, are meeting to co-operate in coming up with some programs that will assist agriculture. They understand the need to co-operate.


Madam Speaker:: That is not reasonable. The Hon. Member announces his question and then goes to another preamble. Question, please.


Gary Michael Gurbin: In the absence of an answer to this first question, Madam Speaker, I will now put my supplementary. Where is the Minister's red meat strategy, and will he cooperate with the provincial ministers?
November 4, 1982


Eugene Whelan: Madam Speaker, I now remember his first question. It was about the AgriBond policy. That policy has been suggested by farm organizations, by Members of this Party, and by Members of his own Party. Anyone who can claim to be the originator of it has got to be pretty fantastic, Madam Speaker, as far as I am concerned, because that was suggested by many people, many years ago, and it is still under consideration.
In reply to the second speech he made about whether we were going to have some kind of program for the red meat industry, I do not know if he was in the House earlier when one of his colleagues said he did not want any more Government interference or regulations whatsoever, calling it dictatorial. The Hon. Member is now asking me to interfere with the red meat industry. Maybe I should not be doing anything. The provinces are certainly getting ready to interfere with the red meat industry, if they are going to come up with something in that meeting in Regina. I proposed something to them four years ago that is pretty much the same as they are proposing at the present time, and they took over four years to say no to it. Now they are talking about accepting it. If they do, boy, will I say hurrah, Madam Speaker.


PAYMENTS UNDER WESTERN GRAIN STABILIZATION PROGRAM
Mr. Len Gustafson (Assiniboia):: Madam Speaker, I have a question for the Minister of Agriculture which pertains to the low incomes of farmers at this present time. According to a release from the United Grain Growers today, farm income will be down 28 per cent due to lower wheat prices and increased costs of production. The Minister knows that in the recent budget there was absolutely nothing for the western farmer, and that takes into consideration the $400 million that it will cost them for the loss of the Crow rate.
With regard to the Western Grain Stabilization Program, under which there is $451 million of the farmers' money in that account, is his Government going to make a payment to the farmers now when it is so needed, how much will it be, and when will it be?


Eugene Whelan: Madam Speaker, if the legislation triggered the payment, because of low commodity prices, the Hon. Member knows full well, there would be a payment, when it is all tabulated and has gone through the system. But when he talks about how bad off they are, is he suggesting we interfere in the private grain trade and do something about world commodity prices? I have a letter from the head of the United Grain Growers. He used to be an adviser on the Agriculture Stabilization Board and I know him very well. In his letter he states it is mostly blamed on low world commodity prices. Is the Hon. Member suggesting we interfere in that area again?
Oral Questions


REQUEST THAT FARMERS BE ALLOWED TO OPT OUT OF PROGRAM
Leonard J. Gustafson: The Minister knows that was not the question I asked him. I asked him whether there was going to be a payment.
Farmers, first of all, paid a levy of $500 per producer. Then it was increased to $900 for each producer. Now, I understand, it is going to be increased to $1,200 to the producer. Will the Government consider allowing farmers to opt out of the program if the farmers are not going to see it is a reasonable program? Many of them, had they invested their money in the bank at today's interest rates, would have a lifetime savings policy.


Eugene Whelan: Madam Speaker, the Hon. Member knows that farmers joined that plan voluntarily. The vast majority of grain farmers in Western Canada still belong to that plan, and will belong to that plan. He wants them to be opting in and out of it. There can be no kind of a program if, one day, they decide to be in it and the next day out of it. What kind of plan, Madam Speaker, would that be? There has to be some stability to it.
The Hon. Member knows that it is one of the best plans any grain growing group has in the whole world. The United States does not have anything that good for its grain farmers, plus the fact they do not have a crop insurance plan. We have such a plan in Canada. We put into his province about $80 million last year in federal funding to pay half of the crop insurance premiums. We spent more in his province, Madam Speaker, than the Province of Saskatchewan did last year, by about some $50 million. The Hon. Member says we do not care about western agriculture. Let the Figures show the facts.


IMPACT OF GILSON COMMISSION RECOMMENDATIONS
Mr. Vic Althouse (Humboldt-Lake Centre):: Madam Speaker, my question also is directed to the Minister of Agriculture and concerns a study made public recently by the Chase Econometrics Institute in the United States. It was a study concerning the impact on Canadian agriculture of implementing the Crow changes that Gilson recommended. Since the Chase Econometrics Study shows that the changes in the Crow rate proposed by Gilson will negatively affect all of eastern Canadian agriculture, British Columbia agriculture, and most of the prairie agriculture with the exception of a few highly specialized feeding operations, will the Minister tell the House what his position is on the Crow change that it appears to impact negatively on virtually every sector of Canadian agriculture?


Eugene Whelan: Madam Speaker, the Hon. Member has not changed his opinion from the time when changing the Crowsnest Pass rate was first talked about. What he says about it having a negative impact on every sector of agriculture is just not so, and he knows it. There must be a change in the rate if agriculture is going to

November 4, 1982
Oral Questions
develop not only in western Canada but in eastern Canada. The vast majority of farmers recognize that a change must take place for the over-all good of Canadian agriculture.
We have held very, very intense meetings with many, many provincial representatives in eastern Canada who are concerned about the effect the changes will have on them. Our findings are being put together at the present time, and next week we should have a very firm presentation on the Gilson Report and its over-all effect on agriculture.


FUTURE OF LIVESTOCK INDUSTRY
Victor Fredrich (Vic) Althouse: Madam Speaker, since most of the economic studies previously done by the Minister's department and by the Minister of Transport indicate that the main advantage to a change in the Crow rate in based on an understanding that the livestock industry will expand in Canada-some studies indicate as much as 25 per cent-and since we are now faced with a decline in livestock product prices and we no longer have access to the U.S. market for meat, where are we going to go with this increased production? Where is the advantage in producing goods which have declined in price and which do not have access to a market?


Eugene Whelan: Madam Speaker, the Hon. Member talks about the beef quota which the United States of America has imposed on Canada. That is true for carcass meat and broken beef, but no other meat is affected at this time and live cattle can still be shipped to the U.S. as we have been freely able to do for many, many years.
When the Hon. Member talks about where the production is going to go, again you do not have to be a great mathematician to know that the world population today is 4.3 billion people, and over the next 17 years it will increase to over six billion. In light of that, we think some of these prices are temporary.
Also, the Hon. Member knows full well that those farmers who have looked after themselves in some kind of a marketing organization are not suffering at this time. The ones who have not looked after themselves through some kind of supply management system are the ones really suffering in the present economic downturn. The others may not be doing as well as they did before, but they are not going bankrupt, and the Hon. Member knows that.


EXTERNAL AFFAIRS
Mr. Bill Yurko (Edmonton East):: Madam Speaker, in the absence of the Prime Minister I am going to direct my question to the Secretary of State for External Affairs. In 1977 the Prime Minister spoke very effectively to a joint session of the U.S. Congress. Recently the Prime Minister met with business leaders from the United States. Also, the U.S. Secretary of
State Schultz visited Ottawa recently, and meetings four times annually are planned. Shortly the Prime Minister will be going to meet with the leaders of Europe.
Since the Canadian economy is massively interwoven with that of the U.S. in regard to interest rates, foreign investment, trade, tourism, communications and so on, and since the U.S. elections may signal significant changes to U.S. fiscal and economic policy, may I ask the Minister the following question.


Some Hon. Members:: Hear, hear!


William J. Yurko: Is the Prime Minister planning, or does he consider it advisable, to have a meeting with President Reagan in the very near future, on economic direction and recovery, and/or is he perhaps planning to speak to the U.S. Congress on Canadian-U.S. economic irritants and direction?


Mr. Nielsen:: Yes or no.


Hon. Allan J. MacEachen (Deputy Prime Minister and Secretary of State for External Affairs):: Madam Speaker, as the Hon. Member knows, the Prime Minister and the other leaders of the western industrialized world met to discuss the world economy earlier this year. The Summit in Versailles addressed global economic questions.
With respect to the United States, Madam Speaker, I am pleased that the Hon. Member has highlighted the importance of our relationship with the U.S. and the interrelationship between our two economies. I certainly attach a very high importance to maintaining good relations with the United States. In that respect, the United States Secretary of State visited Canada for very extended discussions, and it is my intention to maintain the continuity of that communication which we began a very short time ago.


FISHERIES
Mr. George Henderson (Egmont):: Madam Speaker, my question is directed to the Minister of Fisheries and Oceans. Given the recent uninformed statements by some members of the European Economic Community in regard to the Canadian seal hunt, would the Minister inform the House today what action both the Government and he personally are taking to defend the all important Canadian seal hunt?


Hon. Pierre De Bane (Minister of Fisheries and Oceans):: Madam Speaker, as Minister for the region where the seal hunt is a traditional activity I can make the following report to the Hon. Member.
First, I have personally met with Members of Parliament of each country of western Europe to sensitize them about it. I have met personally with the President of the Common Market, Gaston Thorne. I have met with officials both in
November 4, 1982

Canada and in Europe. I have met with our ambassador to the European Community in Brussells. I have issued the strongest statement ever on that question, explaining why Europe's attitude on this question is irresponsible and hypocritical. I have met with journalists both in Canada and in Europe. 1 am working closely with the Minister of State for International Trade who is also from that region.
Finally, Madam Speaker, I have personally offered to establish a joint commission with the Common Market to study every single aspect of the seal hunt. As I was saying last week personally to an official of the Common Market, it is the height of hypocrisy to establish, as they have done, a commission to study the question of the seal population, which is going to make a report next month-


Madam Speaker:: Order, please.


Mr. Crosbie:: A supplementary, Madam Speaker.


Madam Speaker:: The Hon. Member for Halton.


John Carnell Crosbie: A supplementary, Madam Speaker. There must be more. Madam Speaker.


AUTOMOTIVE INDUSTRY
Mr. Otto Jelinek (Halton):: Madam Speaker, that was an excellent off-the-cuff answer by the Minister of Fisheries.
In the absence of the Minister of State for International Trade, I would like to put my question to the Minister of Industry, Trade and Commerce. Sales of Soviet-built Lada cars in Canada have increased by over 1,200 per cent in the last three years because of artificially low prices. The total of our off-shore automotive imports, as the Minister knows, continues to increase, and their share of the market is now 36.7 per cent. The re-introduction of the so-called Ottinger Bill in the U.S. Congress in imminent, a Bill which calls for 90 per cent U.S. content regulations.
In view of these facts, Madam Speaker, which are contributing to the deterioration of our automotive industry, I ask the Minister whether he is specifically aware of these facts and what does he plan to do to try to correct them, and when?


Hon.   Ed. Lumley@Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion: Madam Speaker, with respect to the first part of the Hon. Member's question concerning the dumping of Lada cars in Canada, that comes under the responsibility of my colleague, the Minister of National Revenue. However, I am not aware that any particular company has lodged a claim with the AntiDumping Tribunal or the Minister of National Revenue with respect to the dumping of Lada cars.
With respect to the second question, we have already made representations here in Ottawa, and in Washington, to Members of Congress. My colleague, the Minister of State for
Oral Questions
International Trade, was in Washington yesterday talking to his counterpart, Secretary Block, with respect to the content legislation proposed in Congress. If the Hon. Member had read the transcription of the hearing before Congress, he would have seen that Ambassador Brock and Secretary Baldrige, the United States Secretary of Commerce, both indicated that they did not agree with the Congressional position with respect to content.


Otto John Jelinek: Madam Speaker, ironically there are two Ladas for sale in the Government's surplus sale today; they are Russian-built cars.


Some Hon. Members:: Oh, oh!


Otto John Jelinek: Second, the Minister knows that the Ottinger bill had support in Congress from over 200 Congressmen.


GOVERNMENT POSITION
Otto John Jelinek: Madam Speaker, last week the Canadian Institute for Economic Policy released a study which concluded that, unless new specific steps are taken, "the Canadian automobile industry is in such bad shape that the federal Government should wind up the industry". Therefore, could the Minister tell the House whether he agrees with the conclusion in that report and will indeed allow the industry to disappear from Canada, or is he now prepared to stand up in the House and introduce, forthwith, Canadian content regulations, as most other countries are doing, in order to save the industry, to save jobs and indeed to create more Canadian jobs? Is he prepared to take that step today?


Hon.   Ed. Lumley@Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion: Madam Speaker, obviously the Government does not agree with the report produced last week. We think the automobile industry is one of the most important sectors in Canada. As late as yesterday afternoon I had a meeting with the principals in the automobile industry, the UAW, and the autoparts industry, with respect to putting together an industrial strategy for this very important sector in Canada.


SHIPBUILDING
Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. I am holding in my hands letters which I have received from current and laid-off workers of the Saint John Shipbuilding & Dry Dock Co. As the Minister will know, it is one of the finest and best facilities in the world. The workers who work there, who would like to work there, or who would

November 4, 1982
Oral Questions
like to return to work there, are among the finest tradesmen in the world as well.
These men, and I, would like to know why the federal Government can spend $350 million to purchase British Petroleum, a move which will not create a single job; bail out Dome Petroleum to the tune of millions of dollars, a company that purchases its ships from Japan; order a $150 million semisubmersible rig from Korea; then allow its champion of Canadianization, Petro-Canada, to pull out of a multi-million dollar deal with the Saint John Shipbuilding Company which has resulted in the loss of some 2,000 man-years. This was done despite the fact that the private company which the Government was operating in conjunction with wanted to go ahead with the deal. Will the Minister tell the House why this was done? What does he intend to do to protect the jobs in Saint John and to get these laid-off workers back to work?


Hon. Jean Chretien (Minister of Energy, Mines and Resources):: Madam Speaker, I think the question is a rather long one. The Hon. Member referred to the purchase of BP. I should like to say to him that it is a commercial transaction. It does not involve any funds from the Government and, in fact, it is a profit-making decision by Petro-Canada.
As far as the problems of shipbuilding in Canada and the competitive position of any company that wants to have facilities made in Canada are concerned, of course it is a question of competition with other available facilities either in Canada or sometimes elsewhere. I am not aware of the specific problem which the Hon. Member mentioned, but I can tell him that a lot of work has been done in Saint John at the initiative of the Government. We are quite proud of our record in terms of the work which we have been able to provide to Saint John over the years.


Madam Speaker:: I ask Hon. Members to return to asking short questions. I am becoming increasingly disappointed. When we returned to the Chamber, all Hon. Members were ery good at asking short questions and giving short answers. I was sitting here feeling very generous that I could recognize so many Members. Please return to that very good discipline; it is marvellous for the House.


Robert Alfred Corbett: Madam Speaker, as far as the laid-off workers of Saint John are concerned, the Minister might as well continue his seance of meditation.


POLICY REVIEW
Robert Alfred Corbett: Madam Speaker, I will direct my supplementary question to the Minister of Industry, Trade and Commerce. For several years the federal Government has been boasting a shipbuilding policy review. The review has been completed, passed by Cabinet, and yet the Government continues to sit on policies which should protect not only the Canadian shipbuilding industry but workers' jobs.


Some Hon. Members:: Order, order!


Robert Alfred Corbett: Does the Minister have any intention of releasing this review and, if so, would he please give the House and the laid-off workers of the nation, those Canadians whose livelihoods depend on this industry, a firm date and a commitment?


Hon.   Ed. Lumley@Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion: Madam Speaker, the Hon. Member seems to be very well informed about what goes on in Cabinet. However, I should like to inform him, as a Member from New Brunswick in his Party caucus, that my colleague from Saint John has already made substantial representations for the shipbuilding industry in Saint John. The Export Development Corporation, for example, was very instrumental in obtaining a $100 million contract for semi-submersible rigs in Saint John, one of the first ones ever built in Canada, so the Government has already taken positive action.


CANADIAN TRANSPORT COMMISSION
Mr. Stan J. Hovdebo (Prince Albert):: Madam Speaker, my question is directed to the Minister of Transport. As the Minister knows, the Canadian Transport Commission continues to hold abandonment hearings on hundreds of miles of railway branch lines in western Canada. Decisions on abandonment centre on whether railways will receive sufficient revenues to maintain the branch lines. That is the principal test of whether the lines and the communities on them will live or die. Can the Minister tell the House why abandonment hearings and decisions are continuing, given the Government's intent to change the Crow rate and the fact that it has no idea how much railways will receive through the operation of branch lines?


Jean-Luc Pepin: Madam Speaker, indeed I have deeply meditated, as the Minister of Energy, Mines and Resources would say, on that particular subject. I decided not to instruct the CTC to abandon the procedure for the abandonment of branch lines for essentially three reasons. The first one was that the concept of viability, to which my friend made reference, would apply here in a very special way. When the Hon. Member talked about branch lines being viable, he means viable after a branch line subsidy of $250 million a year, after a branch line rehabilitation program of $700 million over a period of ten years, and so on and so forth. I thought that was not a particularly defensible concept of profitability.
Second, there were a number of branch lines which remained to be assessed by the CTC. Most of them, if not all, have already been rejected by Hall and by PRAC; some have already been ruled out by the CTC.
Third, rates are not the only factor in branch line abandonment. Volume and the situation of the rail, for example, have
November 4, 1982

to be taken into consideration as well. I thought that, for all these reasons, and some others, the CTC procedure should go on.


Stanley J. Hovdebo: That was a very good answer, except the Minister did not take into account the fourth point, that there was no indication of how much they would receive for operations.


QUERY RESPECTING POSSIBLE INTERIM PAYMENTS TO RAILWAYS
Stanley J. Hovdebo: Madam Speaker, the Gilson report on which the Minister bases so many hopes is not law. The Deputy Minister of Transport right now is stating that he is engaged in preliminary negotiations for "interim payments" for the Crow benefit which railways will receive. Where did the Minister find the authority or authorization for spending to make such interim payments in advance of any kind of legislation referring to these payments?


Jean-Luc Pepin: Madam Speaker, there is a difference between studying and spending. No interim payments are being made now on the basis of the future policy in this regard. If there should be interim payments paid to railways, they will be part of the package which the Government will bring forward to the House at the time the bill is introduced.

[ Translation]


INDUSTRY
Mr. Claude Tessier (Megantic-Compton-Stanstead):: Madam Speaker, my question is directed to the Minister of Finance, in his capacity of Chairman of the Cabinet committee responsible for the Industrial and Labour Adjustment Program. Can the Minister inform the House whether the Government still intends to maintain the Program and to commit additional funds, and also whether the Government will be announcing new designated areas in the new future?


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker, 1 can inform the Hon. Member that the Government intends to maintain the Program in question. As far as additional funds are concerned, that is a matter I shall be looking into when preparing the estimates for fiscal year 1983-84. Finally, I can inform the hon. member that our committee is, in fact, proceeding with consideration of a number of applications from various areas for this program, to see whether they comply with program criteria.
Business of the House
t


BUSINESS OF THE HOUSE
Erik Nielsen: Madam Speaker, may I ask the Government House Leader a question concerning House business. Last Thursday he laid out the House business for the remainder of this week. It included Bill C-134, the interest rebates on farm loans on which we will commence debate today. Tomorrow is to be an Opposition day. That is as far as we got. The Government House Leader also said that debate on Bill C-136 will follow Bill C-134 and following Bill C-136 we will debate Bill C-135. Will that be the order of business followed next week? If so, what comes after Bill C-135?


Mr. Pinard:: Madam Speaker, it is correct to say that today we will commence second reading of Bill C-134 concerning rebates of interest on farm loans. This will be followed by Bill C-136 which concerns grants respecting interest for small business and Bill C-135 concerning grants to home owners. Tomorrow is an Opposition day. That confirms the business for the rest of this week.

As far as the business of the House for next week is concerned, on Monday and Tuesday we shall continue debate on Bill C-134, respecting rebates of interest on farm loans, Bill C-136 which is aimed at assisting small businesses with interest payments, and finally, Bill C-135, which provides assistance for home owners. Thus, next Monday and Tuesday, depending on this week's progress with consideration of these bills, we shall continue consideration of the bills in the order mentioned. Next Wednesday, again depending on our progress with Bill C-134, Bill C-136 and Bill C-135, we may decide to consider two bills which, for technical reasons and also because of Canada's international commitments, are extremely urgent, and I am referring to Bill C-129 regarding the Bretton Woods Agreements and Bill C-130, which concerns continuing financial assistance to be provided to certain international financial institutions. Thus, at the end of the day on Monday or Tuesday, I shall be in a better position to inform Opposition Members whether we are going to consider Bill C-129 and Bill C-130 or continue debate on the bills arising from the budget to which I referred earlier.
Madam Speaker, I also wish to remind the House that we will not be sitting on either Friday or Thursday-Remembrance Day-next week, and that Monday and Tuesday we shall be sitting from six to eight to make up the time that will be lost next week Friday.

November 4, 1982
Order Paper Questions



ROUTINE PROCEEDINGS


Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, I rise to present the views of 1,639 petitioners of my riding of Mission-Port Moody. The signatories, in expressing their outrage over the brutal murders of B.C. children by self-confessed killer Clifford Olson, call for the reinstatement of capital punishment.


Some Hon. Members:: Hear, hear!


Mark Willson Rose: While I personally do not support the death penalty, I believe it is my duty as their elected representative to present my constituents' views to this assembly, the highest court in the land.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
David P. Smith: Madam Speaker, the following questions will be answered today: Nos. 4,120, 4,402, 4,403, 4,426, 4,436, 4,469 and 4,470.


Mr. Hnatyshyn: 1.	For each Cabinet Minister, what are the names of executive assistants and other members of exempt staff who are receiving income from sources other than from funds allotted to ministerial budgets?
2.	What are the names of those who receive income, favours, loans or other benefits of value from sources other than those permitted by the conflict of imprest guidelines for Cabinet Ministers and former Cabinet Ministers?
3.	Did the Prime Minister supply every Cabinet Minister, every executive assistant and ail members of the exempt staff with copies of the "Code of Ethics" produced by the late Prime Minister Pearson and with a copy of the conflict of interest guidelines for Cabinet Ministers and former Cabinet Ministers?


David P. Smith: 1. Exempt staff who have been designated by Ministers as being subject to the conflict of interest guidelines for Ministers must make public disclosures of gifts or other benefits of a value exceeding $200 received from any source. These disclosures are available in the Public Registry maintained by the Assistant Deputy Registrar General. Those members of the exempt staff that Ministers have not deemed to be subject to the conflict of interest guidelines for Ministers are subject to the guidelines for public servants. In both cases, it is impossible for the Government to know of income that is not required to be declared, other than through confidential declarations under the Income Tax Act. For instance, some
exempt staff could be receiving income from blind trusts set up in accordance with the guidelines, family allowance cheques, or interest on bonds that bears no relationship to their present employment.
In addition, an individual can be seconded to a Minister's office on an interchange assignment from the private or public sector. The salary of such an individual remains the responsibility of and is paid by the organization the person is seconded from, and the Minister reimburses the organization from his approved budget an amount equal to the salary of the position to which the individual is assigned.
Mr. Michael Phelps, was employed as Executive Assistant to the Minister of Energy, Mines and Resources, under an interchange assignment from June 16, 1980 to June 22, 1982. His salary was paid by Petro-Canada and the Minister reimbursed Petro-Canada an amount equal to the salary of the position to which Mr. Phelps is assigned.
2.	The Government is not aware of any exempt staff who are receiving income, favours, loans or other benefits of value from sources other than those permitted by the conflict of interest guidelines for Ministers.
3.	All Cabinet Ministers, their Executive Assistants and designated members of their exempt staffs have received copies of the Conflict of Interest Guidelines for Ministers of the Crown and the Post-Employment Guidelines. A copy of the Prime Minister's letter of April 30, 1980 to all Ministers concerning the conflict of interest requirements applicable to Ministers' exempt staff members, other related correspondence, and the Guidelines were tabled in the House of Commons on May 1, 1980.


