1983-02-22

GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Thursday, February 17, 1983 consideration of the motion of Mr. Lalonde that Bill C-143, to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs; and the amendment of Mr. Skelly (page 22957).
The Acting Speaker (Mr. Corbin):: There is a certain custom in the House of Commons whereby when the Leader of the Official Opposition indicates that he wishes to rise, Hon. Members agree to permit him to speak at that time. Normally the Chair would recognize an Hon. Member from the Government Party. Is it agreed that the Chair recognize the Hon. Leader of the Opposition (Mr. Nielsen)?


Some Hon. Members:: Agreed.


Hon. Erik Nielsen (Leader of the Opposition):: Mr. Speaker, I thank the Hon. Member for Ottawa Centre (Mr. Evans) for his observance of that parliamentary courtesy.
I have seldom given titles to speeches which I deliver in this place, but because of the issue before us, I thought that in this instance I would entitle my speech: "Living in Never-never-land with the Grits"; and it might have the subtitle: "Neither a borrower nor a lender be", the purpose perhaps being to advance a short course on what is involved in this borrowing authority Bill.
All of us in this House have listened with keen attention, not to say bated breath, to the Deputy Prime Minister (Mr. MacEachen) on the subject of guidelines. There has been nothing like it since "Goldilocks and the Three Bears", or was it the "Three Little Pigs"? If he erred on the side of naivete, or something else in that episode, he was quite sensible and down to earth in committee when in May the Minister said, and I quote:
I would not expect the House to act upon an additional request for borrowing authority without providing it with detailed information on the economic situation-
That is what he said, "detailed information on the economic situation in the form of a budget".
When you are talking in terms of $14 billion for a fiscal year which is not yet upon us and for which a budget has not yet been presented, nothing else surely will do. There must be a detailed financial statement with, as the Deputy Prime Minister has said, the implications of that situation on the Government's fiscal situation. That can only mean a budget.
It may come as a surprise to Members on the Government side, some of those on the backbenches, to be reminded, as seems to be an increasing requirement these days, that they are responsible to Parliament. They cannot come in here and get a blank cheque covering the next fiscal period without producing a budget which constitutes an outline of their fiscal and monetary position.


Some Hon. Members:: Hear, hear!


Erik Nielsen: The borrowing authority demanded in the Bill constitutes an immediate inflationary pressure. It will force interest rates up, the most damaging development in the economy at the present time. We have had no indication from the Government of the purposes to which this enormous borrowing power will be put. It indicates an expectation of a deficit in 1983-84 considerably higher than the proposed $27 billion. Without a budget we have no indication of what policies this Government intends to implement to restore confidence, stimulate the economy and provide jobs.
Now the chickens are coming home to roost. This Government is faced with a major, almost disastrous, economic crisis. One cannot help being reminded of the fable by La Fontaine:
La cigale et la fourmi
"La cigale ayant chante tout Pete
Se trouva fort depourvue quand la bise fut venue."
I hope my accent was understandable.


Some Hon. Members:: Hear, hear!


Erik Nielsen: To the Prime Minister (Mr. Trudeau) and the Minister of Finance (Mr. Lalonde), I say "Go to the ant, thou sluggard", a piece of advice they would do well to embrace. Having brought the country to the sharp edge of insolvency, they want money. Without a budget, with no budgetary measures, no setting out of fiscal or monetary policy, they simply came into the House and said: "Fork over, boys", to the tune of $14 billion.
When one contemplates the financial situation of this Government, one is overcome with amazement that in a mere

February 22, 1983
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three years so much could have been undone. It is a subject for students of political science and human conduct in years to come to attempt to explain how a Government could come down so fast, so far, in so short a time. What we must all be concerned about is that in its slide into insolvency and economic disarray, the Government has brought the entire economy down with it.
I, sir, am concerned about the size and the amount of this demand imposed on an already staggering economy in this country. It is conclusive proof, I submit, if any were needed at all, that this Government has no intention of mending its ways at all. Like a drunken sailor, it will go on throwing public money away until it leads this country to the edge of bankruptcy. The course of spending followed by this Government has been described as profligate, as wasteful and as reckless. It now, sir, borders on the edge of lunacy.
The first part of the Bill covering borrowing authority for $5 billion, representing part of the Government's cash requirements for the current fiscal year, must be taken in conjunction with the October budget. It is here that the details are set out covering the cash requirements for the current fiscal year. There are no such detailed explanations covering the second and larger amount of $14 billion.
As the Minister framed his demand, he must have been thinking of the lines from "The Ancient Mariner":
We were the first that ever burst
Into that silent sea.
It is a parliamentary first, sir, when you have a Minister who comes before Parliament and asks for authority to go to the public for $14 billion without the supporting and buttressing evidence of a budget. Perhaps he was thinking of the wreckage of the last three budgets now piled up on the beach. He decided to take the cash and let the explanations go until a later date. This House has been given no supporting documents, no financial picture, on the state of the economy, no current outline of fiscal and monetary policy. This mess which we are in is a direct result of mismanagement on the part of this Government. It is due to the two years in which the Prime Minister dragged the Canadian people through the labyrinth of constitutional reform. It is due to the Government's preoccupation with experimentation and centralization, and vast development programs which never got off the drawing board.
Giving this Government power to borrow $14 billion for unspecified purposes to be outlined in a budget which we have never seen is like giving a keg of whiskey to a drunk. This Government has a record of fiscal madness which is second to none. You have to go back, sir, to the Manchu dynasty to find a governing Party so remote from the ordinary citizens of this country.


Some Hon. Members:: Hear, hear!


Erik Nielsen: Talk about the cart before the horse! This borrowing Bill is more evidence of the Government's mismanagement of the finances of the country. Its budgetary performance has been so inept that, in order to get one budget accepted by the House, it has to take three runs at it. We are now
working on a budgetary resolution covering three budgets, approving budgetary measures which should have been through this House months and months ago. Now this lethargic, incompetent aggregation of political misfits find themselves confronted by the necessity of producing another budget to cover current and upcoming demands, and they cannot do so until they get rid of the logjam of previous budgetary resolutions which have remained piled up in the House while they played with Canagrex and other non-essentials.
So what do they do? Do they follow normal procedure and bring in a budget, followed by a request for borrowing authority for the purposes spelled out in such a budget? Not at all. The Liberals have decided to cut the Gordian knot of their own incompetence by dispensing with the need for a budget and simply demanding the right to go into the market for their cash needs. First comes the cash, and then whenever they get around to it they will produce a budget justifying their demands for the cash.
We have had a bellyful of this Government cutting corners, bypassing Parliament, raiding the Treasury and attempting to govern without responsibility. It produced two unworkable budgets and a third which was simply an exercise in plastic surgery. It wandered away in a jungle of hazy schemes like the CIDC, the CDC, the NEP and FIRA, which consumed enormous amounts of money, involving, for example, the purchase of Fina and BP. Now that it is time to do its housekeeping, it is completely at a loss.
The Minister's desire to be orderly and efficient cannot be used as an excuse to deprive Parliament of its right to full explanations and respect for the traditions of this place. If the Minister and the Government are faced with meeting huge debt commitments and refinancing requirements, all we can say, in all bluntness, is: "Don't come crying on our shoulders". For years we have warned about the runaway expenditures of the Government, and for just as many years we have been totally ignored. When the day comes that the Liberals can walk into this House and demand permission to borrow $14 billion without any explanation, without detailed taxation measures and fiscal proposals outlined in a budget, then this House has no further function but to act as a rubber stamp for the demands of Government.


Some Hon. Members:: Hear, hear!


Erik Nielsen: In the cursory explanations of the Minister of Finance which in no way addressed the issue as to why there was no budgetary explanation of the cash which he required, along with the proper tax measures, the Minister used the words "orderly" and "efficient" more often than did Mussolini when he was making the trains run on time.


Some Hon. Members:: Oh, oh!
February 22, 1983


Erik Nielsen: That is right. Where are our trains after the VIA cuts? In his speech, with a mere nod to the practice and traditions of this place, the Minister said:
It is desirable that Parliament have adequate time to study and debate the budget as well as the new borrowing authority Bill.
It is more than desirable; it is absolutely and vitally necessary. The Canadian people are uneasy and very concerned about handing the Government another blank cheque. Canadians are asking themselves: "When will this stop?" Here is a Minister who comes in after three disastrous budgets, with the economy on its beam ends, and says: "Let us not worry about a budget this time. Just give us the money; we will take the cash and let the credit go." It is not that easy. This is Parliament. This is not Household Finance.


Some Hon. Members:: Hear, hear!


Erik Nielsen: Surely no finance company would lend money on those terms. What would be the collateral? A bunch of gas
stations?
Mr. Speaker, you, as the chief officer of Parliament, the guardian of its rights and privileges, the watchdog of its traditions, must be concerned about this abrogation of practice and tradition. You must surely be uneasy about a Government which comes in with all the finesse of Jack the Ripper and says: "give us money". Everyone who knows and respects Parliament and is aware of what this institution stands for must be conscious of the fact that if we sit still at this kind of hijacking of our rights, the institution itself will have entirely lost its validity.
We want the Minister to follow the practice of previous Ministers back to Confederation. We want him to outline his cash requirements for 1983-84 in a budget for that period, clearly outlining the state of the economy, the Government's fiscal and monetary position, the measures it contemplates taking to restore confidence and put Canadians back to work. That is the minimum that the Minister and the Government is obliged to accord Parliament. I warn the Minister and the Government, Parliament surely cannot stand for anything less than a full measure of its rights.
It would be the height of naivete to inquire why the Government tries so hard at every turn to evade parliamentary scrutiny. The Auditor General had something to say about that. He said the expenditures of the Government were entirely out of control. This latest demand by the Minister of Finance proves in spades that the Auditor General was exactly correct.
Parliament is being asked to underwrite expenditures for a fiscal year not yet begun, in reference to a budget which has not yet been presented. It is the Government's way of covering up the mess that it is in. It is a mess entirely of its own making.
For two years the Prime Minister, like a modern Moses, led the country through the desert of constitutional reform. He was not concerned about the economy, he was not concerned
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about unemployment, he was not concerned about balancing the budget, he was not concerned about runaway deficits, he was not concerned about high interest rates, he was not concerned about accelerating bankruptcies, and he was not concerned about farm foreclosures.
None of that could penetrate the veil of mystical fanaticism in which he warpped himself. Like a prophet of old, he betook himself into a desert of his own making-with his "moozmaad"-and there he remained in isolation, fed by the ravens of his own party.
The problem which this country faces today, in spite of signs of an economic pickup in the United States, is that their policies have so disrupted the country's capacity to come back, that we may not get the benefit of their economic turn-around.
The Government is now in a position where it is borrowing to pay off its creditors. That is surely always a bad policy in financial circles. The request for authority to borrow $19 billion illustrates the chasm between the Government's perception of the economic parameters and the real needs of Canadians.
No one would object to a deficit, even one of the colossal proportions of the Government's deficit, if it meant that Canadians would get jobs. We know it will not mean that. It means a licence to the Government to continue its orgy of unproductive, ideological empire building. It means a licence to continue its ideological and destructive interventionism in the private sector. It means that this House is putting its seal of approval on policies which have driven this country to distraction, made us a laughing stock internationally, put hundreds of thousands of Canadians on the streets, and brought the economy to a rockbottom low. A deficit of this size creates a logjam in capital markets and reinitiates the battle over scarce capital that will result inevitably in pushing up interest rates.
The simple fact is that the resources the Government is asking for will not go to stimulating the economy. After all, it has had more than two years of the highest deficits and highest spending in the country's history to stimulate the economy. Instead, we have unemployment and foreclosures. So to suggest that this idiot Government is capable of providing jobs is to suggest that blood can be obtained from a stone.
There will be no new jobs, no stimulus. There will just be an added burden on the dead weight of centralist interventionism by the Prime Minister and his associates-both past and present-that will result in blocking our economy from benefiting from the resurgence now under way in the United States. They will use this to build an isolationist and separatist wall around the Canadian economy so that the benefits of the American comeback will not cross the border. That has been the record, and there is no warrant for believing that it will be anything different. There will be no end to the Liberal-induced recession in the country until the Liberal Government is removed from office.

February 22, 1983
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Some Hon. Members:: Hear, hear!


Erik Nielsen: Certainly a deficit would be permissible in normal times for a normal Government to attempt to stimulate the economy. A deficit of this size for a Government which has been spending like drunken sailors for more than two years on non-productive, self-defeating projects is simply not acceptable or permissible. This Government ought to be cutting out unrealistic and counter-productive expenditures, such as the incredible purchase of hundreds of gas stations which have become a drug on the market.
They could open doors and allow constructively-motivated investment to flow back into Canada and provide new jobs. They could back out of energy and allow the energy industry to operate in accordance with the realities of the day rather than the textbook fumbling of the Government. They could do these things, but they will not because the Government is as remote from reality as though it were on hashish. Nowhere in the Government is there any sign of repentance, regret or remorse.
They have run up the largest deficit in history, with the highest expenditures in history, yet they sit over there, proud of their dismal record. Rather than curtailing their own expenditures, they turned to the pensioners, the superannuates and public servants. Now, by demanding a lump sum advance payment of $14 billion, they evade the problem of coming before Parliament with specific budgetary measures in support of their demand for cash.
The other day the Minister rose in the House and went through the motions of explaining the need for $14 billion for the next fiscal year. This is what it amounted to. He said: "We are broke. We need money; $14 billion will do for now. If we need more-and we will-we will be back." He went on to say that the required explanations will be forthcoming in the budget which is forthcoming. As to the precise time when the budget would appear, he was vague. He said, of course, that we could turn to the "Economic Outlook" for further information. That too will be reviewed in the budget, not yet here but forthcoming. This is why the House must not agree to this Bill, without the necessary explanations and taxation measures clearly spelled out in a budget for the 1983-84 fiscal period.
The Minister expressed a desire not to be hindered by borrowing authority constraints. Surely in view of the record of the Government, it is a primary requirement that the Government shall be hindered in every way by constraints. That is precisely what we are here for-we are here to protect the interests of Canadians, not to see the country ripped off by the Government.


Some Hon. Members:: Hear, hear!


Erik Nielsen: This approach by the Government is symptomatic of the deep financial mess into which it has plunged the country. The Government senses the oncoming storm and
is trying to build itself a $14 billion hurricane cellar so that it will not have to come back to Parliament until some time next year. At this time and in the context of this Government's record of mismanagement and blundering, to approve a borrowing commitment of this size, with no further details than the hand-wringing pleas of the Minister, would signal the end of the usefulness of the institution.
This House, sir, should stand on its right to have detailed explanations of the reasons for this Government's borrowing. This Government should not be allowed to spend another single red cent of the taxpayers' money until we have those traditional explanations.
Canadians have come to the end of their rope. They will stand still no longer for any further rip-offs by this profligate Government which now comes to us in this totally untraditional fashion for borrowings of this magnitude.


Some Hon. Members:: Hear, hear!


The Acting Speaker (Mr. Corbin):: Questions? Comments? Debate?


Mr. John Evans (Ottawa Centre):: Before the Leader of the Opposition (Mr. Nielsen) takes his leave, I would simply like to point out to him that the Estimates which detail the expenditures for the next year will be tabled in the House at three o'clock this afternoon. That should give Hon. Members a good explanation of precisely how the dollars that are being asked for in the borrowing authority Bill are to be expended over the next year; and a budget is forthcoming, Mr. Speaker.


Miss MacDonald:: When?


John Leslie Evans: The Minister has indicated clearly that a budget is forthcoming.


Mr. Lewis:: What about the income?


John Leslie Evans: I would suggest to Hon. Members opposite that the changing circumstance we now face, whether or not we are actually into an economic recovery-which many people are saying we are and which I personally agree we are-is altering the situation very dramatically.


The Acting Speaker (Mr. Corbin):: Order, please. The Hon. Member for Kingston and the Islands (Miss MacDonald) is rising on a point of order.


Flora Isabel MacDonald: Mr. Speaker, with regard to the budget which the Hon. Member for Ottawa Centre (Mr. Evans) has been discussing, would he for the benefit of the House interpret the word forthcoming?


Mr. Fisher:: We have time for that; show some courtesy.


Mr. Kempling:: Listen to who is talking about courtesy.


The Acting Speaker (Mr. Corbin):: Order, please. I must inform the Hon. Member that that is debate.
February 22, 1983


John Leslie Evans: Being out of order, Mr. Speaker, is something which the Hon. Member is quite used to. The budget is coming within this month or the following month-


William James Kempling: Some time this year?


An Hon. Member:: We have a forthcoming budget, do we?


John Leslie Evans: The real reason the budget has not been brought down to this point in time, to my mind, is that the economic situation, as I have stated, is changing very rapidly. If the Government were to bring down a budget which did respond to these very real, changing economic conditions, the Opposition would be the first group to howl that the Government was not forecasting properly, that the Government had done something improper in bringing down a budget before the Government really knew what the economic situation was. Changes are happening very fast. Changes are occurring very fast in this country and very fast in other countries. This affects our economic condition very dramatically. Economic change and economic recovery is coming about very quickly in the United States. That will have an impact upon employment in the primary Canadian industries. What kinds of programs should be in place in a budget will depend on where the areas of greatest need are in this country in light of the changing economic circumstances.
We will have the Estimates today at three o'clock. Given that the Minister has indicated his intense desire to bring down a budget at the earliest possible date, the Opposition will certainly have sufficient material to evaluate how the Government intends to spend the money it is asking for in this borrowing authority Bill.
Along the lines of the Bill itself and in trying to add something to the debate in this area, I would like to carry on with the comments I was making last Friday in the debate. I had to shorten my comments because another Hon. Member wanted to speak and we had to cut the debate short. At that time I indicated that the economic situation we faced in this country is no different in substance from the economic situation that is being faced by most, if not all, western industrialized countries. Certainly there are differences in the numbers as far as the unemployed in this country are concerned versus the numbers of unemployed in other countries. There is a difference in the level of inflation in this country versus other countries as well as differences in the level of interest rates and so on. But uniformly all countries are facing the same dramatically difficult economic situation.
The particular economic situation which faces the world has been in the making for a great many years. First it was in the form of inflation, and subsequently there were the attempts to bring that inflation under control made by all Governments.
It is important that we understand the nature of inflation and what must be done in order to bring inflation under control. Then we can argue whether or not Members in this House believe it is important that we bring inflation under control. If what causes inflation and what needs to be done to bring inflation under control is understood, then we can ask the question: Is fighting inflation worth the price? I suggest to
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you, Mr. Speaker, that it is worth the price. Indeed, there is no option but to bring inflation down.
Quite frankly, we have succeeded quite dramatically in the last year in bringing down inflation. If you look at the inflation rate on an annualized basis for the last three months, Mr. Speaker, you will find inflation is now running at 3.2 per cent. Similarly, if you look at inflation for the last six months, it is running at less than 6 per cent. That is a clear indication of the trend, the elimination of inflation which will lead to lower interest rates. All observers who have the slightest knowledge of economics understand that lower interest rates will be the key to stimulating the recovery of the economy.
Let me go back to inflation, Mr. Speaker. I believe the fight against inflation and the recession have very common characteristics. First with regard to inflation, inflation comes about as a result of a situation where the purchasing power in a system exceeds the output of the system. In other words, standards of living in a country can only rise as fast as productivity or the increase in output of the system. If the money supply, the purchasing power of the system, grows faster, it will lead to rising prices. There is no argument about that; it is a basic fact. That is what gave rise to the inflationary spiral we saw, which the United States saw, which western Europe saw and which all countries in the western world saw during the 1970s.
Can inflation be allowed to continue and be left to run on its own? The answer from the Opposition, the answer from the Government and the answer from other Governments in other countries has really been no. There are very good reasons why that answer was resoundingly no. Because inflation leads to increased uncertainty, it cuts back on investment. Without investment there is no growth. Without growth there are no rising standards of living. The situation leads to higher interest rates. This we saw in an all too real way during the 1970s and especially during the first part of the 1980s. That is the reason that we had to bring inflation under control. All Members in the House were very concerned about inflation and called upon the Government to bring inflation under control.
How does one bring inflation under control if it is growing because of the increase in purchasing power at a rate that is higher than the rate of output in the country? The only way to reduce inflation is to reduce the purchasing power so that it is back in line with output. If that is not done, inflation will not be brought down. High inflation means that our dollar income had been growing faster than the output of products that those incomes were to buy. Therefore, to reduce inflation incomes must be constrained in dollar terms.
What is inflation, after all, but the market's natural adjustment mechanism which tells an economic society that it has been living beyond its means? That is what inflation is, a sign that the market is adjusting for excess purchasing power through a reduction of incomes to reduce the purchasing power. In order to eliminate inflation, the growth of income

