1982-11-26

MOTIONS UNDER S.O. 43   POLITICAL PARTIES MEMBERSHIP OF LIBERAL PARTY

['No.']
Mr. Blaine A. Thacker (Lethbridge-Foothills):: Madam Speaker, since Confederation, and up to 1968, respective Conservative and Liberal Governments respected the rights of individuals to own businesses, land and shares. Under this individual enterprise system, Canada rose to a position of second place in all the world. Individual Canadians were truly free. Since 1968 and the imposition of a government-owned economic system by the Liberal-Socialist Party, Canada has fallen to thirteenth place in OECD and fortieth place in all the world. Individual Canadians are very much less free. Therefore I move, seconded by the Hon. Member for Erie (Mr. Fretz):
That true Liberal Party supporters across Canada rise up and take control of the Liberal Party and throw out the present Liberal Members who make Lenin and Trotsky look like Genghis Khan.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.



Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, both my colleague from Kingston and the Islands and I, over the past few days, have pointed out certain inequities in Bill C-131, the Government's assault on the old age pensioners of the nation. 1 shall not attempt to enumerate these inequities, Madam Speaker, but I want to observe that the sum to be realized in actual savings by the Government through the provisions of this Bill are so limited as to be meaningless, when viewed from the vantage of Government expenditures as a whole. Accordingly, I move, seconded by the Hon. Member for Kingston and the Islands (Miss MacDonald):
That, in view of the fact that Bill C-131 achieves little in the way of savings for the Government and inflicts disproportionate and unnecessary hardship on the
senior citizens of this nation, this House urges the Government to withdraw this ill-conceived and unjustifiable legislation.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


CROWN CORPORATIONS
Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, I rise to move a motion under the provisions of Standing Order 43. In British Columbia the verb "to brie" means foolishly to privatize good government corporations with disastrous consequences. Now we fear that the Canada Development Corporation and its invisible Chairman, Anthony Hampson, who pretends to operate out of Vancouver, will lay off 3,250 workers and will privatize or "brie" the Government's 49 per cent share. Further, Senator Jack Austin, the same one who was defeated in Vancouver-Kingsway, has set up the CDIC whose object will be to "brie" Teleglobe, Canadair, de Havil-land and other corporations, with God knows how many layoffs. Therefore I move, seconded by the Hon. Member for Winnipeg-St. James (Mr. Keeper):
That the Government set up a real investment corporation based in Vancouver with a business, labour, and consumer board accountable to an elected Minister of Parliament and with the object of providing jobs, and furthermore, that Messrs. Austin, Bell, Strong and Hampson should be "briced" instead.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


CANADIAN PACIFIC RAILWAY
Mrs. Ursula Appolloni (York South-Weston):: Madam Speaker, I rise under the provisions of Standing Order 43 on a matter of urgent and pressing importance. In blatant and arrogant defiance of the will of the people, as clearly expressed

November 26, 1982
by the Mayor of the City of Toronto, by the President of the West Toronto Junction Historical Society, and by the local Members of Parliament, Canadian Pacific yesterday stealthily destroyed the West Toronto railway station, despite the withdrawal, as recently as Tuesday last, of its application to the Canadian Transport Commission for authority to demolish. I therefore move, seconded by the Hon. Member for Beaches (Mr. Young):
That this House condemns CP's demolition of the West ed396;-l Toronto railway station as an act of corporate vandalism.


Some Hon. Members:: Hear, hear!


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


THE PRIME MINISTER
Mr. Gordon Towers (Red Deer):: Madam Speaker, 1 rise to note that the Prime Minister's vacation plans are unfolding as they should not, with a tour of eight sunny nations in January. His time would be better spent if he stayed in Canada and visited with some of the organizations which speak for our hard-pressed farmers. I therefore move, seconded by the Hon. Member for Hastings-Frontenac (Mr. Vankoughnet):
That the Prime Minister cancel his junket and remain in Canada to consult with farm leaders, in light of the fact that farm income is expected to be down by 28 per cent and in view of the fact that the Government's punitive excise tax on farm energy is forcing farmers to the wall, driving production costs up, contributing to inflation, and resulting in higher grocery prices at the supermarket checkout counters.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.

|


NORTHERN AFFAIRS
[Stage Direction]
disappointment and chagrin, the Minister was represented by a bureaucrat from the Department.
If I may quote from the memo given to people at this auspicious meeting:
... the past decade has seen great progress toward self-determination in Canada's North, which has excited and exhilarated everyone associated with it.
Therefore, if the Minister is so excited and exhilarated about this issue, I move, seconded by the Hon. Member for Western Arctic (Mr. Nickerson):
That he be present at all future press conferences, and that important announcements be made in the House to the elected representatives of this country, before release to the news media.
Madam Speaker:: Is there unanimous consent for this motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


PENSIONS
Mr. Neil Young (Beaches):: Madam Speaker, I too rise under the provisions of Standing Order 43. In view of the fact that the Minister of National Health and Welfare (Miss Begin) has been the lone Liberal to defend the Government's proposal to limit increases in old age pensions to 6 per cent and 5 per cent over the next two years, and in view of the obvious fact that the Minister's colleagues know how unpopular this piece of legislation is, and are allowing the Minister to swing in the wind and be hung out do dry by the machinations of Keith Davey and Jim Coutts, I move, seconded by the Hon. Member for Hamilton Mountain (Mr. Deans):
That this House calls on all Liberals who do not support this indecent attack on Canada's elderly to defy openly the dictates of the back-room boys of the Liberal Party and demand that this unfair, unjust and indefensible piece of legislation be withdrawn.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


Mr. Girve Fretz (Erie):: Madam Speaker, I rise to express my deep concern on a matter relating to the conduct of the Government. This morning there was a press conference in the Offices of the Minister of Indian Affairs and Northern Development (Mr. Munro). Of course, accustomed to the pearls of wisdom which emanate so regularly from the headquarters of this Ministry, I hurried over eagerly to hear what the Minister had to say. Imagine my surprise when the Minister was not present at the press conference. Instead, to my


MUNICIPAL AFFAIRS
Mr. Doug Lewis (Simcoe North):: Madam Speaker, in many municipalities across Canada the local YMCA or YWCA is a prominent facility. They act as a focal point for a large and diverse number of community activities. The YMCA in Orillia, Ontario, recently suffered severe fire damage. In view

November 26, 1982

of the importance of YMCA and YWCA facilities to a community, I move, seconded by the Hon. Member for Parry Sound-Muskoka (Mr. Darling):
That the Government include the building and renovation of YMCAs and YWCAs as part of its planned municipal public works program to be announced in the spring.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


EDUCATION
Mr. Howard Crosby (Halifax West):: Madam Speaker, the former Secretary of State agreed in this House that the Government's six and five restraint formula should be applied to university tuition fees in light of the substantial contribution of public funds to post-secondary education. Yet university tuition fees have increased more than 16 per cent across Canada in this academic year, and 30 per cent in some Provinces. Therefore 1 move, seconded by the Hon. Member for Annapolis Valley-Hants (Mr. Nowlan):
That the Government take immediate action to ensure Canadian university students will be protected from financial cutbacks to universities, and that tuition fee increases will be limited to 6 per cent and 5 per cent in accordance with the Government's commitment.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


NEW EMPLOYMENT EXPANSION AND DEVELOPMENT PROGRAM
Mr. Les Benjamin (Regina West):: Madam Speaker, I rise on a matter of urgent and pressing necessity under Standing Order 43. In view of the fact that the federal-provincial temporary job creation scheme in Saskatchewan excludes workers from existing labour contracts, and since the Program will not even keep up with the number of permanent jobs being lost, I move, seconded by the Hon. Member for Humboldt-Lake Centre (Mr. Althouse):
That this House calls upon the Government to revise its NEED Program in Saskatchewan to allow workers protection under existing collective agreements and to provide for long-term job development.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.



ORAL QUESTION PERIOD


Mr. Dave Nickerson (Western Arctic):: Madam Speaker, my question is directed to the Minister of Indian Affairs and Northern Development. Today the Minister announced the Government's policy on constitutional development in the Northwest Territories and Yukon. What he did in this announcement was to reject the possibility of provincial status for either the Northwest Territories or Yukon within the foreseeable future. Why has the Government rejected the possibility of provincial status?


Mr. Nielsen:: Because the Prime Minister is still alive.


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, if the federal Government has rejected anything, it has rejected provincial status now. That is based on realistic factors, such as the tremendous land mass, the limited number of people, and the still relatively narrow economic base.
May I say that our position is based on the realities of the situation. As a northerner himself, I think the Hon. Member knows that there are very few northerners who realistically believe that provincehood, especially in the Territories, is appropriate at this time when they want division. I am talking about the Northwest Territories now. That is a fact. If the Hon. Member is suggesting that they want to wrestle with the question of division now, but want provincehood before that, that seems a ridiculous position and one with which most northerners would never agree.


Dave Nickerson: Madam Speaker, as a northerner I know that people who live in that part of Canada want control of their own affairs, the same as people who live in any other part of the country.


RESOURCE REVENUE SHARING
Dave Nickerson: Madam Speaker, my second question deals with the financing of the operation of government in the Territories and in Yukon. At his press conference this morning the Minister rejected the possibility of resource revenue sharing. Instead, he said that it is the policy of the Government to collect all resource revenues and then

November 26, 1982
Oral Questions
hand back dribs and drabs to the Territories as it sees fit. Why has the Minister rejected the possibility of resource revenue sharing?


John Carr Munro: Madam Speaker, with reference to the Hon. Member's first remarks, may I say to him that not only the native leadership in the Northwest Territories but also the Executive Committee and the entire Assembly, indicated that they wanted the federal Government to indicate, in principle, its commitment to responsible and politically accountable government in the Territories. That is precisely what we have done and that is, therefore, why I can say with considerable confidence, in terms of the northerners whom 1 have met in the last half hour, that they endorse the Government's policy very enthusiastically. May I indicate that they wished they could have received a similar hearing from the previous Government when they made representations of this kind.
As far as the Hon. Member's question about resource revenue sharing is concerned, may I indicate to him that we met the Territories' desire for formula financing. That will allow them to accept political accountability for the moneys spent in the North. They will make their own decisions with respect to priorities for spending that money. That, again, is the real test of responsible and politically accountable government in the North.
In addition to that, we have established the principle of a discretionary fund that will assure northerners that they will have a fund to offset the cost of development in the North. It is the cost of development that is of particular concern right now.
May I indicate that they wanted the discretionary fund to offset the cost of development because that is where the real problem resides right now. It is exploration that is taking place right now. They are going through a stage of expenditure; there are no revenues, simply mammoth expenditures that must be made in order to attain revenues for the future. That is what we are prepared to share with northerners right now.


INTRODUCTION OF LEGISLATION TO AMEND YUKON ACT
Erik Nielsen: Madam Speaker, may I put a very simple, brief, supplementary question to the Minister. Does he intend to introduce amendments to the Yukon Act which would give Yukon control over its natural resources? Does he intend to introduce similar amendments which would remove his power of veto over elected members of the Legislature introducing measures affecting the expenditure of money?


John Carr Munro: Madam Speaker, we intend to amend the Yukon Act to give legal basis to the de facto situation which is there now in terms of responsible government. That is a position which the head of the Yukon government wanted us to take for some time, and I suspect that it has the support, not only of that Government but of the Hon. Member himself.
That will take place. In future, also, it will mean that the Governor in Council at the federal Government level will not have to authorize elections. It will be done by the Commission in Council and therefore by the duly elected people in Yukon. Again that is something which is very much desired in the North.
The amendments to the Yukon Act will take place as soon as the claim of the Council for Yukon Indians is settled. In fact, that was the singular condition to us getting ahead with the amendment of that Act. Dennis O'Connor, the negotiator there, a man whom, I believe, the Hon. Member has backed in terms of his tenure as negotiator, indicated with some optimism that that claim will be settled within the next few months. That being the case, I would certainly hope that we could get ahead with the amendments to the Yukon Act, as the Hon. Member has wanted for some time.


Erik Nielsen: The question concerned the removal of federal control over resources and federal control over finances. The translation of the Minister's answers to both those questions is obviously no.


FUTURE OF YUKON MINES AND RAILROAD
Erik Nielsen: Madam Speaker, I ask the Minister whether he could part the waves, penetrate all the smoke and mirrors of his announcement, and tell me and other Yukoners whether the federal Government has found solutions to opening the Cyprus Anvil mines, to opening United Keno Hills mines, and to putting miners and other out-of-work persons in Yukon back to work. What is the solution the federal Government is coming up with, with respect to putting the railroad back to work and all those miners who are suffering the tragedy of unemployment in company with 1.5 million other Canadians who are out of work in the country?


John Carr Munro: Madam Speaker, I just do not believe that Yukoners will appreciate the Hon. Member misinterpreting their representation to this Government for two years. It has been that they wanted formula financing, a type of financing which allowed them to accept their own political responsibility for decisions made on financing, somewhat analogous to the concept of what we do with the Provinces. We have endorsed that.


Erik Nielsen: What about jobs?


John Carr Munro: We have given them a stake to this degree-a discretionary fund which the leader of that Government, the Conservative Government there, wanted in terms of a heritage fund. That can be provided under discretionary funding.


Erik Nielsen: What about work?


John Carr Munro: Those are two things which we have acknowledged and done. For the Hon. Member to say that that is not what the people there wanted is a distortion.


Erik Nielsen: Jobs, jobs.
November 26, 1982


John Carr Munro: As far as the Cyprus Anvil situation is concerned, may 1 say that we have been in intensive negotiations, not only with the Japanese but others, in trying to resolve that. The Hon. Member is fully aware that it requires a labour settlement first, which we still have not attained but are endeavouring to get. May I also indicate that 1 will be talking about the Cyprus Anvil situation when I am in Yukon in the next day or two. In all the time I have been in Whitehorse, Yukon, discussing Cyprus Anvil and trying to get that situation back to work, the Hon. Member for Yukon has not even been there.


MACDONALD ROYAL COMMISSION
Mr. Ian Deans (Hamilton Mountain):: Madam Speaker, my question is directed to the Prime Minister. When he announced the formation of the Macdonald Commission it was quite unclear exactly what Mr. Macdonald was going to investigate. In the intervening two or three weeks the whole question has become even more muddled, and yesterday Mr. Macdonald added to the confusion with a press conference. At the press conference he said that he will not give up his corporate directorships-and I assume that applies equally to the other Commissioners-that he will investigate House and Senate reform, that he will take a look at constitutional reform, that he does not know what the Commission will cost, and that in fact he will look into everything with the exception of morality and the state of professional sport in Toronto.
Given that we have a serious economic problem in the country that has to be faced now, could the Prime Minister please tell the House what, in Heaven's name, is this Commission supposed to be doing?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, I think the clearest answer that I could give the Hon. Member would be to advise him to read the terms of reference which were part of the Order in Council setting up the Commission. If he reads that, he will not only understand what the Commission is intending to do but the Hon. Member will also understand what Mr. Macdonald was saying.


Ian Deans: Madam Speaker, I think I do understand what this is all about, but I am not sure that public funding for Mr. Macdonald's leadership aspirations is a good thing.


Some Hon. Members:: Oh, oh!


JUSTIFICATION FOR FUNDING COMMISSION
Ian Deans: Madam Speaker, surely the Prime Minister knows that we are already funding-we, the people of Canada-the Science Council and the Economic Council, to look at the future and to determine what kind of economic direction we should be taking. We are
Oral Questions
funding the "blue ribbon committee" to advise the Government on immediate and long-range plans for the economy. Now we are going to spend another $5 million on fees and on advice for this Commission to look into all manner of things, not one single one of which relates directly to current economic conditions and how to solve them.
How can the Prime Minister justify spending $5 million right now on this Commission, given that the Commission hasn't the faintest idea what it is doing, and given that it is duplicating work already being done by other groups funded by the Government?


Pierre Elliott Trudeau: Madam Speaker, the two "givens" quoted by the Hon. Member are precisely not two "givens". The other work which is done within Government is not work which will be duplicated by this Commission. I repeat it is not a "given" that the Commission does not know what it is going to do. The terms of reference are quite clear. It tells them what they are going to do. The Hon. Member is basing his conclusions and his indignation on two wrong premises. I would urge the Hon. Member to read the terms of reference, and to think with a clear mind of the importance of having Canadians, not part of the Government, looking at the long-term prospects for Canada in economic terms and also in institutional terms.
This is hardly an invention. I had occasion previously when I was questioned to refer to the Rowell-Sirois Commission and to the Gordon Commission, for instance. These were very useful works for the elaboration of thought on the future of Canada, ten, 20, and 30 years down the road. This is what we want to have done outside the partisan atmosphere of this House, outside the more short-term preoccupations of departmental duties.
We want a group of distinguished Canadians, hopefully assisted by large numbers of Canadians in financial, academic and labour circles, who will be able to assist the Commission in arriving at a certain number of principles useful for the guidance of this or any government in orienting Canada toward a progressive path in the future. I repeat this has been done before. It is time that it be done again now, and I would urge the Hon. Member to try to depart a bit from his partisan approach to this and to think of the benefit that can come to Canada from it.


Ian Deans: Madam Speaker, it is not a partisan consideration. It was the Prime Minister who appointed Donald Macdonald, not I.


Mr. Crosbie:: And Romanow.


Ian Deans: It was Donald Macdonald who said he wanted to be free to leave and run for the Liberal Party's leadership, not I. If there is any partisanship injected into this, it was the Prime Minister and Donald Macdonald who injected it, not we.


Some Hon. Members:: Hear, hear!

November 26, 1982
Oral Questions


NECESSITY FOR JOB CREATION PROGRAMS
Ian Deans: Madam Speaker, we have two million people who are unemployed in Canada. There are any number of job opportunities that could be undertaken if the Government had the will to pursue them.


Mr. Clark:: The Prime Minister will appoint them all to Royal Commissions.


Ian Deans: To send this group of high-priced individuals at $700 plus a day across the country, to walk around chatting to people about where the future might lead us, is a waste of public funds at this time.
[DOT] (M30)
Why does the Prime Minister not catalogue the various and many jobs that could be created in this country now, the projects that could be undertaken now, and try to get work for Canadians who are unemployed now, rather than create high-priced jobs for Canadians who are already employed?


Pierre Elliott Trudeau: Madam Speaker, the Hon. Member seems to indicate that his mind can only operate at one level. That is not the case with nor is it the duty of the Government which tries to discharge its functions.
A few weeks ago the Minister of Finance made statements in the House which were concerned with jobs now. The Minister of Employment and Immigration made several announcements concerning jobs now. We think that it is the duty of the Government, and we should have thought also the duty of Parliamentarians in general, to be concerned about the longer term future of Canada and that we should not be so narrow in our approach to reality and our duties as politicians that we are only concerned with today, tomorrow, and next week. We should be concerned with the orientation that the country should take in the future in a very rapidly changing world. This is the job of the Commission.


NATIONAL REVENUE
Mr. Bill Kempling (Burlington):: Madam Speaker, my question is directed to the Minister of National Revenue. Some months ago his Department moved the records of the Hamilton taxation office to Sudbury. My office and the offices of other Members are being swamped with calls from irate business people, tax accountants and taxpayers, who are told that it will take six weeks to get their files from Sudbury. When they call Sudbury they get a recorded message. The taxation staff in Hamilton are being unfairly blamed for the resultant confusion and they refer the irate taxpayers to the local Member of Parliament.
I resent my staff being abused because of a stupid decision made in the Minister's Department. How long will he allow this to continue?


Hon. Pierre Bussieres (Minister of National Revenue):: Madam Speaker, first of all, I must say that entirely I disagree with the Hon. Member's conclusion that the decision to decentralize the district office was a stupid one. I would say that before-


Charles Joseph Clark: Madam Speaker-


Pierre Bussières: Madam Speaker, the Leader of the Opposition also has a habit of jumping to conclusions before hearing the answer, and his conclusions have often been wrong. I would invite him to let me finish my answer.
After this less than courteous interruption by his leader, I can inform the Hon. Member that all objectives have not yet been met to make decentralization complete, and I am sure he will understand that it takes time for the mechanisms involved in office decentralization to become operational, and once that is the case, taxpayers will be able to obtain a better service from their office. However, there is the time factor, and I am sure the Hon. Member will want to ask his constituents to help us by being patient until these services become operational.