Mr. Gauthier: Were term employees informed of the termination of their employment following the Budget of the Minister of Finance and, if so, how many in each government (a) Department (b) Agency?


Hon. Paul J. Cosgrove (Minister of State (Finance)):: Prior to accepting a position for a specified period (term) within the Department of Finance, a person is advised through the letter of offer of the termination date of his/her employment. This is a requirement under Public Service Employment Regulations. This process was not affected by the Budget of the Minister of Finance.


Mr. Mazankowski: Did the Department of Energy, Mines and Resources hire Dr. D. Brean of the University of Toronto to study the impact of taxation on fuel use in Canada and, if so (a) at what cost (b) what was the rationale behind the study (c) what conclusions or recommendations did the study advance?


Joseph Jacques Jean Chrétien: The Department of Energy, Mines and Resources reports as follows: EM&R awarded a contract to the University of Toronto Institute for Policy Analysis on March 9, 1982
November 4, 1982

to study the impact of the tax system on fuel use in Canada, (a) $24,209. (b) The purpose of the study is to determine the impact of fuel taxes imposed by the different levels of Government on fuel consumption and to determine their incidence effects as well as their contribution to energy conservation, (c) The study will not be completed until the late fall of 1982 and because it is analytical in nature, no recommendations will be provided by the consultant.


Mr. Howie: In the fiscal year ending March 31, 1982, how many applications were received for assistance under the Off-Oil Program and how many rebate cheques were issued?


Joseph Jacques Jean Chrétien: The Department of Energy, Mines and Resources reports as follows:
No. of applications received-213,379 No. of applications processed-192,161


Mr. Stewart: 1.	Did the Canadian Broadcasting Corporation produce a documentary film for television about Cuba and Jamaica starring Harry Belafonte and the ex-Premier of Jamaica, Mr. Michael Manley?
2.	Was the film released and, if not, for what reason?
3.	What was the total cost of the production and for what purpose was the film made?
4.	What were the names of all other prominent persons shown in the film?
5.	Does the CBC plan to broadcast the film on television some time in the future and, if not, for what reason?
6.	How many CBC employees were involved in the production and, in each case, what was (a) his/her name (b) the cost for travel and miscellaneous expenses?


Mr. Jack Burghardt (Parliamentary Secretary to Minister of Communications):: I am informed by the Canadian Broadcasting Corporation as follows:
1.	No. The CBC is, however, producing a light entertainment musical program for television about the music and people of the Caribbean which will feature Harry Belafonte as the star performer. Mr. Michael Manley is not mentioned and does not appear in the program.
2.	The program is scheduled for telecast in two segments in the 1982-83 series of Supershows which will be seen on Sunday nights from 7:30 to 8:30 p.m. The original videotaping of the portions of the program which featured the live concerts in the Caribbean took place in 1980, but because the taping was done in less than optimum conditions, some of the sound material was not of sufficiently good quality for broadcast. To rectify this, CBC officers felt it prudent management to wait until the Belafonte world tour was in Canada earlier this year at which time it would be possible to employ CBC's studio facilities to re-record the defective voice and music tracks.
Order Paper Questions
3.	It has not been customary to require the CBC to provide such details of its internal management and administration as the costs involved in individual program projects. The background to this custom is explained in detail in the reply to question No. 2,530, answered November 6, 1975. The program was produced as light entertainment under a co-production arrangement with the Belafonte Company.
4.	Harry Belafonte is the only prominent person shown in the program. Other people who appear in the program are all professional performers.
5.	Answered in 2 above.
6.	Twenty-eight CBC employees were involved in the production. With regard to employee names and the costs for their travel and miscellaneous expenses, it has not been customary to require the CBC to provide such details of its internal management and administration. The background to this custom is explained in detail in the reply to question No. 2,530 answered November 6, 1975.


Mr. Mazankowski: 1.	For the fiscal year (a) 1982-83 (b) 1983-84 (c) 1984-85, what amount for foreign-held debt owed by the Government is scheduled to mature?
2.	In what form is the debt and at what interest rates were the issues offered?


Paul James Cosgrove: 
Mr. Mazankowski: 1.	For the fiscal year (a) 1980-81 (b) 1981-82, what amount of foreign-held debt owed by the Government matured?
2.	(a) In what form was the debt (b) what were the interest rates paid by the Government on the debt (c) what were the total interest payments made by the Government (d) what new foreign debt was issued and at what rates?


Paul James Cosgrove: 1.	1980-81: None
1981-82: SFr 700 million
2.	(a) SFr 700 million, 2% per cent bonds, 3-year term
(b)	23A per cent
(c)	SFr 60.375 million (Cdn $34.9 million)

November 4, 1982
Farm Loans Interest Rebate Act
(d)	Sept. 81: U.S. $330 million, 5-year 1694 per cent private placement with the Saudi Arabian Monetary Agency
March 82: SFr 400 million, 5-year 794 per cent notes.


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


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


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


Eugene Whelan: that Bill C-134, respecting rebates of interest on farm loans made under the Farm Credit Act, be read the second time and referred to the Standing Committee on Agriculture.
He said: Madam Speaker, Bill C-134 is an Act respecting rebate of interest on farm loans made under the Farm Credit Act and is a piece of legislation which is extremely important to the farm community and to all Canadians.
Hon. Members will recall that in the June 28, 1982 budget speech, the then Minister of Finance announced a special loans program to assist farmers in financial distress. Contrary to what some Members say here, the Minister had a program that was quite significant and farmers who have benefited from it think it is quite significant. Under the special Farm Financial Assistance Program, the then Minister of Finance had allocated a total of $100 million for loans in fiscal years
1982-	1983 and 1983-1984 and for interest rebates on these loans for a total of $200 million. Because of the pressing demand for assistance this year, this allocation has now changed to $130 million for 1982-1983 and $70 million for
1983-	1984.
The funding from the then Minister of Finance, combined with that from other FCC sources, will result in loan approvals of $200 million, on which a subsidy of four percentage points will be paid for two years. This measure will help to assure the survival of many Canadian farmers who are presently facing serious financial difficulties. The Farm Credit Corporation credit advisers will assist farmers in the development of farm plans which will provide for greater financial stability at the end of the two-year rebate program.
The Farm Loans Interest Rebate Act is required in order to provide the statutory authority for the appropriation of an amount of $16 million, not zero but $16 million, for the payment of the interest rebate of four percentage points of the principal amount of farm loans made under this special program.
The Farm Credit Act does not provide the Farm Credit Corporation with the authority to rebate any portion of the interest charged under the Act, nor is there other appropriation legislation through which the subsidy could be paid. Thus, after a review of all other options, the proposed legislation was deemed to be the most acceptable method by which to pay the subsidy.
Under the special Farm Financial Assistance Program, loans will be made at the regular Farm Credit lending rate which on June 29, 1982 was 16.5 per cent and on October 1, 1982 was set at 15 and % per cent. The rebate of four percentage points over two years to date reduces the farmers' effective interest rate cost to 11 and % per cent. FCC customary lending criteria will apply. For example, a loan ceiling of $300,000 for individuals and $500,000 for more than one qualifying applicant will apply and a maximum amortization period of up to 30 years is still in effect.
This is what most Members must keep in mind. No one is willing to loan long-term money now, at least hardly anyone we could find. We were offered some Canadian money for up to 10 years, I believe it was around $50 million, with an interest rate of 14 per cent. We refused that because we are confident that interest rates will go down even further and we will be able to obtain long-term money, using the agribond principle that was not originally thought up by those opposite, Mr. Speaker, but was thought up and talked about by people for many years, probably even before the Hon. Member for Bruce-Grey (Mr. Gurbin) thought of coming to the House of Commons. I can remember when it was first thought of and talked about by farm organizations and politicians several years ago.
We must still have long-term money in agriculture. At the present time, the demand for money is not as great as it was at one time because there are not as many farm transfers taking place in 1982. Any farmer in financial distress may apply for this special loan under this Program. The farmer is required to prepare an acceptable plan of recovery in consultation with the Farm Credit Corporation. In addition, he or she must demonstrate that the farm operation will be able to generate sufficient income after two years to meet anticipated commitments.
From the time the special Program was announced on June 28, 1982, up to October 26, 1982, 554 loans had been approved, totalling $80.1 million. Including applications in process, the total loan commitment to October 26, 1982, under this special Program is estimated at $105 million, which indicates the demand from farmers in financial distress for these special loans. This is contrary to the figures that the
November 4, 1982

Hon. Member used when quoting, I believe, from the Canadian Federation of Agriculture. We say that with that Program we will probably help approximately 2,000 farmers.
When we break down the numbers of those who received loans into regions, it is interesting to see where those farmers are. The number of farmers in British Columbia who received these loans was 23. The amount of the loans was $5.3 million.
I am surprised that there would be farmers in Alberta applying for a Farm Credit Corporation loan.
Mir. Paproski: Why?


Eugene Whelan: I thought they had many different programs there. They have about five different programs in Alberta that provide funds for farmers. Most of the other Provinces cannot even afford to have one of those programs. There were 42 farmers in Alberta who borrowed $9.3 million. In Saskatchewan 72 farmers borrowed $11.4 million. In Manitoba 50 farmers borrowed $6.7 million. In Ontario 237 farmers borrowed $32.5 million. In Quebec 105 farmers borrowed $12.3 million. In the Atlantic region, including all four Provinces, 25 farmers borrowed $2.7 million. The money which has been loaned does not include pending applications.
The breakdown according to enterprise type indicates that on a national basis beef and swine producers have received the biggest share of the funds available. It is that area which is probably the most disorganized of all agriculture in Canada because those producers depend on someone to pay them a fair price for the product that they deliver to the marketplace. Sometimes they wait as long as two weeks to see what they will receive for their product, especially when marketing beef.
We can see what the United States is doing at the present time because of the scare they have over the amount of beef being exported to their country. This meat is being exported mainly by Australia because it had an extra slaughter-kill due to the heavy droughts in that country. That great free marketing system to the south decided to impose a meat import law to stop bringing that slaughter-carcass, broken beef into their country. We were not over our quota but Australia was. The United States decided it would treat all countries in the same fashion, but we were able to negotiate and instead of the quota we would have been given if we were treated similarly to Australia and other countries, with a quota of 101 million pounds, we were allowed to export 120.1 million pounds of beef to the United States. If we had not been able to negotiate that quota we would have been stopped from exporting beef to the United States some time in July or early August, I believe.
So when anyone says that the North American market belongs to us, tell them that they are kidding themselves, because that is what they are doing. The United States is becoming one of the most protected nations in the world. There are approximately 25 bills before Congress presently in the form of protective legislation to attempt to protect their producers of every kind of product imaginable. This is happening in that great, free trading nation to the south, which so many people think it is.
Farm Loans Interest Rebate Act
A Bill of this nature is not new. In the November 12, 1981 budget the then Minister of Finance announced a similar special program to assist farmers in financial distress. It provided a five percentage point rebate. Similar legislation to this Bill came into force in April, 1982 for the November 12, 1982 special program which terminated on March 31, 1982. There was strong demand for the program, as the statistics indicate. From November 12, 1981, to March 31, 1982, 382 loans totalling $45,417 million were approved. Interest rebates on these loans over a two-year period will total about $4.6 million. The total in the two-year period is approximately $16 million in interest rebates.
I urge Hon. Members to support this Bill which will be instrumental in assisting so many Canadian farmers through these difficult times. Most agriculture producers are at the mercy of the marketplace for their incomes. The price received for their production does not correspond with their costs, and in recent times costs have outstripped earnings for a significant number of our farmers. 1 firmly believe that most of these producers can survive and contribute to the economy if they are given a chance to recover. This interest subsidy for a two-year period provides that breathing room. Agriculture is essential for a healthy economy, and if our economy is to strengthen, so must agriculture.
I want to conclude by pointing out that the number of accounts with the FCC total 75,770 Canadian farmers out of
320,000	farmers. The total number of farmers in default at the present time is approximately 11 per cent. The total amount of loans to all farmers in Canada is close to $4 billion. The amount of money issued under regular loans this year is $252.3 million to date. As I indicated earlier, about $85 million is under the special Farm Financial Assistance Program. We estimate that we will have loaned about $700 million by the time this fiscal year ends. We have made plans and have received applications already, and while we have had several offers, we have not accepted them because we do not think the rates are what we should receive on the American money market. There has been a tender form for approximately $129 million. I am going by memory as to what that figure is.
Average assets of borrowers this year increased by about $368,000. The average loan this year under the regular loans program amounted to $92,400. The average loan issued under the special loans program was $135,000.
Those are just some of the figures that we are using, but we hope that we can use the system to which the Hon. Member referred and which we have discussed, the agribond system. We are still working on it; it has not come through as quickly as I would like to see it. Some of the financial institutions have very strong reservations about it, including the credit unions who say that we would take too much money from their operations. They have expressed strong concern about our proposal for a special system which would allow people to invest with a smaller return on interest by paying no tax on it,

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and that type of thing. I still think the principle is good. Other countries are using it. We are still presenting other new proposals to the Minister of Finance (Mr. Lalonde). I do not know whether the proposal will be ready this year or not, but offers are still regularly coming in, as I said, for long-term money. We do not know what the result of that will be.
As 1 said earlier in my speech, we had refused the proposal of long-term money for a ten-year period, I believe, at 14 per cent interest in Canadian money, which I thought was too high. I am still optimistic that the interest rates will come down and that maybe by Christmas or shortly thereafter the interest rates will be single digit. 1 am very much of an optimist. That will put us in a better position to arrange for longterm money. We are in the best position to arrange long-term money for over two years; but 1 again stress to the House, through Your Honour, that very rarely can one find any institution which will lend long-term money.
As Minister of Agriculture, after listening to what the farm organizations have said to me, I very strongly feel that it is a must that we have long-term financing for farmers. From what we see today on the world commodity markets, the great fluctuations in prices mean that they must have that kind of long-term financing with reasonable rates of interest. This applies to somewhere betwen 35 per cent and 45 per cent of all farmers. Over 50 per cent of our farmers are not in that bracket at all. Farmers in certain age groups do not owe any money, and that takes in nearly 50 per cent of all farmers in Canada. A mixture of grain producers, livestock producers, dairy producers and poultry producers are in that bracket. Some of them have eveii said to me, "Some of your programs, Mr. Whelan, are too rich because we are paying too much income tax at the present time." Well, it is hard in an agricultural community to provide the kind of equity we want. However, if a farmer is paying income tax, that is as it should be, because successful business people pay taxes, and farmers are successful business people. If they are paying taxes, that means they are running very successful, efficient businesses. It is when farmers or business people are not paying taxes that we should worry more about them.
We recently received a visitor to Canada. We showed him the agricultural production entities from Quebec, Ontario, Saskatchewan and Alberta, the different kinds of farm operations that he wanted to see. I know he was very impressed with what he saw. The productive system in our country is so different from the one in his country. He was the minister of agriculture of the Soviet Union, which is our largest purchaser of agricultural products. He wanted to see dry land farming. I was delighted to show him our family type farm operations, from small and medium to the large type operations which have several thousand acres under cultivation. He also saw livestock and grain operations. No other country in the world has a system such as ours.
In reference to the plight of producers in the United States of America, the potato producers of that country requested hearings because they said that they could not compete with the programs available to Canadian producers. Little Canada
was putting the producers out of business in the main potato producing areas of the United States. Hearings were held in Boise, Idaho, and Bangor, Maine. Transcripts of the proceedings are available for anyone to see. However, their main argument was that Canada's programs are so superior to theirs that they cannot compete with us.
Once again I ask for speedy passage of the Bill. I have given a brief report on what we are doing to raise extra funds for the Fram Credit Corporation, but we are being a little bit cautious about arranging long-term money at high rates of interest because we do not want to tie too many farmers into a high rate of interest. I think that no matter who may hold the office of Minister of Agriculture over the next few years, he will have to review mortgages which farmers have taken at 16 per cent or 16.5 per cent interest because the average rate of mortgages is now around 10 per cent on the nearly $4 billion we have out on loan. However, some farmers are paying less than 10 per cent and others are paying 6.5 per cent more than 10 per cent. When they were obtaining those mortgages they were still borrowing money at a rate about five points lower than the regular market rate at that time and they could not obtain long-term mortgages even if they were willing to pay 20 per cent, 21 per cent or 22 per cent interest. That cost us several millions of dollars. However, we think money spent on agriculture is money well spent.
The record of the Farm Credit Corporation and its cost of operation is one of which we are very proud. It is an organization which knows and understands Canadian agriculture, which is one thing the private lending institutions have proven to us they do not understand. By the way, they lent money to the rural community of Canada, but in many cases they did not understand just what was going on. If most of the farmers who are in financial trouble had borrowed long-term money four, five or six years ago from the financial institutions, most of them would not be in such difficulty. We appeal to the private lending institutions to start lending long-term money to the rural community. I can honestly say that I did not realize what they were doing until I became really involved during the last 18 months. Farmers have sent me copies of agreements they have signed with lending institutions. I was amazed, appalled, and in some cases just downright disgusted to find that they had become involved with financial lending institutions which would put them into such difficult positions.
I know that other Hon. Members would like to contribute to the debate, but again I ask for speedy passage of the Bill.


Hon. John Wise (Elgin):: Mr. Speaker, I do not want to take a great deal of my time to respond to the Minister's opening remarks except to say that I am somewhat surprised that his comments were directed to some of my colleagues and farmer friends in the Province of Alberta. There is certainly no question that farmers who carry on business in Alberta are obviously Canadian farmers, and if there were any doubt in anyone's mind, I simply draw attention to the overwhelming manner in which they voted in the recent provincial election. We find that the Premier was able to gather some 75 out of 79
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seats and the WCC was completely wiped out of the Legislature.
He also made a reference to the worthiness of the agribond concept. I was certainly encouraged to hear the Minister respond favourably with respect to it because 1 really think it is the only way to go, the only route which would provide sufficient financing at the lowest possible cost to Government. Losses to the Consolidated Revenue Fund would be minimized and it would supply sufficient funds to assist the farmers who find themselves in severe financial difficulties.
There has been some debate as to who should claim credit for the agribond concept. 1 am sure the Minister has tried to lay claim to it, as did my colleague earlier today. As I understand the situation from my reading of history, that concept was born out of a farm meeting held by a group of farmers in the Province of Saskatchewan and was brought to our caucus by the Hon. Member for Swift Current-Maple Creek (Mr. Hamilton). Rather than the Minister or myself taking credit for it, I think we should give credit where it is due. As with most good agricultural programs, this one had its origin at the grass roots level.
I welcome this opportunity to comment on Bill C-134, Mr. Speaker. As Members of the Government will understand, it is not traditional for critics to be overly complimentary but I want to indicate that I am somewhat encouraged by the priority given this Bill by the Government House Leader. Of the three agricultural Bills among the 18 or 19 on the Government's list, the choice of Bill C-134 for debate today is quite proper and a step in the right direction.
While the concept is a good one because it recognizes the problem, the amount of money made available to tackle a problem of this magnitude falls far short of what is needed to do the job properly. The Government knows that when legislation that will assist the agricultural community is introduced, it can expect to receive our co-operation and support. There are many examples of our co-operation on legislation of this type.
Having made those comments honestly and sincerely, Mr. Speaker, I do not want to leave the impression that this rather limited measure will do a great deal to resolve these problems that have plagued the economics of the agricultural industry, particularly during the last 24 months. Throughout this debate, my colleagues and I will demonstrate, by fact and example, that the agricultural industry in Canada is experiencing the worst economic crisis in four decades. Indeed, some knowledgeable people will recognize that the current dilemma in the agricultural industry is probably the worst since Confederation.
Last fall I was invited by the Ontario Federation of Agriculture to serve as a member of a small task force organized to deal with this emergency in agriculture. I accepted the invitation for a number of reasons. I was aware of, and concerned about, the serious financial conditions that were beginning to develop in the industry in the early part of 1981. Last fall, the
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most seriously affected people were young farmers with sizeable debt loans and those in the red meat industry. Some improvement had taken place in the red meat industry by this fall, but unfortunately it could be short-lived. Certain actions taken by the U.S. Government will exert a downward pressure on beef prices. The increasing number of hogs being produce in Canada means that there will be a greater number on the market within six or eight months, and that will have a depressing effect.
This year, the financial crisis has spread to the cash crop farmers. Three factors have combined to create this impossible situation. First, high interest rates; second, increased input costs; and third, declining market prices. If one examines the history of agriculture it will be seen that one of these factors can usually be found at any time, but when all these factors are combined for an extended period of time, it creates an impossible situation.
It will be recognized that interest rates have declined but, given the traditional and historic profit margins associated with the primary sector of the agricultural industry and our current economic conditions, they remain too high. There has been a dramatic increase in the amount of total Canadian farm debt. In 1960 it was $1.6 billion; ten years later, in 1970, it had increased to $4.2 billion; 9 years later, in 1979, it had increased to $13 billion; in 1981 it was $16 billion; and this year it could go as high as $18 to 20 billion.
Servicing this debt at an interest rate of 8 or 10 per cent, with improved market conditions, could be possible; however, the cost of servicing the debt at today's interest rates is impossible for a large number of Canadian farmers to meet. In 1981, farmers paid out $2.2 billion in interest payments alone. This is almost $600 million more than was paid in 1980. Farm input costs have risen to the extent that net farm income will decline this year by at least 17 per cent and a further decline is projected for 1983.
Statistics Canada estimates that the 25 per cent increase in energy costs will be the major factor in the decline of net farm income. We have to recognize that energy is vital to Canadian food production, Mr. Speaker. In Ontario, about one-third of the total cost of operation of a cash crop farm is taken up by energy. In the greenhouse industry, energy takes about 22 per cent; in the dairy industry it accounts for about 14 per cent, and in the production of beef it accounts for about 7 per cent of the cost.
Some examples of declining market prices include the price of corn. I am sure the Minister is aware that this year corn has been a reasonable crop, selling at about $2.50 per bushel. One has to apply drying charges, of course, which are extremely high. The cost of producing a bushel of corn is not $2.50 nor $3.50, but is closer to $5.50. Large crops of soybeans are produced in Essex County in the Minister's riding, so he should know that soybeans are selling for something in the neighborhood of $6 per bushel when the cost is closer to $8 or $10 per bushel. Other examples could be cited for Ontario grains and for grains grown in western Canada.