February 22, 1983
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has to be restrained so that it more closely corresponds to the growth of output.
The issue, then, is how should the income reduction in the system be distributed? In a normal, functioning marketing economy all individuals in society would share that reduction by some small amount. Unfortunately, that is not how our system or other systems in the western world operate. While the Japanese system operates that way to a much greater extent, our system operates on the basis that the great majority of people are able to protect their incomes and hold them at the previous level while the minority are deprived of incomes altogether. In other words, instead of our system adjusting to the fight against inflation by reducing everyone's income to bring income into line with output, it reduces the incomes of a few by a great amount and the incomes of many by very little. In other words, we throw people out of work rather than reducing incomes uniformly. The labour-management system in our country leads to that situation. Those who continue to be employed do very well but there are a large number of people who are thrown into destitution.
That is the system which has evolved in this country, in the United States and Western Europe over many generations. It is not a system that was introduced by this or any previous Government. Given this situation and the necessity to reduce inflation for all the reasons I have suggested, what can the Government do to raise our standard of living? There are methods which the Government can use. The Government can respond by reducing income security programs. The Government has done this over the years. We introduced the Unemployment Insurance Program to ensure that those people who are out of work as a result of this system have some kind of income to support themselves. We introduced welfare programs, medicare and public pension schemes.
If the system were to adjust normally, everyone's income would come down a little and employment would stay very high. This is the case in Japan where they have a 2.5 per cent rate of unemployment as opposed to our 12.5 per cent. In our system, however, a few are asked to take an enormous income loss while the rest have no income loss. The Government can respond by introducing programs and it can pay for those programs by imposing some form of involuntary tax, in the broad sense of the word, on those who continue to be employed in order to pay for those who are no longer employed. I believe that system is inefficient. Our compensation system should be modified and revised so that we have a more automatic, uniform and just method of adjusting to these changes which occur in our economy over a period of time.
There are three ways the system can pay for these kinds of income transfers. The first method involves the natural process of adjustment that comes about with inflation. Inflation effectively taxes people's incomes by raising prices and that inflationary system is generated by the increase in purchasing power. The increase in purchasing power is caused by increases in the money supply which is under the control of the Government. If the Government increases the money supply very rapidly and uses those funds to give money to people who are
out of work while generating inflation, it can pay for those programs in that way. However, we know that this is not a very efficient method because it will have a negative impact on future growth rates and standards of living. In fact, Governments all over the world have tried to stop that kind of process.
The second method which can be used is for the Government simply to tax those who continue to receive income and use those revenues for its expenditure programs that pay those who no longer have incomes. We are presently in a very deep and difficult recession. Any tax increase at this point could, and I believe would, lead to a much more severe recessionary situation than we now face. I personally believe that this is certainly not the time to be talking about any kind of direct tax increase.
The third method is effectively to borrow against the future, since taxes cannot be imposed today due to the very fragile economy. Therefore, these income support programs that are very necessary-which I believe no Member would deny- would be paid for through another form of tax called a deficit. A deficit is no more and no less than an increase in future tax liabilities. The present economic situation being as it is, I believe the best way to stimulate the economy and maintain the income support programs that are necessary in our economy is to use the deficit. In other words, borrow against the future to ensure that we establish the conditions for growth today. Through growth, we will be able to reduce the deficit in the future.
Let me say that there are some conditions which should be met. If the decisions were up to me, there would be certain conditions that I would place on that deficit, its nature and how it should be employed. First, I think the use of borrowed moneys from the increased deficit should be oriented wherever possible toward expenditures which are in the form of an investment in future growth. This could be in the form of public works programs, railway expansions, port development or other programs that improve the infrastructure of the economy and make it more efficient and lively in the future. It can be used in other areas, such as skill training programs which are an investment in human capital as opposed to physical capital. If the deficit is used to improve the lot of those who are out of work and are suffering from the recession in order to make them more capable of participating in the future growth of the economy and being able to have higher incomes than they had without the skill training program, then it is a very valid use of the money.
Of course, the money should be used for straight income support programs to ensure that the critical mass of skilled workers in adversely affected industries, such as the forest and mining industries, can remain in those jobs, when we know that the demand for those products will increase in the future. That critical mass of skilled people has to be maintained in these areas so the industry can rebound when the recovery comes.
I think the NEED Program is another area where the deficit can be used effectively with regard to employment. It is
February 22, 1983

designed to keep that critical mass of employment available as the recovery comes.
We could bring forward, of course, viable projects for immediate start in the private sector. The deficit could be used to finance programs which would help bring forward some of these programs which the private sector has delayed.
We could also, and most importantly-and we talked about this last week-invest more heavily in the expansion and development of research and development facilities and people in this country, which again is an investment in the future. It is an expenditure today but it is an investment in the future. All of these things will lead to a more robust recovery and allow us to handle the deficit more carefully.
As a final point, Mr. Speaker, all of us are concerned about the deficit. It is very large. It certainly can be justified on the basis of the kinds of reductions in income or reductions in tax revenue that the Government is faced with and the increase in expenditures for these income support programs that are very necessary. That is what is causing the deficit to go up.
In closing, I have to say that I would call upon the Government to ensure that in the coming budget a program for deficit reduction is clearly spelled out, so that Canadians know as the economy recovers, as the growth occurs, that the very high deficit that we have today will be reduced in a systematic manner over the next three to five to seven years, to a level in relation to GNP that we consider appropriate for long-term stability in the Canadian economy.


The Acting Speaker (Mr. Corbin):: Questions? Comments?


Philip Derek Lewis: Mr. Speaker, my colleague, the previous speaker, has pointed out that the Government is asking for $5 billion to the end of March and $14 billion for 1983-1984. My colleague has suggested that the Estimates will be tabled today. We know that there will be Supplementary Estimates after that.
Just out of curiosity, as my colleague is a learned economist by profession-


William James Kempling: Not too learned.


Philip Derek Lewis: -he appears to be suggesting that the presentation of expenditures is sufficient to support massive borrowing. As an accountant, I would suggest to him that if someone goes to the bank to borrow money, one has to show not only the expenditures that one is projecting but also the revenues. What we are asking for on this side is an accounting for the revenues for 1983-1984 before we, as the country's banker, approve this Bill. When can we expect to see the anticipated revenues for 1983-1984? We know, as of today, what the expenditures are. When do we get to see the anticipated revenues, before or after we are asked to approve a borrowing of $14 billion?


John Leslie Evans: Mr. Speaker, as I indicated, the best estimate I have, and it is probably no better than the Hon. Member's opposite, is that a budget will be coming down before Easter. That was the latest information that we received in this House
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with regard to a budget. I think we should make it clear to the Canadian people who are watching and listening that the Government cannot spend without parliamentary authority. The Government might have borrowing authority, but the Government cannot spend any of that without the authority of Parliament, and the authority of Parliament is granted through the process of passing the Estimates. The Government could have $100 billion of borrowing authority, but it could not spend a dime if this House did not approve the Estimates.


An Hon. Member:: Nonsense.


John Leslie Evans: The Estimates are the control, except for the statutory payments in the statutory programs, of course; but the Estimates are the control that this House has over Government expenditures in the non-statutory area.


William James Kempling: They are passed or are deemed to have been passed. What a bunch of garbage!


John Leslie Evans: Borrowing authority, Mr. Speaker, is simply the authority to finance those expenditures that are being approved by this Parliament.


Mr. Blenkarn:: Mr. Speaker, we were all humoured by the Member for Ottawa Centre (Mr. Evans). Does he realize that Governments cannot spend money if they do not have money to spend? If we give them money to spend, we know how they spend it. He was talking about a budget and he said it should not be a blank cheque deficit. He suggested it had to be stimulative.
I was wondering if he could tell us how the deficits of, say, 1977 or 1976 or 1978 or last year or this year, $27.2 billion, have been so stimulative. Have they put people to work? Have they made the country prosperous? Have they made the country grow? Can he tell us about how stimulative these deficits have been and how borrowing money makes something stimulative.


John Leslie Evans: Mr. Speaker, I think the Hon. Member and I have agreed on a number of points in this particular area. He knows as well as I do that I have been concerned about deficits, especially during a period when the economy is running relatively smoothly. My own personal opinion is that Governments should not run deficits during good times, but deficits are certainly appropriate during bad times.
In this House we are now debating deficits and borrowing authority during the worst economic recession we have had in 50 years in this country. That is what we are debating, and the question is: Is the borrowing that is being asked for by this Government to finance the deficit that is forecast by this Government appropriate in this economic situation? I suggest it is appropriate. I would not like to see it grow bigger and I would hope it could be brought down very dramatically and very rapidly as we come out of this recession; but certainly, faced with the economic realities we are faced with, the Opposition cannot stand and say we should slash away at the deficit at this point in time. Certainly we should as we recover

February 22, 1983
Borrowing Authority
from the recession; there is no doubt about that in my mind and I agree with the Hon. Member from Mississauga South (Mr. Blenkarn). But today's request for borrowing authority I believe is appropriate to make sure that we spread the burden of this recession as widely as possible and remove the possibility of having people in this country in destitution as a result of having to cut back on Government support programs.


Mr. Crouse:: Mr. Speaker, I have a question for the Hon. Member for Ottawa Centre (Mr. Evans). In 1968 it took approximately $12 billion to look after the needs of this nation, which at that time was composed of approximately 20 million people. This year the Government is asking for approximately $90 billion, an increase of $78 billion, to look after a nation of 24 million people. In other words, we have only had an increase of four million people between 1968 and the present, but the cost of looking after their affairs has increased from $12 billion to $90 billion.
I would like to ask the Hon. Member how many billions per million does he feel are required in order to bring about what he says is economic recovery?


John Leslie Evans: Mr. Speaker, the Hon. Member's figures mask a great many things. One is that we have had a very serious bout of inflation over the period of time and $12 billion in 1968 cannot be directly compared to $90 billion in 1983. We have had 15 years during which there has been some very serious inflation and as a result those figures would have to be deflated dramatically.
The second point is that there has been a dramatic increase and improvement in services that are provided by Government to Canadians. If you look at the expenditures of the federal budget, 50 per cent goes in transfers to Provinces and people in this country for services that are directly received by Canadians. Right now 25 per cent goes to servicing the interest on the public debt. That is one of the reasons inflation had to be brought down, to bring down the interest rate and reduce that proportion. The other 25 per cent is used for all other matters, including 10 to 12 per cent for defence. Therefore, about 13 per cent of the federal budget goes to administer the operations of Government.
Many observers who recently have looked at the pattern of Government expenditures have found no evidence of runaway federal Government expenditures in the last five years. There has been restraint in the federal Government, not runaway expenditure increases. The increases have come in the form of statutory programs, the cost of administering the deficit due to higher interest rates and in other such areas. These are the two areas which led to the increase in programs which we deal with in the Estimates. They have not been out of control. They have not grown inordinately.


Mr. Taylor:: Mr. Speaker, the Hon. Member talked about fighting inflation. One definition of inflation is too many dollars chasing too few goods.


John Leslie Evans: That is the only definition of it.


Gordon Edward Taylor: Wait for my question. Don't go away.


John Leslie Evans: I thought this was debate.


The Acting Speaker (Mr. Corbin):: I should inform the House that the time for questions and comments has been exhausted.


Mr. Lyle S. Kristiansen (Kootenay West):: Mr. Speaker, we have before us today another in a long and horrendous catalogue of borrowing Bills which this Government has placed before us since the February, 1980 election. It is the fourth of its kind in eight months-$6.6 billion in June, 1982; $7 billion in July, 1982; and $4 billion in November, 1982. The Government now has the temerity to request us to grant them a blank cheque. I do not know how Canadians, including Members of Parliament, could possibly visualize $19 billion and the other billions we have been asked for over the last three years. How could anyone visualize what is involved in that amount of money? It takes considerably more imagination that I could bring to bear.
The Government has given no clear indication as to how it intends to use this $19 billion. A few moments ago the Leader of the Opposition (Mr. Nielsen) suggested that it would be difficult for any borrower to get funds from a finance company, unless he believed the TV commercial "Never borrow money needlessly, but when you must"-for a vacation, third car, winter holiday or summer cottage. Perhaps that is the airy-fairy kind of thinking which this Government has. It has given no clear indication of the purpose of these funds.
Anyone attempting to borrow money is asked a number of questions. They are asked about their plans. The Minister of Finance (Mr. Lalonde) has given no indication as to what his plans are. He simply says: "trust us". With this Government's record of shenanigans over the last few months, why should we trust them with another $19 billion on top of the $6.6 billion, $7 billion and $4 billion of the past eight months?
A borrower is also asked about his credit rating. The lender wants to know how he measures up in terms of meeting financial commitments. I received a letter today which deals with a situation which I have raised in this House many times. It is perhaps on a smaller scale but it shows the abominable attitude this Government, its Departments and agencies have when it comes to meeting payroll commitments to its employees. The letter I received in the mail today is addressed "To whom it may concern". I am sure it was forwarded to cabinet ministers and officials as well as to Members of Parliament. I quote from the letter:
I am writing this letter on behalf of the participants of the Salmo Workers Employment Society. (Employment Bridging Assistance Program). The reason of this letter is to find out why so many of the participants in this project are not receiving bi-weekly UIC pay cheques-
When we owe the government money they expect it promptly or there is an interest penalty of some kind added on. Why then, when the Government owes us, can't we expect the same treatment from them?
February 22, 1983

That is a worth-while question, especially today.
We can't rely on this money that we've earned to pay our bills and the interest is starting to add up. If the Government was to pay the interest on these past due bills, they may realize the unfair treatment they give us.
We are doing this work because the country is in need of it and they are far behind. We trudge through deep snow, work through all kinds of weather, and climb mountainous terrain to thin and space trees, while regular UIC people sit at home in warmth and collect UIC benefits on time, while we suffer on these long delays on our UIC pay cheques. How would you like to do this type of work and not get paid on time for it? Some employees can't even afford to bring a lunch or drive their vehicle to work. Since Louisianna Pacific Canada Ltd. has been shut down in 1981 there has been very few jobs available in this area.
We appreciate the opportunity of being a member of the Employment Bridging Assistance Program. On this program we have received a great amount of training and experience in the forest industry. We have the feeling of some importance knowing that we are aiding our country in these poor economical times, but, it sure would be appreciated to have more support from the Government themselves as the Province is in need of this work being done and they are profiting by it. We would appreciate it very much for your attention on this matter.
Many of those involved with the sending of this letter do not have a great deal of education. However, they are willing to work for very little in order that they can be useful and make a contribution to society. Despite repeated urgings and having the various technical and other problems brought to their attention, the Government still has not devised a system whereby these people could be paid every two weeks. If an employer with that kind of reputation tried to borrow rather heavily from some agency, he would be looked at questioningly-
This letter does not talk about normal delays. There is a list of 18 employees attached to this letter. One is behind seven weeks, three are behind four weeks, the next two are so far behind they have lost track, three weeks, three weeks, four weeks, another inestimable number, four weeks, three weeks, four weeks, three weeks, three weeks, six weeks, three weeks and three weeks.
That is the record of this Government when it comes to paying its own employees, not to mention payments on other matters which are not normally covered by legislation in terms of the time in which those bills must be paid. God knows what it does when it is not required by law to make payments. And, of course, the federal Government is not required by law to make these payments either because the provincial Governments, in concert with it, have seen to it that the parts of provincial legislation which require payment of wages on time is excluded. So the Government has even bent the laws and the rules.
This is not the time, necessarily, to give a long catalogue of the ills of specific programs, but they are symptomatic of the inability of this Government to meet its financial commitments and of its faulty sense of priorities. How is it that the country has managed to pile up the terrible debt burden which it has over the past number of years? There are a multitude of reasons, Mr. Speaker, and Hon. Members are very aware of some of them. It is interesting to note that at a time when we are being asked to authorize the borrowing of another $19
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billion as of June, 1982, the cumulative total of deferred corporation taxes was some $20.8 billion. We in this Party believe that deferred taxes are actually interest-free forgivable loans given to corporations through the taxation system. That is money which is owed to the people of Canada and which has not been paid. It has been deferred for a number of reasons, but ordinary Canadians do not have the right to defer their taxes. It seems incumbent upon some of us to point this out at a time when we are being asked to authorize the borrowing of yet another $19 billion. The corporate sector is not asked, or has not been asked over a number of years, to pay those debts, and that means that the rest of Canadians must.
Just the other day I received a copy of "Beale's Letter", an independent newsletter which is generally sent to chief executive officers in the forest industry mostly in the Pacific Northwest, but actually right across the continent. The editor of the newsletter-and it is a highly regarded one within the forest industry-was in Tacoma, Washington recently, and in this particular issue he dwells on some comments of an industrialist in the Tacoma area. He quotes the industrialist as saying:
If there's one thing that really worries me about Canada today, it's political uncertainty. What's going to happen to Trudeau? Will he be around another 10 years? And as for Clark-when he was prime minister it seemed Canada had no government at all.


The Acting Speaker (Mr. Corbin):: Order, order. I hesitate to interrupt the Hon. Member, but when he refers to Hon. Members of this House, he should refer to them by their portfolios, their offices or their ridings.


Lyle Stuart Kristiansen: With all deference, I recognize that rule and generally try to obey it. I was just quoting something from a publication and the names appeared within it.


The Acting Speaker (Mr. Corbin):: Order. Again the Chair must remind Hon. Members that we should not do indirectly what is not allowed to be done directly under our rules. The Speaker has on many occasions advised Hon. Members to proceed with extreme caution when quoting from documents. It is simply a matter of respecting each other's reasons for being here, and I would recommend to the Hon. Member that he adhere to that practice.


Lyle Stuart Kristiansen: Very good, Mr. Speaker. The problem, again, on the whole matter of confidence, not only in the political situation in Canada at present but for the future, over perhaps the next number of years, is that we as Hon. Members and representatives of our constituencies are affected by and share in that feeling of uneasiness as to whether the plans and priorities of this Government, or any future Government, are going to make more sense than they have in the past.
One of the major items which has led to the large deficit which we have today is the matter of deferred corporate taxes owing, the amount of which is almost equal to what is being asked for today. That general scheme of forgiven taxation is not only supported and advocated by the Government but has been supported strongly by the Official Opposition. The huge multi-billion dollar grants which were given to the oil and gas industry within the period of the last year was not only the

February 22, 1983
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policy of the Government, but was supported by the Official Opposition. Huge bail-outs of the corporate sector have taken place, especially over the last few years, and hundreds of millions of dollars on each occasion has been taken out of the public purse. The public purse had been used continuously to bail out losers, and this has also been supported on both sides of the House.
What confidence can we, therefore, have when these holus-bolus hand-outs are given, either directly or by simply not collecting the money which the people are owed? How can we have confidence as long as it appears that one or the other of the two major Parties in this House, the Liberals or the Tories, will likely be the Government and this policy is not likely to be changed? How can we have any secure feeling whatsoever? We cannot.
There are two or three other programs which I would like to draw Hon. Members' attention to while discussing this Borrowing Authority Bill because they demonstrate again the incompetence of that bunch over there with their faulty sense of priorities. One such program is the Residential Rehabilitation Assistance Program. Among so many of the Government's employment-creation programs, this has been one of the most popular and most long standing. There were problems with it in its infancy, but they have been largely resolved. It has a well established delivery system and is one of the most productive and job-intensive programs ever to be offered by the Government, producing some $3 in job-creating private housing expenditures for every $1 of Government funds expended. It has also in its social purpose contributed greatly to many senior citizens, particularly, and to many other Canadians of modest means, enabling them to retain their own homes, which is surely a worth-while social objective.
Yet at a time when our national unemployment rate is some 1.6 million officially, when British Columbia's rate is 16 per cent, we see the RRAP budget for the British Columbia-Yukon region being reduced by some 15 per cent. At this same moment the Government is bragging that it has increased the individual amount of forgivable loans from $3,700 to $5,000. It has reduced the total amount available and issued directives which really leave us with a feeling that the operative slogan of the Government now should be: "Let the user of Government programs beware". Its directives have been to the co-ordinators of this program in the various areas, telling them not to advise people of the forgivable loan aspects of the program, and to try only to lend money which will be repayable. Some regional districts and one of them in my own constituency have had to tell the Government quite frankly to go to hell-that they are not going to defraud program consumers by omitting to list the facts of the program and what benefits the people are eligible for. They will not do that. If there is a program in place which offers assistance to people, then these people have the right to be informed.
At the same time, a new directive has been issued stating that no longer will it be possible for unused surplus funds in
one part of the country to be used in the program in other areas which have demonstrated a need. Again, those allocations have been included in the budget and have been provided. With a program of job creation which is as useful and beneficial as this one, why should the Government deprive those areas which have shown initiative and have the demonstrated need for housing and jobs? Those jobs are surely needed. It simply makes no sense. There is a whole myriad of other job-creation programs, which is surely one of the reasons the Government feels it will be bound to borrow money, whether for the Canada Community Development Programs or Summer Employment Programs.
Why is it that when the deadline for applications to the Summer Canada Employment Program is March 4, we and our constituents have still not been advised as to the constituency allocations under that program? Apparently, according to calls made today, we will be told tomorrow, only a week before the deadline. How does the Government expect people in the communities, in volunteer organizations or wherever, to be able creatively and efficiently to expend public money to obtain the maximum social benefit when we and they are given less than a week's notice as to what funds will be available? Is that the way the Government plans its financing?


Mr. Thacker:: Yes, exactly.


Lyle Stuart Kristiansen: People in my constituency and, I expect, people across the country are only human. They need a little bit of information upon which to base their judgments. They feel they have the responsibility to see to it that public funds are used in an efficient and responsible way. It is unfortunate that the Government seems to have failed to recognize the importance of that very necessary attribute in any responsible Government and any responsible citizen. It is for precisely that reason that we cannot support the appeal now before us.


Blaine Allen Thacker: Because the Government is sub-human.


The Acting Speaker (Mr. Corbin):: Order. Questions or comments?


Mr. Epp:: Mr. Speaker, I would like to ask the Hon. Member who just spoke this question: Does he believe the federal deficit is too high?


Lyle Stuart Kristiansen: Is the Hon. Member referring to the current operating deficit or the accumulated debt? Certainly the accumulated debt of this nation is too high. The kind of appeal which is being made to us today is unjustified simply because we have not been given the appropriate information in order to determine whether or not the Government has any concrete investment plan which would give us any faith in its ability to expend those funds in an efficient way, a way which would in fact add to this nation's wealth and to its productivity rather than simply detract from it, as its policies have done in the past.