COMPLAINT CONCERNING RECORDED MESSAGES
William James Kempling: Madam Speaker, I have a constituent who called the Sudbury office 14 times and received a recorded message 14 times. At the same time he has a demand for payment of taxes placed on him with the threat of garnishee of his wages. All that he gets from "Big Brother" is a recorded message. How does the Minister attempt to justify having the administrative staff in one location and the records on which they rely in another location? Is he going to give the person who made that recommendation to him a medal for stupidity, because that is what it is?


Pierre Bussières: Madam Speaker, regarding the particular case to which the Hon. Member is referring, and any other cases that may exist,
I would urge the Hon. Member, whenever he is unable to get proper service from our district taxation office-which would surprise me, except perhaps in certain circumstances-to call the minister's office, where we have people who will be glad to answer questions by Hon. Members.
I may also point out that just because files are located in one office and the officer who has to answer queries is located elsewhere, in another office, it does not mean that proper service cannot be provided. The Hon. Member is aware that tremendous progress has been made in electronics, and he should know that with computerized systems, we can bring
November 26, 1982

information located in a file some 400 or 500 miles away, on to a small television screen. Thus, adequate service is possible even if the information is not available in the same office and in the same geographical area. I can assure the Hon. Member that we are maximizing the use of modern technology with a view to provide a better service to the taxpayer.


COST COMPENSATION REQUESTED FOR HOME OWNERS IN NOVA SCOTIA
Howard Edward Crosby: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. It could be answered by the Prime Minister because it was the Prime Minister who promised to extend the gas pipeline to the east coast.
If natural gas were available in the Maritimes in 1983, as promised, Nova Scotians would be protected from the dramatic increases in the cost of fuel oil and electricity for home heating. Since the gas pipeline is delayed to 1986 and beyond, I would ask the Minister of Energy or the Prime Minister if the Government is willing to compensate Nova Scotians for this broken promise, by giving financial assistance to those who must continue to use oil or electricity to heat their homes this winter and for several winters in the future. Does the Minister think it is right that any person in one part of Canada, such as Nova Scotia, should pay more than the national average for energy costs?


Hon. Jean Chretien (Minister of Energy, Mines and Resources):: Madam Speaker, I wish to tell the Hon. Member that the plans we are working on at this time are much better because we are paying 80 per cent of all the drilling costs off the coast of Nova Scotia. We hope that there will soon be natural gas off the coast of Nova Scotia, so that gas will not have to come from Alberta to Nova Scotia.
Of the $2 billion worth of work in drilling that will take place there in the next two years, the federal Government will pay a large portion of it for the Canadians who drill there, through the PIP Program. We are paying 80 per cent of it.
I hope the Hon. Member will be glad to see that we are doing our utmost to ensure that the resources off the coast of Nova Scotia will be on the shore very soon to serve the people of Nova Scotia.
Of course, in terms of paying the energy costs across Canada, we do not have a national rate. There are different rates across the country because power systems across the country are controlled by the provincial Governments. In terms of natural gas, we have moved the pipeline as far as Quebec. It might not need to go from Quebec to Nova Scotia any more because it is most likely that the drilling program will very
Oral Questions
soon produce natural gas off the coast of Nova Scotia which will serve Nova Scotians first.


Howard Edward Crosby: That is just the kind of nonsensical answer that annoys people in Nova Scotia and in other parts of Canada. I am talking about the cost which must be borne by individual consumers in Nova Scotia, and the Minister's answers concern Government policy and transfers between provincial Governments and the federal Government. It is the people who are paying for this broken pipeline promise.


EQUALIZATION OF ENERGY COSTS
Howard Edward Crosby: Madam Speaker, my supplementary question is directed to the Prime Minister. When he hears his Minister talk about all these arrangements, does he really give any weight to the provision in the Constitution Act which the House approved, Section 36, which provides for equalization of economic opportunity in Canada? Does he not apply that to a situation such as energy costs? How can we have equal opportunities in the Atlantic area unless we have equalization for energy costs? Will he not apply this provision of the Constitution Act to this situation and guarantee that people in all parts of Canada will pay no more than the national average for their energy?


Pierre Elliott Trudeau: Madam Speaker, it would seem to me that the Hon. Member might reflect on what was done in, and before, the National Energy Policy, when we had precisely the intent of equalizing the cost of petroleum and gas across the country. That was done. That is why there are these huge subsidies to the importers of petroleum in the Atlantic Provinces in particular. This is an aspect which the Hon. Member and his Party have not supported. I am glad that they are coming around to the realization that the National Energy Policy was based on this concept of equalization. Naturally, we cannot equalize every last detail, and the cost must be borne-the cost of transport in particular-within Canada. Even there, we have attempted to equalize as best we can.


CUSTOMS AND EXCISE
Mr. John Evans (Ottawa Centre):: Madam Speaker, my question is for the Minister of National Revenue. As some Members have been aware, there is a video game in the United States called "Custer's Last Revenge", which is extremely degrading to the native people, and especially degrading to native women, since it involves rape and other acts of this kind. Can the Minister of National Revenue assure the House that he will use every power of his Ministry to ensure that such perverted trash is not allowed into the Canadian marketplace?


Some Hon. Members:: Hear, hear!
21022

November 26, 1982
Oral Questions
[ Translation]


Pierre Bussières: can assure the Member for Ottawa Centre that I am concerned about the importation of this particular video game, and I may add that I have received representations from other colleagues, especially from my Cabinet colleague the Minister of State (Mines) who is also responsible for the Status of Women. This morning, I met the deputy minister of Customs and Excise, and I asked him, in the light of the guidelines governing the administration of Customs Tariff regulations and also in the light of our past experience in this area, to make a thorough study of the initial decision made with respect to the importation of this video game.


FINANCE
Mr. Mark Rose (Mission-Port Moody):: Madam Speaker, I would like to direct a question to the Minister of Finance, if I may, and it concerns the increasing number of student loans which have been defaulted because of unemployment. With the rate of youth unemployment up to 21 per cent across Canada, because of the policies of the Government, it is an increasingly serious problem and, more and more, the Government is turning these loans over to collection agencies. Potentially, there were about 10,000 loans in 1980-81 which defaulted. Is the Minister aware of the extent of the problem and, if so, what is he prepared to do about it?


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker, the Hon. Member knows the economic situation the western world is facing, as well as the rest of the world. Therefore, when he blames the present situation on the federal Government, in the first part of his question-


Erik Nielsen: How about Bill C-133?


Marc Lalonde: -I would invite him to broaden his sights and see what has happened in the world in the last two years. The Government has taken steps to try to accommodate the difficult time we are going through. We have taken steps to remedy it in so far as we could in co-operation with all economic agents in society. We will continue to do so.
As far as the specific problem to which the Hon. Member referred is concerned, I will investigate the matter and report to him. I will see whether, indeed, there are situations where people are not able to repay debts. I will be pleased to inform the Hon. Member.


Mark Willson Rose: I will be pleased not to criticize the Government when unemployment is going up, if the Government, in turn, does not try to take credit for unemployment when it is going down.


REQUEST FOR MORATORIUM ON LOAN REPAYMENTS
Mark Willson Rose: I would like to ask the Minister if he is aware that most of these young Canadians want to pay back their loans. Some of them are trying to do it. I know of one case where a person paid back $738 just in interest last year, without reducing the principal at all, and that situation must be duplicated all over the country. Would the Minister consider either a mortgage type of loan subsidy to these students or, better still, a moratorium for those who are unemployed until the economic situation rights itself because of world conditions, not because of the Government's policy?


An Hon. Member:: A moratorium on the interest charges.


Marc Lalonde: I will look into the suggestions brought forward by the Hon. Member. I will examine them very seriously. Indeed, the Government is quite concerned and feels that we should not ask people, who are unable to pay, to make payments on debts that they owe to the Government but which they simply cannot meet at the present time, and that we should show concern and be willing to accommodate them if at all possible. The Hon. Member has made some suggestions and I will consider the matter to see whether they can be acted upon, or whether there are other, better ways of dealing with the problem he has raised. I will be very happy to report to the Hon. Member at the earliest opportunity.


AGRICULTURE
Hon. Don Mazankowski (Vegreville):: Madam Speaker, I should like to direct a question to the Minister of Agriculture, who is supposed to be looking after the interests of the farmers of Canada. The Chairman of the CNR has been reported in the Western Producer as stating:
-farmers should assume they will have to pay all freight cost increases above the annual Crow benefit payment guaranteed by the Government through legislation to be introduced into Parliament this winter.
May I ask the Minister if that is the position of the Government? Does he support the statement of the Chairman of CN? If this is not Government policy, what is the Government's policy and where does the Minister of Agriculture stand on it?


Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, I would like to know where the Hon. Member stands on the issue of what farmers should pay, because he never made it very clear, either.


Some Hon. Members:: Oh, oh!


Eugene Whelan: As he knows, the Government has not made a decision on the Gilson Report, but it will in due time. I am not aware of what the Chairman of CNR said.
November 26, 1982


MINISTER'S STATEMENT
Donald Frank Mazankowski: The Minister, in his speech to the Ontario Federation of Agriculture, said that in fact the Chairman of CN had made a very legitimate point that there should a capping of the subsidy paid under the Crowsnest Pass freight rate structure. How does the Minister square his statement here in the House today with the statement that he made to the Ontario Federation of Agriculture?


Eugene Whelan: The Hon. Member is referring to a copy which states on the top of it, "Notes for a Speech".


Some Hon. Members:: Oh, oh!


Eugene Whelan: Your Member over there has all the copies of my speeches for the last few years.


Mr. McKnight:: It is lucky I have a fireplace at home, Gene!


Some Hon. Members:: Oh, oh!


CANADIAN DAIRY COMMISSION
Blaine Allen Thacker: Madam Speaker, once the House settles down and the Minister of Agriculture turns his hearing aid up, I also would like to direct a question to him.


Some Hon. Members:: Oh, oh!


Blaine Allen Thacker: That is an inside joke, for the other people who do not know it.
My question relates to the administration of Crown corporations. The Minister knows that the Canadian Dairy Commission went through a very detailed examination by the Public Accounts Committee which reported in 1978 and pointed out that the administration of the CDC, plus parts of its export policy, were very badly handled. Reference was also made to it in the Gibson Report concerning problems in those same areas, as well as the Kotes inquiry. We have just completed studying the Public Accounts Committee report which pointed out quite a few errors in the administration of the Canadian Dairy Commission. Throughout that entire period, the Commissioners and the top management, who were appointed by the Minister, have remained in office, whereas in any other business, if they had made those same types of business mistakes, they would surely have been retired. What is the Government policy for making the top management of Crown corporations, of which there are over 600, responsible?


Eugene Whelan: Madam Speaker, I would like the Hon. Member to be as patient as I will be in waiting for the Public Accounts Report. 1 know that it went through a very thorough study in the last few days of the operations, of Canadian Dairy Commission. I want the Dairy Commission to be run as well as any corporation, private
Oral Questions
or Crown corporation, can be run. I am satisfied at the present time, when making comparisons between the operations of the Canadian Dairy Commission and any other corporation, whether private or other, whether in comparison with Massey-Ferguson, Chrysler or some of the other companies that we have helped, such as Dome, that it is run pretty well and is subject to public scrutiny.
I asked for the inquiries, but I am still of the opinion that one does not assassinate or fire anyone by innuendo. One waits until one has the facts. I have known the men and the Commission, as the Hon. Member said. I am responsible for their appointments. I am responsible for the Dairy Commission. I would put the operations of the Dairy Commission up against any other dairy operation in the whole world. This Dairy Commission has the support of the total dairy industry in Cananda, as does its Minister. Probably no other Minister can say that of his Ministry. He has total support, which the record indicates. When they all say how good it is, am I supposed to condemn it?


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Blaine Allen Thacker: Madam Speaker, the issue is not how good the policy is, it is how the Corporation is being administered and, when there have been four investigations showing mistakes, someone should go.


Some Hon. Members:: Hear, hear!


RCMP INQUIRY
Blaine Allen Thacker: My supplementary question is directed to the same Minister. Since he wants to get into this issue, he also asked for an RCMP inquiry, and that has been delayed and delayed. I want to know when the Minister of Agriculture will bring that RCMP inquiry to a conclusion so that we can really get at the true facts.


Eugene Whelan: Madam Speaker, does the Hon. Member want me to put pressure on the RCMP and interfere with its investigation? Is that what he is suggesting? That is not my prerogative. It is not within my power to do that. I asked for an inquiry. They are making their inquiry. They will not make their report to the Minister of Agriculture, but to the Minister in charge of the RCMP. They make it through the appropriate Minister. That report then comes to me. I wrote to the Minister in charge of the RCMP to have that inquiry conducted.
When one checks the facts, one will not find that they say to the Minister of Agriculture, "There is that kind of inefficiency in there and you should take that action and fire that person or those persons," because it was not that firm. If the Hon.

November 26, 1982
Oral Questions
Member can bring those accusations where there was that kind of wrongdoing in the Canadian Dairy Commission, he should put them on the record. I have had everybody study them. There may have been inquiries. There were certain things said without anything to back them up. I asked for the facts. That is why I asked for the internal audit of the Auditor General. I asked for that because I wanted the facts before I beheaded anybody or did anything like that to anyone. I said if anybody brings out the facts to the Public Accounts Committee-


Madam Speaker:: Order.


NATIONAL PARKS
Charles Joseph Clark: Madam Speaker, I wonder if the Minister of the Environment could tell us who is the official who ordered the Judd Buchanan building permit to be issued. On whose specific authority was that ordered? If the Minister does not know the answer to that question, which has been before the House for four days, will he give us an undertaking that he will answer that specific question next week?


Hon. John Roberts (Minister of the Environment):: Madam Speaker, the building permit was issued by Mr. Racine, as I think is well known. If I understand the substance of the question of the Leader of the Opposition, he knows that. He wants to know if there was some ordering of him to do that. To the best of my knowledge, if that was the case, it would have been as a result of a discussion with his superior, who would be the townsite manager. I do not know the substance of what discussions took place between them before the permit was issued by Mr. Racine.
I have given him the knowledge that I have presently, and I will follow his suggestion. If I can supplement that information, I will forward a communication to him.


Charles Joseph Clark: Madam Speaker, Mr. Racine, and Mr. Ross the Acting Superintendent, and the Director of Canada Parks West in Calgary have all said they were ordered to do it. I want to know by whom they were ordered to do it. That is what they said, Mr. Prime Minister. If you want to check what is going on in your Government, carry out an inquiry. We would be delighted to do it on the floor of the House of Commons.


CHANGES MADE TO ORIGINAL PROPOSAL
Charles Joseph Clark: Let me
come to the letter of December 23 from the Deputy Minister of Environment Canada to the Member of Parliament for Bow River in which the Deputy Minister indicated that the Buchanan proposal had been rejected. I quote, "The proposed land exchange was not approved". The Minister said yesterday that the Government negotiated a very different proposal and then approved it quietly, secretly. Will the Minister tell the House
of Commons what changes made an unacceptable proposal acceptable?


John (Moody) Roberts: Madam Speaker, I will reply to the hon. gentleman's question. I do want, however, to point out to him and the House that he has not accurately reported what I said. I at no time said there were secret negotiations which took place after the letter to which he referred. Indeed, the fact is that discussions took place which were certainly not at all secret. On several occasions after that date-on January 4, February 1, June 7, July 5 and again August 30-the minutes of the Banff Advisory Council clearly indicate that there were indications of discussion on the project at that place. I think most Members know that discussions which take place at that Council are communicated to members of the town quite readily, so his allegation which is one made as well by Members on that side earlier this week, that after the letter to which he has referred that somehow there were continuing and secret and unknown negotiations, is simply not the case, and the facts bear that out.
In reference to the earlier part of his question, the other part of his question, there is indeed the letter which he described. Parks Canada, not being entirely sure that the original proposal was one which they would wish to accept, did have a memorandum prepared for Treasury Board which was considered. Treasury Board decided that that proposal was not one which they would accept. As a result of that, Parks Canada did go back and negotiated a different arrangement with the developers which led to the addition of another parcel of land on the part of the developers to that which was the other three, which were being and exchanged with Parks Canada. This narrowed very, very considerably what had been the previous disparity in value, so that was a very significant and substantial change. As a result of that change, Parks Canada officials were confident that the exchange was one which was of benefit to Parks Canada and to the townsite. They felt no need for a further second opinion and they therefore proceeded with the negotiations.


REQUEST THAT MINISTER TABLE DOCUMENTS
Charles Joseph Clark: Madam Speaker, if the Minister is so confident that this matter is in the public interest, will he agree to table in the House of Commons the first proposal which was rejected, the second proposal which was accepted, and any representations and any records of conversations that went on between the rejection of a proposal by Mr. Buchanan in the first instance and the acceptance of a proposal by Mr. Buchanan in the second instance?


John (Moody) Roberts: Madam Speaker, the hon. gentleman has referred to any representations, which is an extraordinarily wide net. "Representations" is the word I think he used. It is not the practice to reveal discussions or negotiations between private citizens pursuing business affairs and governments. As far as I know, it has
November 26, 1982

never been the practice to reveal the kind of commercial information which might be of use or benefit to competitors in the marketplace. That is not something that we have ever done.


PUBLIC SERVICE
Mr. Sid Parker (Kootenay East-Revelstoke):: Madam Speaker, my question is directed to the President of the Treasury Board. When the Bill cutting the wage increases of Public Servants was before the House last summer, the Government amended it to permit unions to bargain changes within the six and five guidelines. It now turns out that the Government is not permitting this. The Professional Institute of Public Servants is trying to provide increased maternity benefits for some of its members within the six and five guidelines. Treasury Board negotiators told the Professional Institute earlier this month that they were not in a position to respond to the request for increased maternity benefits and that they did not even know when they would be able to respond. Is the Government trying to weasel out of even its minimum commitment to bargaining and, if not, can the Minister give us a firm answer on when his negotiators will be in a position to bargain?


Hon. Herb Gray (President of Treasury Board):: Madam Speaker, the Bill in question was amended by Parliament to give the authority to the Governor in Council to exempt from the Bill collective bargaining in the context of accepting the six and five principle. I have been working with colleagues in Cabinet to develop a set of guidelines which would be made available to the Public Service unions so that they would know the basis on which the Governor in Council would be likely to exercise that discretion. I have discussed this matter with the heads of the major Public Service unions. I told them that I am working actively to get these guidelines developed, and I will show them the guidelines for their input before the matter is finalized. I hope to do so as quickly as possible.


DELAY IN STARTING NEGOTIATIONS
Sidney James Parker: Madam Speaker, I am sure the President of the Treasury Board must realize that time is important on this very specific question. Public Servants have already had their increases cut below the cost of living and they do not want their increases delayed by this type of Government stalling. Why has the Government refused to bargain even within the six and five guidelines, when it has had all summer to prepare itself for this very important issue?


Herbert Eser (Herb) Gray: Madam Speaker, as far as I am aware the increases of six and five which are permitted by Bill C-124 are not being held up by the
Oral Questions
matter to which my Hon. friend is referring. The Hon. Member is asking whether it would be possible for agreements to be negotiated of a kind that would not be covered by Bill C-124 because the Governor in Council would exercise its discretion to exempt them. In order to do this, I think it is fair to the public servants in question that they know the basis on which this discretion would be used, so there would not be negotiations on an agreement which later would not be found to be subject to exemption. I am trying to operate in a fair and efficient manner, and I want to get these guidelines worked out as quickly as possible.