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The Government has never really given the agriculture industry much priority. We have seen a number of legislative updates but we have not seen any real measures directed to the agrifood industry in the last 10 or 15 years. Regardless of this Government's indifference, the agrifood industry is the most basic and vital industry in this country. It is an industry on which all life and all sectors depend. Canadians, and indeed civilization throughout the world, can do without just about everything except one thing, and that is food.
Some of my urban friends may wonder why we are taking the time we are today to debate agricultural legislation. Some of our urban friends might ask what is their place and their involvement in the agricultural industry. The very simple answer is that if you eat, you are involved in agriculture.
In Canada there are about 300,000 farmers. That number continues to diminish. Those 300,000 farmers provide direct employment for nearly 500,000 people. That is a tremendous number of jobs. There are about 1.5 million Canadians out of work, so it represents a significant contribution toward employment opportunities and job creation which is not being fully utilized. There are approximately 4,000 food and beverage establishments in Canada and they employ over 200,000. That is more jobs. In fact, this sector is the country's largest single employer. Quite often we think of the automobile industry as the largest sector in our economy as far as job creation is concerned. That obviously is not the case.
It is recognized that the agrifood industry constitutes about 40 per cent of Canada's economy and employs about 25 per cent of all Canadians. In 1980 we exported $8 billion worth of food products and imported about $5 billion. This gave Canada a trade surplus of about $3 billion. However, approximately $3.5 billion of the $5 billion worth of imported food could have been replaced by Canadian-grown produce. Consequently, the lack of any real import replacement program has resulted in a loss of economic activity to Canada and a loss of jobs in Canada during a time when we need them most.
The cost squeeze has decreased farm incomes. This in turn has substantially reduced the farmer's buying power. This has forced farmers to reduce their purchases, increase their borrowing, sell off their assets and has caused a bankruptcy rate of 65 per cent, comparing September of this year over September of last year. Many have been forced out of business. Others have simply left their businesses. In fact, in the first nine months of 1982 there were some 316 bankruptcies.
If the present rate continues, this year bankruptcies in the agricultural industry could well reach 500. This sharp decline in net farm income is having a drastic effect on business activities in the downtown areas in every city, town and village across this country. Just talk to the downtown merchants, the boards of trade, chambers of commerce, for verification of this loss of business, Mr. Speaker.
This decline is taking its toll as well in the farm supply sector. Sharp declines are expected in fertilizer and chemical sales and in the supply sector of the industry in 1983. Farm
tractor sales are down some 35 per cent; combine sales are down 56 per cent. Dealers are filing bankruptcies and our major farm machinery manufacturers are fighting for survival. Why? Because net farm income is dropping. Profit margins are diminishing. Interest rates remain too high. Market prices for a number of commodities are below the cost of production. Consequently, farmers are not buying machinery because they simply cannot afford to buy. The ripple effect is lost income, lost business activities and lost economic opportunities for thousands of Canadians.
I said earlier that this Bill goes in the right direction. However, in view of the magnitude of the problem, it will simply not do the job. What we need is, first, a moratorium of short duration on farm bankruptcies, foreclosures and powers of sale. The Minister recognizes this to be a problem; a number of his colleagues do as well. They have spoken in support of this moratorium. However, nothing has been delivered.
We need a greater infusion of capital into the Farm Credit Corporation. I have not said exactly how much money would be required. I know it is more difficult to secure funds from the Consolidated Revenue Fund at a time when you have a $23.6 billion deficit. It is much more difficult than if you had a $10 billion deficit, there is no question about that. The CFA has indicated on a number of occasions that it would require at least $1 billion.
We need an interest rate subsidy greater than what we have provided in Bill C-134, applied on a selective basis for the consolidation of debt. As I look at this Bill, my calculation indicates that there are $216 million in the program, $116 million of which is a reshuffle. If you apply that under the normal lending formula of the 4 per cent interest rate, if the funds are fully lent and the 4 per cent rate is applied, the interest rate subsidy would be about $16 million. We are suggesting a more adequate amount would be in the neighbourhood of $300 million.
How do we reach that figure? It is fairly straightforward. We have approximately $17.6 billion or $18 billion in total farm debt. It is estimated that about one-third of that would be at unmanageable interest rates. When it requires $50 million to lower the interest rate by five percentage points on a billion dollars worht of debt, the final calculation indicates it would require about $300 million to provide adequate funds to reduce that interest rate by five percentages points on that $6 billion.
I talked earlier about the agribond concept. I am encouraged to the extent that the Minister is still talking favourably about it. However, if he takes his direction from the blue chip committee or the Lortie Commission, they brought down a ruling recommending against a policy of this kind. The Minister should remind his colleague the Minister of Finance that the membership of the Lortie Commission does not include one farmer.
We need rationalization and stabilization. As the Minister indicated, the provincial Ministers are meeting at this very moment in Regina. If the Minister could deliver on that
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promise and deliver those dollars in 1978, I do not know why he cannot do the same thing today. He will have to answer to the provincial Ministers. I am certain they will be here in Ottawa within two or three weeks.
The Minister should look carefully at the recommendations of the task force to which I referred earlier and at the recommendations which were put forth by the Ontario Federation of Agriculture. When the report of the meeting of the provincial Ministers meeting in Regina is made, I am sure he will see some similarity between the decision they reach today and the income market insurance program put forward by the Ontario Federation of Agriculture.
Changes are required in the area of capital gains. 1 challenge the Minister simply to match the provisions contained in the Crosbie budget in 1979. We want to restore the incomeaveraging provision and the capital gains reserve. Both of these provisions were removed in the November budget, which was probably the worst budget for industry and the most damaging budget ever to Canadian agriculture.
The other area the Minister should be looking at is an energy tax credit or rebate. Forty per cent of the cost of farm fuels, as the Minister will realize, is in direct federal taxation, and that tax represents about 40 cents a gallon on diesel fuel, and some 60 cents a gallon on gasoline. The CFA have had an opportunity to look at this Bill and their bottom line, Mr. Speaker, is the fact that they have determined the money provided in the Bill is totally and wholly inadequate. They estimate about 10 per cent, or some 20,000 farmers, desperately need the assistance of this rebate. The CFA indicate that only some 500 farmers will actually be assisted under this program.
The CFA have also indicated that we should remind the Minister, particularly the Minister of Finance, that although the small business bond provision has been extended, the banks are using this provision in the same way as they have been using the Farm Improvement Loans Act over a number of years. Although they have the legal authority to lend money under this program and under the small business bond, very few banks are participating to any great extent. It is interesting, as well, Mr. Speaker, to look at some of the comments and further recommendations made by the Canadian Federation of Agriculture. Quoting from some correspondence that i have had from the Federation of Agriculture:
The Government must give authority, and quickly, to the FCC to borrow short-term-three to five years-by the issue of financial instruments, on which interest is tax free, for farmers requiring money at lower interest rates not only for debt consolidation but for essential investment and working capital.
Such lending, though necessarily selective, could be much more generously available than the present subsidized FCC lending, because the interest paid by the producer could not be expensed. This makes it a self-policing policy since borrowing on this basis would not be attractive to farmers whose operations indeed were, or could become, profitable.
This policy can be put into place quickly and effectively under present legislation, as we understand it. It is one that comes with a price tag to Government in forgoing some tax revenues, of course, but it is a small price to pay for
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sustaining the productivity and the family farm structure of an industry of such fundamental long and short-term importance to the Canadian economy.
I acknowledged earlier that interest rates have fallen. I acknowledged as well that this legislation is going in the right direction. But the fall in interest rates is not sufficient and, for many, that reduction in interest rates comes too late. Those who will benefit by this Bill will be far too few. This Government must decide whether they want a strong, viable agricultural industry or whether they want to continue on the road to disaster, a road of loss of productivity, lost employment opportunities, lost economic activities, becoming more dependent on potentially unreliable, more expensive, poorer quality, food imports.
We believe Canada should be striving for the former, but time is running out. The primary sector of the agrifood industry must receive, and receive now, a more positive, meaningful response from this Government. I am certain that the agricultural industry is not asking for the impossible, because if this Government has money for Dome, Chrysler, Massey-Ferguson, and money to purchase B.P. which obviously is a liability on the treasury of Canada, then we say that it should get its priorities in order and should assist the agricultural industry.
Canadian farmers need action from this Government now and they need it in a form of a temporary, short-term moratorium, increased FCC funding, Agribonds, updating of stabilization. They need capital gains changes, and an energy tax rebate. The results of such measures can and will remove this crisis. These measures will turn this current economic crisis into an opportunity. Canadian farmers have the resources, capacity, desire and the determination to meet this challenge. Action now will ensure the preservation of a strong and prosperous agriculture industry.
I want to conclude, Mr. Speaker, by saying that when this Government, or any Government, has the agrifood industry back on the road to recovery, then they will also have this nation back on the road to recovery.


Victor Fredrich (Vic) Althouse: Mr. Speaker, I am pleased to take part in this debate on a Bill which will reduce the interest on farm credit loans by 4 per cent for a period of two years. I think this is a necessary short-term move. I am not so certain that it is an adequate response to the need. However, it is an indication of an attempt to address the problem.
The problem is one that I would like to dwell on for just a few minutes, Mr. Speaker, because I think that if we do not go back and look at how we got into this credit difficulty, we cannot properly address the real reasons for bankruptcies, why people are behind in their payments, and why people are selling out because they can no longer survive in agriculture.
I submit that Canadian agriculture, probably since the Second World War but certainly in the last decade and a half, has been under some very severe strains and pressures. These are different strains and pressures from those of the post-war years when the objective was simply to become more efficient and a great many people opted out of agriculture. To some

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extent they were pulled out of agriculture because there were jobs in the industrial urban centres that were growing rapidly. But in the last 15 years or so we have seen some moves, partly by Government, both federal and provincial, and partly as a response to those policy moves by Government, which have brought a rapid escalation of agricultural production.
I think that in looking back at our agricultural history we tend to see moves that create a situation where types of farming are made obsolete by deliberate policy moves. To some extent that started off with a clutch of policy changes which included the Farm Credit Corporation being deliberately pulled out of the long-term interest rate and medium-term interest farm loan field.
Farm Credit Corporation had been supplying most of the long-term needs of the farm community, and a good portion of the short-term and intermediate financial requirements of farm communities up until the late 60s. Land prices were relatively stable, production capabilities were pretty well regionalized, people knew where they were on the farm front.
The late sixties and early seventies brought some terrific changes, Mr. Speaker. The federal Government began to ease back on the amount of lending by the Farm Credit Corporation. It proposed to allow the banks into the farm credit field. Along with that there was a drastic change in the federal grain policy. Prior to that most feed grains had been marketed across the country, outside of the Prairies, under the auspices of the Canadian Wheat Board. Therefore, prices were relatively stable and the competitive capability of the different regions was kept more or less equal. But the combination of going to the so-called open market and allowing the large grain merchants and feed mills back into the grain market on an across the country basis, along with allowing the banks into the farm credit field, created a climate which may have looked good to the economists behind the Government front benches because it created the illusion of growth in agriculture, but was in fact a switch in production from some regions of the country to others, financed largely with borrowed money.
As well, provincial Governments got into the act by providing subsidies to encourage those shifts. Sometimes it was straight subsidy, at other times it was subsidized credit. In short, by the end of the 1970s there was a quite visible move of much of the hog production out of the Prairie region into Ontario and the Maritimes to some extent, but largely into Quebec. These two or three policy shifts also encouraged a move to feeding cattle outside of the Prairie region where most of the livestock originates.
There were, Mr. Speaker, some very important economic side effects resulting from these shifts. Luckily there was a sudden surge in demand for grains in that period of time which happened to coincide with the increase in oil prices in about 1973 or 1974. That surge in grain prices and agricultural commodities generally tended to carry the farm community through the last decade. As the Hon. Member for Elgin (Mr. Wise) outlined quite well, they were able to do it while watching farm prices decline, costs increase and farm debt increase at a dramatic pace. That has been outlined today. In 1970 accumulated farm debt was $4.2 billion; in 1979 it was up to $13 billion; in 1981 it was $16 billion.
This has put great pressure on financing in this country. Interest rates rose because other sectors of the economy were doing the same thing, growing at a rapid pace, making large demands on the finances of this country and thereby bidding up interest rates. Consequently, by the end of the decade and into the 1980s, we see that the highest farm expense is interest costs. At the beginning of the 1970s the cost of money was about number eight or number ten in priority, and then suddenly it shot to the fore. Following that is the cost of energy, which had not been a tremendously big farm cost. So farmers were very much in a squeeze situation. Long-term credit at fixed rates was becoming less and less available. The Farm Credit Corporation was supplying a smaller and smaller amount of the requirements for farm credit.
Finally, we got into the 1980s when the new, large and intensified livestock production units were beginning to flounder. There was overbuilding, or alleged overbuilding. The units which has been the traditional sources of supply in other parts of the country had been declared obsolete and had shut down. We had, in effect, an overbuilding of the agricultural industry and we were and are carrying costs which farmers have no way of avoiding.
Banks have been willing and able to supply credit needs up until recently because along with this decade of growth came high inflation in the value of farm land. So every time a banker went to review an individual farmer's account he could usually conclude that, because of the rapid increase in real estate values, the assets still exceeded the liabilities of the individual farmer. But in the last three or four years that picture has changed for a great many operators. Liabilities began to exceed assets.
As the banks foreclosed on some of those operations it created a new situation where the price of farm land is no longer escalating 12 per cent, 15 per cent, or 18 per cent a year. We are now in a situation where there have been foreclosures and bankruptcies and offers to sell on the part of farmers who think they can no longer survive in the industry, and therefore land prices are falling in many corners of the country and are not rising. That is setting the whole industry on a path which could lead to disaster. The banks, because of their past practices, now have to be a little more careful about forcing some operators into bankruptcy. They are now beginning to realize-if they do not, they should-that the more bankruptcies they cause, the lower will go the price of real estate. The more loans they will have to call because more and more accounts will find themselves in the position of having greater liabilities than assets, since the banks are putting pressure on the real estate market and pushing down the value of those assets.
So what we have before us here is a very feeble attempt to deal with this very grave problem, a problem which I do not
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think the Minister fully realizes he is faced with. In fact, he even seems to be prepared to create another kind of massive adjustment of agriculture resources by his apparent support for abolishing the Crow rate, which will, in effect, reverse some of the changes we went through in the last decade. This will increase the already high bankruptcy rate in Quebec, the Maritimes and Ontario, just so that a few highly intensive feeding operations in western Canada may get an advantage. I do not think the industry will appreciate that kind of disruption yet again, and that is one of the reasons we have been asking that everybody involved in the process take a second look at it. It will have violent repercussions across the country and in all agricultural sectors of Canada.
The proposal before us is one which has been described as being able to handle a few hundred farmers who are on the line between bankruptcy and survival and to whom a 4 per cent reduction in interest rates for two years might make the difference between survival and collapse.
I think this is important because the bankruptcy rate has been growing by leaps and bounds. In 1979 there were 82 farm bankruptcies in Canada. In 1980 they had doubled to 164. They rose again in 1981 to 191, and so far in 1982-and we are only three-quarters of the way through the year-there have been 316 bankruptcies.
The outlook is not particularly good this year. At the beginning of the year Agriculture Canada predicted that net farm incomes would be down again, the second or third year in a row. Indeed, when we go back as far as 1974 we find that net farm incomes have varied only a little from about $3.5 billion. This year they will be below that figure. If we relate that to 1974 dollars, we can conclude that net farm incomes are less than half at the present time. This is the real reason there is a farm credit crunch. It stems from a disruption of the industry. Large investments have been made in some parts of the country and investments in other parts of the country had to be abandoned. Also it stems from an increase in the demand for funds which has caused interest rates to go sky high and has left farmers with virtually no options.
The Farm Credit Corporation has attempted to increase its finances by going to foreign markets. To date my information is that no funds have been raised in that manner. This coming winter we will probably see great demands for long-term, fixed interest rate loans through agencies such as the FCC. Basically it is the only agency available to farmers which offers longterm, fixed interest rate loans. Interest rates are now going down, but FCC rates are locked into a formula used by FCC which comes down very slowly. The formula was just revised at 15.75 per cent, but farmers can walk into their local credit union or bank and obtain money at lower interest rates because they are still reaping the benefits, if we can call them benefits, of the high interest rates which have gone before.
If the FCC succeeds in obtaining funds from foreign sources at much lower rates than 15.75 per cent, those sums could not be re-lent to farmers at less than that rate until the new
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formula comes out next spring. Farmers are locked into the situation. The response has been multitudinous. Some Provinces have responded by getting into the farm loan field in which most of them have been involved in some form or another. The demand has increased the intervention of provincial Governments through the offering of sometimes greatly subsidized farm loans to farmers.
If we are to have any stability in the Canadian agricultural community, it is imperative for the Farm Credit Corporation to be enlarged again to provide the long-term, fixed rate credit required by farmers in a volume which will service all requirements across the country. Failure to do so continues the instability in agriculture, instability created when one Province lends money at 5 per cent, another Province lends money at 8 per cent and the going rate on the market is 15 per cent. This creates a tendency for production to shift from regions of comparative advantage to other regions.
I would be remiss if I did not point out that there is a great need for money to finance intergenerational transfers. This is where a good chunk of farm credit funding goes at the present time. Some of it still goes to improving physical plant, but most of it is for transferring land and property from one generation to the next. This amount has been shrinking through FCC and, consequently, other methods have been proposed. The agribond proposal has been around for approximately five or six years. It was discussed in the House and in the Standing Committee on Agriculture several times since I have been here.
Some experiments with turning over land from one generation to another have been tried in various Provinces. There are land banks and land assembly systems in some Provinces which make it possible for the older generation to turn over land under very reasonable terms to the younger generation without their being placed under a debt load which they cannot handle and enabling them to produce under current market conditions.
Such programs should be reviewed and looked at objectively, but I think we should come to the conclusion that the FCC must be expanded if Canadian agriculture is to have an equal chance right across the country. If we are to have an agrifood policy which takes advantage of what is on the farms now and makes it possible for production units to produce in a market that provides some stability, farmers will increase production and help the country out of the current economic chaos. If stabilization programs are available on a federal basis, and if marketing systems are in place which provide some equity across the nation, then farmers will have some assurance that by producing they will be able to get back their costs of production plus decent standards of living for their families.
The proposal before us today is a very short-term one to help a few hundred farmers. I have no objection to that, but I should like to point out that there are thousands and thousands more who will need equal consideration. This proposal, while of assistance to a few hundred, is only a drop in the bucket in terms of meeting the total need.

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Mr. Marcel Dionne (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, as the Minister of Agriculture (Mr. Whelan) mentioned earlier, the federal Farm Financial Assistance Program was established in order to alleviate the distressing situation created by high interest rates and lower returns on farm products. Canadian farmers who are facing serious financial difficulties can obtain an interest rebate of four percentage points on their loans for two years, which reduces the effective interest cost to 11 % per cent during the first two years of the loan. The Program has already saved several hundred farmers from bankruptcy, and will probably save several hundred more before it expires.
The Farm Credit Corporation has always done its utmost to help its clients through difficult periods. Its recovery plans, for instance, are among the most flexible known. FCC credit advisers encourage farmers to discuss their financial difficulties as soon as they become apparent, so that they can then reconsider repayment schedules and take appropriate action. In some cases, rescheduling of the loan may be necessary. In others, postponement of one or two payments may be sufficient. It is reassuring to note, however, that the FCC is sufficiently concerned about the problems facing its clients to take this kind of action, and that this agency, which represents the Government, has not forgotten the human factor in its business relations with Canadian farmers. In addition to its flexible recovery plans and the special loans being granted since June 1982 under the Special Farm Financial Assistance Program, the FCC offers its borrowers every opportunity to resolve their financial problems through its Advisory Services Program.
Generally speaking, all FCC loan applicants may benefit from preliminary counselling, including advice on how to organize and develop their farm operations. The service is available to any FCC borrower who asks for it. However, the service is compulsory in the case of borrowers under the special program, since it is one of the conditions of the loan. If we look at the components of this Program, it is easy to understand why the service is compulsory for borrowers who are in financial difficulty and are anxious to improve their situation. First of all, the goal of the Advisory Services Program is to help the farmer manage his farm finances more effectively. The credit adviser will therefore help the farmer to select the accounting system that is best adapted to his needs and help him get acquainted with the system. With his financial training and experience, the credit adviser is also in a position to help the farmer interpret and analyze the financial data provided by his accounting system. He can also provide a comparative analysis of financial factors and farm production in similar operations. Finally, if the farmer requires another adviser, the credit adviser can tell him where to obtain the information or the help he needs. Thus, this service is an adjunct to provincial educational programs.
As a result of the follow-up provided through the Advisory Services Program, the farmer has a better chance of successfully implementing his recovery plan. Thus, Mr. Speaker, the FCC is doing everything in its power to help borrowers through the difficult times we are experiencing today. By supporting Bill C-134, my hon. colleagues will enable the FCC to continue its good work. Mr. Speaker, I would like to emphasize that Canadian agriculture is represented by a very large percentage of family farms, and I would like to quote a few figures here to underline the importance and growth of Canadian agriculture. According to the 1981 census, there were 366,000 farms in 1971 and there were only 318,000 in 1981. However, although the number of farms has dropped significantly, there has been, conversely, an increase in production.
Last week, when the Minister of Finance (Mr. Lalonde) made his speech in the House, he mentioned the high productivity of our farmers and was happy to see that this group had continued to progress and to provide the Canadian consumer with products at very reasonable cost. I cannot agree more with the words of the Minister of Finance, and here I would like to underline the importance of Canadian agriculture and its productivity.
I want to give a few statistics on the assets of our agricultural sector and thus illustrate the need for the measures being proposed in Bill C-134. I am sure that honourable members will realize that many farmers need financial assistance and some are facing more difficult conditions at a time when the economy is deteriorating in certain sectors, and also that it is absolutely necessary to help farmers cope with these temporary problems. Thus, in 1971, the average farm was worth $65,800; in 1981, average farm assets had risen to $409,300. On the basis of these figures, you will agree, Mr. Speaker, that the farmer's financial requirements are increasing steadily. Of course, the debt rate has also followed this trend. In 1971, the average farm debt was $12,600, and in 1981, it was $58,000. My point is, Mr. Speaker, that the farmer needs more support, because while in 1971, our agriculture was worth $4,500 billion, by 1981, this figure had increased to $18 billion, which represents an annual increase of 15.1 per cent. Also, farmers are playing a very important role in our economy, since we are exporting increasing amounts of farm products to world markets, which is an invaluable asset to our trade balance. Mr. Speaker, I do not think Bill C-134 needs further justification, and once again 1 hope that the bill will pass all stages in the House and that we will then be able to help farmers in financial difficulty by providing an interest rebate.


Mr. Lome Greenaway (Cariboo-Chilcotin):: Mr. Speaker, I am among those today who speak with reservation in favour of Bill C-134. This Bill does not receive my wholehearted endorsement. Like so many measures emanating from this
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beleaguered Government, it is a half measure. It is part of a half-baked and ill-conceived range of policies, in this particular instance dealing with agriculture financing, a subject that has been an issue in this country for as long as I can remember.
For many years I was a practising veterinarian in the beef cattle country of central British Columbia. In this, and in other capacities 1 have been in continual contact with cattle producers and have become very familiar with their problems.
A subject that is continually raised is financing; how to finance the purchase of property, livestock and equipment. Of course, the pros and cons of the Farm Credit Corporation are often discussed. The most common complaint that we hear in my part of the world is that a person is lucky if he can get a Farm Credit Corporation loan because usually the Corporation is out of money. In B.C., farmers and ranchers have pretty well given up looking to Ottawa for financial assistance. I do not expect that attitude to be changed very much as a result of this Bill, legislation that will affect perhaps only 500 farmers in Canada and maybe 25 or 30 in British Columbia. The agricultural community in my province looks mainly to the provincial Government for help when needed.


Eugene Whelan: We pay twice as much in B.C. to agriculture as they do. Where are they getting their help? They are getting it from us.