Arthur Jacob (Jake) Epp: If the Hon. Member, then, says that the accumulated deficit is too high and that the deficit request is
February 22, 1983

unjustified because of lack of information, could he give the House an indication of what means he would take to reduce that deficit?


Lyle Stuart Kristiansen: Mr. Speaker, while I may not be able to be specific on this occasion, I can refer back to October of last year, I believe, when the Leader of this Party made some very specific suggestions in the city of Hamilton which would have cut approximately $2 billion from the deficit at that time. There are suggestions which this Party has made and which I have supported. I cannot draw them out of the air right now to express them in the House.


An Hon. Member:: That is where they came from.


Lyle Stuart Kristiansen: They were very well documented and presented at the time and were not challenged, as I recall, by either the Government or the Opposition, and I would certainly stand by them.


Mr. Mayer:: Mr. Speaker, could I ask the Hon. Member who just spoke on behalf of the NDP whether he could answer a question from another direction concerning the size of the deficit. With a GNP or total of goods and services in this country amounting to something under $300 billion, could he give us an indication as to what percentage he thinks the federal Government's deficit should be before it becomes too large, in terms of percentage? Would it be 3 per cent, 5 per cent, 7 per cent or 10 per cent? What would be his estimate as to an appropriate federal Government deficit compared against the GNP?


Lyle Stuart Kristiansen: Mr. Speaker, I would hestitate to throw out a given percentage term. That would seem to be playing a rather hypothetical game. It appears to me that a much more important consideration would be to determine whether or not expenditures or any planned borrowings by this or any other Government are to be directed at investing and increasing the wealth and productive capacity of the country, or whether we are simply to see a further pouring down the drain, with no visible, concrete, productive results.


Charles James Mayer: Mr. Speaker, I have a very short supplementary question. One of the other ways in which the Government can finance a deficit is by printing money. Could the Hon. Member indicate what he thinks would be appropriate in terms of increasing the money supply in these problem times? Should it be 3 per cent, 5 per cent or 10 per cent? Should it be 20 per cent as it was in 1975-76? Could he indicate what kind of advice he would give to the Governor of the Bank of Canada as to how far he should let the money supply increase?


Lyle Stuart Kristiansen: It certainly appears to this Party, Mr. Speaker, that over the years one of the problems has been the abuse of credit and expansion of the money supply, not only by Government but, even more so, by the corporate and private sectors. I do not know what position the Official Opposition would take concerning the kind of encouragement which has been given by Government taxation policy over the decades to financially support the kind of demand-creation advertising which has encouraged consumers to go out and buy what they
Borrowing Authority
do not want or need, or at least what they did not feel they wanted, until millions of dollars of private funds, supported by Government, deducted as legitimate costs of doing business, were spent in order to create exactly this kind of continuous and excessive demand by both the private and public sectors over the last few decades.


Blaine Allen Thacker: Mr. Speaker, I have been a Member of this House since 1979, but it is only within the last three or four weeks that I have heard the NDP speaking about the creation of wealth, actually mentioning private enterprise as creating wealth.


Mr. Althouse:: You should listen.


Blaine Allen Thacker: When did the Hon. Member have this giant conversion on the road to Damascus, as it were, and begin to understand that wealth is really created by private enterprise rather than by Government enterprise?


Lyle Stuart Kristiansen: The question of the Hon. Member leaves me a little puzzled, because I have been a Member of this Party and the predecessor part since I was approximately 16 years old, and I have always recognized that there is a vital role to be played by the private sector within any economy. This Party and its predecessor, the CCF, have always held that view.
However, unlike the blind dogmatism of the Conservative Party, we recognize that no sector of the economy has a monopoly on virtue or on efficiency. If we believed that the private sector was always efficient, we would not be seeing the gross corporate failures and the continuous bail-outs which he and his friends in the Conservative Party and in the Liberal Party have endorsed over the past few months. Governments can fail and the private sector can fail. Government operations can succeed and private sector operations can succeed. We are not the doctrinaires. The Conservatives and the Liberals, with their blind faith in the private sector, are the ones who seem to feel that as long as they pray to the holy mother of private enterprise, all will be well; but that is just not the way it works.


Mr. Shields:: Mr. Speaker, the Hon. Member indicated that advertising by private industry is creating unnecessary demand and making people buy things they do not want. Does the NDP advocate that we should pass laws to limit the kind of advertising that is directed to the consumer so that he will not buy things that he does not want? Or should we be advocating that consumers only buy things that the Government dictates they can buy, so that they will not make a mistake and buy things that they do not want because they were led down the garden path by advertising?


Lyle Stuart Kristiansen: Mr. Speaker, an argument could be made that there is a distinction. I hesitate to suggest that anyone should tell people what they should or should not buy. I would not tell them that. At no time have I or this Party suggested it. However, we think there is a legitimate question to be asked

February 22, 1983
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about whether excessive amounts of money spent on advertising for creation of an image by a given company, or an excessive level of advertising beyond a certain percentage of the cost of production or perhaps of sales revenue, should legitimately be charged as a cost against a company's revenue.
That item has been raised before and it is in the program of the New Democratic Party. We do not suggest that there is a simple answer. We would be the last to suggest that people should be told what they should or should not buy, but we would be among the first to ask whether demand-creation advertising for products beyond a certain point is an acceptable charge, however indirect, against the public purse.


Mr. Friesen:: Mr. Speaker, I was surprised to hear the Hon. Member become an advocate of the private sector all of a sudden-after all these years he says, since he was 16. If he is such a devotee of the marketplace, then why did he advocate in this House support for former Premier Barrett's position at the 1975 First Ministers' Conference, that all the natural resources of Canada could be turned over to federal control on the condition that they become nationalized? If he advocates that, would he include Kootenay Forest Products?


Lyle Stuart Kristiansen: Mr. Speaker, I am not certain of all the incidents; there was a specific situation in British Columbia a number of years ago regarding a particular resource. The Hon. Member did not mention it and I cannot recall which resource was in question at that time.
Regarding the last part of his question about whether this would apply to Kootenay Forest Products, I would say that it would be better for anybody, public or private, to operate that company rather than having it turned over to the private sector and then shut down, putting some 400 or 500 people on the dole as has been the case in the private sector. This was not the case when KFP was under the public sector, previously.


Hon. Michael Wilson (Etobicoke Centre):: Mr. Speaker, I want to speak in the debate on the borrowing authority Bill today because this is a very important request that the Government is making. It is a request from a Government that has no concept whatever of financial responsibility, no understanding of the trust placed in it by Canadians and no comprehension of the need to demonstrate a concern for spending control or restraint.
The Government of six and five is coming before us with a borrowing request for $19 billion-$5 billion this year, $2 billion to curry over to next year, plus another $14 billion- $16 billion for next year. That is the largest borrowing request in the history of this Parliament. The Government will probably require another $19 billion after the $16 billion is used up to carry it through the balance of the year. It has asked for a total of $26 billion to date and has clearly shown that it is a Government which is out of control.
Let us examine the record, Mr. Speaker. In November, 1981 in the infamous MacEachen budget, the deficit was estimated at $10.5 billion and the borrowing requirement was some $6.5 billion. Eight months later, in June, 1982, the deficit had
almost doubled to $19.5 billion and the borrowing requirement had gone up three times to about $17 billion.
Then we had a change of players. In September, 1982 we had a new Minister, one who would take control and would show that he knew what was going on. We heard that he would probably be a little more conservative in his estimates to show that he had things under control and would perhaps be able to cut back the borrowing requirement or the size of the deficit before the year was out. His first guess was that the deficit would be about $23.5 billion and the borrowing requirement would be $22 billion, an increase of $4 billion and $5 billion respectively over his predecessor's estimates.
Now we have the man who had it all under control telling us that the deficit is $27 billion, about 2.5 times the original estimate, and that the borrowing requirement is $26 billion, four times the original estimate. How could any Government be so far out in its estimates made just 15 months later? The utter contempt that this Government is showing Parliament and Canadians is unprecedented. In face of this incredible demonstration of incompetence, it is coming to Parliament and saying: "Give us a blank cheque. Give us a free rein over spending for the next few months. We are not going to tell you what is happening. We want total carte blanche to the end of this year before we come back, cap in hand, asking for more money."
There is no spending plan, no stated purpose for the amount of money required, no real control indicated of how the Government will keep its spending within reasonable limits. It is bad enough to be embarking on this crazy spending spree, but the Minister is breaking a clear commitment that he made to Parliament four or five months ago.
Last October the Minister said:
In the budget I intend to present early in 1983, I will review again the fiscal situation for the current fiscal year-
He has not done that.
-set out estimates for 1983-84-
We have not seen them.
-and future fiscal years-
We have not seen any since November, 1981.
-and then seek additional borrowing authority as required.
As my colleague the Leader of the Opposition (Mr. Nielsen) just said, he is putting the cart before the horse and in so doing is breaking the clear commitment he made to Parliament in October, 1982. That fiscal plan must be presented to Parliament. That is why he is showing such contempt for Parliament and Canadians. There is no sense of need or of giving reasons why this borrowing authority is necessary today. That is why we oppose it so strongly.
This is quite consistent with what we have seen in the House in the past few days, Mr. Speaker. There is an utter lack of principle, an ignoring of guidelines on conflict of interest, as the Deputy Prime Minister (Mr. MacEachen) told us yesterday. It is quite consistent with the ignoring of the principles
February 22, 1983

that have been established over the years on control of spending by Parliament.
Here is a Government with the Deputy Prime Minister sitting on a platform with a former minister, Mr. Gillespie, when he knew that the Government of Canada had to sign an agreement, when he knew that the former minister stood to make a gain of $725,000 personally, when he knew there were no tenders being called by the Government for this particular project. It did not cross his mind that he should question whether there was something being done that was contrary to the principles of this Parliament, contrary to the guidelines that had been established.
What did we get from him yesterday? He said that those guidelines are there to be broken, that the guidelines are there for the conscience of the Ministers themselves. But if the Ministers have no conscience and if the Ministers have no principles, those guidelines are not worth the paper they are written on. That, Mr. Speaker, is the sort of Government we have been receiving from these people for 15 years and it is a Government that must be changed.
Let us look at what the borrowing authority signals to Canadians today. It shows that the spending of the Government is totally out of control; but worse, it is showing Canadians that there is no real sense of concern about this, no sense of concern that there is any real intention of submitting itself to the normal constraints of Parliament. It is asking for a blank cheque.
Last October the Minister said it would not be right to request more borrowing authority until the budget was brought forward with a Five-year plan. Now, five months later, totally ignoring the principles he established at that time, he is saying; "Give me that blank cheque".
The last time we had a Five-year plan was in November, 1981. It was out of date before it was presented in the House of Commons. The Minister has not had the courtesy or the principle to set before the House a Five-year plan on which we as Canadians can judge where we are going and how we will get there before we give the Government approval to spend taxpayers' money. We have no idea of the budget deficit for next year. We have no idea of the financial requirements. We have no idea of the spending or the revenues which the Government has in mind for next year or the five-year period thereafter. Yet the Minister wants $19 billion of borrowing authority without any strings attached. It is essential that the Government honour the obligation made to the House and through the House to Canadians. We must have that commitment before we approve this Bill.
Interest rates during the last few months have been going up in the area of the marketplace which is established by the private investor, the saver, or people who have their money at risk. These are not the rates which are manipulated by the Bank of Canada; these rates are a reflection of the broad concerns in the marketplace at this time. These rates have been going up since the middle of December, but, more important, real interest rates or interest rates after the impact
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of inflation are at a near record high at this time. Last month inflation dropped one percentage point to about 8.3 per cent, which is down from about 12 per cent last summer. If we look at a more concentrated period of time, say the last six months, we will see that it ranged from 6 per cent to 6.5 per cent or, as the Hon. Member for Ottawa Centre (Mr. Evans) told us today, it is down to 3.2 per cent. That is his figure. I have not checked it out but I will take his word for it.
The reason Canadians are worried about the value of their money is very simple. They are worried that the dollars they have invested today in a Government bond or in a mortgage will lose their present value. This is why real interest rates after inflation are so high. Also they are concerned because they see that runaway budget deficits will lead to more inflation. Deficits also mean that Governments will borrow; Governments will go into the marketplace and compete with the private sector. That competition with the private sector will force up interest rates. It forces up the cost of money, which is interest rates. The federal Government will borrow some $30 billion this current calendar year, provincial Governments will borrow some $20 billion and the private sector will borrow another $20 billion. That combination must force up interest rates. It means that money invested today will be worth less some short period of time down the road.
Another reason for the fear is a lack of confidence over what the Government is doing. Let us look at what happened in 1981 and let me remind the House of that disastrous budget. We all know of its disastrous effects across the country. It hurt people who were small-businessmen, people who were on pensions, people who had health care plans, people who were trying to save for their retirement, farmers, Fishermen, people in the North and businesses in general. All these people were hurt by that budget.
Why did the then Minister of Finance attack these people? It was not because he had any outrageous desire to hurt them; that is not what a politician likes to do. He said: "I am broke; the Government is broke. We need money. We have to get some money in the till." The Government was desperate at that time. It knew the deficit was too high. It was worried about it, so it brought in that budget in an attempt to get more money through an increase in taxes on that wide range of people.
If there was a problem in the 1981 budget with the deficit projection, as I reminded the House a minute ago, of $10.5 billion, think of the problem today with budget deficits of some $26 billion. Next year we are hearing stories that it could be as high as $30 billion. What is that doing to people? What is that doing to Canadians who are wondering what will happen to them in the next budget? They are very concerned that the same attack will come through increased taxes, taxes which will take away their ability to grow. They see their ability as small businesses to grow and create jobs for people taken away. A huge deficit increases the pressure on the Minister of Finance to increase taxes and to remove tax incentives which lead to planned expansion, the development of new technology
23088

February 22, 1983
Borrowing Authority
or the creation of jobs. This is why Canadians are worried today. This is what a high budget deficit means to them when we get down to the raw, real terms of the marketplace.
It is difficult to comprehend the runaway deficit. It is a huge amount of money. What is $27 billion? Can we picture how much money that is? It is very difficult to comprehend. This year with that deficit it means that each Canadian-every man, woman and child-will be going into debt by $1,125. Or to put it in family terms, in terms of our responsibilities as family people, it means that each family will be seeing its debt load through the Government of Canada increase by $3,700. That will be repeated next year, and it will be probably a little more because of a higher deficit that year. Whether it is in Newfoundland, Nova Scotia, British Columbia, Manitoba or Ontario, it is all the same-we will see our debt load increase by $3,700 per family.
Let us get down to the hard facts. Let us look at the impact of this on job security, the competitive position of the companies for which we work, and their ability to stay in business and continue to provide the jobs we need. We are all aware of the drop in the value of the Canadian dollar over the past eight years. This is one clear indication of the loss of a competitive position in the country. We are all aware that the deficit in our manufacturing trade balance has increased over the past ten years from $3 billion to $20 billion. This is also an indication that we are losing our competitive position. We are all aware that Canada is last in productivity of the industrialized countries of the world. This is another reason we are losing our competitive position.
What does all this mean to the average Canadian? It means that jobs are being lost, companies are going bankrupt, and small businesses are in the most serious position they have been in the last 20 to 40 years. How do we get out of this mess? How do we break the downward spiral of the Canadian dollar? How do we regain the competitive position we have lost in the past few years? We have to do all we can to help small-businessmen and large-businessmen take the necessary steps to recover our competitive position on a broader industrial basis. This means that we must give them incentives to expand, to buy new machinery, to develop and acquire new technology, not just for the high technology, glamour companies of the world, but for run-of-the-mill companies which need that technology just to maintain their position in an international environment. The deficit to them means potentially higher taxes. It means that the cost of the money they will need to allow their companies to expand will increase because Governments are competing directly with them.
When the Government shows no indication through the borrowing requirement it puts before us that it has its deficit under control or that it has any serious resolve to bring it under control, when Canadians see the deficit increase 2.5 times in 15 months and the financial requirements of the Government four times in that same period, is there any wonder there is a lack of confidence in what the future holds for the country?
I have spoken about small businesses and other businesses, but the same applies to individual families. I said that real
interest rates, the interest rates after adjusting for inflation, are close to a record high today. We know that savings rates are high and that Canadians are putting record amounts of money into the sock for a rainy day. Why is that? With these record high interest rates it makes sense to save. If inflation is falling there is no urgency to rush out and buy that new car or that new stove because the price will be much higher in the next few months. It will not be higher because inflation rates are coming down. People are being encouraged to save.
Canadians are also worried because they feel they will lose their jobs. One million, six hundred thousand Canadians have lost their jobs, and if taxes are to increase because of high inflation, more jobs will be lost in the future. Canadians are taking the cautious course. They are taking a sensible course. They are leaving their money where it can be drawn upon for that rainy day.
I have shown why this deficit, this run away spending, is a fundamental problem for all Canadians. It is not just a number; it is a major threat to our way of life, our industrial base. It affects the ability of our industries to provide jobs for our economic future. By bringing in this totally irresponsible borrowing Bill the Government is showing no understanding of the problem, and by demonstrating this total lack of comprehension, it is making the problem far worse than it need be.
I urge the Government to adopt a three-part program for deficit control in its upcoming budget. This is absolutely essential if the Government is to face its loss of confidence out there among Canadians as a result of its policies.
Let me outline briefly what this three-point program is. First, we have to recognize that the safety net in place today cannot be changed. The safety net of Unemployment Insurance and welfare programs is there just for the times that we are now experiencing. Let us leave that safety net in place and recognize that there will be an increase in cost there.
Second, in order to finance that increased cost, the Government must review all Government spending programs, weed out the unproductive ones and either cancel them or defer them. That must be an objective in this forthcoming budget.
Third, I want to address the problem of the structural deficit, which has been growing from zero about ten years ago to $1 billion, $2 billion or $3 billion, then up to $5 billion, to a level of $10 billion for four years, and now it is over $20 billion. In fact, the deficit is close to $30 billion.
The Government must bring in a long-term plan to bring the structural problem under control. I do not want to hear any figures like those the Hon. Member for Ottawa Centre brings in. He says that the deficit will drop down to about X billion dollars in five years' time. Those figures do not mean anything. We know that from experience over the last 15 months. However, we must see a program that brings this structural problem under control on a long-term basis.


Some Hon. Members:: Hear, hear!
February 22, 1983


The Acting Speaker (Mr. Corbin):: Order, please. Questions? Comments?


Mr. McKinnon:: Mr. Speaker, I notice today that Canada has suffered another blow on the international market. An Associated Press story from New York reports that economic recovery is under way in all seven major western industrialized countries, but Canada's anticipated rate of growth is the slowest. The U.S. Conference Board reports that Japan is showing an increase of 8 per cent this year; the United States will be growing at 5 per cent, and the list goes on until we finally reach Canada's rate, which is 1 per cent. Would the previous speaker care to comment on that?


Michael Holcombe Wilson: If I do not speak loudly enough, will you draw that to my attention, Mr. Speaker.


The Acting Speaker (Mr. Corbin):: The Hon. Member should address his comments to the Chair.


Michael Holcombe Wilson: I will, Mr. Speaker. It is a very serious point which this very astute and wise Member of Parliament raises.


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: I believe there is a broader problem that we face in the country today, above and beyond the short-term problem of the international recession. We have been trying to draw this to the attention of the Government over the last few months.
Let us stand back and look at some of these broader problems that are coming together at this point in time. There are four points that I wish to outline. First, over the past two or three years we have suffered a major regional conflict, East versus West. That causes problems right across the country.
Second, during the same period of time this Government in particular has provoked differences between Canada and our major trading partners. That problem and the effect it has on our ability to trade and on our ability to deal and reach agreement on some major problems with the United States is hurting our short-term economy.
Third is the problem of the over-all micro-technology revolution, the information revolution. We have not faced up to that in the way we should as a people, and certainly this Government has not been leading our thinking in that direction.
The fourth problem I lay directly in the lap of this Government, that of its over-all role. This Government opposite over the past three years has taken on far too much of a requirement to solve every problem. It has concentrated too much of the decision-making within the bureaucratic apparatus that is here in Ottawa rather than having trust in the people, whether they are small-business people or otherwise.
It is the confluence of those four major areas that is at the heart of why Canada is suffering so much from international
Borrowing Authority
economic problems and why our rate of recovery is so much lower than that of other countries in the world.


Mr. Cosgrove:: Mr. Speaker, as the Hon. Member for Etobicoke Centre (Mr. Wilson) was concluding his remarks, he touched upon a three-point program for deficit control. I was under the impression as he dealt with the last point of deficit control that he was short of time and he might have had a few more things to say. I would be interested in the specifics that he had in mind if, indeed, he had. If he would like to elaborate further on the specifics of what he referred to as controls for structural deficit, I would like to hear him.


Michael Holcombe Wilson: Mr. Speaker, I would be glad to elaborate, but I will elaborate on them after we see a budget in this House. The responsibility of the Government of Canada is to do just what I have set out; that is, to identify the structural problems and put forward Government policies for attacking those structural problems.
Since the Minister asked whether I had anything else to bring forward in my speech, there is one other point. I wrote a letter to the Minister of Finance (Mr. Lalonde) on September 13 and again on November 5. I raised some of the elements of the broader problems of borrowing in the Government; the problems of borrowing by Crown Corporations and guarantees to such corporations as Canadair, of the enterprise development program of Maislin, Massey-Ferguson, Consolidated Computer and so on. I said that in the next borrowing Bill there should be introduced some over-all control, some over-all limitation on this type of borrowing and guarantee, because the credit of the taxpayer, the Government of Canada, is brought to bear on that. In addition, I said it was essential that the Government commit itself to an annual report on the overall financial requirements for the operations of the Government. They should be laid before the House of Commons so that we understand what is going on in these other indirect areas. We do not know that today.
It is for that reason that I addressed this letter to the Minister of Finance. He has not responded to it in his remarks in this debate. I hope the Minister of State will.