CANADIAN PACIFIC RAILWAY
Ursula Appolloni: Madam Speaker, in the absence of the Minister of Transport I address my question to his Parliamentary Secretary. The Parliamentary Secretary is aware that yesterday, in the wake of the demolition of a building in my riding, the CTC sent a telegram to Canadian Pacific, requesting an explanation for their actions, by ten o'clock this morning.
Has Canadian Pacific respected the deadline set by the Canadian Transport Commission to justify the wanton destruction of the West Toronto railway station? If so, what was the reply to the CTC telegram and, most important, can the Parliamentary Secretary assure the people of Toronto that conditions laid down by the CTC were satisfied before demolition took place?


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: Madam Speaker, the news of the demolition of the West Toronto railway station came as a complete surprise to the Hon. Member for York South-Weston, to the Minister of Labour, and to me-


Mr. Baker (Nepean-Carleton):: And to the Minister of Transport.


Jesse Philip Flis: -because the three of us worked very closely with the West Toronto Junction Historical Society to preserve this 71-year old building as an historical site.
When the owner of a railway station wants a station removed or demolished, he must apply to the CTC under Section 120 of the Railway Act. Canadian Pacific did this. The puzzling factor in this case is that, a few days before the demolition, CP withdrew this application, and did not apply for a demolition permit from the City of Toronto, claiming that this building is on federal land and does not require such a demolition permit.
CTC acted very quickly by sending a telex to CP yesterday demanding a reply by 10 a.m. this morning. I am pleased to inform the House that such a reply did come in this morning.

November 26, 1982
Sports
The Railway Transport Committee is meeting at this very moment to study this reply-


Erik Nielsen: Put it back.


Jesse Philip Flis: -and determine whether CP acted properly or irresponsibly.


VIA RAIL
Charles Joseph Clark: Will the Parliamentary Secretary tell us whether the Railway Transport Committee of the CTC will act as vigorously to see if the 20 per cent of VIA Rail service was abandoned in accordance with the law?


Jesse Philip Flis: Madam Speaker, I do not see the relevancy of the Right Hon. Member's question to the question posed by the Hon. Member for York South-Weston. I would hope that the Leader of the Official Opposition would learn to ask more responsible questions in this House.


GREY CUP GAME, 1982 CONGRATULATIONS TO PARTICIPATING TEAMS
Hon. Steven E. Paproski (Edmonton North):: Madam Speaker, 1 rise on a point of order. I think that it would be appropriate at this time to congratulate two great gridiron teams who, this weekend, are going to be performing in Toronto and have done such a great job for Canadian unity. I think this House should congratulate the Edmonton Eskimos-


Some Hon. Members:: Hear, hear!


Steve Eugene Paproski: -and the Toronto Argonauts-


Some Hon. Members:: Hear, hear!


Steve Eugene Paproski: -and no matter who wins I know they are going to do a great job this Sunday for the people of Canada.


Madam Speaker:: I do not think I will venture to rule on that point of order! The only thing I know is that when the subject of football comes into the House, the House throws all of the rules out of the window and with good spirit, and that is great.



ROUTINE PROCEEDINGS


Hon. Paul J. Cosgrove (Minister of State (Finance)) moved: for leave to introduce Bill C-138, an Act to amend an Act to amend the Excise Tax Act and the Excise Act, and to provide for a revenue tax in respect of petroleum and gas.


[Stage Direction]
Motion agreed to, Bill read the first time and ordered to be printed.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 4,410, 4,423 and 4,507.


Mr. Fulton: During the fiscal year 1981-82, how many trips were taken, at public expense, by employees of each Department and, in each case (a) to which locations (b) for what purpose (c) at what cost (d) was vacation leave involved?


Mr. Peter Lang (Parliamentary Secretary to President of the Treasury Board):: The information sought is not readily available from departmental records; only total expenditures are rolled up by Department. Such information would only be available on individual travel claims and would necessitate compilation by hand, the cost of which would far outweigh any informational benefit that might accrue. Departmental emphasis is placed on internal control mechanisms, which require all government business travel to be justified and pre-authorized. Expenditures must be submitted on a travel form, which is compared with the pre-authorization by departmental administration to ensure that proper approval for the trip has been given and that the claimed expenditures comply with those permitted by the travel policy.
A recent survey of travel patterns in a representative sample of seven Departments showed a total of 380,950 trips during 1981-82. In the majority of cases, these are routine trips made by employees involved in direct service to the public, such as weights and measures inspectors, agricultural inspectors and advisers, and health inspectors. The employees generally use their own car or a government car to travel between workplaces during normal working hours. Travel for other reasons, such as travel for business purposes that is not directly related to a regular part of duties, attending conferences or taking training courses, has recently been the subject of more stringent controls by Treasury Board. More specifically, the Board
November 26, 1982

has directed that Departments and agencies reduce business travel that is not directly related to a regular part of duties by 15 per cent from 1981-82 level; foreign travel (which represents 1.6 per cent of all travel) must be approved by the minister responsible, except for trips to continental U.S.A.; and the Minister responsible must also approve conference attendance in excess of two delegates from the Department, as well as all departmental sponsorship of conferences.


Mr. Fulton: Were 1,569 international flights taken by government officials between May 3 and June 10, 1982 and, if so (a) who took the flights (b) what was the (i) destination (ii) cost (iii) purpose of each trip (c) was any vacation time involved (d) were any persons not employed by the Public Service on any of the trips?


Peter Joseph Lang: The figure quoted was supplied by the Central Travel Service of the Department of Supply and Services and would relate to bookings rather than actual flights.
The specific information sought is not readily available from departmental records; only total expenditures are rolled up by Department. Such information would only be available on individual travel claims and would necessitate compilation by hand, the cost of which would far outweigh any informational benefit that might accrue. Departmental emphasis is placed on internal control mechanisms, which require all government business travel to be justified and pre-authorized.
To accent the government's program of fiscal restraint a number of administrative mechanisms aimed at augmenting existing controls on government business travel, were introduced on August 6, 1982 including the requirement for all foreign travel other than to the continental U.S.A. to be approved by the Minister responsible.


Mr. Mitges: What was the total cost to the taxpayer for the blue ribbon committee headed by Mr. Pierre Lortie of the Montreal Stock Exchange which was set up to study a mortgage rate reduction plan and certain tax proposals as outlined in the June 28 Budget?


Paul James Cosgrove: Total cost for the Ministerial Advisory Committee on Inflation and the Taxation of Personal Investment Income:
(a)	T ravel	$ 44,600(b)	Freight and express	500(c)	Telephone	75(d)	Rentals	5,000(e)	Consulting and research	309,225(0	Other professional and special services	41,600Total	$401,000
Agricultural Products Standards


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


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


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


Eugene Whelan: that Bill C-98, an Act to amend the Canada Agricultural Products Standards Act, be read the second time and referred to the Standing Committee on Agriculture.
He said: Madam Speaker, the Canadian horticultural industry is a $3 billion a year business, employing something like 200,000 people. It is a huge and varied industry, stretching from coast to coast. Indeed, it is an international industry. Thanks to the advances that have been made in storage and transportation, our consumers have access to an incredible array of fresh produce from across the country and around the world.
As a matter of fact, Canadians last year imported $1.1 billion worth of fruits and nuts and about $600 million worth of vegetables.


Mr. Deputy Speaker:: The Hon. Member for Carleton-Char-lotte (Mr. McCain) rises on a point of order.


Mr. McCain:: Mr. Speaker, is it presumed in this debate that the Minister is now closing the debate, or is he introducing it? Technically, he could be closing it and I wish an opportunity to
speak.


Mr. Deputy Speaker:: My understanding is that the Minister is proposing a motion to the House, the motion being the Bill. Correct?


Eugene Whelan: Correct. The great distances that fruit and vegetables travel en route to the consumer, coupled with the fact that they are highly perishable products, creates in many instances unique marketing problems. For example, a carload of British Columbia cherries may pull into the Ontario Food Terminal and the buyer is not pleased with the quality. This could be a rare occasion, because most of the time, 99 per cent of the time, the produce from British Columbia is of high quality. But if someone decided to say it was not of that

November 26, 1982
Agricultural Products Standards
quality, and if we did not have a mechanism for arbitrating this kind of problem, the load of cherries would sit there for a long time before some kind of agreement was reached between the buyer and the seller. By then we would have an unholy mess on our hands.
Fortunately, we do have an arbitration mechanism. Unfortunately, that mechanism has not had the legal teeth to do its job effectively since a court challenge to its powers in 1974.
The Arbitration Board has continued to function since then, but without the authority to enforce its rulings. There have, in fact, been cases where a party to a dispute simply refused to pay the amount of compensation which the Board deemed appropriate.
The amendment to the CAPS Act, which is before the House, would clearly establish the Board's legal authority, and would improve some aspects of its operation. I must stress that such action is needed because of the fact that we are dealing with highly perishable goods that are being shipped great distances.
Perhaps I should take a moment to run through the full arbitration procedure, and how the reconstituted board will fit in. First off, everybody who is engaged in the interprovincial and international buying and selling of fruits and vegetables must be licensed by Agriculture Canada. The licensee agrees to obey a code of practice which incorporates normal trading procedures. Here is how the arbitration procedure works. When a buyer feels that the shipment he or she has received is not of the grade requested, or that it has deteriorated in transit, he or she has 24 hours to take exception. Then an official inspection is done by an Agriculture Canada primary products inspector. Next, the buyer contacts the seller to see if they can reach an agreement on the settlement that should be made. If buyer and seller cannot reach an agreement, the seller files a complaint and the matter goes before the Arbitration Board. Meanwhile the buyer is required to dispose of the product to best advantage.
The Arbitration Board has been composed of three experts. The Chairman is appointed by the federal Government and the other two members are representatives from buyers and shippers. When the Board meets, the federal Government pays their per diems. In the reconstituted Board there would be three to five members, appointed by the Minister of Agriculture. Aside from the one or two Government representatives, the industry members would be nominated by the trade associations. As with the old system, the Board's decisions can be referred to a Board of Review. The old Board included the original members of the Arbitration Board, plus the Department's legal adviser and the director of our dairy, fruit and vegetable division. The new Board of Review will not include members who sat on the Arbitration Board.
Under the proposed system, the Board of Review will only be able to review how the Arbitration Board made its ruling; whether it considered all the information. From there, if the buyer or seller is still dissatisfied, and refuses to pay the amount recommended by the Board, the Board's decision is
passed on to the Federal Court, and in effect becomes a decision of the court.
The Minister of Agriculture also has some scope to help ensure the smooth operation of the Board. The Minister has the authority to revoke the licence of a party that refuses to abide by the rulings of the Board, or who is the subject of repeated complaints. It is important to note that the procedure I have just outlined is followed by most of our fruit and vegetable trading partners, most notably the United States. It is only reasonable that we should be able to provide a reciprocal service to settle international disputes.
Finally, Mr. Speaker, I want to say that the long-overdue amendments I am proposing will help in the orderly marketing of agricultural products. As you and the Members of this House know, agriculture is prone to such an incredible range of production and marketing hazards, it is only reasonable that we should try to reduce some of the element of risk through the provision of a good arbitration service so as to make it fair and operate in a very smooth fashion.


Fred Alward McCain: Mr. Speaker, some eight years ago there was a ruling of the court which said that the establishment and rulings of the Arbitration Board for purposes outlined by the Minister were ultra vires and not binding. I think it would have been very important for the Minister to tell us in what way he has now closed the gate so that producers, dealers and receivers will now be able to get a reasonable, binding decision with respect to a dispute. Looking at this Bill and its predecessor, I wonder why the first one was thrown out and why this one will not be thrown out under the circumstances.
The absence, Mr. Speaker, of binding authority has been a very serious situation, and the Canadian Fruit Wholesalers Association and the Canadian Horticultural Council, the two groups which in the main represent the shipper and receiver of fresh fruits and vegetables, have been pressing very hard to have this system re-established. One of the real difficulties which arose was the fact that people who shipped into Canada really had no means of obtaining a settlement of a problem which might arise. One may ship a product in top-flight condition but in some cases it may arrive in less favourable condition. As a result there is often a dispute which arises between the shipper and receiver, and we need this Board of Arbitration to sit down around the table with the parties concerned and arrive at a binding decision. However, such a vehicle has not been available.
In the U.S., if such a situation arose, there is a vehicle of comparable nature which would arbitrate the dispute. Once the ruling is made, the licence of the person against whom the decision is made is in jeopardy if the claim is not in fact paid. American shippers of these goods into our markets have found themselves unable to obtain a reasonable, binding solution upon a customer in Canada who may wish to abuse the foreign shipper. The result has been that the American association has decreed that any Canadian involved in a dispute must post a
November 26, 1982

bond equal to twice the amount of the claim lodged. This has caused some very serious difficulties for Canadians who ship their produce into the American market.
It has worked both ways, Mr. Speaker. The shippers from outside this country are uncertain as to their legal status with respect to the produce they ship into Canada, and people shipping out of Canada into the United States find themselves in a very difficult position when they attempt to make a claim concerning an unsatisfactory deal in the United States. So it is high time that a procedure to settle these problems is in fact in place. Trade between our two countries has suffered and American publications such as The Packer, which some people call the bible of the wholesale fruit and vegetable industry in the U.S., have been levying charges at Canada which are not very complimentary. So the earlier this Bill is in place, the earlier we can re-establish our historic relationship with the American receivers of our goods as well as the American shippers of our needs, the more healthy will be the trade between the two countries.
I might say, Mr. Speaker, that this present situation has affected all sorts of agricultural trade between Canada and the U.S. It is being used as a weapon. For example, in the potato disagreement between Canada and the U.S., particularly the State of Maine, the Americans are saying that Canada does not deal in good faith any more. They do not want to deal with us. The situation is giving us a reputation which we can ill afford. It is therefore imperative that this Bill should pass, be given Royal Assent and proclaimed at a reasonably early date.
Fortunately, during that period in which a legal and binding Board could not be established by the Department of Agriculture, an Acting Board has been the arbiter of disputes between shippers and receivers of fresh fruit and vegetable products. Its decisions were not binding but in roughly 75 per cent of cases they were accepted. However, even though a shipper may have been found at fault by the existing Arbitration Board, his licence is not in jeopardy. The decisions of the Acting Board do not have the weight that the Bill would give the appointed Board.
1 suppose the Minister could suspend a licence if he chose to do so, but so far he has not. The proposed legislation gives the Minister the authority to issue or cancel a licence. I think the circumstances under which a licence could be suspended should be defined. The Bill is not clear on this point although it may be set out in the regulations which will follow.
Having just attended a seminar on fisheries, I feel it is imperative that the House, the Committee and the trade should know the terms and conditions under which licences are to be granted. It has been suggested that any dealer in the fresh fruit and vegetable trade should submit a bond with his application for a licence. This would put pretty serious constraints upon free access to business. I would say that probably the three largest dealers in fruit and vegetables today started with a roadside stand. They have managed their businesses in
Agricultural Products Standards
such a way as to gain the confidence of the trade and so have become very large indeed.
If we are going to insist on a bond, it should be available at a reasonable cost. There may, of course, be cases where someone with a bad reputation in the trade applies for a licence but cannot provide an adequate bond. In the main, however, the amount of the bond should not be so high as to act as a constraint.
The same remarks apply to licencing. If the cost of the licence is prohibitive, it is a constraint upon entry into this kind of business. I know that representations have been made for a large licence fee which would act as a constraint to entry into the business, but I think this should be considered very seriously. Until it is proven that irresponsible people are entering the business, excessive constraints should not be imposed.
There is a technical matter that concerns me, Mr. Speaker, and I hope the Minister will address it. As I understand it, no constraint is imposed upon one farmer who ships products to another farmer. On the other hand, if a difficulty about the shipment should arise, there would not be access to the Board of Arbitration. Should we not consider imposing a nominal licence fee for producers and purchasers? 1 think both should be licensed prior to the product being inspected at point of origin or at destination. Some people in this category do quite a little bit of business on their own and I think they should have an element of protection.
The seed potato industry is an example of this. There is really no way that a farmer in one province can know the financial reliability or integrity of someone who receives his product. An element of protection should be afforded such people.
There are some other aspects of the legislation that I should like to discuss, Mr. Speaker. It provides for a Board of "not less than three and not more than five members", but does not set out any guidelines for the qualifications of members. Perhaps that will be provided for in the regulations. The Minister touched on that matter this morning but not as fully as I should have liked. The explanatory note provides that the Bill would:
(b) empower the Governor in Council to make regulations, including regulations prescribing the products for which a licence is required and standards for those products-
This would mean an overlapping of regulations, because there already is a standard for grades of fruit and vegetables shipped within this country. Now we are proposing to regulate in respect of grade, standards, packages and other items. I should like the Minister to explain this overlapping of regulations when the Bill goes to Committee.
It occurs to me that licensed dealers in Canada should have the Arbitration Board available to them at the federal level for sales within a province. They would be licensed to ship products dealer to dealer under federal standards. In some Provinces there is a mechanism for dealing with problems that may arise, but in others there is no such provision. I do not think it would be an infringement upon provincial jurisdiction if there were an opportunity for licensed dealers to approach this

November 26, 1982
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Arbitration Board to settle disputes which might arise from shipments made within a Province.
I am quite concerned about the qualifications of people appointed to the Board and about its status, Mr. Speaker. Clause 1, amending Section 6 of the Act, reads as follows:
6.2 (3). The Board is a court of record and shall have an official seal, which shall be judicially noticed.
That does not mean a great deal to the man on the street, Mr. Speaker, and it does not mean as much to me as it would to a lawyer, but I can see that it gives the Board a high status.
Clause 1, amending Section 6.6 of the Act, provides that the Board will have full jurisdiction. Appeal from its decisions may be made under Section 28 of the Federal Court Act. I do not know what is contained in that Section but I am advised that the Arbitration Board and the Appeal Board, known as the Tribunal, can rule on the fate of an individual without that individual having access to the courts of appeal. Apparently if someone were to appeal as provided in this Clause, he would find that the court has very little scope for action and would be virtually unable to reverse the Board's decision unless there was a great error in judgment or some aspect of the law. I do not know whether this really affects the human rights of individuals in Canada under the Charter of Rights and Freedoms, but I think the constraints of appeal to the courts of Canada are too excessive.
I reflect again upon the qualifications of the individuals who will constitute these Boards. As I understand it, they will not be legal minds. Nor do I think in the initial adjudication of a problem should they be legal minds. I think they should be minds which are knowledgeable of situations that can occur in the trade and that their decisions should be based upon them. When one fails to extend the full right of the courts of Canada to traders, I submit that that is precluding the opportunity for legal interpretation. Whether it may go for or against the appellant is really not the factor which should be considered. It is the fact that he cannot effectively get to the court to try to appeal a decision which he feels is unjust.
There is no clear indication in the Act as to what it may cost the individual to take his case to the Arbitration Board. I wish that could be defined. I think it is imperative for the sake of the trade that one in fact knows what will be the cost. I presume the cost will be spelled out by regulation, and I ask the Minister to give his attention to this item as well.
Referring to Section 6.7(2)(c) dealing with people who handle agricultural products on commission, I should like to ask whether they will be licensed as dealers or brokers. This is a question which must be addressed. At the present time I believe that the broker, the intermediary between buyer and seller, is not subject to the Arbitration Board except on very, very rare occasions. Since we are looking at the word "commission" as used in the Section to which I have referred, I raise the question as to whether or not brokers will in fact be subject to decisions of and responsible for the decisions of an arbitration case which happened to be put before the Board.
I do not have any intention of suggesting that this Bill is not needed. I do not have any intention of suggesting that this Party will block it. If the regulations are reasonable, if the Minister's answers are explanatory and address the questions I have raised today, I think we could expect that in the haste required this Bill could be put through.
I do ask the Minister to make a change in practice in the House, one which is very rarely observed. I think the Standing Committee on Agriculture should have an opportunity to study the regulations section by section, because his regulatory power is so broad. I think the Canadian Horticultural Council, the Canadian Fruit Wholesalers Association and any other group or organization within the trade itself should have an opportunity to express themselves in respect of the regulations, and I think the committee should have the benefit of that. I do not believe that the regulations and regulatory power extended to the Minister under the Act should be exercised without advance warning and without consideration by the committee. Some of the committee Members, including the Hon. Member for Chicoutimi (Mr. Dionne), are familiar with the practice of the trade and how the regulations will or will not work. I want them to look at the regulations, particularly because I do not want overlapping. I do not want consumer legislation and agricultural legislation in the regulatory structure interfering one with the other. We have troubles enough now without that. If we are to get into packaging as mentioned in the Act, then let us know that other Act will regulate packaging, labelling, etc.
I have nothing further to say. I look forward to discussing the Bill in committee. I hope it can be done quickly because the Act is needed for the benefit of the trade; it is needed very badly and post haste.