Lorne Everett Greenaway: The Province of British Columbia has had an interest rebate plan in place for many years and has assisted a good many producers of agricultural commodities. Last year there were 5,700 applicants for this Program. The B.C. Government also provides guarantees for agricultural loans. If you ask any farmer or rancher what is needed most in Canadian agriculture today, I will wager that nine out of ten will say: "Just give us some long-term money at a reasonable, fixed rate of interest and then leave us alone." Of course, today this cry issues forth from all sectors of the economy, but I venture to say that farmers have been saying it for the longest time.
Further, the question of finance and credit is a vital issue to young people trying to take their rightful place in Canadian agriculture. The average age of Canadian farmers today is 49, and obviously young people must be encouraged to take the place of those who retire. It is almost impossible these days for them to do this unless they are fortunate enough to inherit a farm or ranch. Even if this does happen, there is no guarantee that the operation will remain viable.
There is no doubt that there is a real need for reasonable credit, and there is no doubt that the Farm Credit Corporation requires a larger pool of capital. Presently there is a plan afoot to raise $100 million in the United States by selling notes on U.S. exchanges. We are assured that U.S. insurance companies, both fire and general, and pension fund agents will eagerly line up to purchase Canadian securities in the form of Farm Credit Corporation notes. It is my understanding that this offering will be forthcoming when brokers feel that
Farm Loans Interest Rebate Act
conditions are stable and top prices can be obtained for the issue. Perhaps now that the United States mid-term elections are behind us, we will soon see these notes on U.S. markets. Naturally, foreign exchange and interest rates are vital considerations in this scheme. At present, Canada's dollar, at 82.5 cents U.S., will add a full 2 per cent to the 12 per cent cost of this money, 12 per cent being the approximate U.S. interest rate.
In order to protect itself from foreign exchange risk, the U.S. money raised and returned to Canada will have to be hedged. This will likely add a further cost of about 2 per cent, and allowing 1 per cent for Farm Credit Corporation administration, the money would finally reach the borrower at a cost of 17 per cent-not what I or anyone else would call cheap money. Is this, then, the purpose of Bill C-134, to reduce the interest rate and thus the flak that the Corporation and the Government would have to bear for procuring expensive foreign money?
As I understand it, the plan is to lend this money to Canadian farmers at a fixed rate of interest over a ten-year period. An obvious risk to the Farm Credit Corporation could occur in the event that loans are prepaid before full term, when the Corporation could be left with some pretty expensive money on its hands. Farmers have expressed concern over the Farm Credit Corporation venturing into foreign currency markets, worried that the plan might fail and make loans even more expensive. Many have rightfully asked, "Why not raise the needed funds at home in Canada?"
It seems to me that Canadians would be most interested in supporting Canadian agriculture through purchasing Canadian agricultural bonds. Our Party has long advocated the establishment of an agribond, as was mentioned earlier this afternoon by my colleague the Hon. Member for Elgin (Mr. Wise).
For years and years this Government has neglected to address the serious problem of adequately financing Canadian agriculture. The Farm Credit Corporation over these years has been literally stangled by lack of sufficient capital to lend. The Minister of Agriculture (Mr. Whelan) and the Government know full well how the lack of capital at a reasonable rate, especially for long-term credit, has throttled Canadian agriculture. Why has the Minister not made this problem his top priority instead of such things as threatening beef producers with his ridiculous and destructive plan for a beef marketing board? Why is he spending so much energy flogging the abomination called Canagrex? He and his colleagues might saddle Canada with Canagrex, but if they cannot properly finance our farmers, young and old, then it will not be very long until there is little, if anything, to export to other countries.
Over the years I have had many opportunities to discuss agricultural financing with American ranchers who have moved to Canada. I cannot remember one who was not completely dismayed by the evident lack of credit options

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available to Canadian farmers. Many told me of a very popular institution in the United States called Production Credit Associations. They could not understand why Canada did not provide a similar option. 1 am indebted to the Canadian Cattlemen's Association for providing me with information on Production Credit Associations.
The PCAs originated under the Federal Farm Loan Act of 1916 in the United States. In 1933, PCAs became retail outlets for credit available at wholesale from the federal intermediate credit banks. At first, their equity base was supplied by Government funding. Later, as the Government money was paid off, the equity base was supplied by Association members. Equity is in the form of class A and class B shares. All borrowers must be shareholders. When obtaining a loan the borrower has to invest 5 per cent to 10 per cent in class B stocks. No interest or dividends are paid on this class B stock. Once the loan is repaid, the borrower can allow his equity to remain in the PCA to provide a fund base for future loans. If the member does not borrow for two years his class B shares are converted to class A and a dividend is paid.
PCAs use their equity base to borrow from the federal intermediate credit banks of which there are 12 in the United States. They raise their funds through the sale of securities to investors in the nation's money markets. PCAs pay state and federal taxes. Their structure is basically that of a farmer-owned co-operative with a board of directors made up of active member borrowers. The administrative cost of loans is one-half of 1 per cent and interest on loans is usually 2 per cent to 4 per cent below commercial bank prime rates in the United States.
I have a brochure provided to me by the Production Credit Association and I would like to quote some of the significant points mentioned:
Are PCAs Providing Government Loans to Farmers?
No, all government funds originally in PCAs were completely paid back. The PCAs are now all farmer owned.
Who Operates Local Associations?
Only farmers who borrow money from PCA are permitted to become members and owners. Only these members have the power to elect members to serve on the board of directors.
What Prompted the Organization of PCA?
Necessity! Prior to its founding, farmers often found themselves without an adequate source of credit that was dependable. Also, the terms and conditions of the credit did not work to the best advantage of the farmer. PCA, by providing a reliable, permanent source of funds, has eliminated most of these credit problems for farmers and ranchers.
What Additional Advantages Does PCA Offer?
It is operated for farmers by farmers-who understand the needs and problems involved in farming as well as farm credit. In addition, through the Federal Intermediate Credit Banks, PCA has ready access to funds from the nation's money markets.
More Specifically, For What Purposes Can Loans Be Made?
For feed, seed, fertilizer, labor, harvesting expenses, fencing and other improvements, chemical sprays, spraying equipment, farm and home supplies; money to buy livestock, poultry, machinery processing equipment, storage facilities-
In short, practically anything the farmer needs to produce food.
How Much Can Be Borrowed From PCA?
Practically any amount. Loans are based on the amount needed to do the job; how much can be used profitably; the amount of dependable income from the operation for which the loan is made.
How Much Time Does it Take to Get a Loan?
The time varies from a few minutes for established members to perhaps up to 1 week for a new member.
Who Passes on Loan Applications?
The member-elected board of directors names two of its members to serve with the association's manager on a loan committee. These two members and the manager review the applications.
Besides PCAs there are several other options available in the U.S., such as the federal land banks, local banks and the Bankers Acceptance Corporation, just to mention three. Original sources of credit similar to what I have just outlined are desperately required by Canadian agriculture. If Canadian farmers were ever presented with a brochure similar to the one I have just been quoting from, I am certain their first reaction would be one of the total disbelief. Fighting to get financed in Canadian agriculture has become a way of life.
Canada is light years behind in the financing of its agricultural sector. The Farm Credit Corporation does the best it can under the terms imposed upon it by Liberal politicians who continue to fail to come to grips with this very serious problem.


Mr. Ralph Ferguson (Lambton-Middlesex):: Mr. Speaker, I am pleased to take part in the debate on Bill C-134, which will provide a measure of relief to Farm Credit Corporation borrowers at a time when interest rates in that Corporation are higher than the return most commodities sold by farmers will justify. I was also pleased to note today that the Bank of Canada rate fell again by approximately a quarter of 1 per cent. This is the twelfth consecutive week that there has been a drop in interest rates. I am pleased with the legislation before us today because it will assist those farmers who have taken out loans in the last few months, and will be requiring funds in the next few months to continue their operations and follow the plans which they have set out.
While the Hon. Member opposite was mentioning some of the things happening in the United States, I think it only fair that we should point out that approximately 50 per cent of loans under the main loan program in the United States are in default. Compare that with Canada, where the rate of default is approximately 10 per cent of loans to farmers.
To break that down a bit further, arrears in the cash crop sector, including grain farmers, amount to slightly over 13 per cent. In the fluid milk sector, 6.16 per cent of the producers are in arrears. In the industrial milk or cream sector, arrears amount to 8.4 per cent. Arrears amount to 15 per cent in the beef sector, to 19.8 per cent in the hog sector, to 8.9 per cent in the poultry sector, and so on down the line. However, it is interesting to note that the average interest rate charged to those in deepest trouble is approximately 9 per cent, which would indicate that they have been in production for a long time or they would not be paying that rate of interest.
No doubt the fluctuations in interest rates among countries in the western world had an adverse effect upon their cash flow
November 4, 1982

projections and created part of the hardship. However, rates charged by the Farm Credit Corporation have indeed been very reasonable until the last year and a half. I want to pay tribute to this organization for having done a thorough job of administration and of advising farmers how to chart the proper course, and plan their operations.
I could not help but comment on an article in The Globe and Mail of August 26, 1982, which reported that Mr. Gracie of the Canadian Cattlemen's Association had indicated that mark-ups on beef are much lower in the United States than they are in Canada, a mark-up of 45 cents a pound above what United States stores get. This in turn has no doubt created much hardship to the beef industry in Canada. This is one area the Cattlemen's Association should be investigating to ensure that there are not abnormal mark-ups by the beef industry.
I would also like to point to the stabilization programs. I am a beef producer, a cow-calf producer, and previously belonged to a stabilization program.


Mr. Mayer:: It is a lower mark-up?


Ralph Ferguson: As a matter of fact there is a lower retail mark-up in the United States than in Canada. 1 hear comments from the other side so I will reiterate that Mr. Gracie, as reported in a story in The Globe and Mail on August 26, 1982, indicated that Ontario and Quebec supermarkets are taking a beef mark-up, as much as 45 cents a pound above what United States stores get. The beef industry in Canada could certainly do well with some of that mark-up.
However, returning to the stabilization program, I belonged to such a program in the cow-calf industry a number of years back. I paid into it for four years of a five-year program. I received a payback for three years and paid my premium on the fourth year because I considered it as insurance against the lean years which would come in the future. When 1 subsequently went to pay in the fifth year, I was advised that the program was being discontinued because the balance of the farmers had not sent in their premiums for the fourth year when they realized there would not be a payout. I was one among the less than 10 per cent who paid in that fourth year.


Gary Michael Gurbin: It must be a national program.


Ralph Ferguson: If we are to have a stabilization program of any kind, I want to ensure that it is mandatory as far as contributions from farmers and the provincial and federal Governments are concerned. If it ever develops, it must be mandatory. It must be administered by a central body to ensure that all Provinces are paying in at the same level so that we do not have add-ons in the various Provinces, such as we had a year ago last May in the pork industry, when some provinces were paying over $11 a hog while others were paying only $3.50. These things must be taken into consideration and be worked out in detail so that there is a total harmonization across Canada, as suggested by the Minister in 1977.
I believe that under current conditions in Canada there must be some better mechanism for price discovery than we have had over the past few years. At the time I planted my crops
Farm Loans Interest Rebate Act
last spring, I could not help but consider what was happening in the Chicago futures market. In spite of the fact that there was a crisis in the Falkland Islands, a consequent embargo against Argentina, and the plantings in two of the major American producing states were late because of a cold, wet spring, the projected carry-over in the oilseed sector was approximately half of what was expected, yet that market was in a downward trend because, as was explained by some of the experts, people were exercising their investment options. That was not done because of the law of supply and demand but because they were exercising their option to invest in gold, high interest bonds or other areas.
It is very difficult for farmers to project a cash flow with accuracy when this type of thing takes place. They cannot use the futures market because supply and demand no longer applies. Last spring the futures market was on a downward trend and yet all signals pointed the other way. There must be a better system for providing stability for farmers than the Government assistance provided in the Bill before us today or the interest-free loans of approximately $500 million that will be given to farmers this year for crops in storage. I am distressed that not all commodity sectors have chosen this route, Mr. Speaker, because the assistance is needed this season. Ontario is the largest corn producing Province in the country, yet it has no organization which could administer the program. I believe there are such organizations in Manitoba and one in Quebec.
I hear a comment from an Hon. Member opposite to the effect that we have a solution for all the problems, Mr. Speaker. I have 30 years' experience in the farming sector and I have taken a few hard knocks. I know the sectors of my operation that are paying their way and the ones that are not. My beef herd is acting as scavengers on scrub land in order to pasture hillsides that cannot be cropped in other ways.
I would remind Hon. Members that the figures compiled from Farm Credit Corporation statistics show that the largest percentage of loans in arrears in relation to various commodities are not for those commodities for which there is a system of planned production and which can set their own prices, based on a reasonable cost of production. This is a subject we must examine very closely if we hope to be able to provide the stability that is required by young people in the industry.
In the last ten years a tremendous number of young people in the industry have been affected. Perhaps they have over extended in some areas. I have always maintained that a farmer cannot borrow his way out of trouble, but rather, must adjust to the price structure. We must ensure that market mechanisms are in place that will provide a standard of living for farmers commensurate with that of the rest of society.
In spite of the fact that there has been a large number of bankruptcies in the farming sector in the last year, slightly over 300, the percentage has not been as great as that in other areas sectors of the economy. Many commodities have their

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own marketing systems and in that way can plan the production necessary to satisfy the domestic and export markets.
I believe this Bill is needed at the present time, Mr. Speaker, in order to assist farmers who have had to borrow money during the last summer and who will be borrowing in the months ahead, until the rates change at the end of the fiscal year. The Bill ensures that they will know what their interest charges will be and so will be able to project their costs. We need to go further in planning the financing of our farm organizations, Mr. Speaker, so that the farmer will be confident that he will not be forced off his land because of a temporary cash shortage.
I speak on this aspect as a private Member but I intend to raise the matter with the Ministers involved. I believe that some simple amendments could be made that would assist the cash crop farmer or the beef farmer through a tough winter, until the prices pick up. We cannot afford to let them go out of business. Any turnaround in our economy will be based on the natural resource industries meeting the requirements of the Third World.
1 am delighted to report that in the last month I have been contacted by people from offshore who want to buy our commodities. They have asked when the legislation before the House will be in place, because they want to be sure of a steady and stable source of supply.
I should like to conclude by commending the Minister of Finance (Mr. Lalonde) not only for including this provision in the budget, but also on the twelfth consecutive week of declining interest rates. As a farmer, 1 have to be optimistic. Farmers must be optimistic if they are to plan their crops. We hope that Mother Nature will bless us with the bountiful supply of food that we have always had in Canada and that we will continue to have the ability to help provide for a hungry world.


Charles James Mayer: Mr. Speaker, this is an important Bill, not only because it deals with agriculture but also the most important problem facing Canadian agriculture today, and that is interest rates. That is what determines whether a farmer will survive this year and be around next year.
Before I call it five o'clock, I should like to comment on some of the points covered by the previous speaker. It is unfortunate but true that the Canadian retailing system takes a larger mark-up on beef that does the American retailing system. I hope the Hon. Member will make a recommendation to the Minister of Consumer and Corporate Affairs (Mr. Ouellet) to bring in anti-combine legislation. The Government has been fooling around with that kind of legislation for the last 10 or 12 years but as yet we do not have it on the books.


Ralph Ferguson: Mr. Speaker, I rise on a poi.it of order.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Corbin):: Order please. Pursuant to Standing Order 40, it is my duty to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the Hon. Member for Calgary North (Mr. Wright)-The Economy-Government policy on private sector; the Hon. Member for Portage-Marquette (Mr. Mayer)-Grain-(a) Levels of advance payments, (b) Possible benefits to western communities; the Hon. Member for Erie (Mr. Fretz)-International Joint Commission-Delay in appointing Canadian commissioner.
It being five o'clock, the House will now proceed to the consideration of Private Members's business as listed on today's Order Paper, namely, notices of motions (papers), private bills and public bills.


PRIVATE MEMBERS MOTIONS FOR PAPERS
[Stage Direction]
[ Translation]
All items preceding No. 87 allowed to stand by unanimous consent.

[Stage Direction]
The House resumed, from Thursday, May 27, consideration of the motion of Mr. Korchinski:
That an Order of the House do issue for copies of all correspondence and communications, including telephone submissions, regarding the application by Cargill Grain Limited for a grant from DREE towards construction of an Oil Seed Crushing Plant at Melfort, Saskatchewan.
Mr. Pierre  Gimai@: Mr. Speaker, after a few weeks in our constituencies where we were able to determine the needs of our constituents, listen to them and discuss the economic future of our regions and our own ridings, I am glad to be back in the House with my colleagues to deal with the issues raised by various Members. First of all, we now have before us a motion introduced by a Member, and I believe it is one of the most important aspects of our democracy that, regardless of their political party, private Members can express their opinions by introducing bills and defend the views of their constituents, as the Hon. Member for Mackenzie (Mr. Korchinski) is now doing.
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For my part, I have already spoken on the matter under consideration for about ten minutes. During our first discussion, I explained that it is extremely important, when a government, such as the Government of Canada, negotiates with a company, whether Cargill or any other, that these negotiations remain confidential. Because of the competition between the various companies in all economic sectors throughout the country, such companies cannot afford to make public their financial statements or economic situation simply because they are negotiating with the Canadian Government to obtain certain grants. It would not be normal for such information to be made public and for the competitors of these companies to learn about their financial situation. The important thing for the Canadian taxpayer is that his tax dollars be redistributed equitably among the various regions, that everything be done legally and that after the money is redistributed and the grant is promised, the people be informed of the reasons for the grant, namely to create so many jobs or to promote the economic development of such a sector or such an area. This is a far cry from divulging all the figures requested by the Hon. Member. To quote from motion No. 87, he asks that telephone costs, communications and the correspondence between the company and DREE be made public. In all my three years as assistant to the Minister of Regional Economic Expansion and my two years as executive assistant, Mr. Speaker, 1 have never known such information to be made public because, as I was saying, it is extremely important for the companies involved that if they have developed, for instance, specific working procedures or development plans for their company, these not be made public only because they had to provide them to the Government to establish the profitability of their business. That is why I have to remind the Hon. Member for Mackenzie that, while I find it extremely laudable on his part to defend the views of his constituents and to work for the welfare of his riding, the company involved in this matter took certain steps because it wanted to improve its facilities, but in the belief that the Canadian Government would keep in mind that its assets, its development program and its financial statement are its own business and that of its shareholders and not something that should be made available to the public tomorrow morning. I want to make myself clear, Mr. Speaker, and that is why I am repeating myself. If the Canadian Government gives even one penny to someone, it is normal that the Canadian people know where this penny went and why. That I admit. But I stronghy object to all information submitted by Canadian citizens or Canadian companies being made public simply because the latter are dealing with the government. I think that is going a bit too far. Besides, the purpose of the whole exercise is definitely not to open the books of those companies for public viewing, but rather to help them prosper so that people in general will be better off in the end. Such is the purpose of regional development legislation and, I would suggest, of current negotiations between the company and the Department. Some people may say that the Department
Dree Grant
expects too much but I for one am glad that it does so. Being aware of the very high number of grants awarded by the Department, and of the substantial amounts involved in certain cases, I would rather not see all those funds redistributed haphazardly to the various areas of the country. It is quite normal for the Department to insist on profitability and, in that respect, the rate of failure among companies which were given assistance by the Department of Regional Economic Expansion is very low, even lower than the rate where banks are involved. This is important because that happens to be the taxpayers money. It pays the Government to help a company with public funds, provided that company is operational and creates jobs which will generate income for the state as well as for the people living close to the company plant.
Mr. Speaker, our regional economic development legislation has been extremely useful over the past 15 years because it has played a major role, particularly in a riding such as mine, in the development of various industries, whether small, medium or large. The presence of the Department has been quite evident, particularly in areas where economic development was lagging. In these trying times, a number of companies which had been given assistance by DREE are now the only economic mainstay of certain regions now experiencing very serious difficulties.
That is why I urge the Hon. Member for Mackenzie to keep in mind the spirit and the principle of that legislation which was designed to help certain companies in certain regions, not everywhere, because those regions do need an economic stimulus. Even so, those companies must indeed be assured that their operations and their economic standing will not be the object of public scrutiny.
Those are the remarks I wanted to make on this subject, Mr. Speaker. I hope they will enlighten my colleagues, at least so they will know what DREE is all about and why discretion is the order of the day. Personally, I hope the Department will keep up the good work.