The Acting Speaker (Mr. Corbin):: Order, please. It being one o'clock, I do now leave the chair until two o'clock this afternoon.
At one o'clock the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
[Stage Direction]
February 22, 1983


Mr. Gaston Gourde (Levis):: Madam Speaker, on January 19 of this year, the Canadian Government officially announced a federal contribution of $ 122 million for the construction of a ferry for CN Marine. Starting in August 1983, this will mean work for nearly 1,500 people at Davie Shipbuilding Limited in Lauzon. This is very important news for the riding of Levis and the Quebec City area, where otherwise the employment situation would have been a complete disaster. However, a few days ago, the president of the Lauzon shipyard workers union wrote to the Minister of Supply and Services (Mr. Blais) and to the Minister of National Defence (Mr. Lamontagne), as follows, and I quote:
The Davie Company has informed us that its order book is empty, except for construction on the ferry Gulfspan for CN Marine, which is not expected to begin until the fall of 1983.
On behalf of workers in our Canadian shipyards and especially in Lauzon, I want to urge the Ministers concerned to speed up the procedure for awarding contracts for ship repairs, such as the HMCS Nipigon, tenders for which are to be made known on April 5 of this year.



SUGGESTED TELEVISING OF S O. 21 STATEMENTS

Mr. Geoff Scott (Hamilton-Wentworth):: Madam Speaker, my ninety-second statement today is about these ninety-second statements.
I do not know how Your Honour and other Hon. Members feel about this 15 minutes under Standing Order 21 prior to Question Period. My own impression is that these brief statements by Members have been quite valuable to the daily parliamentary process.
Just look back over the number of Members of Parliament who have taken advantage of this period since we began statements on January 17. The vast majority of statements by Members on all sides of the House have been really meaningful. Hon. Members put a great deal of thought and expertise into these brief statements. They are not always partisan. They are often valuable messages to Canadians generally and to constituents in particular. For backbench MPs especially, they constitute a safety valve for those Members who cannot get on Question Period.
My point is that this 15-minute period should be included at the front end of the repeat broadcast of the daily proceedings of this hour. An ever increasing nation-wide audience is
watching the playback of Question Period. I think our constituents might also want to see and hear these sometimes thoughtful presentations.
Madam Speaker, I would request that Your Honour take whatever steps are necessary to have the CBC parliamentary network, in conjunction with the House of Commons Broadcasting Services, televise statements by Members as part of the replay of the oral Question Period.
I believe that a message from your Office, Madam Speaker, to the President of the CBC would suffice to have this done. I know that CBC can mount it. 1 also know that Hon. Members and their constituents will appreciate it.



PARLIAMENT


Mrs. Ursula Appolloni (York South-Weston):: Madam Speaker, immunity is a precious privilege conferred on parliamentarians so that they may better pursue the good of the state and of its citizens. However, like all privileges, the one of parliamentary immunity carries with it an awesome responsibility which is to ensure the protection of the innocent.
No court in the land would admit innuendo or unsubstantiated statements. No court in the land would deny or curtail the right to defence, whether the subject be a private citizen or a former Minister of the Crown.
Let this Parliament, then, as the highest court of all, pay extra heed to the responsibility of its Members lest, in the heat of debate and the glare of publicity, they besmirch innocent reputations, deny equal time and opportunity for rebuttal, and find themselves guilty of morally reprehensible character assassination.



INDIAN AFFAIRS


Mr. John A. MacDougall (Timiskaming):: Madam Speaker, the Ontario Indian Fishing Agreement is a matter of great concern to anglers, tourist operators and outfitters throughout the Province of Ontario.
This tripartite Agreement which has been signed by the Province of Ontario and native leaders, but has yet to be signed by the Government of Canada, calls for the granting of certain fishing privileges to the Indian people and the zoning of some lakes for a five-year period.
The lack of information provided to the public by the three parties negotiating the Agreement has resulted in concern and uncertainty among non-Indians throughout the Province. This is a direct result of the lack of public knowledge as to the purpose of the Agreement and the effects that it will have on fishing if and when it is implemented.
February 22, 1983

The controversy surrounding this Agreement is primarily due to a lack of public information and public input. As it appears that the federal Government is on the verge of signing this Agreement, I strongly urge that this Government and the other parties to the Agreement hold public information sessions across the Province, particularly in northern Ontario, to explain the Agreement and all its implications. In order to remove the suspicions that have resulted from misinformation and misrepresentation concerning the Agreement, these public information sessions are essential.
I urge the Government to ensure that allowance will be made for public input on this matter which is causing great, and perhaps unnecessary concern to many residents of the Province.



CONTRACT FOR SALE OF EQUIPMENT TO CHILEAN PRISONS

Mr. Terry Sargeant (Selkirk-Interlake):: Madam Speaker, I was dismayed to learn that the Canadian Government is now in the business of promoting the sale of security equipment for Chilean prisons. Only three months ago the United Nations Report on human rights in Chile stated that there has been a substantial increase in torture in that country. Torture is an habitual practice of Chilean security agencies which can legally detain people for up to 20 days before placing them in the hands of the courts.
Our Government's role in the sale of this equipment is distressing, not only because of the likelihood of Chilean prisoners being tortured but also because it is a clear violation of the Government's own position regarding the sale of such equipment to that country. On August 31, 1981, the then Secretary of State for External Affairs, the Hon. Mark MacGuigan, wrote:
-our own view is that defence equipment may be sold to Chile so long as that country is not involved in hostilities and Canadian equipment is not used against the civilian population.
But now a project officer from the Defence Programs Branch of External Affairs has been assigned to help five Canadian companies prepare their bids to sell military and security equipment to Chilie. The information that I have is that the equipment they are trying to sell includes an intrusion detection system for three new Chilean prisons. In addition, the Program for Export Market Development has approved a grant to one of these companies to help defray the costs of presenting the contract bids to the Chilean military government. The companies involved are planning to present their bids to the Chilean government this spring. I would urge the Government, instead of promoting the sale, to take immediate steps to stop it.



HUMAN RIGHTS


Mr. David Berger (Laurier):: Madam Speaker, Dr. Yosif Begun, a Soviet Jew, who first applied to leave the U.S.S.R. in 1971, has been arrested and faces the possibility of a third term in prison. Dr. Begun has been convicted twice before, and since 1977 has served a two-year and a three-year prison term for trying to maintain his Jewish identity and to teach the Hebrew language.
On November 6, 1982, Dr. Begun was arrested and informed that he would be charged with anti-Soviet propaganda and agitation and face a 12-year sentence. His arrest came only five days prior to the scheduled opening of the Madrid Review Conference. This can only be interpreted as a direct provocation and denigration of the Final Act of the Helsinki Accords and the principles which Helsinki embodies. As such, it is an affront to Canada and the other signatory states.
I am informing the House that I intend to request the Secretary of State for External Affairs to direct the Canadian delegation presently in Madrid to bring the case of Yosif Begun to the attention of the Soviet delegation, and request that he be released and allowed to be repatriated to his homeland, Israel, and further, that the Government inform the Soviet representatives that Canada considers the case of Dr. Yosif Begun to be an indication of Soviet intentions to fulfil its commitment to the provisions of the Helsinki process.
Lazar Lubarsky, a friend of Yosif Begun, and a former prisoner in Russia himself, is in the Gallery today and is visiting Canada to obtain support for the release of Yosif Begun. I am sure my colleagues will join me in wishing him well in his efforts.


Some Hon. Members:: Hear, hear!



CANADIAN PACIFIC RAILWAY


Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, Canadian Pacific Railway facilities in New Brunswick have suffered substantial lay-offs in the past 16 months. Twenty-eight jobs have been lost from the customer service centre and 62 truckers were let go recently. Rumour threatens that another 17 jobs will be lost in Saint John and McAdam on May 1.
The CPR employees are appealing to the federal Government to assure them of protection and fair treatment. Clerical employees are suffering a $3,300 financial loss because of the six and five restraints, and continue to lose their jobs at an alarming rate. They are being squeezed from both sides.
The Brotherhood of Railway, Airline and Steamship Clerk locals in Saint John are asking the CPR to adopt policies of retirement at 55 with full pension, job reduction only through attrition, and the retention of all employees now holding permanent jobs. The adoption of these proposals would make it

February 22, 1983
possible for CPR employees to hold their jobs with confidence and security.
As the federal Government has regulated CPR to adhere to the restraint program, it carries the responsibility of assuring that the employees are offered some protection from unwanted job loss. On behalf of CPR employees I appeal to the Government to adopt these proposals and consider the significant ramifications of further lay-offs on both the employees and the region.



AGRICULTURE


Mr. Robert Daudlin (Essex-Kent):: Madam Speaker, I rise to draw attention to the threatened existence of the vegetable greenhouse industry due to the rising costs of production, one of the major components of which is energy in the form of natural gas.
In the early 1970s it was estimated that energy costs represented approximately 20 to 25 per cent of the greenhouse growers' operational costs. Today, due to increasing prices, energy costs represent at least 50 per cent of those production costs, and are rising.
These rapidly increasing costs have put the industry under extreme pressure because of the need for greenhouses to be built of uninsulated glass or plastic, to provide for sufficient light to ensure a good crop. This prerequisite has minimized the cost of efficient energy conservation opportunities which have been available to other industries over the same period. The problem the industry is experiencing is evidenced by the fact that stabilization payments were paid to the growers in all but one year since the 1977-79 growing season.
To alleviate this pressure, representatives of the Ontario Greenhouse Vegetable Growers' Marketing Board have met with the Government to request that the federal excise tax on natural gas, first introduced in 1980 and now equalling 68 cents per MCF, be refunded to those growers in food production.
I would add my support to this worthy proposal and urge the Government to act upon this request, by using the experience and mechanism of refunding the excise tax to other farmers in the production of food. This act of equity would help ensure that the greenhouse vegetable growers continue to operate-


Madam Speaker:: Order!



STATUS OF WOMEN


Flora Isabel MacDonald: Madam Speaker, a report commissioned by the Canadian Advisory Council on the Status of Women, "A Working Majority: What Women Must Do For Pay," has just been released. It reinforces what many of us have been saying all along, that the economic inequality of women in this country is growing; it is not being reduced. But what perhaps is the most reprehensible revelation in the report is that it points out that the federal Government's Canada Employment Centres are more of a hindrance than a help to those women who are locked into menial, low-paying jobs in the clerical, sales, service and processing occupations.
This report indicates that women in these job ghettos have fewer opportunities for advancement, receive less pay, and lower and fewer benefits than do their male counterparts.
This report makes it even more imperative that the proposal that has been put forward by the Progressive Conservative Party and by the New Democratic Party for a standing committee to deal with issues primarily of concern to women be adopted immediately by this House. Only the Liberal Party has so far refused to act on this matter. Surely even the Minister Responsible for the Status of Women can see how vital-


Madam Speaker:: Order!



ENVIRONMENTAL AFFAIRS


Mr. Jim Fulton (Skeena):: Madam Speaker, I would like to address the serious problem of continued Government inaction on the acid rain problem that threatens our lakes, forests, farmlands, and health. In a comprehensive report released yesterday, hand picked Reagan-supporting American scientists would not agree with Canadian scientists that current sulphur dioxide emissions should be cut in half. The American response has been to demand further studies, further reviews, and further inaction. That is a view created by the manipulative politics of Reaganism that put the interests and profits of industrial polluters before the health, well-being, and economy of the North American public.
When is the Minister of the Environment going to legislate acceptable limits to acid rain? When will he convene a lobby of Members of Parliament and scientists to address the U.S. Congress on acid rain and toxic waste dumps? When will the Prime Minister get involved to ensure an agreement with the United States is reached? When will the Government take unilateral action to stop these deadly emissions? When will the Government admit that the steps that it has taken to date have so far just promoted the status quo?

February 22, 1983

If the Liberal Government put as much enthusiasm into solving acid rain as it has into achieving a weapons testing agreement with the United States, we would have a solution. Instead, Canada is and will continue to be a waste dump for U.S. industry.



ORAL QUESTION PERIOD


Hon. Elmer M. MacKay (Central Nova):: Madam Speaker, my question is directed to the Deputy Prime Minister, my fellow Nova Scotian, concerning the liquefication project involving Scotia Coal in which his former colleague, Alastair Gillespie, appears to have been foisted off on the other consortium members who, prima facie, would appear to have had something to contribute to this project. Accordingly, I want to ask the Deputy Prime Minister just what did his friend Alastair have to contribute to the success of this project, which we all hope will be successful, with the exception of a few dollars up front which now have the potential to make him a very rich man.


Hon. Jean Chretien (Minister of Energy, Mines and Resources):: Madam Speaker, this is a question for the Department of Energy, Mines and Resources. I have had an opportunity to examine the issue, and Mr. Gillespie's contribution to the project was to form a consortium for the purpose of promoting a concept that was of great interest to the Government of Nova Scotia, namely, using Nova Scotia coal to produce oil that could then be used as a substitute for imported oil. I think Mr. Gillespie's contribution was to persuade the various partners in this project, and particularly the Government of Nova Scotia, that it was in the best interests of Cape Breton and all Canadians to try to maximize the utilization of the vast quantities of coal for which Cape Breton was and still is famous.


QUERY RESPECTING POSSIBLE BENEFITS TO ALASTAIR GILLESPIE
Elmer MacIntosh MacKay: Madam Speaker, the most interesting formula here appears to be the Gillespie formula of making $25,000 up front suddenly turn into $750,000. That is the kind of development program that would benefit all Nova Scotians, if we could just make it a little bit more general.


Some Hon. Members:: Hear, hear!
Oral Questions


Elmer MacIntosh MacKay: I was hoping that the Deputy Prime Minister would elaborate on this, because yesterday he talked about the principal ingredients in this whole affair, benefits, knowledge, and guidelines. Yesterday the Deputy Prime Minister downgraded the guidelines aspect-he said they were just guidelines-and no one over there is willing to concede very much in the nature of knowledge about this whole affair, although it is becoming apparent that more and more people are deemed to have known or have imputed knowledge.
Having downgraded the knowledge and the guidelines, surely none of the Liberal members are seriously suggesting that their friend Alastair is not getting substantial benefits, and I come back to my question, for what?


Joseph Jacques Jean Chrétien: Madam Speaker, it was said in the House that Mr. Gillespie had signed an agreement with a certain number of corporations and he had invested some money. It was agreed that if the project were successful and they wanted to buy him out, they would have to pay him a certain price, according to the contract that is already in the hands of the Opposition.
It was clear in the agreement signed between the consortium and the Government that none of the money coming from the Nova Scotia Treasury was to be for the benefit of the contract of Mr. Gillespie. The money should not be used for that purpose. It was clearly understood in the agreement that the Nova Scotia Government and the federal Government signed with the consortium headed by Mr. Gillespie.


APPLICATION OF MINISTERIAL CONDUCT GUIDELINES
Elmer MacIntosh MacKay: Madam Speaker, I appreciate those answers, but I want to again ask the Deputy Prime Minister and remind him that he appears to have been the Vice-Chairman of the Treasury Board Committee at the time that this particular project was approved, some time ago. Why was that Committee not looking at any other such project under the National Energy Program? What made the Gillespie project so unique in that respect? Would the Deputy Prime Minister or the Minister of Energy not agree that this particular deal would fit in very nicely under the recent announcement made by Iona Campagnola, the President of the Liberal Party, wherein the Liberal Party is finally investigating itself and its tendency to reward supporters and former cabinet ministers with generous business deals and contracts. The name of Judd Buchanan comes readily to mind as an example.
Would the Deputy Prime Minister or the Minister of Energy explain the relationship, if any, between the prime ministerial guidelines and this new initiative that was recently announced by their president, Ms. Campagnola?


Joseph Jacques Jean Chrétien: Madam Speaker, I do not know what question the Hon. Member is asking. We have debated that for many days

February 22, 1983
Oral Questions
in the House of Commons and have said exactly that there was no conflict of interest.


Some Hon. Members:: Oh, oh!


Joseph Jacques Jean Chrétien: Then make an accusation.


Erik Nielsen: I make it.


Joseph Jacques Jean Chrétien: There was no conflict of interest on the part of anybody. It was a project that was in the open and that was enthusiastically supported by Premier Buchanan of Nova Scotia. He was convinced that he had a good case even before he had the agreement of the federal Government. He was keen to have an announcement made in Cape Breton. Premier Buchanan was kind enough to proceed faster than the agreement, and he invited the local MP to be there. That was because everything was above board and it was in the best interests of the people of Nova Scotia, particularly those looking for economic development in Cape Breton.


ADVICE GIVEN BY DEPARTMENTAL OFFICIALS
Right Hon. Joe Clark (Yellowhead):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. It has to do with the Gillespie affair. He spoke of people who were enthusiastic about the proposal. He will know that as recently as September, 1982, his own officials warned him against proceeding with this project. His own officials said, and I quote:
It is clear that the project is not commercially viable.
In light of that information received by the Minister from his own officials, will he tell us what it was, other than the Gillespie factor, that caused the Government of Canada to ignore the warnings of its own officials?


Joseph Jacques Jean Chrétien: Madam Speaker, as the second phase of the project was proceeding I received some information about the request for additional funds. At that time I accepted the recommendation of the officials that none should be forthcoming. Eventually, after clarification and debate, the new formula for the testing of this new technology was discovered. It was proposed and recommended that it now be accepted. I made a statement through my parliamentary assistant that we were interested in entering into negotiations with them. We are negotiating at this time. No final decision has been made.


Charles Joseph Clark: We presume that Alastair Gillespie is doing the negotiating for a fat fee.


OFFICIALS' RECOMMENDATIONS
Charles Joseph Clark: Madam Speaker, the Minister will know that there was placed before Cabinet on September 13, 1982 a Cabinet document which, among other things, stated that the consortium, Mr. Gillespie, is seeking a capital grant of "approximately 95 per cent of the net present
value of the capital investment." It said that each permanent job created by the project would have to be valued at over $1 !4 million per job. It said:
Front-end capital assistance in the range of $200 million per year over the five-year construction period for the project would likely be required for the project to proceed.
It said that kind of funding could not be found within the energy envelope. In light of all these recommendations by his own officials against this project, why is the Minister still considering it, apart from a favour to Alastair Gillespie? What other than Alastair Gillespie's involvement justifies this action, against the advice of the Minister's own officials?


Joseph Jacques Jean Chrétien: Madam Speaker, one of the reasons is very simple. It is because we are still receiving representations from the Tory Government of Nova Scotia.


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Oh, oh!


APPLICATION OF CONDUCT GUIDELINES TO ALASTAIR GILLESPIE
Hon. Edward Broadbent (Oshawa):: Madam Speaker, I have a question for the local Member of Parliament who was present when this project was announced in Cape Breton. If I could get the attention of the local Member, the Deputy Prime Minister, I would ask my question. Yesterday, in all his rather noisy obfuscation of the issue, he refused to answer a specific question. I would like to put that question to him again today. In view of all the evidence that has been revealed outside and inside the House in the past week on this important issue, it clearly shows that Mr. Gillespie, within the two-year period prescribed by the Government guidelines, did negotiate with his Department. Will the Deputy Prime Minister tell the House today whether, in his opinion, Mr. Gillespie did or did not violate the guidelines? Yes or no?


Hon. Allan J. MacEachen (Deputy Prime Minister and Secretary of State for External Affairs):: Madam Speaker, I am glad to be referred to as the local Member. Probably I will have that title long after the Hon. Member has left the House, when he would still like to retain the title of local Member. The Hon. Member has asked my opinion. What is important here is the opinion expressed by those who have been involved in the transaction, both Mr. Gillespie and Mr. Cohen with whom he has had discussions. In the case of Mr. Gillespie, I understand he has stated that he has not been in breach of the guidelines. Mr. Cohen has stated quite clearly to me that at no time did he feel that he was being lobbied in any way.


OBLIGATION OF DEPUTY PRIME MINISTER
John Edward Broadbent: Madam Speaker, the Deputy Prime Minister simply cannot get away with that answer. He knows that one of the guidelines pertains to present
February 22, 1983

Ministers, not former Ministers. He knows that, as the local Member, he was on a platform. He was side by side with Mr. Gillespie announcing this project. The Deputy Prime Minister was praising Mr. Gillespie for taking advantage of legislation or a proposal that he himself had instigated.
Considering that the Deputy Prime Minister has a responsibility under the guidelines not to leave any impression or support for the idea that something incorrect might be being done, does he not agree that, as Deputy Prime Minister, he had an obligation to ensure that the guidelines were being enforced? Did he not have an obligation to make sure that Mr. Gillespie was living up to his obligation? That is the question.


Allan Joseph MacEachen: Madam Speaker, the Hon. Member is quite unclear about what the guidelines say, and what has been characteristic of the questioning in the House is that Hon. Members have created their own views as to what the guidelines say. The guidelines make it absolutely clear that, in the case of serving Ministers they should not in any way grant preferential treatment to any former office holder. That is my obligation. That guideline has been fully enforced as far as I am concerned. I believe also it has been fully observed with respect to the then Minister of Energy and the present Minister of Energy. I have no hesitation in assuring the Hon. Member of that.