Mr. Vic Althouse (Humboidt-Lake Centre):: Mr. Speaker, the Bill before us today is one which the horticultural industry and the fruit and vegetables industry have been awaiting for some time. Since 1974 they have been operating under a procedure which does not have any form of legality; it is strictly a voluntary type of operation. This has created some problems for fruit and vegetable producers in international markets.
The Bill is designed to reimplement an arbitration procedure which was in place and well understood prior to 1974. It will apply to shippers and wholesalers or producers of fruit and vegetables both in interprovincial and international trade. It is well known in the House but perhaps less known to the general public that agricultural trade in any product within a province is within the jurisdiction of the Province, and that the rules and regulations for the conduct of trade are handled within each Province. Each of the ten Provinces have their own ways and means of ensuring that buyers and sellers are adequately treated. Basically, the Bill is to apply to interprovincial trade and to trade between Canada and the United States and Canada and other countries.
I suppose pressure for the change has been present for some time. A court case challenging the voluntary arbitrary procedure occurred in 1974. It was a case involving a Montreal
November 26, 1982

wholesaler and retailer. Since that time the arbitration procedure has been open to challenge. This is the first time the Government has seen fit to formalize the procedure which existed then.
Basically, the Bill proposes to set up a Board of five members to do two things. First, it will licence people engaged in importation, exportation or interprovincial trade in any agricultural product which is defined for the purposes of the Act as fruit or vegetables. Second, any question of grade or quality of goods delivered or received will be handled in the following manner: the local Government grader will be called in to determine whether the grades described on the manifest or in the agreement between the two parties were indeed the actual grades and whether the products were the quality they were alleged to be. If there is still a dispute, there is an attempt to arbitrate it by the officials; if that fails, it goes to a Board.
This five-member Board of Arbitration will be set up with its head office in the National Capital Region, according to Bill C-98. The Board members will be appointed for a term not to exceed five years, but at the pleasure of the Minister he can drop the Board members at any time, which is fairly standard in these types of operations. As well, Board members are eligible for reappointment if they have done a good job.


Mark Willson Rose: Or continue to vote the right way.


Victor Fredrich (Vic) Althouse: As my colleague has just said, or continue to vote the right way.
There are standard procedures on how to handle this situation if all the members are not there. The Bill states that a quorum shall consist of a minimum three members. It provides that members of the Board may hear cases in any part of Canada. It does not, however, set out who the members of the Board shall be, from what industry, or from what regions they should come. I assume that decision will be left either to ministerial discretion or be spelled out by regulation. I think the trade would prefer it be spelled out a little more clearly, but we can get into that matter during the hearings of the Standing Committee on Agriculture.
Unlike some of the Bills we have dealt with, there is no requirement for a notice of meeting. It says only that three members of the Board constitute a quorum. There is nothing about how much time members of the Board shall have of notice of a meeting. This may be an important point, given the nature of the country. Canada is a far-flung country consisting of five different time zones. Some members of the Board may, in fact, need a day or more than a day's notice in order to fly to the National Capital Region, or to wherever the meeting is called. That is a point that should be considered. Perhaps during our committee hearings we might decide whether giving notice of a meeting should be set out in the Bill itself or whether it is something that could be dealt with adequately by regulation.
Agricultural Products Standards
The procedures for laying down complaints are outlined in the Bill. They are not terribly direct; they provide some variation. The Bill simply states that where the goods delivered or received do not meet the standards, within nine months after the Board has been made aware that one or other of the parties is dissatisfied with the goods, the Board shall have dealt with the case or have been provided with a written complaint. Some complaints with which the Board will be dealing will be fairly ancient by the time they reach the Board. But the complainants must file a written complaint. That is suitable. This procedure will not cost either of the complainants a great deal of money and, according to my reading of the Bill, people will have nine months to file such complaint. That seems to me to be a good long time for the process to get off the ground.
As previous speakers have mentioned, the Board has a fair amount of power. It is considered to be a court or record and its decisions will be judicially noted. The Board, as a court of record, is empowered to call witnesses if necessary and to swear them in. This Board is, in fact, vested with all the powers, rights and privileges that are vested in a superior court of record. It can issue summonses requiring people to appear before it and requiring either producers or receivers of goods to provide any and all records that apply to the subject matter at hand.
The powers of this Board are fairly substantial. It can also receive such evidence as the Board itself considers to be relevant, trustworthy and credible to the case.
The decisions of this Board will be treated as final, the same as any court of record. The Board must list its reasons for arriving at a decision. The aggrieved parties may then appeal to a Board of Review. Probably there will be very little action in court that can be taken outside of these two forums that will be available to producers and receivers of goods. The review tribunal will consist of five members, three of whom must be available to hear any case brought before it. It appears that this will be a sort of supreme court in Canada for agricultural products and standards applied thereto.
This review tribunal's office is to be located in the National Capital Region. The duties of its members are very similar to those of the Board, with the exception that it is to be a higher court providing appeal privileges. This particular group can hear any appeal. The grievance must be filed within 30 days after the Board has reached its decision. The tribunal basically has three choices. It can affirm the finding of the Board; it can vary or cancel the decision; or it can make another decision. The procedures are outlined fairly clearly. However, I have a bit of trouble with the procedure laid down, not with what is stated in the Bill but with what is left out.
As I read the Bill, the only power the Board or the tribunal has to implement findings would be the possibility of lifting the licence which the parties involved have received from the Ministry of Agriculture. That is the only punitive action that can be taken against someone who is found to have delivered faulty products. There is no bonding provision. There is no way of protecting the aggrieved party. I think this is a reasonably

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serious short coming in the Bill which will have to be dealth with by amending the Bill. I hope Government Members will be presenting such an amendment; this omission has been brought to their attention. If they do not present an amendment, I hope Government Members will see fit to support an amendment from the Opposition side of the House. I am prepared to move an amendment dealing with the bonding provision, which I think should be included since the aggrieved party has no financial protection the way the Bill is framed at present.
I think it is quite necessary it should do so because one of the problems that has been outlined to us by producers and handlers of fruits and vegetables, particularly on an international basis, is the difficulties they have going into American markets. American buyers have become rather leery of dealing with Canadian products because our laws do not provide any means for settling disputes.
This Bill will change that situation. Until now, United States buyers have been demanding a bond in value equal to twice the value of every shipment that enters the United States. This bonding requirement is punitive to Canadian exporters. We in this Party believe that the bonding provision could be an integral part of the Bill and would lower the cost of bonding to those involved in the fruit and vegetables industry to make them equally competitive with U.S. producers.
We believe that this legislation is important to the entire industry, especially since the fruit and vegetables sector has great room for expansion. Canada still imports a vast amount of fruits and vegetables which our climate is capable of growing. For example, in 1981 we imported $2.8 million worth of frozen broccoli which we are capable of growing and freezing in this country. We imported $875,00 worth of frozen peas which can even be grown in the Yukon. We imported approximately $2.9 million of frozen carrots and $1.4 million in frozen spinach. Other assorted frozen vegetables were imported in the amount of $4.7 million. A great many of these products could be produced in this country and frozen here in our freezing industry. The only possible reason we are not producing these products ourselves is that the industry has not been given the support which could make it viable.
The amount of fresh produce which is imported causes greater concern. While we obviously need to import bananas and other tropical fruits, we import other fruits which we could easily grow in this country. For instance, $92.4 million worth of tomatoes are imported annually. We have a greenhouse industry in Canada which is attempting to meet some of that domestic demand, but this is being hampered to some extent by the Government's taxation policy on natural gas. Greenhouses use mainly natural gas as a source of heat during the winter months. There are, however, other heating options which have not been totally utilized. For example, on the Prairies, where I come from, the climate is much colder than in southern Ontario where most of the greenhouse industry is located, but there are greenhouses on the Prairies which
function year round. They are built next to power stations which simply release their excess heat into the atmosphere. Experiments have been conducted by building greenhouses beside these stations to allow the warm air to flow in between two layers of plastic and glass to heat the air inside the greenhouse. The tomatoes and cucumbers which are being grown in these greenhouses are selling locally at a very great premium compared to what is being imported during the winter from southern California and Mexico. People find these products delicious and are willing to pay 50 per cent to 100 per cent more for them. These products are so popular that people check with the produce department in anticipation of a new shipment. These products are gone from the shelves soon after they have been offered. The only problem is that not enough is being produced now.
Another example of a product which is imported but can be grown here is potatoes. We import almost $44 million worth per year. As well, we import $36 million worth of onions. We import over $30 million worth of cabbage, broccoli and asparagus. Approximately $40 million worth of green beans, carrots and cauliflower is imported and over $30 million worth of celery. Another big import item is lettuce , of which almost $68 million worth was imported. Again, this is a product which can be grown in greenhouses. Green peppers are another potential greenhouse product. There was $17 million worth of cucumbers imported into Canada.
There are certain areas of our country where the agricultural potential could be expanded. For example, $75 million worth of apples and pears are imported annually when the Maritimes could expand the production of tree fruits. There are certain parts of New Brunswick where grain production has been declining because of the wet climate. However, those areas are suitable for growing pears and apples. These areas which have that potential should be encouraged to increase the production of soft fruits in order to provide more jobs and increase the self-sufficiency of the entire country.
We hope that this Bill will provide increased inspection services at urban markets. Many of the expanding urban centres in our country do not have the proper market facilities where this inspection service can take place. It is time for terminal markets to be established with the assistance of the provincial and federal Governments. This would make the service available to producers, wholesalers and retailers.
We are prepared to have this Bill go to committee. I suggest it is important that the Government bring in the amendments I have suggested with respect to bonding in the committee. As well, we would be interested to hear some of the Government's proposals with respect to regulations. We hope that these will be discussed in the committee and that the Minister or his Parliamentary Secretary will provide us with a full description of the type of regulations which they envisage being included in the Bill so we may better understand their position.
May I call it one o'clock?


Mr. Pinard:: I am sorry, Mr. Speaker, I thought that there was an understanding that we vote now. I apologize.
November 26, 1982


Mr. Deputy Speaker:: Another Hon. Member wished to be recognized by the Chair.
It being one o'clock, I do now leave the Chair until two o'clock this afternoon.
At 12.59 p.m., the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
Victor Fredrich (Vic) Althouse: Mr. Speaker, I have a couple of closing remarks to make in addition to those I made before the lunch break. I think I had described the Bill in some detail and pointed out the necessity of attempting to achieve fruit and vegetable self-sufficiency in this country, suggested some of the kinds of programs we need to assist us and how I can see that this particular Bill will assist in providing a market mechanism whereby buyers and sellers will feel some certainty that the delivered product meets the required standards, and the Bill does provide, attempts to provide or alleges to provide some sort of financial security for that process to take place. However, as I pointed out at the beginning of my speech, it seems to me that the only teeth in the Bill would be if it were to remove the licence from someone not complying with the requirements pertaining either to delivery or receiving of goods; and the legislation cries out for a bonding procedure.
I would like to spend the last two or three minutes available to me discussing the type of bond which would be suitable here. We must be reasonably flexible concerning the written regulations, as was pointed out by the Hon. Member for Carleton-Charlotte (Mr. McCain). It seems to me that there is a wide variety of sizes of businesses operating in this realm. Some do several hundred thousands of dollars worth of business in a year while others do business amounting to millions of dollars. Shipments that some businesses handle in a week amount to one or two truckloads while other companies handle several truckloads. The size of the bond in each case would have to be consistent with the size of the business which is operating. This could be worked out in discussions between the two parties, the Horticultural Council and the wholesalers group.
I would hope that the Department of Agriculture and the Board which will be set up by this legislation would have discussions to arrive at a consensus among these groups so that it will be possible for several levels of bonds to exist and for a small firm to grow. The bonding provision should not be seen as a detriment to business. As well, those kinds of discussions should occur prior to the final regulations setting the amount of licence fees, because we do not want to see the licence
Agricultural Products Standards
proving to be a detriment to anyone going into the fruit and vegetable trades.
I therefore close with a final plea that the Government provide an adequate bonding regulation in the amendments during the committee process. We are prepared to support that aspect in principle, as well as the Bill; but we will be raising the kinds of questions and concerns 1 have described in my remarks this afternoon.


Mr. Jack Murta (Lisgar):: Mr. Speaker, I rise to bring to a conclusion the debate on Bill C-98, which is entitled an Act to amend the Canada Agricultural Products Standards Act. As has been previously mentioned, all Parties in the House of Commons are generally in agreement with the Bill.
This is basically a housekeeping Bill. It sets down the guidelines under which a Minister of Agriculture can operate and under which the new Canada Agricultural Products Standards Act will, in effect, operate. We all look forward to this Bill being brought before the committee. The committee will have an opportunity to review the licensing, bonding and cancellation of licences. We will be able to review them in relation to the existing horticultural industry.
The legislation has been requested for some eight years. Finally, we are getting these amendments. However, we are getting them without the regulations that are normally attached to a Bill such as this. The regulations is one area we will want to look at in committee.
The Bill defines "dealer" as any person engaged in the business of purchasing or selling agricultural products. That is a rather wide scope. We hope some dealers will come to Ottawa to appear before our committee. The Bill requires dealers who engage in the importation or exportation of fruits and vegetables, or interprovincial trade in those products, which is trade between the Provinces in this country, to hold a licence to be issued for the purpose as described in the Bill. That licence will be issued by the Minister of Agriculture. This is one requirement in the legislation.
The second part of the legislation would empower the Governor in Council to make regulations, including regulations describing the products for which a licence is required. The Bill describes agricultural products as any fresh fruit or vegetable. That again is a wide range. The Bill would empower the Government to make regulations for the fruit and vegetables industry. This industry has been calling for such a move for some time.
The Bill would establish a Board of Arbitration to hear complaints against licensed dealers from, I assume, affected parties. The Board would hear complaints regarding the failure to comply with the prescribed standards that we hope to discuss at some length in the Agriculture Committee. This is

November 26, 1982
Agricultural Products Standards
done in other countries such as the United States, our largest customer. It is a step in the right direction.
The last amendment to the Canada Agricultural Products Standards Act would be to establish a review tribunal to which application may be made for a review of a decision of the Board. That is a stop-gap or safety valve measure. In other words, if a party is not satisfied with the Board of Arbitration ruling, it can move to a review tribunal.
One area we will want to look at in dealing with this legislation is the regulations. While this is a move in the right direction, we do not want to get into a situation where the industry is over-regulated. I do not believe that will be a problem with the five-man group to be set up to look into the matters I have outlined. Nevertheless, that is always a concern for the agricultural industry. While the industry wants help from the Government from time to time, it does not want to be over-regulated, something that seems to be inherent in much of what the Government does.
We look forward to dealing with the legislation in committee from the point of view of making the amendments more workable and to bring this Act up to date. Hopefully our work will attract some attention in the press. When dealing with the legislation, we will want to look at the horticultural industry which makes a tremendous contribution to this country in terms of food, processing and employment.
A number of people in Ontario, Quebec and the Maritimes, and to a lesser extent, although increasingly, in western Canada, are employed in the horticultural industry. As far as employment is concerned, it is probably one of the largest components in the agricultural industry. From time to time the industry has felt that it has been left out with regard to how it feels the Government should operate. Over the years, it does not feel it has had protection against dumping from other countries. One such example is apples.
At the time when the marketing of apples is almost over in the United States, the picking and selling of apples in British Columbia is just starting. If the Americans have a large crop, they may get rid of the tail end of that crop by shipping it out of the country at a fire sale price. This has happened not only with apples but with other commodities. It has happened in almost every region of this country. The horticulture industry has cried foul, and rightly so. I urge the Government to do something in terms of temporary tariff protection.
I want to make a few comments about tariff protection. There is an ugly scenario developing at this time in connection with the whole question of tariffs in international trade which could have a direct impact on agriculture, specifically in the horticulture industry. I am afraid we are moving dangerously close to an all-out trade war in 1983. This is happening for a number of reasons. The main reason is that the economy in countries around the world is in poor shape. When that occurs, countries have a tendency to retrench and throw up barriers to
protect their producers from products of other countries. The General Agreement on Tariffs and Trade meeting at the present time is attempting to deal with that question. We made some gains in terms of freer trade at the Tokyo Round in 1978. Nevertheless, this menace to world trade and our standard of living is a real possibility.
The horticultural industry could get hurt very badly if this is allowed to happen. 1 hope that is going to be one of the areas we are going to be able to discuss with the horticultural industry in the Agriculture Committee because it is probably their biggest single uncertainty at the present time.
In conclusion, we are looking forward to dealing with this legislation from the point of view of seeing if we can make it more responsive to the industry's needs, if in fact they want it changed-and there is some understanding there will be some changes made; but more importantly to have a good discussion and to have the Canadian public and the Members of the Agriculture Committee get a better understanding, a better feel and a better direction for one of the most important industries in this country, the horticultural industry.