Victor Fredrich (Vic) Althouse: Mr. Speaker, I would like to spend a few moments discussing this motion to make public papers regarding a DREE grant, or lack of a DREE grant, to the Cargill Grain Company to build an oil seed crushing plant at Melfort, Saskatchewan.
What seems to be have been involved was an application by the Cargill Company for a $2 million DREE grant for a plant to be built costing in the neighbourhood of $25 million. Apparently the grant was not forthcoming and therefore the plant was not built.
I would like to spend some time discussing the circumstances behind the rapeseed industry. First, I want to comment on the freedom of information argument made by the Hon. Member for Mackenzie (Mr. Korchinski) in the debate last May. He suggested this was a clear-cut case for a freedom of
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Dree Grant
information Bill and that such a Bill would be useful in the circumstance. There are some laudable uses for a freedom of information Bill.
1 am certain that regardless of what Government implemented a Freedom of Information Act or provided the House with such a Bill, a certain amount of information would still not be made public for a number of reasons. I can see that agencies of Governments engaging in business in competition with other corporations around the world would be very loth to produce all information of how they arrived at a certain price, or how they achieved a certain business agreement. 1 think specifically of the Canadian Wheat Board. A great many Prairie farmers would be hurt badly if the Canadian Wheat Board was forced to provide all relevant information regarding business dealings because their competitors are not forced, in any jurisdiction around the world, to make that same kind of information public.
1 doubt any Government or Party would be absolutely free and forthcoming with information. For example, I simply point to the Official Opposition, whose Party has been loudly in the forefront asking for freedom of information legislation and has been a champion of this legislation for some years. This is the same Party that refuses to make its platform public. They say this will happen when the time for an election comes. Until then it is top secret information. I can understand that, and so can a lot of businesses and Government agencies, but the Progressive Conservative Party has imposed definite limits to its freedom of information when it comes to its political plans, even though it is the kind of information that most voters in Canada would be interested in since it is part of the full and efficient functioning of any democracy.
On the question of rapeseed crushing plants in the Melfort area, the question of building more crushing capacity several years ago seemed to be a fairly good business decision. In retrospect, we can see and understand why Cargill did not proceed, since they were going to be putting up over 90 per cent of the capital, in any case. We can understand why they did not when we see what the industry is faced with. I know that Cargill has one of the best market divisions in the world. It is probably the largest grain handling and grain marketing and processing institution in the world at this time. In the intervening two or three years, we have seen that we do not need more crushing capacity, given current market conditions. There is a surplus of crushing capacity in western Canada now, given the price of oil. There are, I suppose, two and a half plants in Saskatchewan, at Nipawin, at Saskatoon and one at Lloydminster balanced on the Alberta-Saskatchewan border.
We are now in a position in that part of the country where most of the crushers are crying that they have not been generating great profits. There were some profitable years, but those have gone. In fact, crushers in Manitoba and Saskatchewan are now crying foul because of a move by the Province of Alberta which has offered the industry $40 per tonne of rapeseed crushed, up to 90 per cent of last year's crushing volume, in order to keep the industry in Alberta growing and
in an effort to concentrate more of the industry in that Province. As well there are subsidies in Alberta, tank car leases, which have increased from the old subsidy rate of 70 per cent of cost to what will now become 90 per cent of cost in the coming year.
So we begin to see some of the problems that have developed in the rapeseed crushing industry since this application first began. The production of rapeseed has not been increasing and there are a number of reasons for that; one is world conditions. The world oil seed output has been reduced, but prices are still under much pressure, again, in part, because of interference by various government. The European Economic Community is offering what to Canadian farmers seems like massive subsidies in order to export rapeseed to countries like Japan, which is our main buyer of raw seed.
Internally, our marketing system has been undergoing some turmoil. As many members in the House will know, rapeseed is marketed through the open market with the Winnipeg Grain Exchange selling and buying futures. A great many small and medium-sized operators in the market are handling the rapeseed and providing a brokerage function between the farmer and the final user.
There has been some change to the Cinderella crop in the last three or four years in the domestic market as well. It is not just the problem of selling the oil and doing the crushing, but there have been internal marketing problems as well. The market was being dominated by a growing number of small grain buyers, and producer confidence in those buyers has been severely shaken over the last three or four years by a number of dramatic and very well publicized bankruptcies, which have left farmers holding the bag for the costs. Farmers have lost on each of these bankruptcies anywhere from a few million to quite a few million dollars because of the method used in handling farmer rapeseed.
These companies are fairly numerous. Anyone who reads the grain news in western Canada knows about the Memco bankruptcy, the Econ Consulting bankruptcy and Diversified. Others that created a problem were Consolidated Seed Exports, and Gibb Farms Limited at Elm Creek also took down quite a few farm dollars with it when it went down, and Trans-Canada Marketing Service in Manitoba took with it a lot of farmers' money as well. There is some hesitancy, therefore, by farmers to produce rapeseed because of the uncertainty in the market and the kinds of operators that have been coming forward.
The disintegration and multiplicity of the market has created some problems for the buyers also. There are only a few large companies buying out of Japan. When they try to purchase it is sometimes difficult to assemble a full shipload. In order to do that, there are often fairly high premiums paid on carload lots of rapeseed waiting on track in Vancouver. Sometimes it is impossible for any one broker to provide buyers with the quantity of products which they need. For this reason there has been some continuing agitation on the part of farmers to have the whole question of marketing of rapeseed

*
November 4, 1982

handled through the Canadian Wheat Board so that there is one agency amassing the grain and forwarding it, in order to deal adequately with the few large buyers of rapeseed and the Japanese Food Commission which, as I said before, is our biggest customer.
So the Cinderella crop has got to the point where, even though we had developed the crop with very sophisticated research, we were world leaders in genetic selection of rape-seed, world leaders in providing, manufacturing and developing the kind of equipment which would test the genetic potential of the varieties produced; and even though we were also at the leading edge of developing varieties which would provide very specific oil qualities required by the trade with very specific types of protein and amino-acids in the meal which went with the rapeseed, we have been having some difficulty finding markets. I think this is in part because, while the industry has done a good job of concentrating its research and production abilities, it has neglected the marketing end which I think is probably the area which needs full attention at this point in time.
I realize that in backing the introduction of one more crushing plant in western Canada, the Hon. Member for Mackenzie realizes what an advantage a crushing plant would be to the largest centre in his riding and is aware of the economic advantages which would spin off from that. But I think we must also recognize the over-all problems the industry is facing which have caused a major company like Cargill to avoid building a plant, given those economic conditions.
We have no objection to the papers being made public if there is anything to be made public. I think though, in retrospect, several years having passed since this application was begun, most of us can see the economic situation-that probably the marketing people in Cargill had foreseen, which was probably far more important to that company than the availability or not of less than 10 per cent of the total cost by way of a DREE grant. We would be prepared to see the papers produced, but I think we understand the economics behind the program not going forward.


Mr. Andre Bachand (Missisquoi):: Mr. Speaker, I realize that the Hon. Member is anxious to clarify a situation which seems ambiguous at first. However, the important thing at this stage is to find out exactly why the department decided, for the time being, to reject the application by Cargill Grain Limited to build a plant at Melfort, Saskatchewan. The motion by the Hon. Member for Mackenzie (Mr. Korchinski) is quite clear. The request made in the motion is simply, and I quote:
That an order of the House do issue for copies of all correspondence and communications, including telephone submissions, regarding the application by Cargill Grain Limited for a grant from DREE towards construction of an oil seed crushing plant at Melfort, Saskatchewan.
Dree Grant
So what the motion is asking is that the documents be made public. Now, the Hon. Member ought to know that in this case, the free competition ethic of international and even national trade forbids production of documents when public funds have not been granted to the company in question. If the Hon. Member wishes to obtain specific information on Cargill Grain's plans in this area, its projected capital investment, its applications to the department and the answers given by the department to the company, he knows perfectly that his request should be addressed directly to the company, because at the present time, no public funds have been granted the company by the Canadian government.
The matter is now being discussed by officers of Cargill Grain Limited and departmental officials, but the department was very clear when requested that Cargill Grain Limited produce new facts if the company wanted to have its case reviewed. Now, in the present case, the minister responsible for DREE at the time, the Hon. Member for Matane (Mr. De Bane), wrote to the Hon. Member, giving him a very specific answer regarding the refusal of the Department of Industry, Trade and Commerce and Regional Economic Expansion, which was DREE at the time, and this letter, which is dated November 2, 1981, is very clear. It says very explicitly, and I quote:
After an exhaustive review of the case, I feel confident that Cargill can, and will, proceed with the project without assistance from DREE. The company is financially strong and the project appears to be a wise one from the company's point of view.
That was written in this letter, which also said that in view of the fact that Cargill Grain Limited could afford to carry out its project without Government funds there seemed to be no reason to grant money to a corporation which can manage on its own. Besides Cargill Grain Ltd applied under the special regional development legislation which quite clearly states that the department may grant funds only to such corporations which really need financial assistance. So far,-and here opinions may differ-experts in this area have felt that Cargill Grain Limited can afford to build its own plant without help. On receiving an application, Department officials investigate thoroughly to make sure the need is genuine. In this case, the Hon. Member is aware that Departmental officials had several meetings with Cargill's representatives to find out what could be done under the current development legislation. The hon. member is also aware that the Minister must abide by the law just as any other Parlimentarian or citizen. Even if the Minister had wanted to grant the funds requested by Cargill he could not have on the basis of the financial statements, which show a satisfactory balance sheet and also on account of the fact that the available funds can only be used on a short-term basis. If the Minister had done otherwise, he would have acted illegally.
The documents and the reply enclosed in the letter which was given to the hon. members are quite clear. 1 suggest that this motion is much more dilatory than real. Perhaps the Hon.

November 4, 1982
Dree Grant
Member should use a different procedure to bring it up or choose another course of action for instance, he could get from Cargill the documents he is seeking from the Department, because the Department is not authorized to reveal the financial interests of private corporations. And I think that any Member of this Elouse would recognize the legitimacy of this principle. Cargill has never agreed to allow the Government to release its financial statements or the nature of its application or its financial requirements. Such a request has never been made by Cargill, and if the Hon. Member ever wanted to know more about this matter, the best way for him would be to prevail upon Cargill to make this information available to him.
When the Hon. Member met the authorities of the Department-I mean the Minister in charge and all the officials-on March 23 last, he made some comparisons with the Province of Quebec where Cargill could have received some grants for the building of a warehouse in Quebec City. The Minister once again replied to the Hon. Member specifying that the Cargill case in Quebec City was entirely different from the Cargill project in Melfort, Saskatchewan. He has a chance then to discuss these matters with the authorities of the Department. I think that the Minister's explanations with respect to the Regional Development Incentives Act were quite clear. This is what the Hon. Member should keep in mind and he should not think that the Department is denying grants at whim on the grounds that they would be unreasonable. However, the Department cannot provide a grant because the application does not meet the criteria set forth in the legislation. And this is the fact on which is based the Department's decision. We would be the first to be blamed if the Department were to start distributing funds to companies or corporations which definitely do not need them. And it would be a waste of public funds if we proceeded gropingly in the distribution of public funds to responsible companies showing quite healthy financial statements and which are in a position to carry out such a plan on their own.


The Acting Speaker (Mr. Corbin):: Order! Pursuant to Standing Order 48(2), the hour provided for the consideration of this motion has now expired.

The Chair would like to point out that the Standing Order also permits at this time a further five-minute participation in the debate by a Minister of the Crown and an additional five minutes by the mover of the motion, after which the Chair is bound to put the question.


Hon.   Ed. Lumley@Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion: Mr. Speaker, I appreciate this opportunity to enter into the debate. Unfortunately I only have five minutes. I would have very much liked to inform Hon. Members of a number of items which the Government of Canada has done for the oil seed crushing industry, but because of the time limitation I will
stick to the specific motion of the Hon. Member for Mackenzie (Mr. Korchinski).
I am somewhat surprised that the Hon. Member would request an order which would violate the basic business and trade ethics of providing information on a transaction with a company when public funds have not been granted. I want to make my position clear that it is not possible or proper to agree to the request of the Hon. Member for making confidential documents public. 1 am unaware of a time where information of a confidential commercial nature was disclosed to Parliament prior to the file either being processed or a positive decision being reached. I will elaborate on this further. However, I want to respond first to what I believe is the concern which precipitated the request of the Hon. Member, that of the Department's processing of the Cargill application for an RDIA grant.
The matter of the Cargill application has received considerable attention and analysis by officials within my Department. I am well aware of the extensive media coverage and the representations which have been made to the Minister of Fisheries and Oceans (Mr. De Bane) and to the President of the Treasury Board (Mr. Gray), former ministers of DREE, and their officials on behalf of the proposed Cargill project at Melfort.
With respect to the proposed project, I appreciate the importance of enhancing value-added processing in Saskatchewan and recognize that support of the agricultural processing industry in Saskatchewan would have a significant impact upon the provincial economy. It is appreciated that if the Cargill oil seed crushing plant were to proceed, there would be the potential for benefits in the long-term benefits to Canada, benefits to the Province of Saskatchewan, to agricultural producers and to the City of Melfort.
The Government's support and recognition of a strong, stable oil seed crushing industry in Canada is evidenced by the favourable ruling of the Federal Investment Review Agency which approved Cargill's proposal to establish an oil seed crushing facility in Melfort, Saskatchewan.
As was indicated to the Hon. Member on May 27, 1982, by the Parliamentary Secretary to the Minister of Industry, Trade and Commerce (Mr. Maltais), the original decision not to provide a DREE grant to Cargill was based on the judgment that Cargill was financially strong and the belief that the project would proceed without assistance from DREE. I believe it is worthwhile at this time to review the facts as outlined to the House on May 27. The Parliamentary Secretary quoted from a letter sent to the Hon. Member from the then minister of DREE, the present Minister of Fisheries and Oceans. Again because I feel it is important, I should like to quote from that letter dated November 2, 1982. In part it read:
After an exhaustive review of the case, I feel confident that Cargill can, and will, proceed with the project without assistance from DREE. The company is financially strong and the project appears to be a wise one from the company's point of view.
November 4, 1982

The letter went on to indicate that since Cargill Grain Limited had the financial resources to carry out its project without Government funding, it would perhaps be inappropriate on the part of the Government to provide funds to a company which already had the means to carry out its project independently.
The legislation regarding the Regional Development Incentives Act is clear. It authorizes the Department to grant funds to a company, provided it can demonstrate a real need. At the time the analysis of the application took place, the firm conclusion was that Cargill Grain Limited was capable of building its plant without a DREE grant and would do so. Thus the Minister, on the evidence submitted, was not authorized to grant funds to Cargill.
At stated in the House previously and repeatedly, the Department is prepared to consider another application from Cargill for the Melfort project at any time. A favourable response to any such application would of course require, in part, that Cargill present a convincing and reasonably attractive projection for the late 1980s and the 1990s for canola crushers as well as demonstrate its need for public assistance on the project. Let me repeat that those specific conditions as well as others are required under the RDIA legislation now, as in the past.
I have attempted in my comments here to provide information which is informative and at the same time respectful of the confidential nature of the transactions that have occurred between Cargill and the Government of Canada.
The provision of copies of correspondence, communications and other documents relating to Cargill's application for RDIA assistance would be contrary to acceptable procedures in Canada and in the international community because of the need to ensure commercial confidentiality. Publishing of this information would be seriously damaging to any future communication between the public and private sectors and is, accordingly, to be resisted. The Department is not allowed to make public statements on private financial interests, and I am sure Members of the House will agree that this is a sound and essential principle.
1 wish to reiterate that to divulge such information could be detrimental to the company, to future RDIA applicants, and to all business and Government transactions based upon the trust in confidentiality. Therefore, I ask that my hon. colleague reconsider and withdraw his motion for these papers.


Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, I thank the Minister for his intervention at this particular time. This now makes it official that the Government is not prepared to proceed with any type of assistance. The Minister told me that Cargill's position was so sound that it did not require any assistance. Would he explain why a warehouse in the Province of Quebec was given a grant by the Government? It was the same company, Cargill, witht he same financial statement. If it is satisfactory in Quebec but not in Melfort, it does not seem fair. The Hon. Member for Humboldt-Lake Centre (Mr. Althouse) told us that the marketing facilities of Cargill were some of the best in the world. The oil seed crushing industry is
Dree Grant
in dire straits at the moment, and Cargill has the marketing facilities. If it were given the grant, it could be moving forward and utilizing its facilities. Either we want industry or we do not want industry.
The Minister told me that it was not proper to provide information. At one time I indicated that I was not interested in the financial position of the company. I know what the capital costs will be. Cargill was quite prepared to put in $25 million. They only asked for $2 million in the form of a grant from the Government, a grant which was paid to CSP.
The oil seed crushing industry went to the Government of Alberta for assistance, and it obtained assistance. The oil seed crushing CSP in Saskatchewan went to that provincial Government for $12 million. It is the same taxpayers' money. If Cargill had received $2 million it would have established the plant. For the Minister to stand here trying to defend the position that he is not to divulge any information based on the fact that the decision was not made is incredible.
I am not interested in financial positions. I have already indicated that in response to an earlier inquiry. I want to know why the decision was made in the way it was made. I am quite convinced that it was for purely political reasons. First, with regard to FIRA, it made a very thorough study of the company. FIRA was quite satisfied that the company would be a good corporate entity in this country. FIRA felt the company would be an asset to this country. The company was examined. I do not know how many times I tried to call the office of the former Minister of DREE, but I could never get any response. The new Minister took over and he, in turn, promised me that he would look into the matter. There are over 1,300,000 people unemployed. What is wrong with the Government? It cannot find $2 million, yet it found $700 million for the Mirabel airport, that white elephant. The Government then poured in $400 million to find an airplane for it. Why can the Government not find $2 million for an industry right in the heartland of an oil seed producing area, one of the best in western Canada? I cannot understand what the reasoning is, other than pure politics.
1 want to know who is behind this and who it is that influences this Government. Is it simply a pool Cottery? I have no argument. I have the CSP in my area. I am not arguing against their position. I am interested in providing facilities for my producers and at the same time an opportunity for employment.


Some Hon. Members:: Hear, hear!


Stanley James Korchinski: My area deserves the same type of attention as does the area of the Minister from Windsor. He provided for a hotel or convention facilities costing $70 million, I understand.


Mr. Kempling:: Liberal pork-barrelling again.


Some Hon. Members:: Oh, oh!

November 4, 1982
Dree Grant


Stanley James Korchinski: If the Government can find money for a convention centre

maybe the Liberal Party is going to hold a convention in Windsor at some time in the future-surely to goodness the Government could give the same kinds of incentives to other areas. Certainly I would not come to the Government at this time if Cargill Grain Limited said that it was in dire straits, I would not defend that kind of a position. But I wanted to get something started in an area which should have been given the same type of incentive as others. In Harrowby, Saskatchewan, CSP got a grant of $5.8 million from the provincial and the federal Governments between them. All that Cargill was asking for was $2 million. Is that too much? Why is it too much?


The Acting Speaker (Mr. Corbin):: Order, please. The Chair will now put the question to the House.
Is the House ready for the question?


Some Hon. Members:: Question.


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


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


The Acting Speaker (Mr. Corbin):: In my opinion the nays have it.
And more than five Members having risen:


The Acting Speaker (Mr. Corbin):: Call in the Members.
The House divided on the Motion (Mr. Korchinski) which
was negatived on	the following division:	
	(.Division No. 260)
 YEAS Messrs.	
Althouse	Crouse	HowieAndre	Darling	HuntingtonBaker	Deans	Ittinuar(Nepean-Carleton)	Elzinga	JarvisBeatty	Epp	JelinekBlaikie	Fennell	KeeperBlenkarn	Forrestall	KemplingBosley	Fraser	KilgourCarney (Miss)	Fretz	KorchinskiClarke	Gamble	Kristiansen(Vancouver Quadra)	Gilchrist	KushnerCoates	Greenaway	LewisCook	Gurbin	LewyckyCooper	Gustafson	MacDougallCorbett	Halliday	MacKayCossitt (Mrs.)	Hamilton	ManlyCrombie	(Qu'Appelle-Moose	MayerCrosbie	Mountain)	McCain(St. John's West)	Hargrave	McCuishCrosby	Hawkes	McDermid(Halifax West)	Heap	McKenzie
Messrs.
McKinnon
McKnight
McMillan
Miller
Munro
(Esquimalt-Saanich)
Murta
Neil
Nickerson
Appolloni (Mrs.) Bachand
Beauchamp-Niquet
(Mrs.)
Begin (Miss)
Berger
Blais
Blaker
Bloomfield
Bossy
Breau
Bujold
Burghardt
Bussieres
Caccia
Campbell (Miss) (South West Nova) Campbell (LaSalle)
Campbell (Cardigan) Chretien Collenette Comtois Corbin Cosgrove Cote (Mrs.) Cousineau Cyr
Dawson De Bane de Corneille Demers Desmarais Dingwall Dion Dionne (Chicoutimi) Dionne
(Northumberland-Miramichi) Dubois Duclos Dupont Duquet Erola (Mrs.)
Ethier
Nielsen
Orlikow
Parker
Patterson
Reid
(St. Catharines) Rose Sargeant Schellenberger
++NAYS
Messrs.
Ferguson
Fisher
Fleming
FI is
Foster
Fox
Francis
Garant
Gauthier
Gendron
Gimaiel
Gingras
Gourd
(Argenteuil-Papineau)
Gourde
(Levis)
Gray
Guilbault
Harquail
Henderson
Herbert
Hervieux-Payette
(Mrs.)
Hopkins
Isabelle
Johnston
Joyal
Kelly
Killens (Mrs.)
Lachance
Lajoie
Lalonde
Lamontagne
Landers
Lang
Laniel
Lapierre
Lapointe
(Beauce)
LcBlanc
Leduc
Lefebvre
Loiselle
Lumley
MacBain
MacEachen
MacGuigan
Scott
(Hamilton-Wentworth) Taylor Thacker Vankoughnet Waddell Wise Wright Young-81.
Mackasey
MacLaren
MacLellan
Malepart
Maltais
Marceau
Masse
Masters
McCauley
McRae
Munro
(Hamilton East) Nicholson (Miss)
Olivier
Ostiguy
Ouellet
Pelletier
Penner
Pepin
Peterson
Pinard
Portelance
Prud'homme
Reid
(Kenora-Rainy River) Roberts Robinson
(Etobicoke-La keshore) Rompkey Rooney Rossi Roy Savard Schroder Simmons Smith Tardif Tessier Tobin Tousignant Turner Veillette Watson Whelan Yanakis-125.


Madam Speaker:: I declare the motion lost.
Motion (Mr. Korchinski) negatived.


Madam Speaker:: The hour provided for consideration of private Members' business having expired, I do now leave the chair until eight o'clock this evening.
At 6.15 p.m. the House took recess.

November 4, 1982



COMMONS DEBATES AFTER RECESS

[Stage Direction]
House sitting resumed at 8 o'clock.


[Stage Direction]
The House resumed consideration of the motion of Mr. Whelan that Bill C-134, respecting rebates of interest on farm loans under the Farm Credit Act, be read the second time and referred to the Standing Committee on Agriculture.
Mr. Deputy Speaker:: When the debate was interrupted at five o'clock, the Hon. Member for Portage-Marquette (Mr. Mayer) had the floor.