DEPUTY PRIME MINISTER'S APPEARANCE WITH ALASTAIR GILLESPIE
John Edward Broadbent: Madam Speaker, I know that Members on this side are very familiar with the guidelines. I will read this to the Minister and then ask my question. I quote:
In any official dealings with former office holders, Ministers must ensure that they do not provide grounds or the appearance of grounds for allegations of improper influence, privileged access or preferential treatment.
Considering that that is the guideline, and considering that the Minister appeared with Mr. Gillespie in Cape Breton and publicly praised him for taking advantage of a deal that was in accord with a proposal that he had implemented as Minister, and considering that we know that Mr. Gillespie acted improperly at the time-


Madam Speaker:: Order, please. I can accept a short introduction to a question, but certainly supplementary questions do not require any preamble.


John Edward Broadbent: I see the Minister smiling. He knows that the factual situation is very relevant to his judgment. Does he not agree that if, as Deputy Prime Minister, he is publicly seen with a former Minister who is doing wrong, he is not carrying out his obligations as laid down in the guidelines?


Allan Joseph MacEachen: Madam Speaker, the Hon. Member is getting more and more absurd every time he
Oral Questions
gets up in the House. The guidelines state very clearly that, and I quote:
In any official dealings with former office holders, Ministers must ensure that they do not provide grounds or the appearance of grounds for allegations of improper influence, privileged access or preferential treatment.
There is no suggestion at any point in the guidelines that Ministers are prohibited from having official dealings with former office holders. There is no prohibition in the guidelines at any point that contact, that conversation, cannot be had with former office holders. And if the Hon. Member is suggesting that appearing at an event with Mr. Gillespie in Port Hawkesbury, an event which included the Premier of Nova Scotia, the President of the Cape Breton Development Corporation, the Vice-President of PetroCan, the Vice-President of Gulf Products, and the Vice-President of Algas-all of these people were there in a public event, known to all of Nova Scotia-if the Hon. Member is trying to suggest two years later that there is something wrong, well, he is getting more absurd everytime he gets up in the House.


Some Hon. Members:: Hear, hear!


REQUEST THAT DEPUTY PRIME MINISTER RESIGN
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, my question is directed to the Deputy Prime Minister. This event was known to everyone, according to the Deputy Prime Minister, except, of course, the present Minister of Finance, who knew nothing. I say to the Deputy Prime Minister that if "Joe Doe" from Port Hawkesbury phones Mickey Cohen, he will get a busy signal, but if Alastair Gillespie phones Mickey Cohen, he says, "Hi Al, what can I do for you?"
I ask the Deputy Prime Minister what does it take in terms of present Hon. Members of this Cabinet in order to obtain their honourable resignation from this Cabinet-a criminal conviction? Why does he not do the honourable thing in terms of his clear conflict of interest in this matter, dealing with a man who is clearly in conflict of interest, a former Cabinet colleague, in promoting this project? Why does he not now tender his resignation and do the honourable thing?


Allan Joseph MacEachen: Madam Speaker, I have examined the guidelines very carefully. I received the guidelines when they were issued. The Prime Minister has examined the guidelines. And it is my view, Madam Speaker, because I consult my conscience and I consult my judgment-


Some Hon. Members:: Oh, oh!


Allan Joseph MacEachen: -I have concluded that there is not the slightest grounds for believing that any Member of the Government has breached these guidelines. The Hon. Member is asking me to accept his advice. Hon. Members, since they began their attack on present Ministers, and since they began their attack on former Ministers, have clothed their sentences in the clothing of high ethics, of high morality, and in their

February 22, 1983
Oral Questions
conduct, Madam Speaker, they have departed from every principle of natural justice, because their purpose-


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Oh, oh!


Allan Joseph MacEachen: -because, Madam Speaker, their purpose is not to protect public ethics and public morality. Their purpose is to score political points at any expense, at any cost. They are not going to get away with it, Madam Speaker.


Some Hon. Members:: Hear, hear!


Madam Speaker:: Order. Order, please.


Ramon John Hnatyshyn: Madam Speaker, it is not I who wallows in the mud. It is the Members of the Treasury benches who have not the courage to stand up and tell the truth in this House.


Some Hon. Members:: Hear, hear!


REQUEST THAT TWO MINISTERS RESIGN
Ramon John Hnatyshyn: Madam Speaker, the Deputy Prime Minister talks about ethics. He talks about doing the right thing. Let me remind the Deputy Prime Minister that in the United States Richard Nixon did not get into trouble on the basis of the original wrongdoing. It was on the basis of the coverup-


Madam Speaker:: Order. Order, please.


Some Hon. Members:: Hear, hear!


Madam Speaker:: Order, please. The Hon. Member is on a supplementary question. I have said that, if I can accept a small preamble or an introduction to a question, I certainly cannot accept a preamble to a supplementary question. I would ask the Hon. Member, in the interest of the Question Period and using up the time as it should be, to put his question.


Ramon John Hnatyshyn: I apologize. Madam Speaker, to you as the Speaker of the House, but not to the Minister. I ask the Minister whether or not he accepts the fact that if a present Minister deals with a former Minister who is in breach of the guidelines set down by his Prime Minister, that bespeaks preferential treatment and privileged access on the part of current Ministers? On that basis, does the Minister not agree with me that the honourable thing is for the Minister of Finance and himself to tender their resignations immediately?


Allan Joseph MacEachen: Madam Speaker, if I thought the Hon. Member's question was based upon a deep concern for the public interest, I might take it seriously. His concern is totally political and that has characterized his party's conduct since this false issue has been raised.


QUERY RESPECTING POSSIBLE CONFERRING OF BENEFIT ON ALASTAIR GILLESPIE
Mr. John Thomson (Calgary South):: Madam Speaker, my question is directed to the Minister of Energy. My question is simple and straightforward. Was a benefit conferred on Mr. Gillespie under the terms of the contract between himself and the consortium? Let us forget about who conferred the benefit and let us forget the timing in which the deal took place. Would the Minister just answer the simple question? In his opinion, Madam Speaker, was a benefit conferred or was it not?


Joseph Jacques Jean Chrétien: Madam Speaker, under the contract with the consortium, Mr. Gillespie was paid a certain honorarium for the work he was putting into the project. He has also invested $25,000 as a minor shareholder. It was in the provisions of the contract between the companies and Mr. Gillespie that if they wanted him out, they had to offer him a certain compensation. This would be the case if he wanted out or was pushed out, as any minority shareholder would try to protect himself in a deal like that. And all that was to happen only when the project was successful. Of course, so far they are still at the point of completing the first stage of the feasibility study and I do not believe Mr. Gillespie has gained, or is in a position to gain anything from the Government, as I said before. As to the negotiations between himself and the representative of the consortium, who was the representative of Gulf company, they signed a contract so that, because he had invested some money, he was to be protected in that fashion.


DETAILS OF TRANSACTION
John William Thomson: Madam Speaker, is the Minister saying that this is a normal, everyday commercial transaction which a minority shareholder could expect? In other words, could you and I, Madam Speaker, go out and invest $25,000 in a project and expect to be bought out for $250,000? Is that a normal commercial transaction, in the Minister's opinion?


Joseph Jacques Jean Chrétien: Madam Speaker, I was not there at the negotiations between the representative of Gulf and Mr. Gillespie. I am telling the House of Commons that the negotiations were held between Mr. Gillespie and the companies. The representative who was involved in the negotiations between Mr. Gillespie and the consortium was a man from Gulf Canada, which was involved in the deal, Mr. Joe De Grandis. They agreed to these terms and the Government had absolutely nothing to do with it.
February 22, 1983


REGIONAL ECONOMIC DEVELOPMENT
Mr. Maurice Harquail (Restigouche):: Madam Speaker, I thank my hon. colleagues from both sides of the House, and yourself, for allowing us to come back to the economy, specifically with respect-


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Oh, oh!


Maurice James Harquail: Madam Speaker, there are many Canadians who share the same concerns as we do on this side of the House with respect to various questions relating to the economy.
My question is directed to the Minister of State for Economic Development and is with regard to employment in Atlantic Canada. The inflation rate is down to 6 per cent, interest rates are down to 11 per cent, and the CPI was .03 per cent in January, 1983-


Some Hon. Members:: Order.


Maurice James Harquail: -making the first decline in the CPI since September of 1978.
My question relates to the project which was announced in the speech of the Minister of Finance on November 12, 1981, with regard to the new Zinc refinery plant in New Brunswick. I would like to know if the Minister can give us assurances, based on discussions with the Prime Minister and the Deputy Prime Minister, that he will take immediate steps, in coordination with the Minister of Industry, Trade and Commerce and the Minister of Energy, Mines and Resources, to ensure that all pressures are brought to bear on the Noranda Group and Brunswick Mining Limited to see that this important project, which will create 1,500 person years of work, is realized?


Madam Speaker:: Order, order.


Some Hon. Members:: Hear, hear!


Hon. Donald J. Johnston (Minister of State for Economic Development and Minister of State for Science and Technology):: Madam Speaker, this is a very significant project, not only for New Brunswick, but also for the country. It has obviously been referred to in the economic development perspective which has been developed for New Brunswick, and it is under consideration. I will be discussing the matter with my colleagues. I might add that we have economic development perspectives destined for all of Atlantic Canada, in fact, for the whole country, which will ensure economic growth in those various regions. However, the project to which the Hon. Member referred is certainly one of the important ones.
Oral Questions ENERGY


REQUEST THAT OIL PRICE BE ALLOWED TO DROP
Mr. Ray Skelly (Comox-Powell River):: Madam Speaker, we spent a great deal of time in the House today dealing with one of the Liberal election promises, that of caring and sharing. I would like to direct a question concerning a second promise to the Minister of Energy, Mines and Resources. That was the promise of the Government to keep the price of energy in Canada and the price of oil below the world price.
Knowing that we have an absolute economic disaster in this country and that OECD and numerous other analysts have projected slower recovery in Canada than elsewhere, and knowing that we are facing thousands of business bankruptcies and lower competitiveness of goods produced in Canada, I would like to ask the Minister why he is not willing to allow the price of energy and oil to track downward as the blended Canadian price rather than the world price of oil, toward which the Government appears to be attempting to shift that pricing policy. In particular, he knows that this would reduce unemployment and get the economy rolling again.


Joseph Jacques Jean Chrétien: Madam Speaker, I think the Hon. Member is making a mistake. The policy is still the same. We have not changed it. Representations are being made to change it but it is still the same. The cost of oil in Canada breaks down as follows: the world price is paid for imported oil and for new oil produced in Canada, while up to 75 per cent of the world price is paid for old oil produced in Canada, which means that at the wellhead, the price in Canada is still below the world price. Therefore, the Hon. Member is wrong in saying that we have changed our policy. It has not changed in the last two years.


Raymond John Skelly: Madam Speaker, I am sure the Minister will be saying that again next week. It would be nice if he could give us a firm commitment in the House.


PRICE OF GASOLINE
Raymond John Skelly: My second question concerns the fact that that price is a fiction, and the Minister and the Government know it. When the price of gasoline in the United States is 95 cents a gallon and the pump price in Canada is $2 plus a gallon, can the Minister tell us why the Liberal federal Government is not prepared to deal with gas pump policy rather than that wellhead fiction so that Canadians can at least obtain a fair price for energy during this economic recession?


Joseph Jacques Jean Chrétien: It is very easy, Madam Speaker. We cannot get rid of the provincial Governments. For example, the price-


Some Hon. Members:: Oh, oh!

February 22, 1983
Oral Questions


Joseph Jacques Jean Chrétien: -the taxes vary from one Province to another. Therefore, a decision not to allow any taxes by the Provinces at the pump level might be possible, but we cannot do that. We must deal with the price at the wellhead, but the price at the pump is not controlled by us because, above the wellhead prices, one must take into account the federal taxes.


Some Hon. Members:: Aha!


Joseph Jacques Jean Chrétien: Yes, they are very much comparable to the level in the United States. Of course, in Canada, in many Provinces the level of provincial taxes is much higher than the level in the United States.


Madam Speaker:: The Hon. Member for St. John's West.


Mr. Crosbie:: Madam Speaker-


Some Hon. Members:: Leader!


John Carnell Crosbie: It is wonderful to know one has admirers on the other side, Madam Speaker.


Joseph Jacques Jean Chrétien: On the Government side, John!


An Hon. Member:: You don't have any on this side!


Some Hon. Members:: Oh, oh!


John Carnell Crosbie: We do not need any from the group to our left, Madam Speaker.


THE ADMINISTRATION
John Carnell Crosbie: Madam Speaker, my question is directed to the Deputy Prime Minister, who said yesterday in this House that federal Cabinet Ministers have only their consciences to answer to when interpreting the Prime Minister's conflict of interest guidelines. It is very difficult to appeal to something that might not be there.


Some Hon. Members:: Oh, oh!


An Hon. Member:: You were talking about yourself.


John Carnell Crosbie: However, I ask the Deputy Prime Minister whether he or the present Minister of Finance, who was then Minister of Energy, Mines and Resources, discussed with the Prime Minister the question of Mr. Gillespie's activities in so far as they knew about them-and the Deputy Prime Minister did know about them-in reaching the decision based on their consciences as to whether it was within the rules or not, or did they refer the question to the office which is set up to look after Ministers' statements under the other rules which apply to Ministers? What action, if any, was taken to consult with the Prime Minister or any other officials on this subject in order to determine whether their decision was right or wrong in carrying on as they did?


Allan Joseph MacEachen: Madam Speaker, I have a suggestion. The words used by the Hon. Member, "carrying on as they did", were probably used to infer all sorts of activities which did not take place. Precisely what happened is that I attended a press conference in my own constituency to-


Mr. Baker (Nepean-Carleton):: Oh, local boy makes good.


Allan Joseph MacEachen: -to participate in an announcement of a project which, if successful, would have a very beneficial effect on a very depressed part of Canada. That is one thing I did.


Charles Joseph Clark: That violated Alastair Gillespie's guidelines.


Allan Joseph MacEachen: The second thing I did was to be informed about this project. As I mentioned yesterday, my staff knew about it. Indeed, at one point Mr. Gillespie advised me about the project, and I think I mentioned that yesterday.


Charles Joseph Clark: When, Allan?


Allan Joseph MacEachen: These are the facts, and the Hon. Member is asking did I go to the Prime Minister to find out if that was right or did I go to some other committee to find out if that was right. I did not, Madam Speaker, because I found that these activities in which I engaged were totally in conformity with the guidelines. I venture to make the other point that, if I failed to participate in the way I did, I would have been shirking my responsibilities as a Member of Parliament, as a Member of the Government of Canada, and shirking my responsibilities to the people of Nova Scotia.


Some Hon. Members:: Hear, hear!


John Carnell Crosbie: I suggest to the Deputy Prime Minister that he shirked his duty to his conscience, which he mentioned here yesterday.


Some Hon. Members:: Hear, hear!


John Carnell Crosbie: That is where he shirked his duty.


REQUEST THAT DEPUTY PRIME MINISTER RESIGN
John Carnell Crosbie: I would like to ask the Deputy Prime Minister a supplementary question. While we cannot yet be certain whether the then Minister of Energy, Mines and Resources knew that Mr. Gillespie was the initiator of this project, we are sure that the Deputy Prime Minister, by his own testimony here in the House, knew he was the initiator of this project through the Department of Energy, Mines and Resources in the Deputy Prime Minister's district. The Deputy Prime Minister knew, and Dr. P. J. Read, who was directly involved with Mr. Gillespie for eight months, briefed the present Minister of State for Mines, who is responsible for the status of women, concerning the whole situation. It is peculiar
;

February 22, 1983

that she would have been briefed, but not the Minister of Energy, Mines and Resources.
In view of that, is it not obvious to the Deputy Prime Minister that the conflict of interest guidelines have been breached, at least by him, possibly by the Minister of State for Mines, possibly by the Minister of Energy, Mines and Resources, and that the whole thing dictates that he refer again to his conscience and resign?


Allan Joseph MacEachen: Madam Speaker, I knew that the Hon. Member was arrogant, but I never thought he would become so arrogant that he would attempt to tell any other individual what their conscience told that person. I think that that is an arrogation that not even the greatest theologian in history attributed to himself. Because of that arrogance that the Hon. Member shows, I reject his suggestion as coming from a mind that is besotted and besetted with arrogance and a clear unwillingness to listen to facts, and a total obsession-


John Carnell Crosbie: You are punch drunk with conscience.


Allan Joseph MacEachen: -with recovering from the humiliation he received in this House in December, 1979.


John Carnell Crosbie: Your conscience is punch drunk.


THE ECONOMY
Mr. Paul E. McRae (Thunder Bay-Atikokan):: Madam Speaker, my question is for the Minister of Finance. Some time ago I had delivered to his office a copy of a report by Professors Bossoms and Dungan at the University of Toronto, which report was given considerable prominence on the front page of the business section of Saturday's Globe and Mail. Has the Minister's Department had an opportunity to analyze this report fully? It purports to show that, if we had no recession, the Government would now be showing a surplus rather than a deficit, as compared with the United States where there is a very large surplus under the same kind of study.
I would also like to ask the Minister if he has had an opportunity to have the report analyzed and if he could indicate if this would have a major bearing on his budget considerations.


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker-


Some Hon. Members:: Resign.


Marc Lalonde: -first of all I want to say that I have received the study referred to by the Hon. Member and have referred it to my officials for further consideration. I also read the story in Saturday's Globe and Mail. I think the comments made by Professors Bossoms and Dungan are very important and very
Oral Questions
relevant. This study deserves the consideration of all Members of the House as we consider the next budget.
I want to underline to the Hon. Member that one aspect that certainly struck my eyes particularly was the statement by Professor Bossoms that the key thing, if there is going to be an activist fiscal policy that attempts to increase the deficit deliberately to help the economy, is that I should make sure it is temporary in nature. I have that very much in mind indeed.


AGRICULTURE
Victor Fredrich (Vic) Althouse: Madam Speaker, my question is for the Minister of Agriculture. I have sent him notice of the question since this involves long-standing parliamentary practice, and I want to make certain that his answers are very accurate.
Since the announcement of the Government's intentions to change the Crow rate is, at this point, only an announcement and not the policy of the country nor of his Department, can the Minister explain to the House why his Department is taking out full-page advertisements in newspapers which argue his Party's case for making the Crow changes? Will he also explain why public money should be used to argue what is, at this point, only Liberal Party policy?


Hon. E. F. Whelan (Minister of Agriculture):: Madam Speaker, the ads are being taken out because of what was said by another level of government and, in most instances, because of what the Provinces are doing with ads. The Province of Quebec, especially, has taken out huge ads, with movies and slide displays et cetera. There is only one way to fight that, and that is to fight it with what is accurately being put forward by the Government. We are trying to do that in the best way we know at the present time. The ads are not free. We know that, and we are estimating that the total ad program will probably cost around $350,000.


FUNDING FOR ADVERTISEMENTS
Victor Fredrich (Vic) Althouse: Madam Speaker, I should like to ask the Minister to tell us the source of the funds he is using. He says he is proposing to use about $350,000. What branch of his Department are these funds coming from? How is the expenditure described in the estimates, and when were the estimates on this particular expenditure passed?


Eugene Whelan: Madam Speaker, the funds we are using are funds from my Department and several other departments that are available for communications.
Oral Questions THE ADMINISTRATION

February 22, 1983


CAPE BRETON COAL AGREEMENT-REQUEST THAT MINISTER OF STATE (MINES) RESIGN
Flora Isabel MacDonald: Madam Speaker, we now have another Minister involved in the "coal-gate" affair. My question is to the Minister of State for Mines, both in her capacity as junior Minister to the then Minister of Energy, Mines and Resources and in her capacity as the Minister who took over a component of the Department formerly headed by Alastair Gillespie.
She admits that her Department was involved in the Scotia Liquifuels project, a project headed by Alastair Gillespie, for some six months prior to June, 1981, and she admits that she has discussed the project with Mr. Gillespie.
Given that the guidelines established by the Prime Minister in 1980-and I hope she pays more attention to them than the Deputy Prime Minister does-prohibit that kind of transaction between any former Minister and any current Minister responsible for the same Department or agency, will she at least have the decency to rise in this House and submit her resignation?


Hon. Judy Erola (Minister of State (Mines)):: No, Madam Speaker, I will not. I did not admit that I had conversations with the former Minister. I said to the press that I had had conversations within the past year, well within the guidelines.


QUERY RESPECTING MINISTER'S KNOWLEDGE
Flora Isabel MacDonald: Madam Speaker, is the Minister now asking us to believe that the project which was headed by Alastair Gillespie, on which she was briefed by P. J. Read of the Department of Energy, Mines and Resources, who had been dealing with Mr. Gillespie for some eight months, the project which her colleague, the Deputy Prime Minister, had been negotiating and had appeared publicly with Alastair Gillespie in April, 1981-that all of these things took place and that she was totally unaware of any involvement of Mr. Gillespie? Is that what she is asking us to believe?


Judith A. Erola: Yes, Madam Speaker. What I find appalling about all of this is that the Hon. Member for Kingston and the Islands is not looking at the project as she should be, as an exciting technological breakthrough for Canada and Canadians.


TECHNICAL RE-EVALUATION OF PROJECT
Erik Nielsen: Madam Speaker, in an exchange across the aisle a moment ago the Minister of Energy, Mines and Resources asserted that Mr. Gillespie had received no benefit. I point out to him that he has already received $30,000 under the annual stipend paid to him, plus $600 per diem-in fact, the return of his initial investment.
The question I have for the Minister is this. In view of his officials' recommendation that the Government offer to the consortium additional federal financial support for a technical re-evaluation of the project, focusing particularly on processes which would utilize higher ratios of natural gas to coal and offer higher saleable product yields-has that offer been made to the consortium pursuant to the recommendations of his officials? Was it made in the amount of $750,000 and, if so, from what fund are those moneys to be obtained?