Mark Willson Rose: Mr. Speaker, I do not intend to take a great deal of time in this debate because I expect that my friend who represents a lot of agriculturists in Vancouver-Kingsway would like to speak, so I will not unduly delay the House with my remarks on this agricultural topic.
I represent a riding that is partially urban and partially rural. Agriculture is a very important industry in my riding. We have many farms on which people work full-time, if they can, but most of the time they are unable to do so as they are required by the nature of their income to take other part-time jobs. So while we have a substantial number of full-time farmers, we have an even larger number of part-time agriculturists.
The main crops in my riding are such things as broccoli, cabbage, strawberries and various other kinds of small fruits. The horticultural products that could be grown there are not grown, for a variety of reasons that have been touched on by previous speakers.
That has not always been the case. When I was growing up my family depended for its income upon a cannery. It was called Canadian Canners; later on it was bought out by American interests, as so much of our canning industry has been in Canada. The Hon. Member from southern Ontario knows that the food processing industry and the preserving industry in Canada is now largely American-owned. I think the only major one that is left in Canada is Canada Packers. We know what happened to Aylmer; it was bought out I believe by Del Monte. We have Stokely-Van Camp and jolly Green Giant and a number of other American firms who are
November 26, 1982

operating in business as part of the multinational food industry or agri-business industry in this country.
My hon. friend from Saskatoon reads to us these horror stories about the amounts of imports that are available in Canada, chiefly from the United States: frozen broccoli, nearly $3 million worth; frozen peas, which we can grow in abundance in many parts of Canada, almost $1 million worth; frozen carrots, nearly $3 million worth; frozen spinach, $1.4 million worth; and all kinds of frozen vegetables as well as the fresh produce which has come to us from our good friends from California, other Southern states and Mexico, are imported.
We had hoped that if there were any beneficial results from the higher energy costs, it would be the fact that importing food would be a good deal more expensive because of the transportation costs and more Canadian produce would be acceptable in our markets because of its competitive price.
When one looks at these figures dealing with cabbage, potatoes, broccoli and tomatoes, 1 know whole areas of the country that used to produce these commodities but no longer do so. I wonder what is the matter with us, as Canadians? We have allowed not only our preserving industry to be sold out, but, along with that, because we have sold out our canneries- there used to be about ten of them in the Province of British Columbia-it follows that the producers of those commodities have gone out of business to because there was no market for their product. As a consequence, all Canadians have suffered. We have become much more dependent on imported products, and if we import products it certainly does not produce a great deal in terms of jobs.
Some people will counter by saying that the consumer got a break by importing these products. I am not sure that that is the case. If we become so dependent on imported products that we no longer have any agricultural industry in our country, including in my own riding, I think what will happen is that we could get an ultimatum to the effect that we will have to export our water to satisfy U.S. needs in the irrigation areas that produce all these fruits and vegetables, or we will be deprived of those imports when we need them.
What we need to do is to look at ways, in an agricultural strategy, to enhance these industries, rather than let them dwindle and erode to the point where there is nothing left.
I could go on and list all the products that we used to grow. Was there a part of this that the Hon. Member missed that he would like me to repeat? I would like to name just one. Once upon a time the area that I represent, and those areas contiguous to it, produced all kinds of fresh strawberries and we had the capacity to freeze them. I understand that last year we imported something like $31 million worth of fresh strawberries. That is absolutely ludicrous. Since we have an area that can produce small fruits or soft fruits, to import $8 million or $9 million worth of frozen strawberries, I think is shameful. At the same time we have nearly two million people unemployed.
Agricultural Products Standards
Some people are quick to say yes, but they won't pick strawberries. The point is that they will and they do.
One of the things that I would like to congratulate the Government for is the changes in the unemployment insurance regulations, Section 16, which allow for the first time agricultural workers who work only a very few days at any one farm to add them up in order to qualify for the 28 days. Previous to that change by the Minister of Employment and Immigration (Mr. Axworthy), many of these people who worked on these farms in the Lower Mainland, and also in parts of my riding, have been forced into the arms of labour contractors in order to qualify for unemployment insurance. That was, I think, a very, very positive move. Many of us who are very quick to criticize the Government should be equally alert to opportunities to state publicly when a good job has been done in a particular area, in response to representations, to let people know that we appreciate that.
Getting back to strawberries, one of the reasons we are in difficulty in Canada in terms of fresh produce imports-and this was touched on by the Hon. Member for Lisgar (Mr. Murta)-is the fact that because we are a northern country we are seasonally disadvantaged. When there is a surplus at the end of the season, in some places to the south of us, such as the United States, their price goes down and offers are made to the large supermarkets in this country through brokers at a price which is much lower than the price for our production, which is just coming into its peak. While it is not technically dumping, and therefore the Minister of Agriculture (Mr. Whelan) has no right to intervene, it does of necessity destroy the value of our crops that are coming into peak production. Even the offer for sale of a particular commodity which competes with the domestic product is enough to drive our prices down. I can give the examples of strawberries, apricots and peaches, things that we produce extremely well in our country. That is one of the problems we have, which applies not only to the preservation or canning industry we once had, but also to the fresh produce industry.
Anyway, while I think the Bill can be supported, I would also like to express a long-standing concern over the fact that, as in so many other industries in this country, we have allowed our capacity to be eroded; and if there was ever a time when we needed to look to a change in direction to reverse this trend, which goes back almost a generation, I would think the time is now.
I do not think we should try to hold up this measure too long. I think there are improvements that might be made, but I would like to give it my general support and send it on to committee while at the same time expressing gratitude for having the opportunity to speak on a topic which is a rare one for me, inasmuch as a number of the agricultural matters we

November 26, 1982
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deal with relate primarily to Prairie agriculture rather than the sort of general agriculture which is part and parcel of my own riding.


Ian Gardiner Waddell: Mr. Speaker, I am pleased to speak on this agricultural Bill, and especially pleased to follow as I do the Hon. Member for Mission-Port Moody (Mr. Rose). I do not know if many Members in this House know, Mr. Speaker, as I am sure you do, that the Hon. Member for Mission-Port Moody is a very good trumpet player. You hear him around this House and around Parliament blowing his own horn constantly. I was surprised that he did not talk about his trumpet in his speech today because he talked about everything else. Seriously though, while we will have to wait until Christmas to hear further trumpeting from the Hon. Member, perhaps I can trumpet a little myself about some things which concern me about this particular Bill.
The Hon. Member, although he said very little in his speech, did say something about the fact that we used to have canneries in British Columbia. He mentioned five of them. He called it Canadian Canneries, or the can-can as opposed to what we have now, the Can-Am, the American Canneries. I do not think he was talking about music there; I think he was talking about the fact we have lost this particular business-a lot of it, if not all of it-in British Columbia.
I can remember travelling to Castlegar in the West Koote-nays last summer, Mr. Speaker, and visiting the Doukhobor Museum there. It is something that I recommend that you and other Members of this House, indeed, the public, go and see. When you see it, you have to commend the spirit and hard work of the Doukhobor people who came here from Russia and who have been maligned in books by my predecessor for Vancouver-Kingsway, Simma Holt. They actually had a great deal of courage and-


Mr. Deputy Speaker:: With respect to the Hon. Member, there is a rule of relevance in the House and it is very difficult for the Chair to relate the Hon. Member's current remarks to the Bill before the House.


Ian Gardiner Waddell: Well, Mr. Speaker, if you would listen to my remarks you would see that I am dealing right now with the canneries that were in British Columbia, which the Hon. Member for Mission-Port Moody pointed out we have lost and which has a direct bearing on this Bill dealing with agricultural products and standards. I am hoping in committee to discuss ways to bring back this particular industry to British Columbia and other parts of Canada, because as the Hon. Member for Mission-Port Moody, the Hon. Member for Lisgar (Mr. Murta) and the Hon. Member for Humboldt-Lake Centre (Mr. Althouse) have said, we are dependent on many imported agricultural products. Later on in my speech I want to talk about how we could in fact use our energy here in Canada to grow some of those products now imported.
The Hon. Member for Lisgar spoke about GATT, Mr. Speaker, and expressed concern about the negotiations going on and the possibility of a future trade war. The fact is, Mr. Speaker, that he is right to be concerned. I just returned from a United Nations Parliamentarians for World Order Conference in New York where we were told that Third World nations are now going into negative growth.


Dave Nickerson: So is Canada.


Ian Gardiner Waddell: Not quite yet, but soon. There are these great pressures in other countries to restrict imports and restrict trade, but I think there are other ways to deal with these problems. For example, we could take a look at producing some more of our own fruit and vegetables. The Hon. Member for Humboldt-Lake Centre spoke eloquently about potatoes, as only he can.


Mark Willson Rose: It was "a peeling".


Ian Gardiner Waddell: It was an appealing speech, Mr. Speaker, I agree. He made the point that we could do a lot more. Perhaps I should not say this to my colleagues, I know they do not believe it, but the Hon. Member for Mission-Port Moody made reference to me as representing a riding where there are no farms, and that is true.


Mark Willson Rose: No, I did not. I said there were a lot of farms.


Ian Gardiner Waddell: He said there are a lot of farms. There are no farms; it is a city riding, 100 per cent consumers; it is landlocked between other ridings and you can jog around it.


Mr. Deputy Speaker:: I am sure the House is interested in the details of the Hon. Member's riding, but there is a Bill before the House.


Ian Gardiner Waddell: You are right, Mr. Speaker, I apologize. I was just going to tell my colleagues about my farm experience, but they will not believe it.
This Bill is designed to implement arbitration procedures between producers, shippers and wholesalers in interprovincial and international trade. At present, and since 1974, no such arbitration exists, I am told, because of a court case in 1974 which resulted in the old legislation being declared ultra vires. The Horticultural Council and the Canadian Food Wholesalers Association have been trying ever since to have it reinstated. This Bill deals with that issue, and so far as it does our party supports it, and we will deal with it in committee.
Secondly, Mr. Speaker, there is strong industry support for this particular Bill from both producers and consumers. I understand there is pressure from growers in the U.S. to have this Act passed because there is no method of dealing with disputes.
Thirdly, I think it is causing problems for shippers to the United States because we do not have an Act which allows
November 26, 1982

recourse for buyers in the United States. As a result, U.S. buyers are demanding, in the case of disputes, a bonding of 200 per cent of the value of the shipment. That, of course, makes it difficult for our industry and we should take steps to change that situation. The Bill will require that the buyer and seller both be bonded in order to obtain a licence. A refusal to submit to bonding will result in the licence being lifted. This will put teeth into the Act and ensure that all parties are protected and are required to deal in good faith.
Fourthly, a buyer will have 24 hours in which to register a complaint. The first course of action will be to get an inspector to look at the load. That inspector will then try to get an agreement between the parties. If no agreement is reached, the buyer will have nine months within which to file a request for arbitration. That is reasonable, although the arbitration procedure should be examined by the committee.
Fifthly, one concern that we have about the Bill is the continuing reduction in the level of inspection services. Arbitration requires a standard and that standard, largely, is grade. There has been a reduction in the inspection service for fruits and vegetables.
The irony is that this area was asked to participate in the cost-recovery scheme last winter and now pays higher inspection fees. As a result of negotiations carried on this year, it now pays 6 per cent more than previously. Then it was faced with cutbacks in services. Mr. Speaker, this is the wrong place to cut back and the committee should look into that.
I am told that there is tremendous potential in Canada for expansion in the number and the amounts of horticultural crops grown and processed here. The federal Government must be prepared to offer more support to the horticultural industry than is provided in the Bill, however. At the GATT round taking place in Geneva at the moment, greater protection must be sought against imports. Under the agri-food strategy the Government must use grants, must provide assistance to growers and must do consumer education to expand production, processing, retailing and consumption of Canadian produce. Under the Farm Products Marketing Act, specific groups of producers, such as potato growers, should be encouraged to form national supply management boards that will have the power to control imports and exports and be able to establish prices to provide a reasonable return on labour and investment.
British Columbia has a long tradition of natural products marketing. In fact, the system was invented there and grew up during the twenties and thirties when there was a struggle for compulsory marketing. It seems to me that the suggestions I have just made could expand the use of the Farm Products Marketing Act and its Board. When I was a small beef farmer for a short period in the Fraser Valley, I certainly had an interest in that particular Act.
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We are still importing a tremendous amount of fresh and frozen produce, Mr. Speaker. In 1981 we imported $2,790,000 worth of frozen broccoli. Members can think of that every time they have broccoli in the Parliamentary Restaurant. We imported $2,880,000 worth of frozen carrots, $1,412,000 worth of frozen spinach, $875,000 worth of frozen peas and $4,696,000 worth of other frozen vegetables.


Mr. Deputy Speaker:: Order, please. With all due respect to the Hon. Member, one of his colleagues read the same list into Hansard before lunch.


Ian Gardiner Waddell: Mr. Speaker, this is my speech and 1 want to make some points with these figures. We are dealing with the Bill in principle and these figures seem to me to be very relevant to the Bill. I hope to develop my speech along that line, if I am permitted. If not, I will sit down.
I will not quote the figures relevant to fresh produce, Mr. Speaker, as I think my colleague has already put them on the record. They refer to tomatoes, potatoes, onions, cabbage, broccoli, asparagus, green beans, carrots, cauliflower, celery, lettuce, cucumbers, peppers, apples, pears, strawberries and apple juice concentrate. We imported $55,907,000 worth of apples, yet, as the Hon. Member for Kamloops-Shuswap (Mr. Riis) pointed out the other day, Canada has a tremendous potential for an apple industry in the Okanagan Valley, an area with which I am very familiar. We should be paying attention to the amount of apples we imported in comparison with the crops produced in this country. As the Hon. Member for Mission-Port Moody who, as well as playing the trumpet, is an expert on strawberries, will be pleased to know-


Mr. Deputy Speaker:: The Hon. Member for Northumber-land-Miramichi (Mr. Dionne) on a point of order.


Mr. Dionne (Northumberland-Miramichi):: Mr. Speaker, may I suggest to the Hon. Member that he speak of that valley with which he is so familiar, because he is obviously not familiar with the Bill.


Ian Gardiner Waddell: Mr. Speaker, the Hon. Member will get his chance to rebut my remarks when he speaks on the Bill. 1 would remind him that I have just presented four detailed criticisms of the Bill. If he listens-and I know Liberals do not listen-he will find that I am referring to the possibilities of Canada producing more fruit and vegetables. This is something that will have to be considered in committee.
In order to increase production we could use some of the energy sources that we have in such great abundance. That suggestion is not as far-fetched as it might seem. We must look into the possibility of using solar greenhouses. We already have the solar technology. Just this summer I attended the Energex Conference in Regina. Representatives came from all over the world and over 100 papers were presented. I would draw the attention of the Hon. Member who rose on a point of

November 26, 1982
Agricultural Products Standards
order to the studies published as a result of that Conference. He will see that a number dealt with the use of solar energy.


Mr. Deputy Speaker:: Order, please. I would draw the Hon. Member's attention to the rule of relevance. If it is the desire of Members of the House that the rule of relevance should never be enforced or considered, that has to be the wish of the House. But the rule stands, and Hon. Members are requested to observe it. I would bring that to the Hon. Member's attention.


Ian Gardiner Waddell: Mr. Speaker, Clause 1 of the Bill deals with the licence required for international and inter-provincial trade. That is going to raise the question of imports. I am trying to make the point that we may not have to import as much produce as we do at the moment, and I have listed crops that can be produced in Canada. I was about to introduce what I think are imaginative ways of doing this that have been proposed by Canadian scientists, and I think we could use them. If I am not permitted to do that, then it seems to me that my privileges as a Member of the House are being trespassed upon. I want to go ahead and deal with that and with the possibility of diverting energy.
I will tell you why I want to do that, Mr. Speaker. Greenhouse operators have said that the federal tax on natural gas should be refundable in order to help them compete. I think that is a good idea. It would give them a chance to expand greenhouse potential in Canada. There is a great deal of interest, even in parts of my own urban riding, in using solar greenhouses to grow crops.
I should like to refer to a quotation of Richard Kadulski, Chairman of the Solar Energy Society of Canada, who said:
Rather than bemoan that present economic structures are leading us towards ruin-
This is what the Government is always saying about us in the Opposition; perhaps it should listen. He continued:
we should seize opportunities to reverse the trend and make ourselves more self-sufficient-at an individual or community level.
This is what the committee should take into consideration when it is discussing the horticultural industry.
Some people say that the Bill before the House is not important, that it is just a matter dealing with Canadian agricultural products and that we should let the farmer representatives in the House speak on it. I do not agree. This is why I am speaking today. I think people from urban ridings should heed the message of Richard Kadulski and his words of wisdom.
We need more federal inspectors to mediate any disputes under the Act and to ensure top quality products for consumers. Also farm markets should be encouraged and growers assisted to meet demand as it grows. One of the good things the Government has done over the past few years was to
encourage the expansion of a fantastic farmer's market on Granville Island in Vancouver. It has just caught on. Local produce, as much as is possible, is coming to that market. When the committee discusses agricultural standards and deals with Clause 1 of the Bill with reference to licensing, the inspection provisions of the Bill, the Boards and the marketing, the people appointed to the Boards, the appeals of particular decisions and so on, it should consider the new urban markets. I say this because "agricultural product" under the Bill means any fresh fruit or vegetable and the word "dealer" is defined later in the Bill.
There are some people in my riding who actually operate in the farmers' market on Granville Island. I congratulate the people who had something to do with getting it going. I make the point that terminal markets should be encouraged in more urban centres in Canada.
I was serious when I referred to the use of energy sources. I remember being in Regina and being shown by two university professors how they had grown tomatoes around a pipeline. They showed us these tomatoes. They were not the rubbery ones which one purchases in Safeway or other supermarkets. They were really good tomatoes. This is an example of what could be developed as a spin-off from such a Canadian industry. Anyone who has lived in Yellowknife, as I did for a couple of years, has gone to the supermarket there and seen the tremendous cost of food, especially fresh vegetables and fruit, and often frozen foods. I think the north could use some of the spin-offs from our energy power for such greenhouses in which to grow produce.
Finally, I should like to refer to a friend of mine who immigrated from Korea to the Fraser Valley in the Richmond Delta area. He had invented a movable greenhouse. He was able to plant his crop, and because the crops are quite early there, he was able to plant a couple of them. When a crop was finished, he would move the greenhouse in order to plant another crop and so on. It is a little invention, but it indicates the imagination of many Canadians in various walks of life, whether it is in the greenhouse industry, in tomatoes, in the Energex Conference or urban markets. We can do anything we want in Canada even though we are a cold country. I think we can cut down on the imports of such produce as broccoli, tomatoes and so on.


Leslie Gordon Benjamin: Mr. Speaker, I intervene in this debate particularly because of Subsections 6.2 and 6.7, among other things. There was a famous exchange in the British Parliament when Winston Churchill extended the rationing of coal and fish in Great Britain during the War. Nye Bevan rose in response and said, "Mr. Speaker, England is an island of coal surrounded by a sea of fish, and only the organizational genius of the Right Honourable gentleman could see to it that we had a shortage of both".
November 26, 1982

Similarly, Canada is a country full of grain, with many bakers and bakery workers. Only the organizational genius of the Government could see to it that we are using American grain to make buns in the United States, to be brought up to Canada for sale through an outfit called McDonald's. This is an example of what has happened for a long time in the Canadian food chain, from the producer to the consumer. Consequently, it is an example of how the ability of Canadian producers to provide Canadians with more production has been reduced. Mainly it has gone into the hands of producers of fruit, vegetables, grain and grain products in the United States.
If, as and when we have to import fresh fruit and vegetables, surely Canada should be concentrating on importing from countries which definitely need the benefit of the export trade-and I am thinking of countries such as Mexico, and those in the Caribbean and Central America-rather than relying on the producers of fruit, vegetables, grain and grain products in the United States, mostly owned and controlled by oligopolies or whatever in the food production, processing, transportation, wholesaling and retailing business.
If I could illustrate, an agriculture product is a grain product, or vice versa. Let me illustrate what is happening to trade in British Columbia. In 1967-1968 British Columbia imported $1 million worth of bread and bakery products from the United States and exported $2.3 million worth of those products. By last year, 1980-1981, British Columbia was exporting $300,000 worth of bread and bakery products while importing from the United States $11.8 million worth. That is what has happened in that brief period of time from 1967 to 1981, a span of 15 years. Not only has there been a reversal in trade, but it has been a reversal in the order of ten times in dollar figures.
The same thing applies to production, processing-particularly processing-and the wholesaling of fruit and vegetable products. Much of the goods produced in Canada are canned and processed south of the forty-ninth parallel. Again, only the organizational genius of this Government could see to it that we had a shortage of processing capability in Canada for the food products that we produce ourselves.
It is not just some narrow nationalism or protectionism that I am talking about, I am talking about our failure to meet much more of Canada's needs by Canadian producers and processors.
Canadian producers are being victimized by fire sale grain prices in the United States. As a result, Canadian flour costs 45 per cent more in Vancouver than it does in Seattle.
Now look at what has happened. McDonald's wants to import buns. McDonald's restaurants cancelled their contracts with McGavin's bakery. Forty-four jobs were lost in British Columbia, 19 in Manitoba and 11 in Saskatchewan. What did
Agricultural Products Standards
McDonald's do? American grain is now used to make American buns to send to the Prairie Provinces where we have the best and the most grain in the world. I have eaten buns made in the United States, Mr. Speaker. They look like they taste, like compressed kleenex. If McDonald's does not like the buns that we make in Regina, Winnipeg or Vancouver, they can damn well go somewhere else to sell their buns. The bun fight is between two corporate empires. What does that accomplish? It picks the pockets of both the farmers and the consumers.
As I said, Canadian flour mills do charge, thanks to the Canadian Wheat Board ensuring a reasonable price to our grain producers-more for flour, in fact, 45 per cent more for flour than the Americans do. A farmer gets only 12 per cent or 13 per cent of the retail price of bread, the rest goes to the middleman.
It is interesting to note that McGavin's is controlled by flour milling companies, 60 per cent owned by Ogilvie Flour Mills- and I want to do a little more research on this but it seems to me that it, in turn, is owned by somebody down south of the forty-ninth parallel-and 40 per cent owned by Maple Leaf Flour Mills, which is in turn, owned by-you guessed it-the CPR.
If the McDonald's clan want to have a feud with the McGavin's clan, they should not be allowed to use bakery workers as cannon fodder.


Maurice Adrian Dionne: What has that got to do with horticulture?