Charles James Mayer: Mr. Speaker, 1 appreciate the consideration of the Chief Government Whip. We are namesakes and we enjoy some camaraderie across the floor. I enjoy having him in the Chamber this evening. I hope he will enjoy what I am going to say about some of the things his Government has been doing. As 1 started to say before five o'clock, this is a very important piece of legislation we are dealing with, first of all because it deals with what I believe to be the most basic industry that Canada has, agriculture, and, second, because it deals with a part of the industry which I believe is fundamental to the agricultural industry maintaining its productivity, and that is the financial end of agriculture. Many years ago, you did not need to have all the financing and sophisticated tools which Canadian agriculture needs today to be productive, but what has happened over the years is that Canadian agriculture has become very capital-intensive. Now, according to figures I have seen recently, it takes more dollars invested in agriculture to create a job than invested in the manufacturing industry in this country. That, by way of explanation, is why the financial problems which Canadian agriculture faces, are so basic to the fundamental problems of the whole Canadian economy. Without a productive agriculture, we are going to find it very difficult to maintain the standard of living we are accustomed to. When we get to a situation where the consumer at large has to spend a larger percentage of his disposable dollars on food, there are less consumer dollars to be spent on other items. That is not a healthy situation to be in. It means that other manufacturing areas of the economy will suffer because there simply would not be as many dollars to be spent on commodities other than food.
The financial end of agriculture, then, becomes very important to the total economic picture, not only for domestic reasons, but also because of what agriculture does on the export market. Agriculture is a major earner of export dollars for the Canadian economy. We all hear a lot about the deficit which we have in our balance of payments. That simply means that we as a country buy or import more than we sell, but the one bright spot in that picture is agriculture. We enjoy a very high standard of living in Canada as a result of an efficient agricultural industry. Not only are we productive enough to do
Farm Loans Interest Rebate Act
that at home, but we are also productive enough to export a lot of Canadian agricultural products that earn us foreign dollars. We export in the neighbourhood of $7 million to $8 million worth of agricultural products.
We all know that we cannot grow oranges or bananas in this country. It means, therefore, that we must import a lot of fresh fruit and vegetables that are out of season from the southern United States and other countries around the world. There is a big minus, then as far as the agricultural side of our balance of payments is concerned. So if we subtract that from all the things we export and sell to other countries, it still means we have a net surplus as far as agricultural products are concerned to the tune of $3 billion or $4 billion. The agricultural side of our economy is very important, therefore, in terms of having a healthy balance of payments. It is a healthier situation in which to find ourselves when we can sell things to earn foreign dollars rather than simply to raise interest rates in order to attract borrowed dollars into the country. That should be obvious to everyone, in the sense that if you sell things, you earn that money which you do not have to replay; whereas if you borrow money, not only do you have to repay it, but you have to pay interest on it until the debt is finally cleared.
Agriculture is very important to Canada as a trading nation, and we are very much of a trading nation. We have a small country in terms of population but a very large one geographically, and a rich country in terms of natural resources. Having said that, 1 must point out that agriculture is facing some very serious problems in Canada today as a result of what is commonly referred to as the cost-price squeeze. That simply means that our costs in agriculture have been going up drastically. We see increases in energy prices. We see increases in the cost of fertilizer, herbicides and insecticides. We see increases in machinery costs and repairs and virtually everything that goes into a modern farm operation. As I said, a modern farm operation today is different from what it was in the days of my father. For instance, farming has become very capital-intensive and as those costs go up, the farmers have to borrow more money to operate. It then becomes very important in any farmer's budget what kind of interest costs he is going to incur. We are hit in agriculture, Mr. Speaker, with a double whammy effect when our costs go up, because not only do direct costs go up but, in terms of the way farmers finance today, the cost of borrowing money when interest rates go up, and that is what this bill seeks to address at least partly, this evening.
To be fair about it, I think the Government has recognized the fact that there are some problems in the agricultural industry and it has attempted to address some of them in Bill C-134 but this bill addresses a very small sector of the agricultural economy. It is designed to lower interest rates by as much as 4 per cent to those people who have financial problems, in conjunction with a Farm Credit Corpoation loan. And though we give the Government credit for recognizing that there are some problems in agriculture, you have to really question the total understanding of the Government as it relates to the very

November 4, 1982
Farm Loans Interest Rebate Act
large problem which the agricultural industry finds itself in as a result of the high interest rates, and the cost-price squeeze.
Let me refer now to the price side. We have seen major declines in world grain prices and world grain prices of rape-seed, for instance, which has come to be known as canola. We have seen major declines in barley and wheat prices. So at the same time that we are experiencing in agriculture very large increases in costs, we are also experiencing a large drop in grain prices. We can talk all we want, as the Parliamentary Secretary did prior to five o'clock, as to how important it is to have supply management and those kinds of things in place that help the farmer to obtain a better price for his product, but I do not know how he is going to address that problem when it gets to the major earner of export dollars in this country as far as agriculture is concerned, that is, the grain industry. Canada consumes about 20 per cent to 25 per cent of the wheat it grows. Therefore, it has to export the remaining three-quarters, and it would be virtually impossible for Canada to do very much about the world grain price. We know they are very low. Having said that it would be very difficult for the Government to do a lot. I have to point out that there are some things it could be doing that it is not doing. In the last year I had the opportunity to visit with American legislators and to talk with them specifically about what our two grain exporting countries can do to bring about some kind of working arrangement on steadying world grain prices production. We have reported our findings to the Minister of State responsible for the Wheat Board in the other place. 1 have had discussions with the Minister of Agriculture (Mr. Whelan) and the Minister of Transport (Mr. Pepin), and nothing has happened.
We know from our discussions with the American Legislators that they are having the same problems expressed to them as are being expressed to those of us here who were elected from agricultural areas of the country. There is a communality of interest there. The American administration is of a slightly different opinion; it is more inclined to go along with the world market situation and not try to interfere in terms of helping to influence prices in the right way. However, I see no reason why the Canadian Government does not see fit to carry on those discussions between the two legislative bodies on both sides of the border. If the Parliamentary Secretary who spoke just before five is really serious in what he said, I hope he will use his influence on the Cabinet Members to see that some discussions take place on which might bring about some of the things he has spoken of. The Opposition is sometimes accused of doing nothing else but talk, but when you are in Government and you have a chance to do something, it seems to me you should do something more than just get up and talk. And I have given the Hon. Member an example.
There are other things I think the Government could be doing to bring about solutions to the farm income problem which is at the root of the Bill we have in front of us this everning, Mr. Speaker. We have heard this afternoon references made to some of the things we as a Party have advocated, such as the agribond concept. The Hon. Member for Cariboo-Chilcotin (Mr. Greenaway) referred to some specific
things which the Americans are doing, such as the establishment to production credit associations, bankers acceptance financing and the setting up of local banks having to do specifically with agriculture and of some federal land banks. These four specific programs are in effect in the U.S., some of them since the 1930s, specifically to aid agriculture in order that American farmers can have access to lower than the going rate of interest.
We on this side are not saying this is going to bring about an immediate solution and solve all our problems, but we are saying there are some things we can be looking at with an eye to solving some of those problems down the road. I have asked questions in this House of the former minister of Finance and of the Prime Minister (Mr. Trudeau), and I wrote letters to them suggesting that they look at some of the things the Hon. Member for Cariboo-Chilcotin mentioned this afternoon, but we have been absolutely stonewalled as far as answers are concerned. We are not saying that we think these programs can be simply transferred from one side of the border to the other, that they would work as well here as they apparently have in the U.S. They have worked there, and I will tell you why. There is evidence that the American farmer has access to financing as much as 3 per cent or 4 per cent below that available to Canadian farmers. That to me is evidence that some of those programs have worked, and they have worked over a long period of time. We will never have a chance to see how those programs work here if we do not make some kind of effort at least to try some of them.
We talk about the agribond concept, Mr. Speaker. The former distinguished minister of Agriculture from my party spoke this afternoon about the Lortie Commission and lamented the fact that the so-called blue chip committee set up to look at financing as far as the housing industry is concerned, did not contain-and I think he was accurate-one single person with very much expertise in or exposure to the agricultural side of our economy. However, they came back and recommended that the Government in fact not proceed with some of the financial assistance it was planning for the housing industry.
Even if we cannot do some of those things with respect to the agribond concept, it seems to me that the least it could do is to see that when the Farm Credit Corporation goes to the market it at least gives Canadians a chance to invest in their own country. About two months ago we saw the Farm Credit Corporation going to the American market to raise $100 million to finance Canadian farmers. Now, statistics tell us the Canadian consumer is saving at roughly twice the rate of the American consumer. So I fail to understand why the Government does not have the courage or the courtesy to give Canadians a chance to invest in the most basic industry Canada has, namely, agriculture. I think it is absolutely deplorable that the Farm Credit Corporation, set up by this Government and this Parliament, should go outside the country to raise funds to finance Canadian farmers when we in fact have a tremendous pool of capital here available for investment. So when we talk
November 4, 1982

about investing outside the country, I think this Government should have its knuckles rapped severely for not giving Canadians a chance to invest in Canada. I do not think there can be much of an excuse for that deplorable situation.
I would like to talk now, Mr. Speaker, about some of the additional steps this Government could take doing to assist farmers in terms of income. I happen to have been here at 12.30 this morning, Mr. Speaker, when Royal Assent was given to the Bill to end the work stoppage on the west coast. For every day that strike went on, the Canadian farming community alone lost-by "lost" 1 mean it cannot be regained-something like $8 million in export sales every day. We knew from the outset that the parties involved were probably not going to come back unless they were legislated back. So on that basis I find it deplorable that this Government waited so long to act. If the Government was serious in its concern, not only about the farming community in this country but about the total economy, I fail to see why it did not act much sooner.
In addition to that, several Members on this side have suggested that the Government take a very hard look at the amount of tax it collects on energy used by Canadian farmers in order to stay in production. I have a table in front of me which gives a breakdown of the pump price of gasoline right across the country. Speaking of my own Province of Manitoba, the Federal Government collects roughly 60 cents a gallon in tax. That is the federal charge on each gallon of gasoline consumed in Manitoba, whether it goes into agriculture, recreation or industry. What we have suggested is that the federal Government look at removing part of the 60 cent per gallon tax levied in 1975 and subsequently changed. Removing that tax would immediately have the effect of lowering some of the input costs of Canadian agriculture. This applies not only to farm fuels, because it would have a spin-off effect. We know that a very large component of fertilizer, of insecticides and pesticides, many of the things farmers need to be productive today, cost more as a result of that 1.5 cent a litre tax. The Government has refused to look at that. Well, even if it does not want to look at it, surely it should be willing to change the way it is administered. What the Government does in the case of agriculture is to collect that 1.5 cents a litre and then refund it under certain circumstances. In the case of the farming community, it is refunded if it is used on the farm for agricultural production. The farmer has to pay the tax and then apply for a refund. We all know that, theoretically, it should not make any difference; if you pay something one day and you get it back the next, it should not make a lot of difference. But what happens in many cases is that the farmer pays the tax, and it takes anywhere from two months to two years before the farmer gets aroung to doing his book work and applies for the refund. In the case of Manitoba it is actually illegal to use fuel on a farm other than the fuel eligible for the tax refund.
So I have suggested in Committee, and to several of the Ministers opposite, that they consider not even collecting the
Farm Loans Interest Rebate Act
tax. That would at least give the farmer a break in his immediate cash outlay, and that does not seem to me to be unreasonable. It would also save some administration costs. It seems ludicrous to me that the Government should have to incur the administration costs that it does to collect the tax and then turn around and refund it when there is a way, as there is in Manitoba with which I am very familiar, of not collecting the tax in the first place. Now, there is something very simple and straightforward which would simplify the paper work, that is, get rid of some of the bureaucracy of which we all think we have too much. And yet this Government does not even want to look at it. That is another example of some of the things the Government could do.
Another thing it could do to help farmers get by without borrowing any more money than they have to is to sit down and talk with the banks to see if the banks would be willing to go along with some fixed term financing for specific projects. The farmer could go into the bank in the spring and know he was going to pay a fixed rate of interest rather than a floating rate over the production period, whether it be for feeding cattle for six months or growing a crop which may take six or eight months from the time it is sown. If the farmer knew that the financing he was obtaining for a specific enterprise was going to be fixed over a period of time, it would mean he could do a much better job of budgeting. It works both ways. Two or three years ago that looked great because prices of everything went up over the production period. If you borrowed money in the spring of 1980 at 11 per cent or 12 per cent, in the fall you paid 3 per cent or 4 per cent more. As was pointed out again by the Parliamentary Secretary earlier today, over the last 12 or 13 weeks interest rates have come down, and we all welcome that. But it means that in this particular year the person who borrowed at a fixed rate will be caught. Fixed term financing at least would eliminate one of the variables as far as production costs for that particular farming enterprise is concerned. This is something at which they could look. It has been suggested many times to the Government.
Let me talk about the general taxation level in the country, but first let me indicate how this topic relates to the Bill at hand. One of the reasons farmers borrow money is to buy land. We all know that one of the big costs associated with purchasing land is the additional costs which farmers incur because they have to pay capital gains taxes. If there were some recognition of the problem this was causing, it would mean that the farming community would get by with less borrowing. It could transfer land from one generation to the other, from father to son, while borrowing less money.
We moved on that when we were the Government. We included a basic exemption for capital gains and a commitment in the budget, which was defeated in December, 1979, to look at the entire question of capital gains. The Liberal Party, at its convention in the early summer of 1980, promised to look at it, but it has not happened.

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As agriculture becomes more and more capital intensive, this will become a major factor in the ability of Canadian agriculture to be as productive and as competitive with agricultural sectors in other countries around the world. Let me indicate why. As 1 said at the opening of my remarks, agriculture is a very productive industry. It is productive because it has become very capital intensive, but I submit that it is the only major industry in Canada which has to regenerate its capital, pay for itself and pay for the land every time there is a new generation of farmers on the land. We know the stock market has been rising astronomically to record levels in the last two or three days. This does not mean that the people operating Union Carbide or Canadian Pacific have to put up more money when stocks rise in order to stay in business. They do not own the stocks. Their ownership is divided widely across the country. Anyone can purchase shares in these companies, if they have the money. The equity in these companies is shared widely across the entire base of the Canadian economy or the American economy, but when we turn to agriculture, that is not the case.
Every farmer tries-and so far has been reasonably successful-to pay for and own their farms. A major issue which 1 believe will have to be dealt with very quickly is the fact that every time a new generation goes on to another piece of land, it means that the land has to earn enough money for the farmer to pay for it over his lifetime. If a farmer, as was the case in the past, thinks of the ownership of his land and a retirement fund so that he can live out his golden years or his retirement years in some kind of dignity, it means that he must sell the land to someone else to obtain his retirement income. If he sells a parcel of land and obtains some money, he has to pay a big chunk of it in capital gains. This means that the person buying the land is required to pay more than he would without these very onerous rates of capital gains.
Unless we address this issue, we will find that the only people owning land in the country, very shortly, will be the Government. 1 find this fact very disturbing, especially when the country was settled not more than two or three generations ago by people who came here with the prospect of owning their land.
In not much more than a hundred years that prospect has been taken away. Young people who are starting to farm now-and I know this for a fact; I can cite various examples from across the Prairies and I suspect the same is true in Ontario, Quebec and the Maritimes-have to rent land and do not have the prospect of ever owning their land as did their fathers. If we get into a situation where we do not have family farms, which are the basis of Canadian agricultural productivity, we will not be as productive agriculturally and the entire country will suffer.
The Government should address the problem of capital gains if it is serious about doing something for agriculture. I do not want to belabour the point any more than I have to, but 1 find it absolutely incredible that the Minister of Agriculture,
who has been in his job for something like ten years, can rise- and I have read most of his speeches-and talk about the problems in agriculture but not offer a solution except for the bill before us. He travels and delivers as many speeches as any Member of Cabinet.
As I have said, we are pleased that the Government has recognized the problems. There are something in the order of
150,000	grain farmers in the three western Provinces, yet this Bill provides only $16 million for interest rebates. This amounts to $10 per farmer, if that amount is divided among only the grain farmers of western Canada.
The other side of the equation is that we in Canadian agriculture are not looking for handouts. We want to pay our way. We are proud. We have always done it in the past and we will do it again if we are given a chance, but we need some Government support. We need Government support when we go to GATT. We need a government to go to bat for us, so that when members of the Canadian agricultural community go to sell to other countries around the world they do so on a fair basis.
I could cite several examples. We have the most eminent authority on the Canadian beef industry present in the Chamber this evening, the Hon. Member for Medicine Hat (Mr. Hargrave). He could literally speak for hours on the failings of the Government, how it has not properly represented the beef industry and has not given it a fair chance to trade with other countries around the world. These are some of the things which we should legitimately expect from the federal Government, if it cared about what 1 believe to be the most basic industry in Canada.
Let me conclude on a note of optimism. I believe farmers are the most resourceful and productive members of the Canadian economy. I may sound as if I were blowing my own horn, since I represent an agricultural constituency and I have farmed all my life. I am proud to be a farmer; I am a farmer by choice. It will take more than the present Government and more than the Minister of Agriculture to run Canadian agriculture into the ground. Canadian farmers have more land per capita than any other farmer in the world. We have some of the most productive land in the world. We will succeed. If we have a change of Government, we will have a federal minister of Agriculture who will understand the basic problems. In that event things will be done for farmers. We will not have to pass Mickey Mouse bills in the House, such as the one before us this evening. Again the industry will be able to finance itself.


Some Hon. Members:: Hear, hear!


Mr. Deans:: Mr. Speaker, I rise on a point of order. I hope the House will forgive me for rising at this time, but I know Hon. Members would not want to miss the opportunity to hear that our former colleague, Bob Rae, was elected this evening to the Ontario Legislature.
November 4, 1982


Some Hon. Members:: Hear, hear!


Mr. Jean-Guy Dubois (Lotbiniere):: Mr. Speaker, of course, the point of order just raised by my colleague for Hamilton Mountain (Mr. Deans) is not a point of order at all, but simply a way of making a comment. In any event, Mr. Speaker, we are considering this evening Bill C-134 which follows from the budget brought down on June 28, 1982, by the then Minister of Finance (Mr. MacEachen).
It gives me great pleasure to speak about this bill this evening, especially since some of my colleagues and I accompanied today the Minister of Agriculture (Mr. Whelan) to the International Agricultural Fair in Montreal which will go on until November 7. When we look at the farming community and agricultural organizations and realize that many people are becoming more and more involved in this industry, it is gratifying to note that Canadian agriculture has become much more sophisticated, and diversified, and I can speak from experience, Mr. Speaker, since I come from a rural municipality where my father is still a farmer. I can tell this House that, as far as Canadian agriculture is concerned, unlike the previous speaker who advocates a change of Government and of Minister, the Canadian farmers must admit today that the Minister of Agriculture (Mr. Whelan), who has held his portfolio for ten years, had done more than any of his predecessors for Canadian agriculture. He has made it progressive, competitive and productive, so that agricultural producers now own small, medium-size and even large businesses. However, what I want to say about this bill this evening after my visit this morning with the Minister of Agriculture, Mr. Whelan, and my colleagues, the Hon. Members for Chicoutimi (Mr. Dionne) and for Beauce (Mr. Lapointe), to the International Fair, is that, in my opinion, because of the present economic situation, while the farmers work very hard to succeed in their business like any other businessman in Canada, it is quite obvious that they have had to face higher interest rates, which has thrown their budget out of balance, even though interest rates are now going down. We all hope that this downward trend will continue, but we have to face the facts and realize that the figures show that we now have in Canada and in Quebec a great many middle-aged farmers, farmers over 40 years old or perhaps as young as 35, who have had to invest in their farms for several years.
Farmers who, like many businesses, are long established, have raised loans at lower interest rates than the prevailing rates and can face the competition and cope with present conditions much more easily. However, we now have young farmers or farmers who, even if they cannot necessarily be called young, have only been established on a farm for a few years, and they have had to make huge investments, not only on a monetary level, but also on the human level and for equipment, and they have what could be described as relatively
Farm Loans Interest Rebate Act
large debts. Consequently, to maintain their productivity and their financial position, they have to work increasingly hard to make both ends meet. They are not the only ones in that situation, Mr. Speaker.
I believe that many Canadians in most of our businesses must now reassess their productivity and financial position and try to work differently and to be perhaps more conscientious. However, in addition to the situation of farmers and of businessmen who must reassess their productivity and financial position, there were many farmers who were only starting in agriculture or who had only a few years behind them and who have had to borrow money quite recently, but the interest rates offered by the Farm Credit Corporation at that time and the increases they had to face have caused them hardship. Many farmers from Quebec and other parts of Canada attending the International Farm Exhibition in Montreal had the opportunity today to meet their elected representatives. Referring to my own province, the Hon. Members for Quebec, made representations concerning the Farm Credit Corporation's high interest rates claiming in these hard times they could not cope with the financial burden they had assumed in borrowing from the Farm Credit Corporation or would have to assume now if they borrowed from the Corporation. Consequently the Quebec Members have appealed to the Government, the Cabinet and more specifically the Hon. Minister of Agriculture (Mr. Whelan) in the hope he would pursue the efforts he has been making ever since he was appointed minister a decade ago, to help farmers survive this temporary high interest rate situation. On the basis of these recommendations, on June 28 1982, the Minister of Finance (Mr. MacEachen) came up with this section in the budget documents:
Special Farm Financial Assistance Program
And I quote from the first two paragraphs on page 25, Mr. Speaker:
The government is introducing a new assistance program for farmers to be delivered through the Farm Credit Corporation.
Over the next two years loans totalling $200 million will be made under the program to farmers in Financial distress. The loans will be made at the regular FCC interest rate-
-which was at the time, in June, 16'/2 per cent, and is now 15% per cent-
-but a rebate of 4 percentage points will be provided for the first two years of the loan. The Government is allocating $100 million to the program ($84 million as a special contribution to the FCC for lending to farmers and $16 million to pay for the interest rebates) and the FCC will divert $116 million to the program from its regular lending fund.
The program was to be implemented immediately, but it had to be completely by an act to amend the provisions of the Farm Credit Act. The important point is that many Canadians interested in agriculture are asking themselves important questions the investments and purchases farmers make and at times wonder how they can balance their budgets. But I suggest that although agriculture is still agriculture, it can

November 4, 1982
Farm Loans Interest Rebate Act
aptly be referred to as industrial agriculture while and farmers may be regarded as manufacturers. They have certainly something in common: investments. A manufacturer may invest his money into a plant 200 x 200 which together with its buildings and machinery, appears less impressive to the eye than a farm with its buildings, machinery and appliances which, because of the very nature of the various crops, may be used only a few months, weeks, or even days each year.
But the situation is not the same for a farmer during the haying season: he must have the implements required for that kind of work even though they will remain idle once the work is completed. Things are different in the manufacturing sector; if you have a press-I see that my colleague from Saint-Denis (Mr. Prud'homme) agrees with me-to do some printing or if you are in the furniture-making industry, your equipment can be used all year round, and as my colleague from Chicoutimi (Mr. Dionne) points out-I see that my colleague from Verdun-Saint-Paul (Mr. Savard), the new Government deputy whip is also in agreement-the farmer uses his implements for a few days only whereas people in the industrial sector use theirs all year long. With respect to depreciation, some of those investments must be taken into consideration and, when it comes to the investments which farmers have to make, they can sometimes be looked upon from a different perspective. I could give a number of examples of machinery which is used only periodically but which may very well cost as much if not more than equipment found in manufacturing plants.
As to whether or not they should share that depreciation, they must indeed do it on their own or pay it off in a different way. So, once this special financial assistance program was announced by the Canadian Government on June 28, it was imperative that we should be able to tell Canadians in our ridings just how important the agricultural sector is. It is important to keep in mind the fact that all the food we find on our tables is produced by the agricultural sector and that if the farmers who grow our food can indeed produce and compete, consumers will be better off. That is why we have to challenge those who keep saying that farmers get a lot more help than other organizations or other businesses.
Mr. Speaker, 1 think we may have been misled by people who make such statements, because any commercial or manufacturing business can benefit from tax exemptions or lower interest rates, or again get help through grants, but the situation is not necessarily the same in agriculture. All things considered in light of this Bill, the Canadian Government was quite justified in launching that program. I should mention as well the program for small businesses and fishermen described on page 10 of the June budget.
Perhaps we could look at the situation covered by Bill C-134. At this point, Mr. Speaker, if we consider investment and the amount of money farmers must invest, it would be useful
to know the maximum amount now available under the Farm Credit Act. Since the legislation has been adapted to the economic, industrial and social requirements of agriculture today, loans to up to $300,000 per qualified applicant and as high as $500,000 for a group. The interest rate is calculated in terms of the return on Government treasury bills, plus 1 per cent, over a period of from five to ten years.
Mr. Speaker, the Farm Credit Corporation, through the Farm Credit Act, provides opportunities for financial assistance of up to $300,000 per individual and $500,000 per group, because the Canadian government realizes that our agriculture has made constant progress, and that even if they have a certain amount of money in the bank, farmers should have the same loan facilities as manufacturers and businessmen. Twenty years ago, Mr. Speaker, we had a situation where manufacturers could borrow on the equity in their companies, while the farm situation was quite different from today, when we see that farm capital has increased at an astonishing rate during the last few years, unlike the more gradual progression in the manufacturing sector, so that there have been considerable changes in the agricultural sector. Therefore, the Farm Credit Act has been an excellent instrument for showing Canadians and Canadian farmers that governments were well aware of the progress and productivity on our farms, and that it was necessary to find mechanisms and funding to meet their requirements. And this is what happened under the Farm Credit Act when loan ceilings were raised.
However, if we consider Bill C-134, to continue what I was saying at the beginning, namely that recently, people had borrowed at interest rates which normally would have allowed them to function, we had to realize that the sharp rise in interest rates was upsetting the financial forecasts made by FCC advisers and agronomists who are increasingly involved in counselling farmers, and in fact they have always done so, but let us say that the process is now so refined that every young farmer or farm producer has access to professional help, as in many other organizations, and it was normal that that should be case in farming.
As I was saying, since projections had been made, it became necessary following representations that had been made to deal with the matter and this was done through the Bill now under consideration which is providing a 4 per cent rebate on a two-year basis for interest rates. Of course, the Opposition will suggest that it is not enough. 1 think Mr. Speaker, when substantial funds of $100 million are allotted to the Corporation, it means that the Government of Canada recognizes the importance of agriculture in this country. It is essential through those budgets to make Canadians realize that the production of food is quite important and that the funds allotted to farming should be directly proportionate to productivity, to the farmer's holdings and fixed assets. I think that it is a rather important matter. This 4 per cent rebate has been granted following projections made by various farming experts
November 4, 1982