Joseph Jacques Jean Chrétien: Madam Speaker, this is what is being negotiated at this time. There is no final decision on that. If we decide to go ahead, this money would not be from the same fund. It would be from a fund in the coal division of the Department of Energy, Mines and Resources. We are discussing that at this time.


Charles Joseph Clark: The slurry fund or the slush fund?


Joseph Jacques Jean Chrétien: My officials are in touch with the Government of Nova Scotia and the consortium on this project. We made an announcement that we were to enter into negotiations. We are at that phase at this time. If we decide to sign, we will inform the House immediately after the decision, one way or the other.


Erik Nielsen: There was some doubt in my mind whether that was to come from the slurry fund or from the slush fund, but the Minister seems to have clarified that.


REQUEST THAT PRE-FEASIBILITY STUDY BE TABLED
Erik Nielsen: Madam Speaker, my next question is directed to the Deputy Prime Minister. He agreed yesterday to come clean with the House and to table all relevant documents with respect to this transaction. In view of the fact that he and the rest of the Cabinet are aware that the consortium-and I quote from the document which he has seen-has completed a pre-feasibility study for the facility, will he table that pre-feasibility study, as well as the feasibility study which, by contract, the consortium was bound to produce in December, 1982?


Allan Joseph MacEachen: Madam Speaker, I undertook yesterday to table all documents that were possible to be tabled.


Some Hon. Members:: Oh, oh!


Allan Joseph MacEachen: I am in the process of completing that commitment, as I volunteered yesterday. The Hon. Member talks about coming clean. We were quite prepared to table the letters that were mentioned in the questions yesterday, and the Minister of Energy, Mines and Resources will determine what is available for tabling in the House.
February 22, 1983



ROUTINE PROCEEDINGS


[Stage Direction]
A message from His Excellency the Governor General transmitting Estimates for the financial year ending March 31, 1984, was presented by Hon. Herb Gray (President of Treasury Board) and read by Madam Speaker to the House.
Hon. Herb Gray (President of Treasury Board):: Madam Speaker, in addition to tabling Part II of the Main Estimates, I would also like to table in support of the Estimates Part I, the Government Expenditure Plan, and, on behalf of my colleagues, Part III, consisting of 47 departmental expenditure plans.


EXPLANATORY STATEMENT BY PRESIDENT OF TREASURY BOARD
Herbert Eser (Herb) Gray: Madam Speaker, this is the first step in Parliament's consideration of the detailed expenditure budget of the Government for 198384. It is for Parliament to grant final approval of this spending plan. When approved, these Estimates establish the framework within which the activities of the federal Government itself are carried out and accounted for. Tabling of these Estimates is the end of months of intensive preparation by the Government.

Madam Speaker, the Main Estimates provide a detailed and comprehensive description of the Government's present policies, activities and programs. However, they do not give more than an overview of total government spending as projected at the present time. If we consider the time required for decision-making and producing the forty-nine volumes that make up the Estimates this year, it means that the Federal Government must be able to adapt to the circumstances and have the flexibility to review and revise its programs so as to promote economic recovery.
Madam Speaker, I also wish to remind Hon. Members that the budget the Minister of Finance (Mr. Lalonde) expects to bring down shortly may very well affect the Government's expenditure plan for the coming year. Of course, any changes in the Estimates as a result of the budget will require approval by Parliament of Supplementary Estimates or a separate Bill. The Government's 6 and 5 program has also had an impact on the Estimates. Capping of compensation in the Federal Public Service and capping of Old Age Security benefits, family allowances and indexing of public service pensions has made funds available for creating jobs and establishing other programs to help Canadians cope with these difficult times and speed up the country's economic recovery.

This year the Estimates are presented as a group of volumes: Part I, The Government Expenditure Plan; Part II, the Estimates proper, long referred to as the Blue Book; and Part Ill's
Main Estimates, 1983-84
Program Expenditure Plans that provide detailed program information.
This is the third year Part I has been prepared and tabled. It provides Parliament with an overview of Government spending in a form conducive to an understanding of total expenditures, and focuses on the broad policy areas to which resources are allocated by Parliament through programs of Departments and agencies.
Part II, that is the Blue Book, continues to support the items that may eventually be included in the Appropriation Act, of the Main Estimates. When the new form of the Estimates is fully developed, there will be changes to the form and content of Part II. However, this year it is the traditional Blue Book in structure and content.
Several volumes of Part III are tabled this year for the second time and a further number are provided for the first time. These volumes, 47 in all, provide information to the Standing Committee of Parliament that has the task of examining the Estimates for each Ministry. Each volume includes explanations of what the Department expects to achieve with the resources requested and includes, where possible, a statement of the benefits expected from the program. Part III will be expanded over the next few years to include volumes for all Departments and agencies. Therefore I have tabled, on behalf of my colleagues, the 47 Department Expenditure Plans. These documents, which are prepared by and are the responsibility of individual Departments, provide a great deal of further detail on Government programs and, more specifically, what the Government hopes to achieve with the money it plans to spend through these Estimates.
In recognition of the fact that individual Members will have particularly strong interest in examining certain programs and Departments but not others, we are not having automatic distribution of all volumes of Part III to all Members. However, Members can obtain these documents from the Parliamentary Distribution Centre by simply indicating those of interest to them on a list of available volumes included with their copies of Part I and the Blue Book.
A further initiative in improving the information available to Parliament is the planned revision of the Blue Book. As I have said, the new concept of the Estimates calls for presentation in three parts. Because consultation with Members on the form of Part I and Part III proved very constructive, it is my intention to initiate in the near future discussions with Members on proposals to amend the form and content of the current Blue Book. I would only note at this time our expectation of a reduction in the volume of the Blue Book when all part III books are available and it becomes possible to relocate information to Part III without reducing the information available to Parliament for its consideration.
I would now like to focus on Part I of the Estimates, the Government Expenditure Plan. The updated plan for 1983-84 and the information related to 1982-83 reflect the policies and programs announced by the Ministers of Finance in the June,

February 22, 1983
Main Estimates, 1983-84
1982 budget and the October, 1982 economic statement. Because final decisions have not yet been made on the measures to be included in the next budget, Part I of the Estimates does not include any information on the planning years beyond 1983-1984. Information on the Government's multi-year expenditure plans will, however, be presented in the next budget, including any changes the Government may make for the current fiscal year.
As announced last Thursday by my colleague, the Minister of Finance (Mr. Lalonde), total forecast spending in 19831984 is $88.9 billion, an increase of 9.6 per cent over the revised forecast of $81.1 billion for 1982-1983. This rate of growth in spending is the lowest since 1979-1980.


Philip Derek Lewis: But it is not six and five.


Herbert Eser (Herb) Gray: Even while funding substantial increases in existing and new measures to assist Canadians in this difficult economic period, the Government has been able to restrain over-all spending growth by implementing a number of spending restraint initiatives. The restraint program announced in the June budget, which, of course, directly affects about one-half of total spending, results in funds available for reallocation of over $700 million in wages and salaries, Old Age Security, Family Allowance payments and Public Service pension costs. In addition, planned spending on aid to developing countries and on defence was reduced by several hundred million dollars. Much of the over-all 9.6 per cent spending increase is due to programs designed to protect those Canadians most in need, to provide support to sectors hard hit by the recession and to enhance the prospects of economic recovery.
Within this total expenditure plan of $88.9 billion, these Main Estimates provide for budgetary expenditures of $85.6 billion, and for $1.8 billion in loans, investments and advances. Within the over-all plan the Government has $0.9 billion in reserves to cover adjustments to statutory programs as well as $2.4 billion in envelope reserves to cover cost adjustments to other programs and to provide for planned but not yet announced initiatives. I should emphasize that these reserves are not free money for which no use has been found. A substantial portion is simply a prudent contingency fund against the inevitable uncertainties of precisely anticipating thousands of costs over one year in advance.
In regard to remaining reserves, Government decisions and approvals in principle have already been developed which effectively earmark the reserves for a variety of initiatives. Once the details of such items are finalized, and should any of the contingency funds be required, parliamentary approval will, of course, be sought through Supplementary Estimates.
The planned total outlays of $88.9 billion also reflect two other adjustments. First, Estimates must be adjusted down by the forecast $0.5 billion in repayments on loans issued in previous years. Second, since the Government cannot legally spend more money than Parliament authorizes, and in fact always spends less, a downward adjustment for the lapse of expenditure authority must be made, for which the current projection is $1.4 billion.
I would now like to focus on the $85.6 billion in budgetary expenditures provided for in these Main Estimates. Thirteen items account for about 80 per cent of the total increase of $12.7 billion in budgetary Main Estimates. These items include increases of $2.7 billion in payments to persons for Old Age Security, Guaranteed Income Supplement, spouse's allowances and the Government's contribution to Unemployment Insurance benefits. Increases of $2.2 billion occur through transfers to the Provinces under the Established Programs Financing Program, the Canada Assistance Plan and fiscal transfer payments. Public debt costs are up $1.8 billion. Other items in this category are petroleum incentives payments, National Defence, direct job creation, Canada Mortgage and Housing Corporation, the Trade Industrial Program of Industry, Trade and Commerce, payments to VIA Rail and the budget of the Canadian International Development Agency.

Although Hon. Members will find a host of explanations and information on changes that have been made as compared to last year's Estimates in the various documents I am tabling today and pertinent press releases, I would like to put this total increase into its proper perspective, namely, the economic environment in which we live and the effect of including in the Estimates some of the measures introduced by the Government last year.

We are all very much aware that the Canadian economy has been passing through one of the most difficult periods since the Second World War. While encouraging signs of improvement are beginning to emerge, particularly with regard to inflation and interest rates, we must be mindful that the recession has been deep and recovery will be gradual. As Members know, almost two-thirds of these budgetary Estimates are for statutory expenditures, thus of a non-discretionary nature. That is, they are based on continuing authority given by Acts of the current or previous Parliaments. These acts determine the basis whereby individuals, businesses, provincial and other Governments become entitled to receive federal funds, and in most cases the amount of money to be paid. I would like to speak briefly about just four of these payments which are directly, and particularly strongly, affected by current economic conditions.
First, public debt charges, which include the interest due and payable on outstanding debt as well as servicing costs and costs of issuing new debt. These costs, totalling $18.6 billion in 1983-1984, are $1.8 billion higher than the 1982-1983 Main Estimates level. This increase is attributable to the growth in total debt, partially offset by lower interest rates. A key factor in the rise in total debt is, of course, the very sharp decline in federal tax revenues as a result of the difficult economic circumstances.


Blaine Allen Thacker: You got us into them.
February 22, 1983


Herbert Eser (Herb) Gray: Under the Established Programs Financing Act, 1977, the federal Government contributes to the financing of hospital insurance, medicare, extended health care and postsecondary education. The federal contribution consists of a combination of tax transfers and cash payments, the combined value of which grows with the total value of economic activity in Canada. If the tax transfer portion grows very slowly, the federal Government makes up the difference in increased direct cash payments. The depressed tax revenues which I just noted have caused a sharper rise in the cash portion of the federal payment under Established Programs Financing, which has increased $1.1 billion, or 21 per cent, to a total of $6.6 billion in the 1983-1984 Main Estimates.
As the Minister of Finance has also noted, we cannot expect a rapid recovery in our economy and the level of unemployment is of particular concern. While the Government has taken a number of measures to improve employment prospects, the unemployment outlook remains difficult. As a direct result these Main Estimates show a dramatic increase in the Government's contribution to Unemployment Insurance designed to reduce the financial burden on the unemployed. This year, $2.9 billion has been allocated to Unemployment Insurance, an increase of some $ 1.681 billion over the last fiscal year.
The final statutory payments I will mention are the federal contributions to the Provinces under the Canada Assistance Plan. The federal Government pays for 50 per cent of eligible provincial and municipal expenditures for assistance payments, welfare services and certain health services. We also cover one-half of the costs of child support services, such as foster care and daycare and a broad array of other family and social support services. During 1983-1984 it is estimated the federal Government will transfer $3.1 billion to continue these programs. This increase of $0.6 billion, or 21 per cent, over the 1982-1983 Main Estimates level is attributable in large measure to current economic conditions.
I noted earlier that the Government has taken a number of decisions in the past year not only to increase spending in existing programs to ease hardship and speed recovery, but has also implemented a number of new initiatives. Of course, since some of these initiatives were approved after the 1982-1983 Main Estimates were presented to Parliament, they have been funded through Supplementary Estimates in the current fiscal year.
I would like to mention just three of these items which are included in the Main Estimates for the first time in the 198384 documents which I have tabled today.
With the passage of legislation in June, 1982, the Petroleum Incentives Program became fully operational and the Supplementary Estimates (B) which I tabled last November included $1.8 billion for this item in the current fiscal year, 1982-83. These payments are included in the Main Estimates, for the First time in 1983-84, and account for $1.2 billion of the total change from 1982-83 Main Estimates.
Main Estimates, 1983-84
Another new measure is the Small Business Investment Grant Program designed to assist small and medium-sized businesses. This new program, announced in the June, 1982 budget, accounts for $0.2 billion of the over-all increase from the 1982-83 Main Estimates.
The last item that I want to mention is the $0.2 billion increase due to funds included in 1983-84 Main Estimates for the New Employment Expansion and Development Program.
[ Translation]
Madam Speaker, these are only a few of the many programs and activities mentioned in the White paper. In fact, the Main Estimates contain hundreds of further changes, on both the plus and the minus side. I would therefore invite Hon. Members, if they require further information on the subject, to consult Parts I, II and III which I am tabling today, as well as the additional information appearing in the press releases.

Finally, I would like to focus on one other element of the budgetary Main Estimates, which is the total operating and capital costs of all federal Departments and agencies. The Department of National Defence has total operating and capital costs in these Estimates of $7.8 billion, an increase of $0.8 billion from 1982-83. This increase is in keeping with the Government's commitment to NATO to sustain the increase in defence expenditures by 3 per cent annually in real terms. A significant part of the growth continues to be devoted to the reequipment and modernization of the Canadian Forces.
The total operating and capital expenditures of all other Departments and agencies is $12.8 billion in these Main Estimates. This cost of running the Government, up $1.1 billion from 1982-83, is increasing only about one-half as fast as total Main Estimates. The category of total spending has roughly only kept pace with inflation over the past six years, thus remaining constant in real terms, despite the growing number of new programs and increasing demands for federal Government services. This year, the share of these total operating and capital costs in budgetary Main Estimates is 15 per cent.
Of course, as I mentioned earlier, this area of spending has been particularly affected this year by the Government's six and five restraint program, since operating costs are in large measure accounted for by the salaries and wages of some 225,000 federal employees. As Members know, the salaries and wages of our employees have been limited as required by the Public Sector Compensation Restraint Act. In addition, in preparing the detailed departmental budgets for non-personnel operating costs presented in these Estimates, the Government has limited Departments and agencies to a maximum adjustment of 6 per cent for the effects of inflation.
Of course, the total increase in operating costs is above 6 per cent, since there are additional resources required to enable the Government to develop and implement new policies and programs and to meet the increasing demands for existing program services.

February 22, 1983
Main Estimates, 1983-84
In the same vein, restrictive adjustments have also been applied to annually authorized grants and contributions made to organizations outside the Government.
I would now like to say a few words about the growth in the Public Service as measured by the increase in the number of person-years. The Government believes that for 1983-84 it should keep the rate of growth of the Public Service in the 1 per cent range, despite the calls by many for expanding Government assistance. Therefore, the Treasury Board has informed Departments and agencies with large person-year requirements that their 1983-84 authorized person-year level is in fact lower in total by 0.2 per cent than the levels shown in the Blue Book. However, there was not time to reflect throughout the Main Estimates this decision to limit over-all growth to 1 per cent without significantly delaying the tabling date.
Therefore, the Main Estimates documents before the House indicate a 1983-84 total of 258,463 person-years for Departments and agencies whose personnel requirements are controlled by Treasury Board. This figure is 3,141 person-years, or 1.2 per cent, over the 1982-83 Main Estimates. However, I have just noted that the Treasury Board has already taken steps to reduce this to 1 per cent over-all growth. A large proportion of the over-all increase reflects short-term requirements for the implementation of recent Government initiatives, such as the NEED Program.
In reviewing the largest specific year-over-year increases, pressures for the provision of greater services to the public become even more apparent. The Canada Employment and Immigration Commission has increased by over 1,400 person-years. Besides the requirement of approximately 500 for the administration of the NEED Program, over 800 will be used to assist in the processing of claims for Unemployment Insurance. In the Department of Transport an additional 250 person-years will be used for regulatory activities related to air safety and the operation and maintenance of air navigation aids and facilities.
The RCMP requires an additional 343 person-years for law enforcement and demand-driven functions, such as provincial and municipal police agreements which are, of course, cost recoverable.
To conclude, I want to say as President of Treasury Board that I have set as a major priority the continuation of our policy of improving the management and efficiency of the federal Government. I am well aware of the difficulties of the task. However, I believe we can still further improve management in Government and the efficiency and effectiveness of Government as a whole. The consequences of the current economic situation pose difficulties for Government itself as well as for Canadians generally. But it has also produced a positive effect in making us demand the best from our systems, the best from our people and the best from ourselves.


Some Hon. Members:: Hear, hear!


Donald Alex Blenkarn: Madam Speaker, my colleagues and I briefly reviewed these Estimates in a briefing session which commenced at noon. These Estimates,
which are massive, involve Part I and Part II, as set out by the Minister, together with 47 baby Blue Books. The Estimates disclose to the House and to the country an unconscionable amount of spending. They are expenditures that we as Members and our constituents cannot begin to fathom even if we were to work on them day after day.
When the Minister of Finance (Mr. Lalonde) presented his demands to the House under the borrowing authority statute on February 17, he said that the spending for the next current year would increase by 9.6 per cent. That was a total, complete and fraudulent misrepresentation to the House. That misrepresentation was repeated this afternoon by the President of the Treasury Board (Mr. Gray). He knows better. One is supposed to compare oranges and oranges, not oranges and apples. The President of the Treasury Board is comparing what he has spent so far in this fiscal year and what he intends to spend by March 31 with the Estimates for next year, which are always much too low.
Let me compare what he has said in the House in prior years with what he is saying now. In 1982-83, the Government produced its Estimates. I am sure Members will remember Part I of the Government Expenditure Plan. That book says that the Government would spend approximately $76,300 million. However, it spent $81,150 million. If you compare it against other items you will find that the Minister spent nearly $7 billion over and above what he said he was going to spend a year ago. What we are comparing here, when he says that his expenses are increasing at 9.6 per cent, are last year's Main Estimates plus Supplementary A, Supplementary B and Supplementary C with this year's Main Estimates. But this year's Main Estimates do not include an anticipated $600 million loss in Canada Post. This year's Main Estimates do not include what we are told is going to be required to continue with the further bail-out of Canadair and de Havilland.
What do the Estimates really include? They include the minimum amount that the Government intends to spend. Last year it came back to the House for $7 billion dollars worth of Supplementaries. Indeed, it has not come back for all of its Supplementaries yet. Supplementary C, which we do not have before the House yet, is going to be $1,850,017,341, and that is also included in these Estimates. We have a spending plan by a Government gone crazy, we do not know where they are going. The Government says that it has covered the contingencies by providing a 7 per cent central reserve and a 3 per cent envelope reserve. But all previous history indicates that these reserves are just not so. The fact is that if we go back over the history of this Government since it took office on February 18, 1980 we find that its expenses for the year 1980-1981 increased over the previous year by 13 per cent. Its expenses for the year 1981-1982 increased over the previous year by 17.6 per cent. Its expenses this year increased over last year by 17.8 per cent. Where are we going? They say it is going to increase 9.6 per
February 22, 1983

cent, and I say to you, Mr. Speaker, that you have no reason at all to believe them. Does anyone in this House have any reason to believe them?


An Hon. Member:: No reason at all.


Mr. Smith:: Oh ye of little faith.


Donald Alex Blenkarn: My friend says, "Oh ye of little faith". You would have to have faith to move mountains to believe them.


William James Kempling: Robbers.


Donald Alex Blenkarn: We know how they act with their former colleagues. That is how you can believe them. We know what standards of morality they have.


William James Kempling: They have none.


Donald Alex Blenkarn: That is how you can believe them. You know how they perform, that is how you believe them.


William James Kempling: No morals at all.


David P. Smith: Wash your mouth out with soap.


William James Kempling: You should wash your morals out with soap.