Leslie Gordon Benjamin: I can tell the hon. gentleman that this is nothing but an additional example of what has been happening. How many fruit and vegetable processing plants since the early 1960s have been shut down in Canada while the processing of that product takes place south of the 49th parallel?
This kind of legislation is as much in the best interests of those who send fruit and vegetable products into Canada as it is in the interests of Canadians, whether they be producers or consumers. It used to be that the farmers, no matter what product they produced, used to deal directly with consumers, or nearly directly, but they have been driven farther apart by separate corporate intervention in the food chain, and the number of hands the food has to pass through between the producers and the consumers keeps increasing. Everybody else takes their bite off the top on the way.
This trans-border ownership of food processing has and will disintegrate the Canadian food system into little branches of regional economies of the United States. From a corporate point of view it makes sense. It makes sense for corporations to consolidate production and trade north and south across the U.S.-Canadian border rather than trade east and west across Canada. Canadian consumers and farmers lose because our traditional ways of dealing with each other are lost in the larger U.S. market.

November 26, 1982
Agricultural Products Standards
The CPR is acquiring running rights over the Rock Island Railway to Kansas City, and through other arrangements can acquire transportation rights all the way to the Gulf of Mexico. The CPR wants higher rates on agricultural products then the CPR can move those goods to the Gulf of Mexico, rather than by way of Vancouver and the St. Lawrence Seaway. Trans-border ownership of food processing causes boom and bust cycles in the regions as the relative cost of production changes. Today it is a flour mill in Toronto-why they are milling wheat in Toronto, I do not know, because they do not grow a bushel of wheat in Toronto-and tomorrow it is in Mississippi. Today it is a packing plant in Calgary; tomorrow it is in California to increase economies of scale for some multinational. This harms our primary producers, processors and the workers in those processing plants here in Canada.
I am not particularly worried about whether some U.S. exporter of fruit and vegetables, or any other agricultural product into Canada, thinks he is getting a good price or not. I am not particularly interested in that. I would be more concerned about seeing to it that agricultural producers in countries that desperately need the business, like Mexico, there in the Caribbean, or those in Central American, get a good price for their product than I would be concerned for the multinational, owned and operated in the United States. If our country allows our farmers to go bankrupt, we will have to pay more for food in the future. It is in our interest to build east-west links rather than wait with supine acquiescence for greater entry of the United States into our markets, while their markets are becoming less penetrable. The U.S. has closed its borders to beef imports from Canada for the rest of this year. So much for that great friendly neighbour and the free trade proponents south of the 49th parallel. The minute Canada becomes more than self sufficient, not only in beef but in any other agricultural product, you will find the forty-ninth parallel closed to Canadian primary producers and processors. Yet we spend time trying to be extra nice to people who send fruit, vegetables and other processed agricultural products into Canada by seeing that they get a fair price. If they are not satisfied with the price, the Government will help them get a preferable one. It has been nothing but a series of governments of both the Liberal and Tory political stripe that have caused the loss of some 400,000 family farms in Canada in the last 25 years. I am not suggesting that all of these farms could have stayed in business, but the policies which have been pursued on prices, production, processing, importing and exporting by successive governments have decreased our family farm population to an all-time low. This has increased our dependency on imported fruits and vegetables and other agricultural products while decreasing our capacity to gain self-sufficiency in Canada.
My colleagues from British Columbia have talked about our failure to become involved in massive greenhouse operations in
order to increase our self-sufficiency, particularly in the production of vegetables. If we will not take advantage of that opportunity, I believe our country should give priority to countries like Mexico and those in Central America for those fruits and vegetables that we import so that we do not have to rely on a multinational corporation which may own supermarkets and wholesale companies in Canada. These multinational companies import their products here and distribute them through their retail outlets at higher costs to the consumers. Sometimes fruits and vegetables which are grown in Canada are processed in the United States and shipped back here. Surely that does not make us worthy of our independence. It is only more of that supine acquiesence that successive old line Party governments have carried on for decades.
The entire costs of those primary producers of fruit, vegetables and grain are being squeezed not only by foreign-owned multinational corporations but by our own corporations as well. Again, Canadian Pacific is squeezing farmers on both their input costs and output costs. Canadian Pacific manufacturers and supplies fertilizers and feeds to farmers. It has a monopoly on the transport of many agricultural products. It is involved in flour milling and retailing. It is involved in meat packing. It is extracting the last possible drop of blood from farmers by giving them the lowest possible prices. All along that production chain, and even at its end, CP charges all that the traffic can bear.
It seems to me that an act to amend the Agricultural Products Standards Act is irrelevant if the farming community is being given to corporations beyond our borders or being handed to agricultural monopolies by default. Government regulations will not require the powerful economic empires to provide high standards of agricultural production because many of those empires, both in Canada and beyond, have more influence on the Government than the regulations. Those companies certainly have more influence than the primary producers do.
In the years that I have been here I have seen producers in the horticultural industry, like the members of the B.C. Fruit Growers and the members of the Niagara Fruit and Vegetable Growers, come here many times to appeal for help, but they lose each time. Nothing has really changed in terms of the health, welfare, good order and growth of the fruit and vegetable industry. Unless and until the Government sets its priorities for an increase of Canadian production and processing in Canada and the expansion of that industry, the situation will not improve.
With respect to those products which we must import during the winter, the Government must give priority to those nations most in need and buy their fruits and vegetables and other agricultural products. Surely that would be more helpful than providing the continuous aid, comfort and protection for corporations outside of our borders which are not interested in the welfare of Canadian producers. They could not care less
November 26, 1982

about what happens to Canadian producers. They can get their products somewhere else.
I return to the matter of the bakery products as an example of what has been happening. The Government, the Minister of Transport (Mr. Pepin), who is responsible for the Canadian Wheat Board in the House, as well as the Minister of Agriculture (Mr. Whelan), who is the great defender and protector of Canadian farmers, sat by while a licence was issued for a corporation like McDonald's to import buns made out of American grain into Canada. That is another symptom of the disease that we have seen in our agricultural industry. That is the most recent example. The Minister even pats McDonald's on the back and says that he believes that McDonald's is showing itself to be a responsible corporate citizen in making this decision. I wish he would go to work for McDonald's, preferably south of the 49th parallel.
It is my hope that when this legislation is dealt with in committee Members from all Parties will seriously consider the suggestions made by all those who spoke. Hopefully, a unanimous report will be submitted that recommends the Government introduce other measures to deal with the production and processing of all agricultural products in Canada, by Canadians and for Canadians. I also hope that this report will emphasize carrying on trade with those countries which desparately need exports of those products which we need.
I might remind the House that the same McDonald's Corporation produced a film in tribute to our Prime Minister (Mr. Trudeau). Well, I will be darned. What is their slogan?


Mark Willson Rose: "We do it all for you."


Leslie Gordon Benjamin: "We do it all for you." This great Canadian corporate citizen produced a film in tribute to the Prime Minister. What happens? It gets a permit from the Canadian Wheat Board to import buns into Canada made out of United States wheat. I am trying to be most generous and I am not concluding for one moment that this is why it go the permit. Perish the thought! The Prime Minister would not stand for that, and neither would the Minister in charge of the Wheat Board, the Minister of Transport, or the Minister of Agriculture. It is pure coincidence that McDonald's produce buns and get a permit from the Canadian Board.


The Acting Speaker (Mr. Blaker):: Order, please. The Hon. Member for Northumberland-Miramichi rises on a point of order.


Maurice Adrian Dionne: Mr. Speaker, I have been trying to follow this debate, although it is somewhat difficult. I would like Your Honour, the Hon. Member or someone in the House, to explain to me what the importation of buns by McDonald's has to do with horticulture. We have discussed this now for some minutes and it seems to me that
Agricultural Products Standards
we are involved in a filibuster, and if we are, let us say that it is a filibuster, but let us not pretend that we are discussing horticulture when we are discussing buns. Someone could burn his buns.


Leslie Gordon Benjamin: Mr. Speaker, the Hon. Member is quite welcome to go back to his office and examine his buns-


The Acting Speaker (Mr. Blaker):: No, no. I must indicate to the Hon. Member for Regina West (Mr. Benjamin) that my predecessor in the Chair had privately expressed some concern to me as to whether or not relevancy was still being taken into consideration. Therefore, I can only add a suggestion that perhaps the Hon. Member for Regina West would like to make some particular effort to addressing himself to the Bill in question.


An Hon. Member:: No bun intended.


The Acting Speaker (Mr. Blaker):: And no bun intended.


Leslie Gordon Benjamin: Mr. Speaker, I meant no bun, either. I am simply applying the most recent example of what has happened in international trade concerning buns, and it applies to what has happened before in international trade with Canada in fruit, vegetables and floral products. By the way, I have completed my remarks about buns except for one point. The president of McDonald's, Mr. Cohen, is also one of the top Liberal fund raisers in downtown Toronto. It is passing strange that these things happen. Well, maybe it is not so strange that these kinds of things can happen in the realms of the old line Parties.
I want to conclude by saying that the attention of the House to the items in the Bill has also been evident concerning many other aspects of fruits, vegetables and other agricultural products. They must be dealt with to make legislation such as this less necessary, if necessary at all. I hope that the Agriculture Committee will apply itself to a second report when it reports the Bill back, one which deals with these other aspects which are germane to the legislation.


Dave Nickerson: Mr. Speaker, like the Hon. Member for Vancouver-Kingsway (Mr. Waddell) who is not from an agricultural area, I, too, intend to speak briefly on this matter. It is a subject which, although of primary importance to those people who represent agricultural areas, is also interesting to all Members of Parliament. We all have a vested interest in agriculture because we all eat. Unlike the Hon. Member for Vancouver-Kingsway, it is my intention to obey the rules of relevancy and discuss Bill C-98 which is before us and what that Bill intends to do. It intends to modify or amend Section 6 of the Canada Agricultural Products Standards Act. If passed into law, the new Section will read:
No dealer shall engage in the importation into or the exportation from Canada of, or in interprovincial trade in, any agricultural product-

November 26, 1982
Agricultural Products Standards
That is the intention of the Bill. One will not be able to ship blueberries from the Province of Quebec to the Province of Ontario. One will not be able to grow cherries in the Okanagan and ship them into Alberta without having a licence and the authority of the Minister so to do. There might be some reason why one would want to create some impediment to international trade, but having to get the permission of the Government to ship agricultural products from one Province to another in Canada is, in my opinion, detrimental to the interests of the consumers in all Provinces. What we are doing with legislation like this and legislation such as that of the various marketing boards in different Provinces, is to make Canadian agriculture and horticulture inefficient and unable to compete internationally, increasing the final price paid by the Canadian consumer.
This legislation is typical Liberal legislation, when one gets down to reading the fine print. It is very bureaucratic, very arbitrary, and ensures jobs for the boys. In order to regulate interprovincial trade in agricultural products, they will establish a board. This is a favourite trick. They will establish a board under Clause 6.1(1). It will contain not less than three and not more than five members, appointed by the Minister, another five people he can appoint to another one of these boards, and each one of these people will be eligible to serve a term not exceeding five years and will be eligible for reappointment. Anyway, each of these people will serve at the Minister's pleasure.
In how many pieces of legislation have we seen a similar setup where there is a board to be established having judicial powers, to be appointed by the Minister at the Minister's pleasure? I am scared of legislation like this. There might be times when it is reasonable to have it, but everything brought before us seems to contain similar provisions. It is dangerous. We are balkanizing commerce and agricultural products in Canada in establishing these boards, which are creatures of patronage, or can be. The danger is already there. Instead of having competition between producers of horticultural and agricultural products, instead of having proper competition between people engaged in the marketing of those products, we are encouraging these people to compete by hiring lawyers and appearing before the boards to argue their cases, to see who has the lawyer who can present the fanciest argument in legal terms, and they are not competing in a way which would reduce costs and increase efficiency.
Each member of this board is to be paid a significant amount of money authorized by the Treasury Board. That is a standard provision. Because these board members are generalists, very often they are appointed because they happen to be of the same political persuasion and Party as the government in office. That has been known to happen. However, because they are generalists and do not profess to be experts in cherries, cucumbers or some other particular product or method of marketing, the next thing they must do is to form a technical advisory committee. How many times have we seen that
happen? Then, very often, besides having a technical committee, they say that they want input from the consumer and the marketing board, so they set up yet another advisory board to advise the board, which actually possesses quasi-judicial powers. The matter just escalates and gets bigger. More and more people become involved, the matter becomes more and more bureaucratic, and there is more and more difficulty in getting a decision from the board.
Under any reasonable method of operating one of these boards, the decision of the board should be pretty well final in most circumstances. If someone, after having received a decision of the board, thinks that it is not the right decision, or not a point of law, he should be able to appeal it to a court of competent jurisdiction. Under this Act, that will not be the case. Under 6.3(1) we have a new gimmick, a new board called the Review Tribunal, which will be established in a very similar manner. It will consist of people who owe their allegiance to the Minister, having been appointed by him and serving at his pleasure. It is another board to oversee the one established in the Act. It is a gimmick of gimmicks.
1 do not think we need a review tribunal. It is superfluous and will only exist to serve the purposes of the Minister, allowing him to appoint a few more of his friends.
When any Act is introduced into this House by the Liberal Government, the first thing I do is to turn to that section which allows the Government to make regulations. I can guarantee that there is always a section which gives wide-sweeping regulation-making powers. In fact, very often Bills are presented that might as well contain only two clauses, the title and the regulation-making authority.
In the regulatory powers assigned to the Governor in Council under 6.7(1), there is power to prescribe any agricultural product for which a dealer requires a licence. Licences must be renewed annually under 6.7(1). A person must make application for the licence. He should be able to keep that licence unless he has disobeyed the law or there is other good reason to take it away. Of course, that would not employ enough people in the Department of Agriculture or require enough people to sit on these boards. Therefore, each year these people must fill in another group of forms in order to renew their licence.
In paragraph (c) of the regulations, we find something rather frightening. It is left to the Governor in Council to decide the circumstances under which the Minister may suspend or cancel a licence. That is absolute. The Minister will have the power of life and death over somebody whose business it is to deal interprovincially or internationally in agricultural products. There is no use having a board or tribunal supposedly offering some degree of protection to these people because the Minister can have the arbitrary power to take away a
November 26, 1982

licence from someone whose livelihood depends on it. Is there any recourse?
This is typical of the Liberal Government which wants to vest in itself and its democratic right life-and-death power over citizens who should be able to engage in any business they want. There is another favourite. It also prescribes all the records that the licencees have to keep. You can be sure there will be a lot of records and papers to be kept.
At the end we come to the hooker. It is always there. It is the power that gives the Government regulation-making authority over virtually anything. If there is anything not listed here and not covered, they have the regulation-making power under Section 6. They have the power to regulate anything they want.
I do not like this kind of legislation. It strangles commerce, in this case commerce in agricultural-horticultural products. If there is need for standards in agricultural products and a need for these standards to be kept, we can rely on the good graces of the dealers and the inter-relationship between the agricultural product dealers. There is no need for the Government to come in except to establish certain standards.
If a dealer orders Grade A plums and a shipment arrives which is substandard, there is no need for the Minister or any board to become involved. If the dealer receives a substandard product, he will not deal with that supplier for very long. The problem will resolve itself. Alternatively, the dealer can sue in a court of competent jurisdiction. We do not need boards of the type envisaged by this Act.
The Secretary of State for External Affairs (Mr. Mac-Eachen) is attending the GATT meeting in Europe. He is stating that the nations of the world should try to avoid those things that happened in the thirties when protectionism took over and destroyed trade and commerce throughout the world. Our Secretary of State for External Affairs is saying one thing at the meeting in Europe, and the Minister of Agriculture (Mr. Whelan) is in this House introducing legislation which will have entirely the opposite effect.
Instead of concentrating on more and more protection, we should be concentrating on ways of becoming more competitive internationally. That would expand rather than contract trade. It would give consumers of agricultural products, which we all are, cheaper and better quality food and would not threaten the livelihood of people in the agricultural industry, as is being done with legislation of this kind.


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


Some Hon. Members:: Question.


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


Some Hon. Members:: Agreed.
Bankruptcy


Some Hon. Members:: On division.


The Acting Speaker (Mr. Blaker):: Carried on division.


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

[Stage Direction]
The House resumed, from Wednesday, May 20, 1981, consideration of the motion of Mr. Ouellet that Bill C-12, respecting bankruptcy and insolvency, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Thomas Gordon Towers: Mr. Speaker, in rising to speak to this Bill, I recognize that it is very complex, running a little over 300 pages. Certainly it is going to take a considerable degree of time to get through Committee. There is no doubt that Canadians want a Bill of this nature, but there are certain things that should be taken into consideration in the passage of this Bill. I believe the old bankruptcy Act is about 35 years old, nevertheless if it is going to be 35 years before we get another change to this Bill, so we had better make sure that it is going to do the job for which it was intended.
There are a greater number of bankruptcies now in Canada than ever before. In the depression of the thirties, there were not the number of bankruptcies with which we are now having to cope, simply because in those days credit was not so readily available. Things tightened up, but people were not forced into bankruptcy because they were not carrying the amount of debt that people are carrying today. We have allowed ourselves to get involved in a debt-ridden society, which perhaps started about 20 years ago when money started to free up and more and more of it became available. We got into revolving accounts that revolved over a period of three years, which meant that people were buying things and paying for them over an extended period of three years, things that otherwise they would have saved for and bought at the end of three years. Chargex was introduced, and that further extended the credit. We have witnessed a phenomenon that has never been seen before in Canadian history to the extent that it is today, which is the amount of credit that has been extended to Canadian people, either individually or in businesses.
At the present time there are in Canada about 40 per cent more bankruptcies than there were one year ago. I recognize that during the last quarter of this year this trend has slowed down somewhat, but nevertheless when you consider a 40 per cent increase, I think it is the responsibility of those of us who