of the Farm Credit Corporation, by personal counsellors or by other agricultural accounting advisers. The anticipated increase of interest rates having unbalanced their budget such a relevant legislation was necessary because for several months now, the inflation rate having decreased both in Canada and in the United States, interest rates have been dropping.
1 think this is the result of the policy put forward by the Government in his fight against inflation and even recently when the new Minister of Finance delivered his financial statement, inflation being momentarily reduced, we saw the Government of Canada extend for a 2 year period that 4 per cent rebate hoping, and being increasingly convinced that since the inflation rate as well as interest rates are considerably lower this will allow farmers to do some planning but if indeed interest rates are really different in months or years ahead the Farm Credit Corporation will readjust them as it did some time ago when it brought its interest rates down from 16.5 to 15.75 per cent. We needed some sort of a mechanism to respond adequately to those well-justified representations and this is why we are dealing with this Bill. I heard the previous speaker say that it was a fine Bill but of course he would never admit that it is an excellent one. I hope that we will soon refer the whole matter to the Standing Committee on Agriculture if not to the committee of the House for immediate consideration through all stages to speed up the process because a larger number of questions directed to the Minister of Agriculture before June 28, 1982 actually had to do with interest rates.
1 trust that my colleagues opposite will pass this legislation without delay because they were asking the Minister of Agriculture many questions requesting a reduction in interest rates or some interest related assistance. I do hope that after listening to the previous speaker, who says he is closely involved with the farmers, and I know that for a fact his colleagues will be convinced to pass this legislation without delay. I think it is important as well, to read Clause 3 of the bill and in particular subclause 3(4), and I quote:
Where an amount may be paid to an eligible farmer pursuant to subsection (1) in relation to a loan payment period, the Minister shall, where it is practicable to do so, make such payment in the loan payment period to which the payment relates.
And subclause 3 states as well and I quote:
Where, in or before any loan payment period in relation to which an eligible farmer may be paid pursuant to subsection (1), the eligible farmer
(a)	ceases to be a farmer, or
(b)	ceases to follow the plan of farming operations submitted by him to the
Corporation,
before he has been paid pursuant to subsection (1), no payments shall be made to him pursuant to that subsection in relation to that or any following loan payment period.
How should this provision be interpreted? What is important, is to tell the Canadian people that if at any given time, representations were made to the effect that we were helping farmers too much and that after getting a loan or some
Farm Loans Interest Rebate Act
financial assistance, farmers would quit their operation, and that therefore the Canadian government would have invested money unduly. Well, we have now a provision stating that in such cases no payment will be made or the loan will be called and the operator will lose all his rights in this regard. 1 think such a provision was important to avoid useless loans or assistance being given out as has happened in the past in the manufacturing sector or other similar industries.
It is often said that unfortunately, when a business asks for a government loan or any kind of government assistance it will have less difficulty getting it because you deal with the government, which is less careful about it. 1 think that governments and . .. this Government in particular have nevertheless made sure that farmers who do receive a loan will use it for the right purposes, as would any lending institution do, whether a bank or a "caisse populaire."
Mr. Speaker, when we look at the situation of the young Canadian farmers in particular we can readily see that it was important to tell them they would get assistance if they really wanted to remain in agriculture, whether as a dairy farmer or a livestock operator. I think this message was very important and was well understood from this side of the House, given the representations that were made to Hon. Members, as far as the Province of Quebec is concerned, by organizations such as the UPA, the Cooperative federee as well as millers, who were asking for financial assistance so that this economic sector may operate according to acceptable standards consistent with those that may exist in other industrial or business areas. And 1 believe they were representations. Farmers did not ask for charity, all they wanted given the present situation, is to be allowed to continue their operations so that our Canadian agro-food industry may successfully compete and production be maintained at the level we have known for several years. I think it was a very impotant message and the response, that is Bill C-134, is equally important. When a farmer is temporarily in dire straits, 1 believe we must take action, and this has been well understood, as I was saying a moment ago, on this side of the House. So, Mr. Speaker, given this situation-


Marcel Dionne: They are not all in dire straits.


Jean-Guy Dubois: As my colleague from Chicoutimi has just said, farmers are obviously not all in dire straits. 1 explained how young farmers were perhaps the most hard hit. However, the important thing is that we could not disregard this portion of the rural population, those farmers who had to meet financial obligations that were different from what had been predicted by their advisor in the first place, and that is why we have responded with this legislation. Hopefully, Mr. Speaker, my colleagues from the other side will pass this act quickly so that we may respond adequately to this need, and hopefully this legislation which I would like to come into force soon will not be stuck here. If it is possible to have it passed without it being

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deferred to the agricultural committee-not that I would not like to have it dealt with at the committee, but since this legislation is accepted on both sides .. . They will complain that it is not enough; well, one has to draw the line somewhere, Mr. Speaker. However, since this seems to be acceptable on both sides, we will be able to have it passed quickly.


Mr. Bill McKnight (Kindersley-Lloydminster):: Mr. Speaker, I take pleasure in participating in the debate on Bill C-134, an Act to amend the Farm Credit Act in Canada. I would just like to make a few comments. We do take pleasure in participating in the debate but, as the Hon. Member on the Government side pointed out just a few moments ago, the budget which brought this Bill forward was announced on June 28, some four months ago. The Hon. Member on the Government side is now urging us to pass it immediately. As a matter of fact he is in such a rush that he took about 40 minutes to urge us to pass it immediately.
Those of us on this side have a few things to say about the Bill. We all recognize the problems which are prevalent in agriculture. Sometimes I think that those of us on this side may be a little more aware of the problems than the Minister of Agriculture (Mr. Whelan) is sometimes, and some though not all the Hon. Members of his Party. That would even include the Parliamentary Secretary who may occasionally be a little more aware than the Minister.
This Bill applies only to farmers who are in financial distress. It is designed for farmers who find themselves in need of refinancing. It does not meet many of the needs of the agricultural sector in Canada, and it definitely does not meet too many of the needs of the agricultural sector in the part of the country that I come from. This is not the first time we have seen this Program, Mr. Speaker. The November budget announced a $50 million Program for Special Financial Farm Assistance loans. That $50 million helped 382 farmers in Canada-not in one Province, not in one country, but in the whole of the country. An additional $100 million was provided for special farm financing in the June budget, but $116 million was taken away from Farm Credit general funds and applied to this Program. That meant that someone who had the ability and wished to farm was probably going to be denied the opportunity because there was insufficient funding. This $116 million was not additional money. The Government used the jiggery-pockery it indulges in quite often. It took the $116 million and said, "Now we have a $216 million Program". Things do not work out quite like, that, Mr. Speaker.
Even though the cost of money is coming down, financing is a leading input cost in the farming sector in Canada. It accounts for about 20 per cent of the total cost of production. The future is not that bright for farmers at the moment, Mr. Speaker. There are projections of a 20 per cent decline in net farm income. It is expected that farmers will receive about $3.4 billion less for their production in 1982 than they did in 1981.
Even those Members who do not have the privilege of representing an agricultural area recognize the importance of agriculture to our economy. One-sixth of all economic activity in Canada is generated in the agrifood business, and a large amount of our balance of trade can be directly attributed to the agriculture industry.
In 1981 we exported $8.8 billion worth of agricultural products and imported $5.6 billion worth of food products. Canada has the ability to bring that figure down to zero. If the programs were in place, the farm population, with its ability, intelligence and skills, would ensure that we do not import farm products at any time.
In the last year, western farmers produced 42 million tonnes of grain. That includes 24 million tonnes of wheat. Canada is the second largest exporter of grain in the world. This year, our grain export business will be worth $6.4 billion.
Fast evening we went through a very difficult exercise, passing a Bill to ensure that the strike at the ports which shut down the whole west coast of Canada could be resolved and the grain worth $6.4 billion could be shipped and bring badly needed money into the country.
People engaged in agriculture need programs that will help them and allow them to use their abilities and their skills- their raw, gut, "stick-to-itiveness" and toughness. If such programs were in place, we would not need a 4 per cent reduction in the cost of money. If the Government removed some of the stumbling blocks that hinder the agricultural community, we would not even have to consider this Bill.
The strike of the last 16 days has cost $8 million per day in lost grain exports. Those exports were lost, Mr. Speaker, and not deferred as the assistant to the Minister of Transport (Mr. Pepin) in the other place has said. He claimed that those sales were deferred; Mr. Speaker, the sales were lost. Over $120 million was lost to the Canadian economy because of the work stoppage on the west coast. If it were the case that we were going to stop growing or exporting grain on July 31, then it could be claimed that the sales were deferred. But we are going to continue growing grain and continue stretching our rail transportation system and continue exporting forever. So that $8 million per day was lost, Mr. Speaker.
1 cannot understand the Minister of Agriculture, Mr. Speaker. Before the session was resumed on October 27 he was claiming that one of the first orders of business would be to use the force of Parliament to resolve the work stoppage on the west coast. Action was delayed until the Monday following resumption, then until Tuesday and finally till Wednesday; a delay of seven days.
Earlier in the House I heard the Hon. Member for Hum-boldt-Lake Centre (Mr. Althouse) speak about the great concern that Members of the New Democratic Party have for the grain producers and farmers. He spoke of what that Party would like to do for the farmers. But last night every Member of that Party who was present voted against the resolution of the work stoppage. The Hon. Member for The Battlefords-Meadow Fake (Mr. Anguish) voted against it, although it
November 4, 1982

caused him a great deal of anguish-and that is not a play on words. The Elon. Member for Humboldt-Lake Centre, the Hon. Member for Dauphin (Mr. Lewycky), the Hon. Member for Selkirk-Interlake (Mr. Sargeant), all those who were present, voted for continuation of the work stoppage.
I do not understand that, Mr. Speaker, but perhaps I should. Even though the people of western Canada sent the majority of the Members of the New Democratic Party to this House, control of those Members has passed from the people in that part of Canada. It has been placed in the hands of the Hon. Member for Hamilton Mountain (Mr. Deans) or the Hon. Member for Oshawa (Mr. Broadbent). Not a Member from the rural areas of Saskatchewan or Manitoba spoke for his constituents in the House last night. That was evident in the way they voted. There is something to be said for those Members who were absent. The Member for Prince Albert (Mr. Hovdebo) spoke in my part of Canada saying that we have to get the grain moving, because that is important. He was not in the House yesterday, however. Perhaps if he had been, he would have suffered the torment that some of the other Members of that Party did when obeying the Party line. So he was absent.
When we looked at the Government's attempt, through an amendment, we asked them to have a second look and, take six and five out. It was meant for the Public Service, but now it will be applied in all likelihood to the private sector, the private economy of Canada. That is something I am sure the Members of the Government and the New Democratic Party will not be allowed to forget.
Looking at priorities, I mentioned earlier that if the Government would remove some of the stumbling blocks, the huge obstacles they place in front of the agricultural community, we would not need a 4 per cent reduction in interest. As my learned colleague, the Hon. Member for Qu'Appelle-Moose Mountain (Mr. Hamilton) pointed out earlier, the men and women of the farming community of Canada do not want a handout, they do not ask for a subsidy. What they ask for is a fair chance to produce. They want to use their God-given skills and the soil they have been given to feed a hungry world. They do not want subsidies, unless Government programs make it necessary for them to ask for assistance. That is the only time you hear their cry.
A prime example is the fuel tax on agriculture. When I went back to the farm in 1965, my fuel costs were negligible. They were less then for a whole season's operation than they are now for one month. If the Government tax on agricultural fuel were removed, the producers of agricultural products in Canada would be much better off. We hear there will be another $4 per barrel increase in the spring, a furthur tax on the production of food to be used to feed a hungry world.
As the Hon. Member for Portage-Marquette (Mr. Mayer) and the Hon. Member for Elgin (Mr. Wise) mentioned, if capital gains were removed, the need for a farmer to ask for a larger sum of money for his land would be reduced. The
Farm Loans Interest Rebate Act
capital required would be reduced and there would be more Farm Credit funds.
I know you understand, Mr. Speaker, and the Minister is well aware that the farmer may pass his land to his or her children. That is understandable. It is as it should be. However, I have seen two examples in the last three months in my office involving a son who had inherited his father's land while his mother was still living, and the son having died tragically, left the land to his mother. Capital gains applied to the transfer of that land. I cannot understand a Minister of Finance or a Government being so hungry for money, so greedy that when a son or daughter dies and leaves the land to a mother or father they want to tax it. It does not make sense. It is another obstacle in the way of production, another roadblock for the agricultural producers of this country. If that were removed, we would not have to talk about a 4 per cent rebate over two years. In the farming community, two years is not considered a long-term program. I have here a pamphlet from the 1979 election wherein the Minister of Agriculture promised to bring the valuation day of farmland up to 1974. Also, I have a copy of a speech he made where he stated that if the Liberal Party was re-elected, the tax on agricultural fuel would be removed. We have not seen that.
When questioned in the House by the Hon. Member for Vegreville (Mr. Mazankowski), the Minister said that was not policy, it was a promise made in the heat of debate. He was saying, "We will put it down. We will make statements in a handout that is distributed door to door, but it is in the heat of debate, don't expect it folks, don't really believe what 1 tell you." He does not have to say that because a lot of people in Canada are beginning to think that way without prompting.
We have had some bills, proposals through Farm Credit and a few other things from this Minister of Agriculture to which I would like to draw attention. They are programs which relate so supply management not requested by the agricultural community. If the agricultural community as a whole requests a board and is represented on or controls that board, there is nothing wrong with that. However, let me very quickly compare North America to the U.S.S.R.
In 1970, both the United States and the U.S.S.R. exported grain. The United States exported 38 million tonnes and the Russians exported eight million tonnes. In 1981 the Americans were exporting 115 million tonnes and the Russians were importing 43 million tonnes.
We all use seed on our farms. In Russia they take 16 per cent of their harvest for seed. In North America we take 2 per cent of our harvest to put back in the ground. It is a funny thing. The latest thing on Government controls, Government intervention in the marketplace and in the agricultural community is in Russia. Right now, in November 1982, they know how much fertilizer they are going to put in the ground in the spring of 1984 because it is in the 1981-1985 five-year plan. On my farm and on those of my colleagues, that decision will be made in the spring of 1984 after we have the soil tested, looked at the weather and checked the markets. That is when we will make the decision about the fertilizer.

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One of the reasons why the U.S.S.R. is now one of the world's largest importers, not only of grains but of meat, is Government intervention. Even the Minister of Agriculture recognizes that. In western Canada the Minister stated that we should be thankful that the U.S.S.R. is Communist, because if they were not, we would not be able to sell them the food we grow. In other words, they would grow enough themselves if they changed their system of government.
I would like to speak for a moment on the cost to producers. The Government's program regarding the statutory movement of grain will cost the producers a lot of money. I say to people in any part of Canada who are concerned and think there may be some hope in the 74 members of the Liberal Government Party voting against that measure that that will be the frosty Friday. I have yet to see Members of the Government Party, let alone Cabinet Ministers, vote against a Government bill. If there is hope in western Canada that the Liberal Party will help to stop the change or somehow modify the change in the Crow rate or have any input directed to that, I say to my friends in the west that that will not happen.
In conclusion I want to say a few words about the economy of Canada. We heard of megaprojects which were cancelled by this Government, Alsands, Cold Lake, all of them put on hold. In my Province alone, Mr. Speaker, there is a megaproject every spring, and that project is worth a billion dollars to the men and women in the agricultural community. Every spring there is a renewable megaproject. A billion dollars goes into the ground. That is a megaproject, Mr. Speaker, to which this Government should pay a little more attention, not a megaproject of $2 billion for only a year. This is $1 billion. I see the Parliamentary Secretary to the Minister agreeing. That is a megaproject, a billion dollars a year put in by the men and women in my Province who are involved in the agricultural community. That project would be much better served if the policies of the Government opposite were directed more toward allowing the men and women to function, to go ahead without the interference, without the capital gains, without the farm fuel tax, without these things that get in the way. We need bills that give us a 4 per cent rebate over two years for farmers in financial distress, and that probably would involve less than 700 farms in all of Canada involved in this Program.
As many faults as I can find with the Program, Mr. Speaker, it appears to be the best this Government can put forward, and I will support it because I cannot expect any more.


Some Hon. Members:: Hear, hear!


Marcel Dionne: Mr. Speaker, I rise on a point of order. Would my colleague on the other side allow a question?


The Acting Speaker (Mr. Corbin):: Would the Hon. Member accept a question?


William Hunter (Bill) McKnight: Yes, Mr. Speaker.


Marcel Dionne: Mr. Speaker, my colleague opposite stated earlier that Russia lives via state controlled economy. On the other hand, he said that in this country every spring, there is a huge megaproject, a renewable project which consists of millions and millions of grain seeds going into the ground to ensure a good crop. He was also asking for the State to play a larger role in these megaprojects. I cannot understand how the hon. member opposite can sometimes ask for government intervention and at other times oppose it. I did not quite get the meaning of his question.


William Hunter (Bill) McKnight: Mr. Speaker, what I was referring to was assistance which the agricultural producers of this country need, not direct Government intervention, not programs imposed by the Government on the agricultural community which are not acceptable to it, and not agricultural programs which take funds away from that community to be placed in the tax budget of this Government, which we have found has wasted some $24 billion in the last year.


Marcel Dionne: Mr. Speaker, I have another question. I wonder if one can attribute the same meaning to the words, assistance and control, when in fact those words are quite different.


William Hunter (Bill) McKnight: Mr. Speaker, I come from a different part of Canada than my colleague, but I know there is definitely the same feeling over assistance, because even this Government gives assistance to some areas of the economy without insisting upon control of that part of the economy.


Mr. Sid Parker (Kootenay East-Revelstoke):: Mr. Speaker,
I am pleased to speak on Bill C-134, an Act respecting rebates of interest on farm loans made under the Farm Credit Act. I would like to start off my remarks by stating we feel it is another band-aid solution to a very important, vital question in Canada with regard to one of our major industries, the farming industry, across Canada.
1 want to refer, if I may, to the remarks made by the Member for Lambton-Middlesex (Mr. Ferguson). The Parliamentary Secretary indicated he had been in the farming industry for 45 years, but he seemed to brush over the fact of these farm bankruptcies in Canada. They were not really that significant and we did not have too much to worry about. I want to say to that Hon. Member that in the farming industry, farmers do not come about just by one or two days' experience. They come up through generations, through family tradition, and their experience whether it is that of one farmer or several
November 4, 1982

farmers, is something we cannot afford to lose. We are losing the expertise, the professional people in those areas. I travelled on the Transport Committee of 1980 across the prairies. The groups that came to us, the farmers' unions, the grain elevator people, time and time again stressed the problem of the abandonment of rail lines, which this Government has allowed to happen. They are not asking for handouts. They are asking this Government to recognize the fact that when it allows the abandonment of rail lines it is creating an extra hardship for those people who have to bring their grain farther distances to the grain elevators, the ports, or to their transportation system. On top of that, this Government has brought in legislation that adds to that cost. Not only have they lost the rail lines, but now they are paying out additional costs for energy. This Government has to recognize the fact that it is creating hardships that cannot be sustained. These farmers reach out and try to develop or plan, but this kind of help is not going to meet their requirements. I do not think the Hon. Member for Lambton-Middlesex fully understands the kind of problems that this has brought about, even though he may have 45 years of experience and may have developed a plan over that period of time.
Here is what we heard from a group representing a large area, the Peace River area. They talk about the age of farm operators, and the potential for further expansion of farming activities is indicated by a relatively large number of young farmers in the district. They give the average age of farm operators: under 25 years of age, 3.53 per cent; 25 to 44 years of age, almost 46 per cent; 45 to 59 years of age, 36.47 per cent; 60 to 69 years of age, 11.24 per cent, and over 70 years, 2.88. What 1 am trying convey is that we have a lot of young, experienced farmers who are trying to take over from their parents and operate the farms, and they need that financial help. They need a long-term support program so that they can plan ahead. If that money were made available, it would stimulate our manufacturing sectors because they would be able to plan some kind of development.
There is a fertilizer plant in my riding in British Columbia, and this summer the walls were bulging with fertilizer, and everyone knows there is no requirement for fertilizer in June or July. So there were lay-offs at that plant. But would it not make sense to have long-range financing for farmers so that they could purchase their fertilizer in the summer and have it available first thing in the spring? Not only would we be accommodating the farming sector, but this fertilizer plant in British Columbia, and others, would be functioning in an orderly manner as well. That is the kind of economic planning needed, and this Government has to recognize that fact and meet those requirements.
1 want to speak for a moment about CP Rail or the railway system and its abandonments, because I think it is vital to this question. I have not heard the Conservative Party speak too much about the Crow rate or the abandonment of rail lines even though it is vital to what we are talking about. While we see the Government speak about how railways must make a profit, where was the Government when CP Rail was dividing
Farm Loans Interest Rebate Act
their corporation? Where was the Government when CP separated its real estate portion into Marathon Realty? What about CP investments? CP Rail has built an empire in this country on the backs of the Canadian people, and this government supports that kind of program. Every time Ian Sinclair comes before the Government, the programs are presented to the House of Commons and in most cases supported by the Liberals and Conservatives. And the farmers and people across Canada have to suffer the consequences.
I want to speak for a moment about a comment made by the Hon. Member for Kindersley-Lloydminster (Mr. McKnight). He outlined a problem with capital gains tax in his riding. He spoke of a father turning a property over to his son, and the son to his mother because of a death, and she had to pay capital gains tax. I want to ask the Members of the Conservative Party of Canada where they were when they were in Government? They were in Government for nine months, and why was that legislation not changed if they feel so strongly about it today? Why, in those nine months when you were in Government, did you not look at this legislation that you are so concerned about and bring it before the House and have it changed? No, they were too busy with other things. In fact, they were elected in late February and did not call the House in for a sitting until October, so that is the kind of concern that that Party had for that kind of legislation.
I would also like to refer to another problem in my riding, the beautiful area of the Creston Valley, a grain and fruit growing area. These people are faced with the closure of the grain elevators. I can understand why they had to make that decision in light of the costs they had been burdened with. Naturally they have to look at running an efficient business, and when the Government creates that kind of burden, who is going to suffer? What happens? They close their grain elevators down. What happens to the expertise of the farmers in those areas? Can you imagine the problems which will be created with regard to storing and shipping their products in an orderly manner?
The Government has made some suggestions, but the problems created are almost devastating. When it comes to the fruit growing industry, another vital part of this riding, the cost of energy involved in transporting products to market is almost unbearable. There are a lot of cattle producers in my area and transportation is very costly. Again, that has been created by the Government, and the Government's programs have done nothing to recognize the needs of farmers in this area. I think it is a sad day when we in Canada cannot recognize that farming is one of our top priority areas. It is an area which could get many other sectors of a given riding rolling again and meeting the requirements, not only of this country but of many other countries as well.
1 would also like to refer, Mr. Speaker, to another of the comments made by the Hon. Member for Kindersley-Lloydminster with regard to the west coast ports dispute. I know farmers across Canada were as concerned as everyone in this Party about that dispute, but I want to say that the farmers