Donald Alex Blenkarn: I thought it would be important that we take a look at some of the spending items in the Blue Book that we have analyzed in the brief time we have had.
First of all, I thought we might compare various kinds of things that the Government does. I thought we would compare, for example, salaries and wages. We are under the six and five program for salaries and wages. The salaries and wages paid by the Government this year will increase 8.8 per cent. That is where six and five is. Other personnel expenses-I do not know what they are, but they are personnel expenses-are going to increase by 13.5 per cent. The Government spending on transportation and communications-and bear in mind that a big part of that is Bell Telephone expenses that are frozen at six and five-are going to increase by 16 per cent. I suppose that is the extra gasoline required, or whatever, for a new fleet of Challenger jets.
There is one figure that I want to give you that I cannot believe. The Government says that its propaganda expenses are going to go down by 1.6 per cent. Perhaps we can analyze that as we go through the Blue Book to find out if in fact the propaganda exercise will only go down by 1.6 per cent.
But that is the only thing that goes down. Professional services go up by 15.6 per cent; rentals go up by 15.6 per cent; the purchase and repair of machinery goes up by 45.1 per cent; utility expenses go up by 14 per cent; construction of buildings goes up by 13.6 per cent and the purchasing of furnishings and fixtures in buildings goes up by 22.8 per cent. We have been told that it is the cost of the debt that is running up this budgetary deficit. That only goes up by 11.8 per cent.
I think we could then compare the expenditures by Department. The Government has broken the budget down into envelopes, and we all want to know what is in the envelope. In the Department of Energy, Mines and Resources, the Energy envelope, goes up by 14 per cent. The Economic Development
Main Estimates, 1983-84
envelope goes up by 25.6 per cent. The Social Affairs envelope goes up by 19.3 per cent. Justice and Legal Affairs goes up by 15.1 per cent. Fiscal arrangements goes up by 10.6 per cent. External Affairs goes up by 12.7 per cent.
The Minister in his statement said that Defence was going up by 12.9 per cent. Again he is giving us a wrong story. The fact is that it is only 11.3 per cent. The reason is that he cut his Defence expenditures last year and now he is restoring them. Comparing Main Estimates with Main Estimates shows that Defence spending goes up by only 11.3 per cent.
I am not going to go through all these and bore everyone completely. I want to say that there is only one Department, one envelope in the whole bunch, that really does not go up at all beyond the six and five guidelines, and that is the cost of running this place. We all know the proclivity to waste that we have here, but our expenditures in this Parliament are only going up by 5.1 per cent. That is within the guidelines. We know what is wasted here, we know because we are here. We know what we could cut back in this place if we really wanted to, yet our expenses only go up 5.1 per cent. Think of what we could cut back if we really worked at it in other Departments, in other envelopes of this Government.
We have advocated to this House that a serious study should be made on the Estimates to cut them back, to get back to where we should be, so we will not have to continue to go to the market and borrow and borrow and borrow. There is unbelievable fat in these Estimates. It can be cut back, and it is a challenge to the committees of this House of Commons to tackle these estimated expenditures and cut them back.
In that respect, if the President of the Treasury Board had any real intention of trimming the fat in Government, he would form a special committee of this House to supervise the cutting back of Estimates. He would say to Departments, "I do not care what you would like to do. Here is what you can afford, trim it to that". This is a Government totally out of control. Expenditures have gone up in the 17 per cent range two years in a row, back-to-back. They are likely to go up 17 per cent this year even though the Government says it will be 9.6 per cent. This Government is out of control.
If you look at inflation, you will notice that with this depression we have had a lowering of inflation rates. Today the Hon. Member for Ottawa Centre (Mr. Evans) indicated in this House that the seasonally-adjusted inflation rate over the last three months was 3.2 per cent. If that is the case, why should Government expenditures be three times the rate of inflation in their increase? Why should the cost of Government creep up three times the inflation rate? Do we really need a positive increase over inflation by 6.4 per cent? Do we need that much more Government in Canada, or does this Government want us to have that much more government? Is this the kind of Government that gets Chairman Mao to do its projections? That is what the Minister of Finance (Mr. Lalonde) suggested.

February 22, 1983
Main Estimates, 1983-84
I suggest that if we allow this kind of expenditure program which is now set to go at a rate at least three times higher than what the Government says is the current inflation rate, we have done a great disservice to our constituents and to Canada. These Estimates are improper, wasteful and must be turned back.


Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, this really is a "Gray Day" for Canada. We have just had the opportunity of perusing about three kilograms of "Gray" matter in an effort to understand what it was the Minister of Finance (Mr. Lalonde) was telling us a few days ago. At that time he said, "Just hold off, Canadians, because I promise you I am not going to say a single word of what will be in the $19 billion request I am bringing forward today, but just wait until February 22 because it will all be in the Estimates and you will have a very clear idea of what the Government of Canada is going to do with your money."
Something is drastically wrong. We have just had the opportunity, not to study carefully I admit, but to peruse the Estimates for the forthcoming year. Either there is a plan for the Government to do nothing particularly new other than simply lift all of the budgets up a number of percentage points, which I will come to in a moment, or the Minister of Finance was unintentionally misleading Members of Parliament and Canadians.
When you look at the documents before us, some very puzzling points come to mind. For example, I remember quite distinctly the Minister of Finance saying that Government expenditures this year will be up not 6 per cent, as the guidelines of the Government would indicate, but 9.6 per cent.
A lot of senior citizens in this country are puzzled because their increase was restricted to 6 per cent. A lot of mothers in this country were expecting a higher increase in their Family Allowance rather than having it capped at 6 per cent. The Government said it would ignore all their six and five programs and lift their expenditures by 9.6 per cent.
We talked to a number of officials from the Government who presumably are knowledgeable on how the Government plans to spend its money. They suggest that the budgetary Main Estimates for 1983 are going to go up 17.4 per cent. I think you can use some peculiar form of rationale, smoke and mirrors and some creative accounting to justify those two figures, 9.6 and 17.4. However, this document tells us that the Main Estimates, that area of Government expenditure where the Government has discretionary power, will increase more than 17 per cent in the coming year.
What does that say about the Government's attitude toward its six and five program? What does it say about the Government's attitude toward honesty, fair play and being forthright with the people of Canada? They say different things, depending on which Minister is making the comment. Whether that is intentional or not I leave up to people's speculation.
At this point one begins to wonder whether there is some effort being made on behalf of Government Members to encourage the public of Canada to think in creative ways
about what it is they are doing. Canadians were waiting for the Government to indicate today how it will be spending the taxpayers' money and borrowed money in the year ahead. They have waited to see what the Government plans to do.
I note with interest that the Government has given up forecasting. It has made so many errors in the last 12 months that any attempt to forecast for another year or more would be totally futile. It simply does not have the ability, the talent or the technology to make any real comment about where the economy is going. For that reason I say that these Estimates are virtually useless at this point.
The Estimates that have been tabled today will not help Members of Parliament, Canadians or anyone else to understand what the Government is trying to do, unless it is trying to do nothing. That they will understand. We cannot rely on the Estimates before us. Let me give a single example of that.
A gross distortion of information has been presented in the Estimates for the past year and for this year. I read with interest in one of the summary statements that direct job creation under CEIC was going to increase by $216 million. When we look at what actually happened, we find that expenditures did not increase by $216 million. As the Government's own forecaster suggested, they increased to approximately $482 million. That is a 125 per cent error in the Estimates. When you look carefully at what that means, not only was there a 125 per cent error in the Estimates of last year in that very critical area of job creation, but it will increase total job-creation expenditures for this fiscal year by only 21 per cent.
What kind of signal is that to the people of Canada? The Minister of Finance said that unemployment will be dramatically high this year, and that it is one of the highest priorities of this Government. However, when you look at what the Government is estimating for 1983 in the area of job-creation, you find that they are going to be expanding by only 21 per cent. The figures before us do not say that. They say that job creation will go up by 170 per cent. That looks good, a 170 per cent increase. However, when you look at the fine tuning, when you do the simple calculations, you find that it is not a 170 per cent but a 21 per cent increase. That is their commitment for real job creation in 1983?
One can only say, Mr. Speaker, just based on that one simple example-and we have not even begun to analyze these Estimates which are critical for 1983 job creation-that the Government is misleading the House in a dramatic way.
However, let us consider something else which we find in these Estimates, Mr. Speaker. I am assuming, first of all, that we all agree that job creation is important. We would like to see more money moved into that particular area. We find from the Estimates, then, in terms of direct job creation under CEIC,-that $100 million more than was spent last year will be invested in job creation. We also noticed that a certain amount of money has gone for PIP grants. Not $100 million,
February 22, 1983

Mr. Speaker, but $1.15 billion has gone for PIP grants to encourage, by and large, the multinational oil companies to explore the frontier areas of Canada. I am not making a judgment on whether or not that is a wise investment, but I personally do not think it is a particularly wise investment. But let us just say that $1.15 billion is going to assist, by and large, the multinational oil companies operating in Canada to explore in the frontier areas. How many jobs will that $1.5 billion create, Mr. Speaker? If we are seriously interested in job creation, that is the most unlikely place to spend a single dollar. The jobs created in that sector under the PIP grants will give us less return than spending money in any other sector of Government spending. Setting aside the rhetoric and looking at where the Government is actually going to be putting its job-creation money, Mr. Speaker, tells us that they are not serious when it comes to job creation because their actions go completely against the rhetoric which we hear from some of the more progressive Members opposite.
I notice with interest, as well, where some of the Government priorities lie, again without necessarily making a judgment at this point. I notice that when it comes to Government spending for operating and in capital costs, over-all Government spending by the Minister of Finance's own admission, is going to increase by 9.6 per cent. Let us say for a moment that we believe him. I personally do not believe him on this point, but if we take him at his word, he says spending for Government operating and capital costs will increase by 9.6 per cent. But there is another area, which is quite different from the 9.6 per cent area, and that is the area of Defence. Defence expenditures appear to be going up 11.3 per cent. It seems that in terms of over-all Government spending, we have identified military spending as a higher priority than other areas. That is an observation. I also notice something, Mr. Speaker, which I believe is a very sad comment on the Government's position towards war veterans. We realize as Members of Parliament how much time it takes to process concerns brought to our attention by veterans. Yet, in terms of person-years, one of the few Departments in the Government which is going to have a decrease of 11.4 per cent in person-years is the Department of Veterans Affairs. Some veterans in my constituency have waited one year, and some two years, simply to have their applications processed through to completion. To find that man-years in the Department of Veterans Affairs are going to be decreased by 11.4 per cent leaves one simply speechless.
We also notice, Mr. Speaker, there is no reference in these Estimates of Government expenditures for 1983 to de Havil-land and Canadair when they come back asking for $100 million each, or $200 million or $300 million. There is no mention of that, when those companies are on record themselves as saying, "We will be back asking for more when we require more." There is no mention of that, Mr. Speaker. There is also no mention of the contract work which the Government relies on to a large extent. There is an attempt, and 1 commend the Government for it, to evaluate carefully its expansion in terms of man-years to ensure that the return to the Government is maximized. But when I see there is no mention of money set aside for contract work, and knowing the amount of contract work which takes place, particularly with
Main Estimates, 1983-84
the federal Government, I believe we are leaving a large void, a large vacuum in these Estimates.
If the Government, and the Minister himself, are serious about these Estimates, when these Estimates go to the respective committees they should receive the kind of thorough analysis which they deserve, not the usual sit around and chitchat with the Minister for an hour or two, a handful of questions and a lot of gobbledygook on behalf of the Minister trying to skate around the issues. Then we vote, and the majority of the Government Members vote in favour and the Opposition vote against, and we all go home for the evening. That is not the kind of examination, study and investigation which Canadians want, Mr. Speaker, during these very critical times.
When we discuss those Estimates in the House of Commons or in committee, what is our goal? What is the point of these Estimates? What is the point of our discussion, our analysis, our examination? Are we attempting to find ways and means of developing a full employment option for this country? Are we trying to reduce Government spending by a certain amount? Are we attempting to support certain kinds of industries or provide certain kinds of services to Canadians? What is it, Mr. Speaker, that we are attempting to do with this examination? If we are simply examining it for the sake of examining it, then, of course, it is not going to be an appropriate investigation. Therefore, before we go into committees to examine these Estimates, surely we need to have some kind of strategy, some kind of game plan, some kind of program which will direct us in our inquiries to see if in fact we are getting the "bang for the buck" which Canadians ought to be receiving.
In conclusion then, Mr. Speaker, I make an appeal on behalf of the New Democratic Party to the Minister: when we have an opportunity to evaluate these Estimates in detail, as the Minister has indicated in his speech, would he give us a framework within which to operate, a strategy, so that our examination can be aimed toward some purpose, some goal, so that there is some objective which the examination is attempting to achieve.
We look forward to getting the Estimates into committee as quickly as possible. In attempting to digest these Estimates, however, Mr. Speaker, I think that a great deal of that enthusiasm and commitment to do the job well will be eliminated because we all know how successful these Estimates have been in years past at predicting and explaining the reality of the Canadian economy, and going in with that cloud over us, I suspect that once again this examination is going to be marginal, if not completely fruitless.


The Acting Speaker (Mr. Corbin):: Order. Before proceeding to the question period, the Chair should remind Hon. Members that it has the discretion of limiting the time for the proceedings on questions. I would propose to the House, in view of the Minister's statement having lasted some 23 minutes, approximately-and this is a proposal from the Chair-that we set the time for the question period at some 20

February 22, 1983
Main Estimates, 1983-84
minutes. And unless there are some strong objections from Flon. Members at this time, I think that at about 4.20 p.m. we should end the time provided for questions.


Philip Derek Lewis: Mr. Speaker, to the best of my knowledge, going back to the last time there was a statement on motions, I do not remember any correlation between the length of the Minister's remarks and the questions. I believe we can, on this occasion, agree to that, but I would much appreciate the question period being controlled by the Chair in accordance with the flow of questions and the sense of the House.
With all due respect, I would also ask that Your Honour monitor the answers on this historic occasion of the first statement on motions since December, 1981. I do not feel that this should be a precedent which is set in stone, for I want some time to think about this and discuss it with my colleagues.


Nelson Andrew Riis: Mr. Speaker, I would agree with the suggestion that rather than allocating a certain period of time, we should leave it to the discretion of the Chair to decide when a meaningful interchange of questions and answers has terminated. I know that the Minister himself, judging from his comments to us earlier and the thrust of his speech, is an individual who is open and quite prepared to do his best at this point, to examine and clarify any questions raised by Hon. Members.
In the spirit of the Minister's comments, I would suggest that rather than setting aside a prescribed period of time, let us just see, and perhaps after only ten minutes Your Honour might, in your wisdom, find that the ebb and flow is sufficient, or perhaps that it should continue for 30 minutes.


David P. Smith: Mr. Speaker, we on this side of the House believe your proposition is a reasonable one. I might say that we are frequently urged by Hon. Members opposite to have more statements by Ministers. Quite frankly, I would think that would be a healthy trend, but it cannot be totally open-ended. There must be reasonable limits. I welcome Your Honour's proposition.


Mr. Malone:: I agree with the Parliamentary Secretary when he says it would be healthy for Parliament to have more statements on motions. With regard to the question as to whether or not there should be fixed times attached to the length of the question period, may I put forward at least one argument for Your Honour's consideration as to why that is probably better left to your discretion? If we state that the period will be 20 minutes, we will have then signalled to the Minister answering the questions how much time he needs to use up. He could have two questions and two ten-minute answers. He would then know he would have to work until 20 after.


Some Hon. Members:: Oh, oh!


An Hon. Member:: Not Herb. Be fair.


Arnold John Malone: If it is left to Your Honour's discretion, then I believe the Minister would be more likely to be psychologically forced into the position of answering the questions that Hon. Members might ask. On the other hand, if he knows that all he must do is use up 20 minutes, then it is to his advantage. He would simply need to know how much time he has for buffoonery, without necessarily responding to the question. I think that if Your Honour believes it should be 20 minutes, Your Honour's judgment would be fine, but it should not be a preknown fact.


The Acting Speaker (Mr. Corbin):: The Chair thanks Hon. Members for their wise comments. Standing Orders do create some difficulty for the Chair in the proceedings inasmuch as they leave the matter entirely to the discretion of the Chair. I have made good note of Hon. Members' responses to the Chair's suggestion and I will be guided accordingly.


Miss Carney:: Mr. Speaker, I would like to address a question to the President of the Treasury Board (Mr. Gray), dealing with some of the questions which have been raised by the two Hon. Members who spoke previously, and which we attempted to explore in the lock-up.
First, last year the Government forecast an increase in outlays of 11.7 per cent in the Main Estimates while, in actual fact, the increase in Government expenditures was 17.8 per cent. I believe my colleague, the Hon. Member for Mississauga South (Mr. Blenkarn), made that point. The Minister is now forecasting an increase in Government expenditures of 9.6 per cent. What assurances can the Minister give the House that he can hold Government outlays to 9.6 per cent in the absence of any budget or revenue forecast or, in fact, any responsible fiscal forecast?


Herbert Eser (Herb) Gray: Mr. Speaker, what we are discussing here is a comparison of the total outlays as announced to the House by the Minister of Finance (Mr. Lalonde) in his statement last week and as restated in Part I of the Estimates, amounting to $81,150,000,000 for 1982-83, with a forecast of total outlays for 1983-84, giving a projected increase in total outlays of 9.6 per cent.
However, there are some elements in the total outlays projected for 1983-84 which indicate why we basically are discussing a forecast. We cannot be totally certain what the demand will be on the Unemployment Insurance Fund. It may require more, but it will hopefully require even less than we have estimated we will have to provide.
With respect to our transfers to the Provinces under the Established Programs Financing legislation, we have estimated that our cash transfers to the Provinces will have to increase because the tax revenues which they had expected to receive under this legislation are likely to be less because of the weakened economic situation. This may also change.
Therefore, we are giving a picture at a point in time as to what we expect the total outlays for 1983-84 to be. But we are obviously discussing a forecast. We will work in order to stick to it, but there are certain factors not under our control which
February 22, 1983

will affect the amounts of money which we will have to provide under statutes passed by this Parliament.


Pat Carney: Mr. Speaker, I would like to address another question to the President of the Treasury Board. I can understand his problem in dealing with a forecast which is at a special moment in time. However, what I cannot understand is the difficulty which the Government seems to have on its side of the House in getting its own numbers together. The Hon. Member for Kamloops-Shuswap (Mr. Riis) has already discussed the discrepancy in the job program, and I would like to address one concerning the housing program.
The allocation for Canada Mortgage and Housing Corporation shows a substantial increase this year of about $482 million. In the Blue Book Estimates, the Government states that $122 million of this amount is included for the purposes of extending the Government aid program to first-time home buyers. In his statement last week, the Minister of Finance (Mr. Lalonde) used the figure of $240 million. There is a discrepancy of $120 million in the space of a few days. Could the Minister explain why it is not possible to get better numbers on some of these spending programs?


Arnold John Malone: What's a million?


Donald Alex Blenkarn: What's a hundred million?


Herbert Eser (Herb) Gray: Mr. Speaker, I think it is the custom, when one deals with specific programs, to address the question to the Minister responsible. However, I would remind the Hon. Member that subsequent to the Main Estimates for 1982-83 which were tabled last year, we had the June budget and the October economic statement, and both of those declarations proposed to Parliament substantial additional expenditures in such areas as housing. The Hon. Member should take that fact into account when making her comparison with regard to numbers.


Pat Carney: Mr. Speaker, I would like to ask the President of the Treasury Board another question. I am not referring to figures which are tabled months after each other. I am referring to program figures or Estimates which are given in this House by the Government within days of each other, which indicate that the Government's financial figures given to us are unreliable, and not to be trusted.
According to the Privy Council Estimates, this year the Government will spend about $4 billion on commissions of inquiry, task forces and others.


Herbert Eser (Herb) Gray: Four billion?


Pat Carney: How much of this amount will be related to the Macdonald Commission on the economy?


Herbert Eser (Herb) Gray: Did the Hon. Member say $4 billion or $4 million?


Pat Carney: I said $4 billion, which is the figure in my notes, but I will have to check the Estimates.
Main Estimates, 1983-84


Herbert Eser (Herb) Gray: Yes. I respectfully suggest that the Hon. Member check her numbers. I think that most of the amounts with respect to the Macdonald Commission on the economy will be dealt with in Supplementary Estimates. I will provide her with the information, hopefully during the course of this question period, with respect to what is in these Estimates on the Macdonald Commission.


Mr. Beatty:: Mr. Speaker, I should like to ask the Minister about the Government spending on propaganda this year. He will recall that on page 15 of the June budget paper last year it was set out that in fiscal years 1982-83 and 1983-84 there would be $15 million for each of those years cut from departmental publishing and advertising, for a total of $30 million.
In view of the fact that on page 1-48 of the Main Estimates under the heading "Information" the difference between 198283 and 1983-84 is only about $5.5 million, could the Minister tell us where the other $24.5 million is in cuts in propaganda as promised by the former Minister of Finance.


Herbert Eser (Herb) Gray: Mr. Speaker, I reject the use of the word "propaganda". The Government is carrying out activities through advertisements to inform the public, in exactly same way the Conservative Government of Ontario and the Conservative Government of Alberta are doing. My hon. friend never complains about their activities which, in many ways, go beyond anything done by the federal Government.
I will be providing my hon. friend with further information in answer to his question. I can say that work is being done with respect to restraint of advertising expenditures which, if my efforts are successful, will go beyond what is in the Blue Book.


Henry Perrin Beatty: Mr. Speaker, these figures were included in the June budget under the former Minister of Finance. Is the President of the Treasury Board (Mr. Gray) now telling the House that he has not given the sort of attention that is necessary to these Government-wide figures on information, propaganda, advertising and publications-he can use his own terms? Is he saying that he has not bothered to check to see whether the $30 million promised in the June budget has been cut out and, if so, where is the other $24.5 million?


Herbert Eser (Herb) Gray: Mr. Speaker, I am not only working to see that what was said in the June budget was carried out, I am working to see to what extent we can go beyond that. I hope that when this becomes more evident even my hon. friend will applaud these efforts.


Mr. Wright:: Mr. Speaker, I have a question for the President of the Treasury Board (Mr. Gray). In Table 5 on page 149 under the heading "All Other Expenditures", the 1983-84 Estimates show $7.5 billion, while the 1982-83 Estimates were $3.5 billion. That is an increase of 88 per cent, Mr. Speaker. Given that inflation is approximately 8.3 per cent, how does the Minister account for this serious increase?