November 26, 1982
Bankruptcy
are elected as representatives of the people to make sure that there is legislation in place that is going to protect people.
In the January to October period of 1982, in the farming community, we find that there has been a 50 per cent increase in bankruptcies over last year. Last year there were 230 from January to October, and this year there are 344. One of the unfortunate things is the fact that the Province of Quebec has been hardest hit by this. This point was brought out in the Standing Committee on Agriculture yesterday evening when the Farm Credit people noted that there is an increasing debt load which somebody will have to carry. Possibly it is going to be all of the farmers in the country who are going to have to pick up this extra debt load. West of Ontario there were 53 bankruptcies last year; this year there are 68. That is a 20 per cent increase. Ontario had 123 this year and 126 last year, which means that their bankruptcies are going down this year. Quebec had 145 bankruptcies this year and they had 45 last year, and that is well over a 200 per cent increase. This is in the farming community. Unfortunately these figures do not include all those cases where farmers have just gone out of business, closed their doors, sold their assets and just shut down. There is no way of actually knowing just what that figure might be.
In view of this, I think it tells us, as elected Members of Parliament, that we had better give special attention to the farming community. We have tried to impress upon the Minister of Finance (Mr. Lalonde) that while he was minister of Energy he did untold damage to the agricultural industry by bringing in the National Energy Program in the form that he did, and then putting on the excise tax on energy that is used in the production of food and the operation of the farm. Farmers are big users of energy, and when you consider that somewhere between 28 per cent and 33 per cent of their fuel costs is excise tax going to the federal Government, I think possibly the federal Government had better take notice of that, act accordingly and do something about it.
The Government has to realize that we are living north of the 49th parallel, it is cold, it takes more to heat our businesses and it takes more to heat our homes. It is something that really we cannot do anything about. We are not living in a southern clime where we do not have to worry about that. We recognize that we are in the northern part of the hemisphere, and it is costly to heat our homes. All this adds to our cost of living. When you consider that the same percentages of excise tax apply to the cost of heating our homes as apply to the energy for operation of our farms, that should be looked at.
The Minister of Finance says that he would like to cut down the inflationary aspect. There is nothing more inflationary, Mr. Speaker, than adding absolute costs to our cost of living, such as heating our homes and our businesses. All this adds to the problem that people have in trying to keep their businesses operating. With these extra costs added on, some of them start sinking gradually into the red, and there is no way that they are going to get out. Therefore you have to realize that people
are caught in this dilemma and the Government can do something about it. People are looking for the Government to do something about it in order that this rate of bankruptcies may be lessened. Unfortunately, many people have been misled.
A particular incident I would like to bring to the attention of Hon. Members of the House of Commons that related to our community in Red Deer has to do with a gentleman from Montreal who sold his business and decided that he was going to invest his money somewhere where he thought it was safe. There was an advertisement in the paper from a group of people in Willowdale, Ontario who were making an investment in Alberta, in fact, in my City of Red Deer. He had been told that the place to put his money was in Alberta. These people were investing in a real estate project out there, so he invested his life earnings in that project. Unfortunately either through lack of experience or inflationary costs or for some other reason, the construction of the building was not budgeted properly. Therefore the money that they had borrowed from the lending institution, in this case an insurance company, was not sufficient to complete the facility so it could be put into operation. They could not get funds to complete the project and, as a result of this, the lending institution decided that they were going to move in and foreclose, although the construction was only half completed. The people who initiated the construction could not raise any more money so they lost all they had put into it. Along with that, this gentleman from Montreal, who wanted to put his life savings where it would be protected and he would have a return from it for the rest of his life, lost it all.
It is very sad, Mr. Speaker, that we have this kind of situation. When we deal with a Bill such as C-12, we have to recognize that there should be some kind of protection put into place, if we possibly can, for cases of bankruptcy such as this. There were a lot of subcontractors who lost hundreds of thousands of dollars on this project, too. They had wanted to take over the project from the lending institution to see if they could not put it together, finish it up and thereby get their money out of it. But no, it went down the tubes because the lending institution put it up for tender, somebody thought it was a good thing and grabbed it and paid off the lending institution. They got their money back, but the subcontractors and the fellow from Montreal lost everything. It is a sad situation and we have to recognize this is happening.
Another case in my community is that of farmers who had delivered rapeseed to a processing plant. The plant was expanding and, well, it is a long story but a lot of people recognize the problems of trying to process rapeseed in western Canada in competition with processors in Japan as well as those in eastern Canada. These producers had delivered rapeseed to the plant for processing, and the agreement was
November 26, 1982

that they could sell the rapeseed any time they wanted, at whatever the price was that day. This was their option. They thought it was a good deal, but all of a sudden we find out that the Canada Grain Commission moved in on the processing plant to pick up what they call their letter of credit, or what some people refer to as a bond. In this case, it amounted to $600,000. When we went through the Bank Act, Mr. Speaker, we thought we had protection for those people. When they phoned me about the problem I said, well, we will protect you up to, I think it was $100,000. My good friend, the Hon. Member for Ottawa Centre (Mr. Evans) knows what I am talking about. We had quite a battle over that in committee, and we thought we had protection for the farmers. However, we found out in order for the farmers to be protected under that section of the Bank Act-my colleague is nodding his head, he agrees with me-the business had to go into bankruptcy. However, in this case the lending institution did not allow that business to go into bankruptcy because they had control of the shares, thereby having total control of the plants' assets. Then we find out that the business itself had apparently been over-valued. It had been assessed at $8 million, but it turns out to be worth probably about $4 million or $5 million. So when you have a bank which has lent $5 million or $6 million and the farmers are owed about $1.25 million, you can understand that there is just not enough to go around.
In any event, the farmers felt that they were protected under this bond worth $600,000. It would at least give them somewhere between 43 cents and 45 cents on the dollar. But what do we find? The bank is now seeking a court order in an attempt to get its hands on the $600,000 as well.
I am not condemning the banks for doing that because they are good business people, they are out to protect their own interests, and you cannot condemn them for that. But somewhere along the line we have to try to provide some protection for producers in our bankruptcy legislation. That is why 1 think this Act deserves a great deal of scrutiny in committee, so that we will come out with the best possible Act that we can, giving as much protection as we can to our producers. There is a feeling in the business community that Bill C-12 is inadequate in so far as receivership is concerned.
There is another area of concern which perhaps relates right back to the earlier example I gave you, Mr. Speaker, where wage earners or subcontractors are not protected. The problems for employees or farmers increased tremendously under receivership as opposed to bankruptcy. When they go into bankruptcy, the are protected. But nevertheless, there always seems to be a way of getting around the problems which seem to surface when these situations develop. I guess possibly it is because the lawyers never cease to do their work and they devise ways and means of advising people how to get around these problems in order to protect their clients. But I do believe, Mr. Speaker, that somewhere along the line the suppliers of merchandise and products of any kind, or the
Capital Gains
working man's wages, should be protected in one form or another.
Another thing I think we have to consider is the sharing of all assets in a bankruptcy so that everyone involved is treated equally. There is another aspect of this Bankruptcy Act which I would like to deal with in relation to the Bank Act. However, I would not like to start today as I think I have only about a minute left. So with that, Mr. Speaker, I wonder if I could call it four o'clock?



PRIVATE MEMBERS' MOTIONS


Mr. Jack Shields (Athabasca) moved:: That, in the opinion of this House, the government should consider the advisability of reintroducing in this Session, the three measures affecting taxation on capital gains, namely, the common stock investment plan changes in the treatment of capital gains, Registered Retirement Savings Plans and the provision for transfer of capital gains on farming assets to RRSPs.
He said: Mr. Speaker, it gives me a great deal of pleasure today to introduce this motion with regard to capital gains. At this time in Canada particularly we are finding in the business sector across the country a drying up of capital funds available to the private sector for investment purposes. That is the kind of investment that is needed to get the economy going, particularly in the high-job creation, small business sector.
I should like to focus my remarks now on the plight of the farmer in Canada, Mr. Speaker. Normally, farmers do not contribute to a Registered Retirement Savings Plan. Generally speaking, they put all the money realized from their operation back into the purchase of equipment and making improvements. At least, that was the idea prior to the Government deciding to apply the capital gains tax to farmers. Usually, when a farmer reached the age of retirement he would sell his farm on the open market and use the proceeds as retirement income. In the Prairie communities today, you will find people who have lived all their lives on a farm and built it up to a viable operation, then sold it and moved to town when it came time to retire. As a rule they do not move to Phoenix or California or Hawaii but into places like Biggar, Saskatchewan, Two Hills, Vegreville, Athabasca, Slave Lake or High Prairie, where they live out their days among their friends. The Government has virtually made that an impossible dream.
At present, if a farmer sells his property to his son or daughter, he is charged capital gains tax on the proceeds. I received a letter from a farmer who sold his operation and found that the total capital gains tax payable exceeded the down payment he received. He had built up the farm and

Capital Gains
poured all he could into it, intending to retire and sell it, using the proceeds to buy a house in town for himself and his wife.
The Crosbie budget introduced a measure to provide that $200,000 of the proceeds of the sale of a farm could be rolled into a Registered Retirement Savings Plan, tax free. I submit that is not too much for a farmer to expect, and 1 think it is imperative that the House reconsider that suggestion. We all know the sad tale of the Crosbie budget; the Liberals and the NDP combined to defeat the budget and, as a result, farmers were left out in the cold.
When my NDP colleagues go out seeking the farm vote in the next election, I think they should remind farmers that they are now subject to the capital gains tax because of that Party's action.
In 1980, the Liberals were re-elected on what would appear to be empty promises. They had promised to examine the capital gains tax legislation but all that appeared in the October budget was a promise of a discussion paper on the subject. That paper has not yet appeared, Mr. Speaker, and farmers have not been approached to contribute to it. In November, 1981 there was another budget which further penalized the farmer on the sale of land. Even with all there retreats and flip-flops that appeared in that budget, this measure was not retracted. There is still no relief for farmers.
A search of the records shows that as far back as 1974 the Liberal Government promised relief for farmers by amending the capital gains tax legislation. This has not happened, despite the promises of the Minister of Agriculture (Mr. Whelan) and the various ministers of finance. Of course, the Minister of Agriculture says that campaign promises do not count! I find that statement unacceptable, Mr. Speaker. I think we must live up to our obligations to the farmers.
It is imperative that we move to bring in legislation that will allow relief from taxes when farmers sell their operations. In some cases, it happens that if a fifth or sixth generation farmer decides to sell to an outsider, he has to pay the accumulated taxes of six generations. That certainly is not right, and I implore Members of the House to adopt the motion which reads as follows:
That, in the opinion of this House, the government should consider the advisability of reintroducing in this Session, the three measures affecting taxation on capital gains, namely, the common stock investment plan changes in the treatment of capital gains, Registered Retirement Savings Plans and the provision for transfer of capital gains on farming assets to RRSPs.


John Leslie Evans: Mr. Speaker, I am very interested in the motion put forward by my friend, the Hon. Member for Athabasca (Mr. Shields). He has put his finger on a very important problem. In fact, however, the Government has taken steps to move on this matter. The Lortie Committee called for the establishment of a registered share investment program which would allow capital gains to be paid only on the real gain, as opposed to the total gain which includes the inflationary component; in other words, indexing the value of common shares to make it more attractive for investors to invest in equities.
November 26, 1982
The Hon. Member put his finger on another important problem, the issue of capital gains realized within a RRSP, which are taxed as normal income when they are withdrawn. It seems to me only fair that if we have a capital gains tax which is half the normal tax rate, that the same tax rate be applied to income, be it from a RRSP or from capital gains in the normal sense.
I think the Hon. Member has a very good point. I assure him that those issues have been raised with the Government and with the Minister of Finance (Mr. Lalonde). I know that on the Registered Share Investment Plan the Lortie Commission recommended that we move ahead with it and that the Minister of Finance indicated that he intended to do so. On the Registered Retirement Savings Plan and the dealing with capital gains there, I am sure it is very logical and I am sure the Minister of Finance will look favourably on it as well. That is my personal opinion, given that we will be introducing RSIPs, which effectively means that only the real gain will be taxed. Basically the same principles are involved as in taxing capital gains out of RRSPs.
There is some relief for farmers if they sell their farms or they are passed from one generation to the next. For example, they have the benefit of what is known as a capital gains reserve for five years, over which time the capital gains can be spread for tax purposes.
During the hearings we had some time ago on income tax matters, the question of capital gains was raised as it relates to family farms and the intergenerational transfer of family farms. In that case farmers who sell or pass land on to one of their children can spread the capital gains tax over a period of up to ten years.
The Hon. Member touched upon some very interesting and some very important points, but we are probably tinkering around the edges of the problem. If we are to talk about capital gains, capital gains tax and how to modify it, it is more important to understand why we have capital gains tax in the first place and, with the present tax structure, why it is essential to have that tax. I think we have to talk about modifications to the tax system, as the Hon. Minister of Finance indicated in the two speeches which he made in the last few days. He dealt with the matter of the complexity of the tax system, which is terribly important, indicated that we need to do something to reduce the complexity. In the Finance Committee yesterday the Minister also indicated that this was especially a problem in the area of small business taxation.
Hon. Members opposite, the Parliamentary Secretary and myself heard about that problem during the month of September when there were hearings into the Income Tax Act and the proposed changes which were put forward in ways and means motions from the November and June budgets. We heard time and again from representatives of the small business community, the tax profession, and the accounting profession that the small business tax system was in total disarray. We heard that small-businessmen could not understand the tax system, and
November 26, 1982

that it was costing them substantial amounts of money. This was also brought to the attention of the Minister. In a speech to the Canadian Tax Foundation the other day he asked its representatives to come forward with recommendations on how the tax system, as it applies to small business, can be greatly simplified to improve the environment for small business people.
Let me say a few things about the tax system, how it got where it is today and how the drive came for capital gains tax. If Hon. Members remember, it came forward during the time of the tax reform in the early 1970s. It was designed to resolve certain types of problems which existed then. With the elimination of capital gains tax today, we would be right back into the situation of having the same problems and of having to find some way to resolve them. Capital gains tax was designed to resolve those problems, and it has resolved them to a great extent. If we are talking about removing capital gains tax and about improving the environment for equity investment, there are other things which must be done as precursors before we can remove or significantly modify capital gains tax.
Let me return to the basic principles of taxation, but especially the income tax system, in the commodity tax, sales tax and income tax systems. On the basis of the income tax system itself, the basic theory behind it underpins our entire structure which is the same as that in the United States, Britain, France, Germany and Japan. That basic theory is that income is generated in the creation of wealth and in the production of goods and services, and that the income generated from the production of goods and services should be taxed somewhere between the time it is created and the time it goes into the consumption stream, or when someone uses it to buy goods and services for consumption purposes. Basically the theory is that it should be taxed somewhere in the line between creation and consumption; that is the basic principle behind taxation.
Mir. Shields: Madam Speaker, I rise on a point of order. I draw the attention of the House to the improvement in the Chair, in the person of the Hon. Member for Leeds-Grenville (Mrs. Cossitt).


John Leslie Evans: The principle about which we are talking is income being taxed once, not twice. This is the whole basis behind deductions and exemptions in the system. Any moneys expended to earn income, whether it be wages and salaries paid, monies spent for good and services, or raw materials to go into products, are deductible and become taxable income in someone else's hand. The flow of income through the system created by the production of goods or services will be taxed somewhere, in somebody's hands, as it goes from creation to consumption. The whole thing will be subject to tax at some point.
Another fundamental feature of the tax system is the timing of taxation. There has been a great deal of ongoing discussion, and much of the argument about capital gains tax, capital gains reserves, income averaging annuities. Registered Retirement Savings Plans and so on, has revolved around the issue of timing-when do we tax it between the point of creation and
Capital Gains
the point of consumption? There is much dispute as to whether it should be a purely income-based tax system, indicating that as soon as the money is earned it should be taxed. This gives rise to such things as the taxation of accrued income, a very valid and legitimate way of taxing, assuming we want an income-based tax system.
As a general rule in that system we tend to be favouring consumption as opposed to savings and investment. At the other end of the extreme we could have a consumption-based tax system where the income would only be taxed if it were taken out of savings or investments and used for consumption purposes. This specific tax system would be similar to a Registered Retirement Savings Plan-earned money is put into an RRSP and is deductible for tax purposes, but the income from it is not taxed until the money is removed from the plan, presumably for consumption purposes.
They are two extremes. The consumption-based tax system is basically said to favour savings and investment. Thus, tax policy people have a choice. If we want to encourage consumption, we would tend to want an income-based tax system; if we want to encourage savings and investment, we introduce RRSPs, RHOSPs and various kinds of deferral mechanisms to defer taxation, which would move us toward a consumption-based system.
The third basic area about which we must be concerned in taxation is the equity question. There are two kinds of equity with which we have been dealing in our tax system for generations-basically horizontal equity and vertical equity. Horizontal equity is a simple concept-people who make the same amount of money should basically pay the same amount of tax, people who are in the same kinds of circumstances should basically pay the same amount of tax. On the other hand, vertical equity is that as one's disposable income rises one should pay a greater proportion of it in tax. This is the principle which underlies a progressive tax system as opposed to a flat tax system. Progressivity basically came about as a driving force in the tax system in the 1940s just before, during and after the Second World War. That was basically the time when tax systems became steeply progressive under the notion of ability to pay. In other words, those who have the greatest ability to pay should pay more or, under the notion of the marginal utility of income, a dollar to a poor man is worth more in terms of what the economists call utility than is a dollar to a rich person. If you tax a rich person and give the money to the poor person, the over-all utility of the system is more equitable. Those are the basic precepts underlying the notion of progressive taxation, the notion of income tax having a greater reliance on vertical as opposed to horizontal equity.
The other important feature in the tax system is the source of income. Here is where we get into the difficulty which gave rise to the capital gains tax in the first place. The source of income, whether from employment or investment is important. Under an ideal tax system, it would not make any difference

November 26, 1982
Capital Gains
where that income came from. You would treat investment income and employment income exactly the same.
The other hang-up that comes into this area of income source, whether it is employment or investment income, is on the investment side, and that is whether the income is earned by an individual or a corporation. Ideally, you would not tax corporations. Ideally, the income that is earned by a corporation would be attributed to the shareholders and included in their taxable income, subjected to their marginal tax rate. They would pay tax. Corporations would not pay tax.
A great many people say today that corporations really do not pay tax. Corporations either pass the tax along to their shareholders, or to consumers in the form of higher prices. But corporations do not pay tax. Either the owners or the consumers of the products pay tax. People pay taxes. Corporations are legal entities and they do not pay tax. Somebody pays the tax, either the shareholder or the consumer. If you tax the shareholder by putting the income in that person's hand, that is probably the most equitable way to do it.
Over the years, in the United States, here, in Britain, in France, everywhere, we have tended to differentiate between corporations and individuals. If you are an individual, a sole proprietor or a small-business person, and you earn income in your business, it becomes personal income and you are taxed. All of a sudden, a corporation comes along and, for some reason, we think we have to treat that income differently. You could have a three or a four-person corporation. For tax purposes a partnership of four people is treated totally differently than a corporation of four people, although the principles are the same. I own a company, I own it through shares or through a partnership. The income which that company earns is partially mine, represented by the amount of my partnership or represented by the shares I own. There should not be a differentiation, but there is. Then we get into a problem. The biggest problem that has arisen for tax policy is that the corporate tax rate is different from the personal tax rate. Not only that, but we have introduced a small-business tax rate. There is a big-business tax rate and a small-business tax rate. What about an individual, for example, earning income through a corporation, one who is in the 50 per cent tax bracket? If under our present system it were possible for an individual to pass income through a small business corporation and bring it out the other end, the small business corporation, lo and behold, is only taxed at 25 per cent. It may be taxed at only 21 per cent if it were a manufacturing-processing small business. Therefore, an individual, could funnel his income through a corporation and come out the other end paying only 21 per cent or 25 per cent instead of paying 50 per cent. Obviously, tax avoidance could take place, legally, but tax avoidance nonetheless.
Dividends from a corporation to the shareholder have always been taxable. What gave rise to the capital gains tax and the Carter Commission-there would not have been a Carter Commission but for this very problem-is what is called dividend stripping or surplus stripping. In the 1960s it became such a major problem of tax avoidance because
individuals funnelled money through a corporation, and instead of taking dividends on which they would be taxed, they let the dividends and the earnings build up in the corporation, ending up selling the corporation. They took the money as capital gains and the capital gains, of course, were tax free. Therefore, income was being created in the system. Income was going through the system. It was being taken out of the system for consumption and it was not being subjected to tax. That was a fundamental flaw in the tax system.
The principle of plugging that loophole was a capital gains tax. If you take the money out of a corporation as dividends, you pay tax. If you take it out as capital gains, you pay tax, and presumably, through the dividend tax credit mechanism and others, you should get an offset. The corporation now has paid the tax, or you have paid the tax on your income from the corporation, and on your personal income tax form you get a tax credit to offset the fact that you have already paid tax as a part of being an owner of the corporation.
Theoretically, that is the ideal world. The problem is that you have two different corporate tax rates. The dividend tax credit basically offsets only to the level of the small business. If you are a big business paying 50 per cent tax, then you are being taxed twice. At the small-business level you are only being taxed once, theoretically. There are all kinds of problems. But the basic problem we had to face back in the 1960s was this problem of surplus stripping. If you were to eliminate the capital gains tax now or in any major way nullify it, you would wind up with a major tax avoidance problem that could not be tolerated.
There are ways of getting around this problem. However, they involve some fundamental changes to the tax system. For example, we hear people talk about a flat tax. They are talking about a flat tax for a very good reason. Once you take the progressivity out of the tax system, then everybody pays the same rate, and a buck is a buck is a buck and it can be handled that way. If you also apply the flat tax to corporations, then you do not have tax dividends or capital gains. After all, capital gains are simply the present value of future dividends. If I get the money as a person, I pay 30 per cent on it. If the corporation earns the income, the corporation would pay taxes at 30 per cent, let us say, and then the corporation would pass the money to me tax free. But it is not tax free because I own the corporation. The income is flowing to the corporation. It pays the tax and I own the corporation because I am the shareholder, then the money is given to me tax free, or if I earn it some other way, I pay 30 per cent. The same thing applies. It is a nice, clean system. Where the trouble arises, and this is where we are now, is that we have a progressive tax system where individuals have different tax rates than corporations. You can play tax avoidance games by going through corporations to get your income. With a flat tax it does not apply. No matter how I get the income at the corporate level, personally, 30 per cent, or 40 per cent, or whatever the flat tax is, it is paid once. There is no double taxation and the system works very nicely.
November 26, 1982

If we are going to deal with the capital gains tax, it seems to me that we have to deal with capital gains tax in a more fundamental way. We can eliminate the capital gains tax, but it implies some fundamental structural changes to the nature of our income tax system. It means effectively coming to a system where we integrate the personal and the corporate tax system. Right now the small business tax and the personal tax system are, for all intents and purposes, integrated. Tax paid at the corporate level is effectively offset against tax paid personally, so you only pay tax once. For the big corporation, it is not fully integrated, it is under-integrated. The corporation pays tax and the individual pays tax so, to some extent, there is double taxation involved. This has all kinds of implications for equity markets. It has all kinds of implications for equity investment.
As I think the Hon. Member for Athabasca said, one of the reasons why we have so much debt in our capital structure now is probably because of the fact that equity is not relatively attractive for getting money through the debt stream.
Those are the kinds of considerations that we are going to have to take into account if we want to deal with the capital gains tax system. We cannot simply eliminate it because, in the current structure, it would lead to insurmountable problems of tax avoidance which could not be accepted economically or sociably, and I guarantee that it would not be accepted politically.
If we are to deal with the capital gains problem we must deal with the fundamental problems which gave rise to capital gains tax in the first place. I believe that we can do that. There are proposals which can be considered by the House, by the Finance Committee or other committees. I certainly think that we must look at this area very carefully in the future development of the tax system.