November 4, 1982
Farm Loans Interest Rebate Act
honestly want to treat those workers as fairly as they themselves want to be treated by this Government. It is because of the attitude of this Government toward working people, toward the farming community, toward regional areas, instead of working in a co-operative way, which has created the hardships that the average worker and the average farmer have to face here in Canada. The Hon. Member tried to point to this Party as not having any feelings for the farming community or for the workers in these areas. These workers did not create the problem. 1 must emphasize the fact that it was the employers who had those workers locked out. It was their decision to lock them out and create the problem that the farmers were faced with. So we in this Party have recognized both sides of the problem and 1 think we have dealt with it as responsibly as we could.
This Bill, Mr. Speaker, does not supply the kind of relief needed, and we feel that unless the Government recognizes the serious problems facing the farming community across Canada, we are going to be faced with some very, very serious bankruptcies. The Government has to recognize that in this industry they must have some long-term planning. There must be long-term financing available so that when the farmers are trying to regulate or plan the kinds of production they want to carry out and meet the needs of Canadians, they must be sure that the money will be available at stable interest rates so that they will not have to worry about a fluctuation in their costs of production. They also do not need the threat of a change in the Crow rate hanging over their heads.
Young farmers are not being encouraged to enter into the farming stream and to continue the tradition of earning their livelihoods in an orderly manner. I think the Government is treating problems in the farming community in the same manner as it has treated unemployment or any other problem. It has used a band-aid approach to a very serious problem. The Government should take its head out of the sand and recognize the needs of the farming community. It should bring forth a policy which helps not only the farming community but ail other areas which feed into that system. If it does not do so, indeed there will be very serious problems within the community.
I have already singled out CP Rail. Ian Sinclair comes before the Government, and it dances to his tune. It danced to his tune when it brought in the six and five program, when the rail abandonments took place and when VIA Rail was discussed. The Government took it off its hands, at literally hundreds of millions of dollars of savings to the Company. In fact, the Company charged the Government an extra month's billing on the passenger operation. In other words, it charged its regular fee for the use of its tracks for 12 months, and added a thirteenth month for extra costs.
We sat in on Committee hearings and heard about this. We found that the company had not yet been audited and that some of the audits had not been done for two years. It seems that CP Rail can obtain the required moneys. Also it seems that we are coming into a rail expansion. Goodness knows it is needed to meet the needs of the farming community. It seems
money is available while it is diverting funds, separating various groups away from the railway system and allowing the Government to carry the load in these areas. It is asking the Government to change the Crow agreement while the farming community has to pay the extra load.
There is little enough in the Bill without its creating an additional burden. The farming community cannot stand the changes the Government is anticipating. I believe the Conservative Party should also be putting pressure on the Government to ensure that the Crow rate is not changed and that it is protected in the interests of farming communities across Canada. This is true also in terms of the Atlantic Provinces. We have now discovered that any change in this regard could seriously affect eastern Canada, and that there are other areas which must be taken into consideration now. I say to Liberal Members who represent these areas that they should take a serious look at what is being put forward. There could be serious ramifications on top of what has already been put in place.
These are the types of problems faced by the farming community. We on this side of the House are not happy with this piece of legislation. We see it as a band-aid approach. We have no alternative but to support it, yet the fact remains, as a Member of the Conservative Party pointed out, that it is a Mickey Mouse piece of legislation which will not meet the needs or come anywhere close to helping the Canadian farming community. It will probably carry the load for a few who will qualify, but many will find, when they go to banks or credit unions to obtain money, that no money is available. I have talked with various farmers in my riding. They tell me that it is all very good that the legislation is there, but they ask how and when they can obtain money. They say, "I need it now. I have some planting to do, but there is no money available." What good is this piece of legislation? It is no better than the small business bond.
I had occasion to go into a bank with a small-businessman who was going out of business. I said to the banker, "Here is the legislation; you are supposed to help this man." He said, "I am sorry, but we do not have any money available." It is all very well to bring a piece of legislation before the House, to get it passed, and then to stand back and say that we have done our part. But, in the name of goodness, what is it doing to solve problems or to assist people when they need it? What is being done so that these people can survive, even possibly try to upgrade or keep up with the nurturing of their land? I would venture to say that across Canada today-and possibly many farmers could verify this-there are many hectares of farmland which are not being nurtured or have not received any type of fertilizer program. They are going an extra year without doing the fertilizing which they know should be done because they do not have the economics to carry it out. The country will suffer if the Government allows economics to interfere with the planning and development of our farming industry.
November 4, 1982

I urge the Government not to stop here. I urge Government Members to get out and visit farming areas across the land; they should meet with the farmers. The Minister of Agriculture (Mr. Whelan) and his group should be visiting them to see first-hand and to ensure that there are provisions to meet their needs. Then we could start in that sector to ensure that the economy begins to work a little better.
Canada has one of the greatest agricultural potentials of any country in the world. We have the expertise. Farmers are proud of what they are doing. All we require is a government willing to give the lead and the confidence for farmers to carry on in a constructive and orderly way. They should not be faced with the roadblocks the Government seems to throw in front of them at every turn as soon as they start to improve something or to produce. I urge the Government to rethink some of its policies. It should look toward developing, helping and assisting farming communities right across the country.


Some Hon. Members:: Hear, hear!


William Hunter (Bill) McKnight: Mr. Speaker, I rise on a point of order. Since the Hon. Member referred to me in his speech and has some time remaining, I should like to ask him a question. Could he tell me why he and his Party voted against a doubling of the capital gains exemption on farmland from $100,000 to $200,000 in the Conservative budget of December 13? Why did they do that? I wonder if he would like to answer that question.


Sidney James Parker: It was a regressive budget, and that is why we voted against it.


Gary Michael Gurbin: Mr. Speaker, I am very pleased to join in the debate on Bill C-134 which will provide some much-needed assistance to farmers. I would like to say much more at this time, but because of the hour may I call it ten o'clock and carry on the next day?



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Bill Wright (Calgary North):: Mr. Speaker, on November 1 in this House, I asked the Minister of Finance (Mr. Lalonde) a question referring to a statement made by the Prime Minister (Mr. Trudeau) who said, "We haven't been able to make it work-the free enterprise system. We've ended up with very high unemployment and very high inflation. We can't go back to what it was before. That means the Government is going to take a larger role in running institutions." But the Minister of Finance in his economic address, his non-
Adjournment Debate
budget, states in the third of his six principles that we must continue to rely primarily on the dynamism and creativity of the private sector as the engine of growth in Canada. I think it is well known in this House that the Minister of Finance had agreed with that statement of the Prime Minister. Suddenly he declares six principles that go directly against what the Prime Minister had been speaking about. I would like to review some of these principles.
First, the Minister of Finance said that we must continue to practice fiscal responsibility and that we must persist in restraining Government spending. But what do we have? We have a deficit that has risen from $10.5 billion as indicated in last November's budget, to $19.6 billion in the June budget and to $23.6 billion in the non-budget of October. The thinking is that the deficit will be $26 billion before we are through.
Why should we believe what the Minister of Finance is telling us? Spending is up 17 per cent this year. The deficit is up $4 billion in four months-not $4 billion in one year, but $4 billion in four months. The Government will not even tell us what the deficit will be next year because it is afraid to admit what it will amount to. One dollar out of every three dollars in tax money goes to service the interest on the deficit. The interest on the national debt is $16.7 billion alone. This is a ridiculous situation. Why should we believe that the Minister of Finance has suddenly done a complete turn around and is no longer espousing his socialist ways?
Second, the Minister of Finance said that we must not abandon the victims of the recession in the mistaken belief that such callous action might speed our recovery. What a bunch of bunk. We have 12.2 per cent unemployment, yet the Minister of Finance stands in this House and tells us that. We have 1.4 million people out of work. We have 500,000 more people out of work than last year. This represents a tax loss of $2 billion. Yet we hear the Minister of Finance standing up and saying that we are going to turn the economy around.
The Minister also stands up and says that we are going to provide $500 million to help 60,000 people. What the Minister does not tell us is that this does not mean 60,000 jobs for a year. They may be jobs for one day simply to put an individual back on unemployment insurance. The jobs could last longer, but we do not know that. There are not 60,000 jobs allocated. That was never intended, but that is what the Minister of Finance would like us to believe. 1 come now to the Minister's fifth principle. He said that must continue to develop effective mechanisms for consultation with the provinces. We all remember the Kirby Report which the Minister of Finance approved. We all have that report. It described how the Government would divide the provinces when the Constitution was to be discussed. And this is the Finance Minister who wants us to believe him? And how long ago did this Prime Minister say that co-operative federalism is dead because he did not trust the provinces. Yet the Minister of Finance stood up and said that he had the method of recovery in this country.

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Adjournment Debate
The sixth and most important point is that we must build on the spirit of the six and five program and implement an effective strategy for national recovery and economic development.
We all heard the Prime Minister a few weeks ago. In fact, one year ago we saw the geese flying across the television screen. A few weeks ago we had the lame duck flying across the television screen in the person of the Prime Minister. He said that Canadians should accept sacrifices. How many sacrifices is he accepting when every few weeks during the winter he flies down to the Caribbean to snorkle? He is not accepting any sacrifices.
Where was the Prime Minister in 1980 when we told him that the country was entering a recession? All he did was stand across the way and say that the Constitution is what we are interested in and what Canadians want. One million unemployed people later, he is still talking about it. We have seen no action from the Minister of Finance and no action from the Prime Minister.
The Minister of Finance tells us that we must adhere to the six and five program, but a few days before that program was announced he brought in a 10 per cent increase for the staff of all the Cabinet Ministers. They are not adhering to any program. The Government is giving us a high tax increase and a 40 per cent increase in UIC. About 500 CBC employees received an 11.5 per cent increase in wages. Where is the six and five program there? They are not adhering to the government program.
The real question is why we should believe anything the Minister of Finance says, or, for that matter, what his Parliamentary Secretary will say when he stands up.


Mr. Douglas Fisher (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, on occasion, we anticipate hearing from some speakers with some ideas, and that we will have to get out our hip waders just to survive. 1 have to say that the speech we have just heard is even worse than 1 had expected.
Today, we have a co-operative climate that exists between Government, business and labour; all working together to help rebuild the economy of this country. Let me give you some examples. The six and five program has been universally accepted by business, Government and ordinary people across this country. The $3,000 home mortgage grant has been universally accepted by the homebuilding industry. The 4 per cent interest reduction grants and the small business investment grants, along with the Small Business Bond have been widely accepted by Chambers of Commerce, the Canadian Federation of Independent Business and the Canadian Organization of Small Business. It is widely accepted that we should go out and put more money into the Farm Credit Corporation, and this was especially agreeable to the Canadian Federation of Agriculture. We have programs introduced by the June budget and the October statement which are productive sources of new jobs and new economic activity. The Hon. Member opposite has ignored all of these programs. In fact, the Hon. Member has followed a course of action that is currently typical of Tory tactics. He is creating fear and
loathing and using personal attacks to substitute for logic and tough debate. An example of that kind of activity is the Tory Party's attack in the past year on F1RA. They have attacked FIR A with unrelenting hatred, so much so that when their leader and their finance critic realized what they were unleashing, they had to make a 180 degree turn and start supporting the agency again. They became too hypocritical.
1 want to conclude by saying that the Prime Minister (Mr. Trudeau) in his speeches challenged us to attack our problems in the traditional Canadian way; through co-operation and working together. I would suggest to the Hon. Member that he lift his eyes and cease those negative attacks so that he may add some of his creative intelligence to solving the problems, instead of simply attacking personally and viciously.


GRAIN-LEVELS OF ADVANCE PAYMENTS. (B) POSSIBLE BENEFITS TO WESTERN COMMUNITIES
Charles James Mayer: Mr. Speaker, it was a very interesting exchange that we just witnessed. I will attempt to be reasonable in my submissions here this evening. 1 see the Parliamentary Secretary is leaving and I find that unfortunate because I had hoped he would stay and listen to some of my logic and tough debating skills with which I will make my case here this evening.
I had an opportunity in July, after having a discussion with the Minister of Transport (Mr. Pepin), and corresponding with him, to ask him a question in the House as to whether he would be prepared to raise the level of cash advances to prairie grain farmers. Cash advances are simply moneys advanced to prairie grain producers against their future sales. They are really advances against their own products-their own money.
The federal Government comes into play because it pays the interest on the money borrowed to pay the advances. The program was initiated for this back in 1957. It is a program which has worked very well. It has put money into farmers' pockets, enabling them to pay bills sooner than they would normally pay them if they had to wait for the sale of their products. This helped the whole community because it means that having cash in advance of their sales farmers are able to pay their taxes, repair bills, fuel bills, and those kinds of ordinary expenses incurred in the normal course of operating their farms.
We all know that the economic system is a circular one. What is an expense for one person then becomes income for someone else. As it goes through the system, that money is spent over and over again. If one wants to speak in economic terms, it is called the multiplier effect. If one looks at what goes on in the farming communities, and in other communities, one finds that farmers have a greater multiplying effect than those in most other industries. It simply means that when a dollar is put into a farmer's pocket, it is used more times. The program is essentially designed to put money into the hands of those in the farming community so that they can use it to pay
November 4, 1982

their bills, and this in turn provides income to other sectors of the economy.
As I have said, this has worked very well in the past. There have been very few defaults and very few problems in collecting money once it is advanced. However, the program is now sadly outdated in terms of the amount of money available. I will just give a couple of figures to illustrate.
In 1980 the number of applicants amounted to a few more than 15,000. The number of dollars advanced was in the order of $61 million. If we look at the figures for 1981, we find that the number of applicants almost doubled, rising from 15,000 to
28,000.	However, the amount of money advanced tripled, from $61 million to $205 million. This is an indicator, first of all, of not only how well received and well used the program is, but also an indicator that farmers were experiencing economic problems and needed some additional money to help pay some of their bills.
When the program was started in 1957, the cash advance limit was originally $5,000. It was increased once since then and is now set at $15,000. What we have suggested is that that limit be increased from $15,000 to $25,000, to $30,000 or to whatever figure is appropriate.
The cost to the federal treasury comes about because the Federal Government picks up the interest charges on the amount of money borrowed by the Canadian Wheat Board to make those cash advances. Admittedly, the federal Government will incur some additional costs, but let me point out to the Parliamentary Secretary that when that money is borrowed, it is borrowed by the Canadian Wheat Board on its behalf, and the Canadian Wheat Board, for the information of the Parliamentary Secretary and those who are interested, borrows money at the prime rate minus a quarter of one per cent. I know of no one else in this country who borrows money at the prime rate minus any figure. Therefore, because of the favourable financial position of the Wheat Board, it is able to borrow money more cheaply than the Government and more cheaply than producers. That is a good, healthy, sound reason why, by increasing those levels of cash advances, the extra interest will not hurt the federal Government as much as one might suppose.
Aside from that fact, I would submit that the additional cost is well worth it because in hard economic times that money is not hoarded by farmers but, rather, is spent and respent, creating additional economic activity, which is what we are attempting to do by Bill C-134, which we just finished discussing this evening. It is designed to help farmers meet some of their financial commitments. That is precisely what increasing the level of cash advances would do.
I have received letters from several farm organizations across the prairies, as I am sure the Parliamentary Secretary has, suggesting that the limit be raised from $10,000 to $50,000. I suspect that is probably too much to ask, but the Government could surely consider increasing the limit from $15,000 to $25,000. After all, in the same period of time, the Government has increased the levy against producers who are in the Western Grains Stabilization Fund. The amount has been doubled. It has gone from a maximum of $500 to $900
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this year and it is about to go up to $1,200, so it has more than doubled in the period of time that the cash advance program has remained the same.
As spokesman on the Canadian Wheat Board for this Party I offered the Minister of Transport an arrangement whereby we would very quickly pass the amendment that would be required to the Act. We would not hold up debate and would not put up a lot of speakers so that it could go through very quickly. This matter was considered to be very urgent last year, on July 30, when I first posed the question. That was before the start of the new crop year. It is equally urgent now, because farmers are facing a very tough winter. Although the additional cash advances would not be totally utilized this year as a lot of farmers have already delivered grain, against which those cash advances would have to be deducted, the program would still be well received. As I have pointed out, the Program has been very well run in the past. Losses have been minimal.
1 hope the Parliamentary Secretary will take these things into consideration and will make the positive announcement tonight that the Government has considered our offer. I hope he will be able to tell us when it is prepared to bring the legislation forward. We will not hold it up, Mr. Speaker. In that way we will be able to increase the level of cash advances and in this way not only the Canadian farmer but the whole Canadian economy will benefit.


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, the Hon. Member's interest in this subject is well-known in the House. I applaud him for making a reasonable case on behalf of the western farmer. As one who was born, raised and lived for 18 years on a farm in Saskatchewan, I know how tough it is to find the cash in advance for the purchase of new machinery, to put in crops and even to buy groceries. I appreciate the co-operative spirit in which the Hon. Member presented his argument-unlike the previous speaker. I thank him for that.
It is very clear that farmers are making good use of the opportunities available under the Prairie Grain Advance Payments Act. The number of producers who qualify for the maximum advance of $15,000 is increasing, as the Hon. Member pointed out tonight. Therefore, it is reasonable to suggest that the maximum be increased, especially at a time when farmers are experiencing higher cash requirements. As the Minister said in his answer on July 30, this question was considered by his colleagues and a decision was deferred until the question could be put in "the wider context of western grain initiatives".
One of the factors which must clearly be advanced in times of restraint, is the cost. In 1981-82, the cost was $12.7 million. The Hon. Member suggested that the advance payments should be increased to $25,000 or $30,000. My calculations show that the resulting cost would probably be over $25

November 4, 1982
Adjournment Debate
million. 1 would have appreciated it if the Hon. Member had suggested where the Government would find this additional money in a time of high deficit. Raising the maximum would obviously add to the cost, although lower interest rates could make a positive contribution.
Until now there has been no further consideration of the matter, but the Hon. Member can be assured of the Government's active interest. In fact, I understand that the Hon. Member has a very positive letter from the Minister of State in charge of the Canadian Wheat Board, so he knows there is a positive disposition on the part of the Government toward his proposal.


INTERNATIONAL JOINT COMMISSION-DELAY IN APPOINTING CANADIAN COMMISSIONER
Mr. Girve Fretz (Erie):: Mr. Speaker, I should like to speak briefly about the International Joint Commission and the serious problems it is confronting. The studies of the Commission are crucial to the people of my riding in Erie which is located in the heart of the Great Lakes basin. Although much work has been done and much concern expressed, the health and well-being of my constituents and Canadians continues to be threatened by chemical pollution in Lake Erie, Lake Ontario and the Niagara and St. Clair Rivers.
The stated purpose of the Great Lakes Water Quality Agreement of 1978 is "to restore and maintain the chemical, physical and biological integrity of the waters of the Great Lakes basin ecosystem." This is indeed an ambitious statement. To comprehend the vast extent of the problem confronting the commission, it is only necessary to look at the following statistics.
The Great Lakes Basin is a highly developed industrial and agricultural region. The present population of 37 million people should increase to 60 million by the year 2020. This increased urban growth will engender accompanying industrial development. Both of these phenomena mean that there will be vastly increased stresses on all the components of the ecosystem.
Not only are the Great Lakes presently being overloaded with garbage at a rate much more than they can handle right now, but the amount of effluent both from industrial and human sources is expected to greatly increase in the new few years. This in itself would be serious enough for the Government of one country to deal with. But here we have two countries, both of which have different priorities and different policies. The need for co-operation and compromise has never been greater, in order to come to agreement on protective and preventative measures which are satisfactory to both parties.
Currently in the Great Lakes Basin, approximately 800 major municipal and industrial facilities are dumping hazardous wastes into the Great Lakes. Smaller contributors number in the thousands. With input of toxic chemicals, phosphorous residues from detergents and fertilizers and superficially treated inflow from municipal sewage treatment plants, it is unlikely that the original state of the Great Lakes can ever be restored.
However, a continued degradation of Great Lakes water quality cannot be tolerated. Reasonable objectives are attainable nevertheless. These include reversal of the over-all longterm trend of water pollution, enabling inhabitants of the area to drink clean water, swim without danger of contamination and to enjoy the recreational resources of the lakes, including fishing and boating. The Boundary Waters Treaty states that those waters whose shoreline or banks are shared by the two countries shall not be polluted on either side to the injury of health or property on the other.
I am concerned, as a representative in Ottawa of a constituency bordering on one of the Great Lakes that little action is being taken to be sure that both parties adhere to the terms of the treaty. Certain areas have been, and continue to be identified by the commission as being environmental or human health concerns.
In looking at the August 1982 report of the International Joint Commission, I note that there are 24 different areas which have been identified as "problem areas". In many of these areas, especially the Niagara and St. Clair Rivers, much more work needs to be done. As stated in the report, "there is little value in continuing to identify such areas if effective remedial efforts are not put into place".
The environmental baseline report of the Niagara River of November 1981 states that the Niagara River has been identified as the major source of numerous trace metals and organic compounds to Lake Ontario. Less than 1 per cent of the loadings of these substances to the river can be accounted for from Canadian sources. The Niagara River is a primary source of the PCBs and the Mirex which have been found in fish and in herring gulls throughout Lake Ontario.
Obviously in this case we, the Canadians, are the ones being injured by pollution from American sources. This situation of course, can no longer be tolerated. Such sources of pollution as the Hooker Chemical Corporation and the municipal wastewater treatment plant in Niagara Falls, New York, pour volumes of pollutants into the river equal to or greater than the total amount coming from Canadian sources.
Given the inequity of this situation we, as concerned representatives of the people of this land, must do everything in our power to convince the Reagan administration that this issue must be dealth with in a firm and conclusive manner before it is too late. Only by co-operation with the United States can this problem be solved. Given the small percentage of the total load of chemicals emanating from Canada, unilateral action on our part seems almost ridiculous-not that our own industries are entirely innocent. I am sure there exists blatant examples of environmental misconduct among Canadian companies as well.
In summary, it is time to stop talking and begin acting. There are just too many 40-page descriptions of the callous destruction of our most valuable heritage, the Great Lakes. We need 40-page solutions outlining in detail the method of ameliorating this unfortunate situation in order that our descendants may enjoy the same fresh, clear, safe waters that our ancestors enjoyed.
November 4, 1982


Mr. Jean Lapierre (Parliamentary Secretary to Deputy Prime Minister and Secretary of State for External Affairs):: thank the Hon. Member for his support of the Government position on pollution, especially vis a vis our relations with the United States. 1 think on this subject there is a communion of ideas between the Hon. Member and Members of this side. 1 know the Hon. Member is very concerned about the appointment of a permanent president to the International Joint Commission, and I would like to tell him that we consider this important institution as one of our special priorities in the future to make sure we have a new Chairman appointed. I want to tell the Hon. Member the Canadian Government has traditionally approached the filling of IJC positions with seriousness and deliberation. That is the explanation for the delay. Distinguished Canadians such as Stuart Hodgson, Gerald McNaughton, Louis Robichaud and Maxwell Cohen have served as Canadian Chairmen of that Commission and we want the Commission to play a major role in our relations with the United States.
In the last few weeks we have had many discussions with the United States. The Secretary of State, George Shultz, came to
Adjournment Debate
Canada and had lengthy discussions with our Secretary of State for External Affairs (Mr. MacEachen). We have conveyed to him our willingness to co-operate in order to make sure we solve these environment problems. With the suggestions of the Hon. Member, and with the will, not only in Canada but in the Reagan administration, I am sure we can achieve the goals that he has set. I want to assure the Hon. Member we will need his support as this fight is going to be a very difficult one, because it involves a lot of money and goodwill. We will need his support and the support of all the Hon. Members from his side of the House. The Government is very well committed to combat pollution, to make sure the environment is safe in the long term, whether it involves acid rain or water pollution. You can be sure we will do everything in our power to make sure that happens.


The Acting Speaker (Mr. Corbin):: Order, please. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m.
At 10.29 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, November 5, 1982