Victor Fredrich (Vic) Althouse: Mr. Speaker, I rise to make a brief presentation during this debate concerning three measures affecting taxation on capital gains which has been introduced by the Hon. Member for Athabasca (Mr. Shields). The three measures concern the common stock investment plan changes in the treatment of capital gains; the registered retirement savings plan; and the provision of transfer of capital gains on farming assets to RRSPs.
I think the Hon. Member for Athabasca is trying to resurface the Crosbie budget which was defeated on December 11, 1979. I feel obligated to speak in this debate because I think that particular budget is being oversold to a great extent. I do not think it was even really understood by some of the Members in the Conservative Party.
Let me return to some of the original documents from that budget and use some of the Conservative Government's words to describe what it had in mind. One can see that it is not quite how it was portrayed by the Hon. Member for Athabasca, or by Conservative Members from the Prairies.
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I will quote the first aspect of it as it appears in the Budget brief. It says:
Individuals will be encouraged to invest in common stock of Canadian corporations by deferral of capital gains tax on shares purchased through a new Common Stock Investment Plan.
Capital gains was not being eliminated as is often portrayed. It was simply a deferral. As a matter of fact, the plan will probably be discussed before Parliament again because Mr. Lortie, President of the Montreal Stock Exchange, who was involved with one of the groups set up by the former minister of finance, recommended that this particular plan or its variant be discussed. Therefore we will probably see this plan brought back to the House and discussed in the full context of the tax law and philosophy as outlined by the Hon. Member for Ottawa Centre (Mr. Evans).
The second point made in the budget note says:
One-half of income earned on common stock investments by Registered Retirement Savings Plans will be exempt from tax when received by individuals on the maturing of their plans.
Apparently, there would have been a reduction in tax for retirement savings plans that are made up of common stocks, under the Crosbie budget.
Since the Hon. Member for Athabasca talked about farms, I will use farms as an example. If the farm which was being disposed of was incorporated, the shareholders would have an avenue to avoid capital gains tax. If it was a normal farm, like the majority, which was privately owned and not incorporated, the third method would have applied. This is the area where I think we are often led down the garden path in rural Canada by some Conservative representatives. What the budget notes actually say and what the budget intendet is:
Farmers will be enabled to get deferral of tax-
I stress deferral of tax. Tax was not eliminated, simply deferred.
-once in a lifetime, on up to $100,000 in taxable capital gains (representing $200,000 of total capital gains) from the sale of their farm by transferring the gains to an RRSP.
Therefore, they were not proposing to do away with part of the capital gains, they were simply proposing to put it into an RRSP and defer the payment of those taxes. The RRSPs that were set up were not made up of common stocks or shares for most farmers but simply transfers of money. The tax was only deferred, not eliminated. This is according to the budget papers that were presented on December 11, 1979.
I believe this is very significant, because that action tells a lot about the Progressive Conservative attitude to farmers with respect to capital gains, much more than do their words.


Blaine Allen Thacker: What would you do?


Victor Fredrich (Vic) Althouse: Since the Hon. Member asks what we would do, I will point out what some of the NDP provincial Governments have done. I think this is significant, because the collection of capital gains tax is under the authority of both the federal and provincial Governments under the Income Tax

November 26, 1982
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Act. I would draw the Members' attention to the Province of Saskatchewan, which, under an NDP Government, exempted the first $100,000 on capital gains tax on farms. It exempted that tax, it did not defer it. It is one of the few provinces that has done so in spite of all of the provincial Governments being Conservative at one time or another. Provincial Conservative Governments have not addressed the capital gains problem in any real or significant way and not at all in the manner which the Hon. Member for Athabasca would have the House believe. I think we have seen an action which speaks far louder than words.
We believe that this exemption should continue on a federal basis as well. We are prepared to give some reasons for that exemption. We note that the Income Tax Act now exempts home owners and workers in the cities and towns from the capital gain on their principal residence. We say that the reason for the $100,000 exemption on farmland is for similar reasons. It is a form of a retirement investment plan by a farmer or small businessman, similar to the way a large home is for someone who is to retire.
Therefore, we think it is justifiable to provide for an exemption of $100,000 on the first capital gains as it applies to farmers and small businessmen. This would be a much more direct way to attack the problem now. I certainly would agree that revamping the tax system to make it more fair and equitable is desirable and important. It probably should be revamped again due to the changes in the ways taxes are levied in this country.
For your information, Mr. Speaker, I note that in 1952, 53 per cent of the taxes that were collected in this country came from the corporate sector and 46.3 per cent came from individuals. By 1980 that ratio had changed so that 30.5 per cent of the taxes collected in this country came from the corporate sector and almost 70 per cent came from individuals.
We hear much said in the House, particularly from the Official Opposition, about the fact that the country can get back on its feet by removing the Government's involvement in business. I suggest that this has been happening since 1952 in the sense that business has certainly not been paying its share of the capital through taxation in Canada. I understand from some of the remarks of the Hon. Member for Ottawa Centre that even the Government side recognizes that the tax load does not fall on corporations to the same extent as it falls on individuals. It is inequitable, and is becoming even worse. He did not seem to be giving any indication that that situation will change soon. Until it does change, I think people should expect to gain a few of the perks given to large corporations in the form of tax deferrals.
There is a basic difference between tax deferrals for individuals and for corporations. The main outlet for deferring taxes of individuals is through RRSPs, but individuals eventually need that money. They put it back into income and pay taxes on it. That is not the case with corporate deferrals.
In June of 1980, deferred corporate taxes in this country amounted to something like $20.8 billion. We do not have figures as to how much of those deferred taxes are ultimately paid. We do know that very few of those taxes are actually shown as income and are taxed. We know from studies conducted in the United States concerning deferral of corporate taxes that only about 1.5 per cent of those deferred taxes are actually ever paid. I think the reason is that corporations have an unlimited lifespan. As long as they remain fairly healthy, they can continue to defer their taxes forever, and they never have to declare any of those funds as income and pay taxes on them.
Therefore, I think that the analogy, the rules and the equity, if you like, between individuals and corporations are not fair, and the provisions contained in the Progressive Conservative budget of 1979 were totally unfair for those very reasons. They provided a form of equity to holders of shares or common stocks, but individuals, proprietorships, small businesses or small farms did not get any form of tax write-off, but, rather, only deferrals. I think that was an unfair situation in which to place farmers. It would have been much fairer to simply provide an exemption applicable to the first $100,000 of taxable income, as was done in Saskatchewan. That should have been spread to the federal level and it would have righted a wrong without greatly changing the current tax system.


Blaine Allen Thacker: Mr. Speaker, I am glad to join in this debate, particularly following the speech of the Hon. Member for Humboldt-Lake Centre (Mr. Althouse), because there is no doubt that he must be very worried about that Progressive Conservative budget of 1979.


Victor Fredrich (Vic) Althouse: There was no problem in 1979 and 1980, I'll tell you.


Blaine Allen Thacker: Hon. Members will notice that even though it was some three years ago, he is still worried about it, because the people of Saskatchewan, for the first time, had a Conservative Government here in Ottawa and after a mere nine months in power, only three months after the House had been called, there was a provision in the very first budget to give capital gains relief to farmers. That was a major task because, as we know, the power behind the Ministers, namely, the bureaucracy, did not want to make any changes. It was an enormous battle, but the party, the P.C. caucus, the backbenchers, stood up and Mr. Crosbie put it in his budget. This was followed by the defeat. The NDP, with many Hon. Members from the West supporting it in 1980, suddenly realized, after the election, what had happened. They had been duped.


Victor Fredrich (Vic) Althouse: Capital gains reserve, what about it?


Blaine Allen Thacker: Had the Conservative Government stayed in, there would have been on the books today substantial additional relief from the capital gains tax on bona fide agricultural land. That got away from them because of the NDP members in the West, and the people will not forget it-


Victor Fredrich (Vic) Althouse: It is really no different than what is in now.
November 26, 1982


Blaine Allen Thacker: -as the Saskatchewan provincial election brought to mind. The Hon. Member pointed out that Saskatchewan, under the NDP provincial Government, was such a great place. I would remind him that the Saskatchewan population today is exactly the same as it was during the thirties. What that means is that once a socialist government was elected in Saskatchewan, for all of those years, through the forties, fifties, sixties and seventies, all those who were part of natural increase had to leave the Province to get jobs. Why did they have to leave the Province? It was because the NDP government like any socialist Government anywhere in the world, started to grind down. The only unfortunate thing for the Saskatchewan NDP government was that it could not put a bloody fence up to keep people in, like in East Germany. It could not put boundaries around the Province to force the people to stay. Consider the western Provinces, B.C., Alberta and Saskatchewan, which basically have the same type of resource assets. B.C., under a Social Credit Government, believes in individual enterprise. It has a population of 2.7 million. Alberta is almost exactly the same, with 2.2 million people. Where is Saskatchewan? With all the enormous resources which should be helping the people of the world, even the poor people of the world, it has a population of barely one million. That is because of a socialist government. Thank goodness in Canada we have an economic union and a Constitution which prevents socialist governments from putting up fences, because that is what would happen otherwise.


Mr. Tobin:: What happened to the $225 million deficit? Can you address that, please?


Blaine Allen Thacker: That $225 million deficit is a drop in the bucket.


Victor Fredrich (Vic) Althouse: You ain't seen nothing yet!


Blaine Allen Thacker: Contrast that deficit with what my friend opposite, the Hon. Member from Newfoundland in the national Liberal Government, has done in contributing to a deficit of some $25 billion this year and an accumulated deficit of $140 billion. What does that do to society? To simply service the debt, $17 billion plus is needed. Money is concentrated in the hands of people who already have wealth. The socialist policies of my friend, the Hon. Member opposite, are leading to an incredibly rich upper class.


Brian Vincent Tobin: I am not a socialist!


Blaine Allen Thacker: It is destroying our middle class. We will have a class system like that in India, like the system in all the other socialist countries. We will have an incredibly rich class of people in Canada and no middle class. We will all be poor, and that is what leads to revolutions, and quite properly so.


Victor Fredrich (Vic) Althouse: What about the other deficit?


Blaine Allen Thacker: I would like to refer to capital gains tax. The Hon. Member for Ottawa Centre (Mr. Evans) gave a very fine speech with many flowery words, in which he very nicely set out the apology always given by the Government. He told of how the capital gains problem grew to the point where the Government began to consider it. My simple question to him,
Capital Gains
though, is, who did all this? Who put it in place? The Carter proposals of 1971, which would have treated a buck as a buck, had quite a bit of support. The Liberal Government did not bring in that report. The bureaucratic proposals which flowed out of the Carter proposals were entirely different. The only people who benefited were the accountants of Canada. The 1971 tax proposals did for the accountants what the constitutional proposals of 1981 will do for those of us who happen to be lawyers. It is like a licence to rob.
I gather the accountants have a huge statue of Mr. Edgar Benson and each year they lay on a new layer of gold leaf because of the enormous fees they have been able to collect as a result of the 1971 amendments. The Canadian Bar Association will soon be putting forth a proposal to put up a similar statue. I think we will put up a statue of the Prime Minister (Mr. Trudeau) and every year, because of the enormous fees we will receive through fighting these constitutional arguments as a result of the Charter of Rights and Freedoms, we will lay on another layer of gold leaf. Over the generations, it will become a tremendous resource for the Canadian Bar Association, so that if we come upon tough times in the future we will be able to take off pieces of this gold and keep our membership up. What the Liberal Party has done has been to help accountants and lawyers.
Let us not forget that we have a motion on the floor to give relief from capital gains tax. The Government obviously has enough members lined up to filibuster this. Once again the Liberal Party is saying to the farmers of this land that they are not prepared to give any relief from capital gains.
Why do we not as a nation exempt bona fide agricultural land from capital gains tax? It is a very small part of our national heritage. This is a huge country, but the amount that is truly arable is a drop in the bucket. When we look at the global scene, the amount of arable land in Canada as a percentage of the world is the smallest fraction. However, out of that smallest fraction, because we put it into the hands of individuals, the farm family, we have produced enough food to export around the world. We have lots.
If we would develop our water resources in the west, we could feed the entire world for generations. We have the land, the solar units and water flowing out of the mountains. If we used it productively, it would be our ace in the hole, and it could turn Canada into the most powerful nation in the world. Within one generation, people are going to be knocking our doors down to get food. We do not need to have agricultural food exporting corporations. They will be banging down the door. Anyone who has looked at the demography figures knows that.
One advantage of exempting just the bona fide agricultural land, all of which is identified, is that it would keep in the small family farms which are clearly more efficient. As the farms get larger, they become more inefficient, the ultimate

November 26, 1982
Capital Gains
being the system in China and Russia where they have huge communal farms. We know that production drops off dramatically. In China they are now trying to get back to individual owners. If we exempted bona fide land we would keep more in small family production. That would mean many more tractors, drills and combines which would in turn mean more industrial jobs in Central Ontario. We could keep the enormous strength of that manufacturing industry here in Ontario. It would make it much easier to transfer to the next generation.
The problem with the tax now, as I am sure the Hon. Member for Ottawa Centre knows, is that we have a value on the land that was adopted in 1971. We must consider the sale value today. In my part of the country, land sold for about $100 an acre in 1971. It is now selling at about $1,500 an acre, a gain of about $1,400 an acre. Of that, $700 comes into income in the year of sale. For the average 5,000 acre farm, the capital gains tax is truly enormous. A new purchaser coming along can very seldom put up the whole amount at the start. Therefore, the seller has to pay in income tax more money than he receives as the down payment. Not only that, there is nothing left to purchase a small home in the town. It is an enormous problem.
The Liberals talk proudly about the rollover which they have. If the farmer sells it to someone of the next generation who will actually be farming, he can get a rollover. That is true. However, what happens to the farmer with four children, a son living on the land, a son living and working elsewhere and two daughters? He cannot leave it to all of them. What if he wants to leave it to the boy who is on the land because he wants it kept together as an economical farm unit? The farmer wants it to stay together as a family farm.
If it is given to the boy on the farm at the 1971 value, the farmer can get the rollover, but can no longer do fairness and equity to those who left. If it is sold to the boy on the farm at greater than the 1971 value, capital gains tax has to be paid. Once he pays the tax, he does not have enough left to do fairness to the other children. It is a very serious problem which it has come about partly because of inflation.
As a result of these enormous deficits, there is simply too much money chasing too few goods. Inflation tends to settle out. Over the last ten years it settled out on land in particular. In my part of the country, the value of land has increased, not because of its productivity but because of inflation; people in times of inflation trying to put their money into something that will increase in value.
Recently I had an opportunity to buy some land. I ran calculations based on its productivity. Based on productivity, the land should have been $200 an acre, yet people are paying $700, $800, up to $1,000 to try to protect themselves from future inflation. Honest people trying to expand simply cannot pay that much, because productivity indicates it is only worth $200. This is a serious problem. As a result, we find foreign money being used to buy up land. Larger corporations with enormous cash flow from sources other than agriculture are purchasing the land. It is therefore becoming more inefficient. We are losing the family farms, the small communities and the
manufacturing industries which produce tractors and other kinds of equipment. Instead, huge four-wheel drive units that are produced in the United States and elsewhere are being bought.
The net result of that capital gains tax exemption for bona fide land would be cheaper food. My friend from Ottawa Centre pointed out that the capital gains would catch speculators. That is true, but there is a very little genuine speculation on bona fide agricultural land. If the tax were attached only to the land, and it became a city subdivision, fine, tax it to death. However, the fact that there would be an exemption on bona fide land would tend to keep land for agricultural purposes. As I said earlier, that is what we need for the future. There is no doubt that the rest of the world is in deep trouble in terms of food production.
It has always been a source of great sadness that Canadians, one-half of 1 per cent of the world population sitting on the resources of half this continent, are out in the world capital markets, down on both knees with their hats off, begging the world to lend us money. At the same time we are competing with the Third World countries for oil. Why should we do that? We do not want to compete with them for oil. We should be a source of capital to the world and a source of energy, yet we are not.
It is close to five o'clock. I hope the House will accept this motion of my hon. friend for Athabasca (Mr. Shields).


Mr. Douglas Fisher (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I appreciate the opportunity to say a few words at the end of what I have found to be a very interesting discussion. I am sorry that the mover of the motion was not able to stay because I wanted to ask him a question. Perhaps the honourable Member for Lethbridge-Foothills (Mr. Thacker) can give us some information.
By my calculations, under the new proposals for the treatment of capital gains, proposals developed from the November budget, it looks as if in the worst possible case a taxpayer, given the reserves and the rates of taxation, will have to pay 5 per cent of the gain per annum over a five-year period. If a farmer sells his farm outside his family, he would then pay 5 per cent of that gain for a five-year period and discharge all his responsibilities for his capital gain. If he sells his farm to one of his sons or to someone in his immediate family, the reserve period is stretched out for ten years. Therefore, his liability is only 2.5 per cent of the gain per annum. That does not seem to be an onerous problem, and those are the worst figures without any allowance for forward-averaging or any of the other normal deductions the farmer might be able to take into account.
We hear stories about these difficulties, but I wonder if the Hon. Member could explain to me, perhaps privately, how 5 per cent of the gain or, in the case of a family sale, 7.5 per cent of the gain per annum, is really that onerous?


The Acting Speaker (Mr. Blaker):: The Hon. Member for Lethbridge-Foothills (Mr. Thacker) on a point of order.
November 26, 1982


Blaine Allen Thacker: I am not rising to answer the question, Mr. Speaker, but to say that I am sure my hon. friend opposite was not intending a slur on the Hon. Member for Athabasca (Mr. Shields) who is is not able to be here. The Hon. Member had to catch an aeroplane, and in view of the inclement weather he had to pop away just a touch early.


Douglas Glenn Fisher: Mr. Speaker, perhaps the Hon. Member from Lethbridge will be kind enough to give me some information personally about how this creates a difficulty.
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The Acting Speaker (Mr. Blaker):: As usual, Friday afternoon debates are the most interesting, but unfortunately the time allotted to private members' business has now expired. Accordingly, this House now stands adjourned until two o'clock on Monday afternon, pursuant to Standing Order 2(1). I wish Hon. Members a good evening, and a good weekend.
At 5 p.m. the House adjourned, without question put, pursuant to Standing Order.
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Monday, November 29, 1982