February 22, 1983
Main Estimates, 1983-84


Herbert Eser (Herb) Gray: Mr. Speaker, there is a whole range of increases that are not connected with the rate of inflation, nor should they be. We are providing substantial additional funding in support of housing, and substantial additional funding in support of job creation, both directly through Government efforts and in support of the private sector. There are a number of items like that which I do not think, nor do I think the Canadian public believes, should be limited to an increase equal to the rate of inflation. If that were the case, we would not be responding to the additional needs and requirements caused by our difficult economic situation. This is the explanation my hon. friend is seeking.


Frederick William Wright: Mr. Speaker, it is too bad that this could not be translated into jobs. As the former Minister of Public Works knows, his program was a failure.
In Table 5, under "Purchase, Repair and Upkeep", the 1983-84 Estimates are $1,056 billion, while the 1982 Estimates were $726 million. That is an increase of 45 per cent. Given the inflation figures that I have just quoted, could the Minister tell the House why there is such an increase?


Herbert Eser (Herb) Gray: Mr. Speaker, unfortunately the need to repair and maintain Government buildings and facilities is not linked to the rate of inflation. The rate at which things wear out or need to be repaired has something to do with the degree of actual use and normal maintenance requirements. I wish it were possible to limit these expenditures to the rate of inflation in some cases. I would ask my hon. friend what the facts are with respect to the need to carry out repairs and maintenance in order to effectively preserve these important assets belonging to the Canadian people. I think we have to deal with the reality which may or may not have anything to do with the rate of inflation.


Benno Friesen: Mr. Speaker, I should like to ask the Minister a question about VIA Rail. On page 29-82, Vote 80 I notice that the 1983-84 Estimates are for $755.4 million, while the
1981-82 Estimates were for $540,617 million. Last year there was a 20 per cent cutback in VIA Rail services in order to save $100 million. If you deduct the $100 million from the 1982-83 figure, it means the Government is now asking for $200 million more in these Estimates for VIA Rail, with a 20 per cent cutback.
To corroborate that, in Part I of the Blue Book at page 49, the Minister said:
In the Department of Transport, of the total 451 increase in person-years, 155 are required for regulatory activities related to air safety, 104 will be used for the operation and maintenance of air navigation aids and facilities, and 127 have been approved for the Marine Program for requirements such as search and rescue, improved vessel traffic management services and a transfer of responsibilities from the Department of Public Works.
Man-years for VIA Rail are not mentioned anywhere. Where will the $200 million be spent-will it be totally on administration?


Herbert Eser (Herb) Gray: Mr. Speaker, I could suggest that this quetion be referred to the responsible Minister, but I will try to assist my hon. friend by giving him the information that I have.
First of all-and I stand to be corrected-when it comes to man-years for VIA Rail, that is not part of the controlled person-years under the jurisdiction of the Treasury Board. In any event, my hon. friend may recall that we had Supplementary Estimates last year of $137.2 million in order to reflect more accurately the cost of providing rail passenger service.
What we are doing, basically, is to carry over to this year what was in last year's Main Estimates and what was in the Supplementary Estimates, with the exception of some additional funding provided last year for assistance to CN, CP and VIA employees who were affected by changes in railway passenger service.
The further increase of 1983-84 over forecast outlays of
1982-83, include $73 million additional payments for services provided by CP and CN, costed in accordance with the provision of the Canadian Transport Commission costing order R-6313 and the Commission's staff estimates of appropriate inflation indices for railway costs in 1983-84.
My hon. friend will recall that this is basically done after the fact, which is something that Members of the House have questioned from time to time. This matter is under review. I am also informed that the figures my hon. friend mentioned include the provision of $43 million for additional capital expenditures, of which the most significant item is further expenditure for the purchase of ten LRC train sets. This is a most useful support for Canadian industrial activity, especially since it involves something that the NDP spokesman claims to be interested in, and that is the use of significant Canadian technological development.
I hope this information will be of assistance to my hon. friend.


Benno Friesen: Mr. Speaker, I stand to be corrected but I thought that several years ago we passed an Estimate which was a pay-out to CN, forgiving it for $600 million or $800 million so that it could operate on its own, as a Crown corporation ought to operate, and compete in the sector.
Is the Minister now saying that there is an extra $47 million in capital expenditures being given to VIA Rail in order to help it along, even though it is supposed to be running on its own? Did I understand him correctly as saying that some of that $200 million was designed as a kind of severance pay to employees who had been injured because of the cutback of 20 per cent of rail services?


Herbert Eser (Herb) Gray: Mr. Speaker, again I think a detailed answer to this question should be given by the responsible Minister. I am told that there was funding provided in the Supplementary Estimates last year to assist in the adjustment of CN, CP and VIA Rail employees affected by the cutback in railway passenger services.
Again this is not a matter I claim to follow in depth or in detail, but I do not think either the House or the Government has taken a decision that VIA Rail is to be immediately selfsustaining. Instead, the decision of the House was that the
February 22, 1983

provision of railway services was a justified need and that, therefore, the House should provide payments to VIA Rail to enable that particular level of service to be maintained. This is why there was an amount in last year's Main Estimates that was approved by the House, and this is why there was a further amount approved by the House in the Supplementary Estimates. This is being picked up again in the Main Estimates for 1983-84. Of course it is up to the House to decide whether or not the amounts in question are to be approved.


Nelson Andrew Riis: Mr. Speaker, I have a very short question for the President of the Treasury Board (Mr. Gray) dealing with the amount of money per job created in the area designated as PIP grants, with which the Minister is familiar. While I realize he may not have the figure available, will he give us some general indication as to what it would cost under that particular sector from a job-creation cost point of view?


Herbert Eser (Herb) Gray: Mr. Speaker, I regret that I do not have information about the cost per job likely to be created by PIP grants. 1 remind my Hon. friend that PIP was not intended to respond to the need for short-term job creation. Its purpose was to carry out a long-term and long-range program to develop our own Canadian oil and gas energy resources. It is part of a long-range effort by the Government, widely supported by the Canadian people, to develop self-sufficiency in oil and gas and to do so in a way which provides opportunities for Canadian industrial and regional benefits, both with respect to the provision of machinery and equipment and also jobs.
One has to look at PIP in a somewhat different way than one looks at the NEED Program, which was directly related to short-term job creation of a kind that, hopefully, will leave some lasting benefit. However, I do not think one would expect it to have exactly the same benefit from PIP and the results sought from it, in terms of creating a basically Canadian oil and gas industry in the hands of Canadians for the benefit of Canadians. PIP is a longer-term program.
While I will see what figures I can provide for my hon. friend in terms of job creation, I would say that this is a somewhat different matter from the type of jobs we hope to create and are creating under the NEED Program.
We are carrying out a long-term development of something which is basic to the well-being of our whole Canadian industrial base. It is reasonably well known that the oil and gas industry is not labour-intensive. Be that as it may, if it is not directly labour-intensive, it is still an outlet for Canadian professional services and, hopefully, for Canadian machinery and equipment. It is a basis for thousands of other jobs over the years in Canadian industrial sectors that will benefit from having a strong Canadian oil and gas sector. I think the Canadian public will, very much agree with the approach I have described.


Nelson Andrew Riis: Mr. Speaker, sometimes one wishes one had not asked questions which allowed the Minister to go off on so many tangents. I will try to be more specific in my last question.
Main Estimates, 1983-84
When we go into the respective committees to examine the Estimates in detail, does the Minister feel that there will be sufficient information to understand the priorities of the Government, so that we can evaluate the Estimates for particular areas within some framework and understand clearly what it is the Government of Canada is attempting to do today?


Herbert Eser (Herb) Gray: Mr. Speaker, I am told that there is no Parliament in the world which has so much information from the executive side of Government with respect to its expenditure programs. When one looks at the quantity of material which I tabled, it would be hard for any reasonable person to say that we are not making a very sincere and substantial effort to provide not only a lot of information but to provide information in a meaningful form.
I suppose it is always possible to bring about improvements. In fact, I said in my speech in the House that I intended to consult with Hon. Members as to how we could improve the format of Part II in the Blue Book. We have made some very substantial strides forward, not only in the quantity of information provided, but in its over-all quality.
I suppose we could go further. An effort was made to inform some Opposition spokespersons in the brief period available before I tabled the Estimates. If Hon. Members wanted to do their homework using the information provided, they would certainly be in a position to carry out a very meaningful investigation, not only of the Government's expenditure programs but of the priorities underlying them.


Blaine Allen Thacker: Mr. Speaker, Canadians have been deluged with bumper stickers and various advertising programs calling for six and five. The Minister has now admitted that the Main Estimates for 1983-84 will be up 9.6 per cent over 1982-83.
Will the Minister admit in good faith that once the Supple-mentaries are in, A, B, C and D, for the year 1983-84, the percentage increase will be closer to 17 per cent or 18 per cent, which will be a similar increase in terms of what Government expenditures have been in 1981 -82 over the year before and in 1982-83 over the year before?


Herbert Eser (Herb) Gray: Mr. Speaker, I am really not in a position to agree with my hon. friend. We certainly intend to make a very important and substantial effort to remain within the expenditure framework reflected by the total outlays figure. As I said to my hon. friend, there are certain factors which are not within the Government's control with respect to programs such as Unemployment Insurance and other statutory programs involving transfers to individuals, to businesses, and to provincial and municipal Governments. The Government is obliged to carry out what the statutes in question indicate. If because of a decline, for example, in revenues generated by the tax points allowed to a provincial Government, it is not getting the revenues it expected, the federal Government has no alternative but to increase the cash payments required under the established programs legislation.
If unemployment continues at high levels or even goes up higher-and I hope this never happens-the Government will

February 22, 1983
Main Estimates, 1983-84
be obliged to increase its payment to the Unemployment Insurance Fund. There are certain factors which we can forecast to the best of our ability but which are beyond our absolute control.


Blaine Allen Thacker: Mr. Speaker, that of course is true, but from all the data which the Minister has and based on historical projections of the amount of the Supplementary Estimates, will he agree and admit that when we get to this time next year and look at 1984-85 the percentage increase this year over last year will likely again be in the order of 17 per cent or 18 per cent?


Herbert Eser (Herb) Gray: Mr. Speaker, I am not prepared to agree or to admit that. Let us see what happens. Let us hope that things improve in the economy so that some of these forecasted expenditures do not have to be carried out at the level we have here. Perhaps they will be even less than 9.6 per cent. On the other hand, as I said to my hon. friend, you cannot say at this point that events will not develop so that we have to make payments above the forecast level. There is a possibility we will go above this. But we are giving a forecast at this point in time to the best of the information we have. All I can say is, let us see what happens, as the Hon. Member puts it, when we meet on this subject this time next year.


The Acting Speaker (Mr. Corbin):: Order, please. The Chair, guided as it is by the wise comments made earlier at the beginning of question period, I proposes at this time to recognize two more Members who have risen; the Hon. Member for Capilano (Mr. Huntington) and the Hon. Member for Edmonton West (Mr. Lambert), after which we will revert to Routine Proceedings.


Mr. Huntington:: Mr. Speaker, I have a question for the President of the Treasury Board (Mr. Gray). I know it is difficult for him to answer questions that should be directed to appropriate Ministers, but in view of the fact he was recently Minister of Industry, Trade and Commerce and DREE, perhaps he could help me with the problem I have.
At the top of page 17 in Part I of the Estimates, funding continues for the organization of the pulp and paper industry. This troubles me because Canada had built one of the most modern steel industries in the world on the principle of capital cost allowance. If the steel industry can become modern in terms of world competition, why is that that the pulp and paper companies in certain parts of Canada have to rely on Government grants? Is it because they have been drawing down too much of their earnings in the form of dividends instead of using the money for capital replacement in order to remain modern, not requiring Government assistance?


Herbert Eser (Herb) Gray: Mr. Speaker, it is my understanding that back, I think, in 1979 the federal Government and the provincial Governments of eastern Canada, including the Conservative Governments of Ontario, New Brunswick and those other Governments that were Conservative at the time, agreed with one another that it was in the over-all public interest, not only
in their region but in all of Canada to lever several billion dollars in additional investment from the private sector, the pulp and paper companies to enable them to modernize and upgrade so that employment would be stabilized and so they could meet competition from companies in the southern United States, where there are faster growing trees and totally new plants.
As a consequence, we have had the results we have been seeking from several hundred million dollars in joint investment by federal and provincial Governments. We have had investment by the private sector in modernizing our pulp and paper companies which will turn out to be several billion dollars. We have stabilized employment and we have made our industry in eastern Canada more competitive in a way that would not otherwise be the case. We have taken steps in the best interests of the entire country.
I invite my hon. friend to take this up with his colleagues, the Conservative Members of his caucus from New Brunswick, Ontario and Nova Scotia. They will give him the same explanation I have given him, and an even fuller one, if at all possible. They will strongly dissent from any suggestion by him that this program is not in the interests of their area or of the country as a whole.


Arthur Ronald Huntington: Mr. Speaker, I cannot accept the answer of the President of the Treasury Board because it does not specifically address the question I asked.
I appreciate the need to modernize plants in those areas, but is it because the draw downs in dividends have been too heavy for companies to take advantage of capital cost allowance in the management of their balance sheet, as the steel industry has done and as other pulp and paper industries in Canada have done-as they have done on the West Coast? Why is it necessary for the Government to intervene where there has been less than good management, when the Government does not have to intervene where there has been good management?


Herbert Eser (Herb) Gray: Mr. Speaker, I regret that I do not have any detailed information at hand that would be available to the Minister responsible for Forestry or to my successor, the Minister of Industry, Trade and Commerce (Mr. Lumley). The amounts are in the Estimates so that we can carry out our side of the agreements which were signed by Conservative and other provincial Governments with respect to the modernization of the pulp and paper sector of eastern Canada. Subject to correction when it comes to western Canada, we have provided assistance in other ways, marketing assistance through the COMDE Program. I could be mistaken, but we have provided assistance in some cases through the DREE Program in some of the Provinces. We have said that we are willing to sit down with the provincial Governments in Western Canada to see if we could develop a program equivalent to that already in place in eastern Canada.
I am not in a position to say what factors make the pulp and paper industry in eastern Canada differ from the steel industry, and so on, but I do know that if we had not done this we
February 22, 1983

would have imperilled, in fact lost, tens of thousands of jobs in areas represented by colleagues of the Hon. Member, and by his friend in his caucus.


Arthur Ronald Huntington: Address the question, Herb.


Herbert Eser (Herb) Gray: We would have failed to take steps that were strongly urged upon us by provincial Governments made up of the same Party he says he is a part of. The debate is not between myself and my hon. friend; the debate is as much or more between him and his colleagues in his Party from Eastern Canada. I hope those colleagues will note what he said and they will work it out in their caucus along with all the other things that they have to work out.


Philip Derek Lewis: We have no Gillespies.


Mr. Lang:: You wish you did.


Mr. Lambert:: Mr. Speaker, I hope I will get answers from the Minister that will not get buried in that sort of political flim-flam in which he likes to indulge. I would refer the Minister to Table 2.1 and 2.2 of Part I of the Government expenditure plan. Along the same line as the point discussed by my colleague, the Hon. Member for Lethbridge-Foothills (Mr. Thacker), I would like to remind the Minister that for years many of us have been complaining about the totally misleading impression left by the tables as we see them at the beginning of Chapter 2 of the expenditure plan. To this extent, I think the Minister would agree that total outlays for 1982-1983 as shown are not anywhere near reality because they were prepared for publication in this Blue Book at least six weeks ago. They were closed at the end of December, 1982, and we still have three months to go to complete fiscal 1982-1983.
Therefore, we have not seen Final Estimates or Estimates C. My colleague, the Hon. Member for Winnipeg North Centre (Mr. Knowles) who has seen so many of those, will tell you that those are usually very interesting Supplementary Estimates, and they are usually the biggest ones. The figure of $81,150 billion may be many billions of dollars greater. In addition to which, there are only two figures in the 1983-1984 column which may have, shall we say, some accuracy. One is the projection of the budgetary expenditures, and the second is loans. There are no Supplementary Estimates A; there are no Supplementary Estimates B and there are no Supplementary Estimates C. Therefore, the whole table which shows changes year by year of the expenditures pales off into something that is totally incomplete and misleading. Can the Minister give us more accurate figures for the total outlays of 1982-1983? What does he anticipate as President of the Treasury Board? This is something we want to know because we are being asked, at the same time as we are starting to consider this, to consider borrowing authority for another $14 billion for 19831984. Therefore, the information is very pertinent now and not six months hence. I apologize for the length of the question, but can he give us more precise information as to 1982-83 and
1983-84?
Main Estimates, 1983-84


Herbert Eser (Herb) Gray: Mr. Speaker, it is my understanding that the figure in Part I, Table 2.1, includes an amount for final Supplementaries. We will be tabling them in the House before too long, and the amounts and exact details will be available.
With respect to the proposed expenditures for 1983-84, the Member is right to the extent that this Table is something of a shorthand expression of the projected total outlays. But these not only cover the amounts in the Blue Book, they also cover, as the Table says, amounts for loans, investments and advances. They cover amounts for a central reserve to cover adjustments to statutory programs. They cover envelope reserves, expenditures which will be reflected in the Supplementary Estimates once decisions are taken on new expenditure programs or the adjustment of existing expenditure programs.
There is also an allowance for lapses, in other words for all the moneys proposed in the Blue Book not being spent, as well as an adjustment or allowance for repayment of previous years' loans.
I will go over these amounts again for the main budgetary Estimates of $85,618 billion, for loans investment and advances we have $1,843 billion. There is a central reserve of $891 million. There are envelope reserves of $2,452 billion. From these amounts we have to deduct the allowance for lapses of $1,407 billion and the repayment of previous year's loans in the amount of $497 million. When the first group of numbers I gave are added up and the last two are deducted from them you get the figure in the final column of Table 2.1 of $88.9 billion.
As I said, I agree that Table 2.1 itself is rather abbreviated, but all this other information is displayed in various tables throughout the Part I expenditure plan and was also contained in my statement earlier this afternoon.


Marcel Joseph Aimé Lambert: Mr. Speaker, just for the Minister's edification, may I suggest that he look at Table 2.2 where the figures come out the same, $88.9 billion. Included in there are the envelope reserves and the provision for lapses. Therefore, there is no difference.
If the figure of $87,852 billion for budgetary expenditures is firm but contains the provision for some flexibility-which it must-such as reserves for the envelopes and adjustment for the lapses, what is the purpose of bringing in supplementary reserves on three different occasions, which will bump up the total of $88.9 billion or the $87,852 billion for budgetary expenses to almost $95 billion, if one looks at the projections of the last few years?


Herbert Eser (Herb) Gray: Mr. Speaker, any use of the envelope reserve will have to be reflected in Supplementary Estimates tabled in the House and voted on in the House. I do not see it as bumping up the amounts.
Incidentally, when my hon. friend's Party was in Government, they took great pride in the fact that they were instituting this program and expenditure management system. We are

February 22, 1983
Privilege-Mr. Althouse
simply carrying forward the elements of the system and displaying it in the way that it was first presented, if I am not mistaken, by my hon. friend's Government, although I am told, some substantial work on this system was done by the Government that was in office prior to 1979. If there are some qualms about the way things are displayed under it, I suggest that responsibility has to be shared by both sides of the House for what we have here today, in terms of the form of presentation of the Estimates.


Philip Derek Lewis: Mr. Speaker, I rise on a point of order. I would like to compliment the Minister on the form of his presentation, if not the substance. If I had the opportunity to ask a question, I would have inquired whether the little six and five stickers will be replaced by ones that say 9.6.
However, I would suggest that we have seen today the parliamentary tradition carried out as I understand it. We have had the Minister come to the House and make a statement.
We have had the opportunity on this side for our Members to be briefed. There have been replies by the Official Opposition and the New Democratic Party. As well, there was a brief question period which followed the flow and ebb of what should happen in the House as we suggested earlier.
Our objections in the past have been about seeing Government policies, such as the Government reply to the Kent Commission report, stated on university campuses. We believe that it demeans this House of Parliament. We find that to be totally offensive to the way the public and representatives of the public should find out about Government policy.
I do not want this to go to the Minister's head, but I suggest that this is the way it should happen and we commend today's practice to the Government in the future.


Herbert Eser (Herb) Gray: Briefly, Mr. Speaker, I want to say that I appreciate my hon. friend's comments and I will draw them to the attention of my colleagues. I do want to point out to him, however, that the Government, as far as I am aware, never said that it would limit all of its expenditures to 6 per cent and 5 per cent. What it was limiting was very clearly stated in the June budget and, in fact, it would not be legally possible to limit all its expenditures to 6 per cent and 5 per cent since there are statutes passed by this Parliament calling for a certain formula for expenditures which we have to obey, as we are doing in the material tabled today.


PRIVILEGE
Victor Fredrich (Vic) Althouse: Mr. Speaker, I rise on a question of privilege. I did not hurry to raise this because it is so rare that we get a ministerial statement in the House. I did not want to intervene in that process.
However, there was a matter arising out of question period which I think should be dealt with by this body because I
believe it deals with the ancient rights and privileges of Members of this House. My understanding of the basic tenets of the parliamentary process is that Members of Parliament oversee, review and pass Government policy into law, after some amendments, with regard to expenditures. As well, we review the Estimates that are based on the approval of those policies. We witnessed that function here this afternoon.
I noted that in the provincial legislatures of this country, a provincial Government introduces a policy to the legislature, the expenditures that are required to implement the policy are passed, and then the policy is put into place. I believe this is what happened with regard to provincial opposition to change in the Crowsnest rates.
We discovered today that some Provinces, having gone through that procedure, have received approval from provincial Members to embark upon an advertising program to oppose what is at the moment the Government policy proposal by the Minister of Agriculture (Mr. Whelan) to meet that advertising thrust with an arbitrary action of his own. It is an action which does not have the backing or approval of the House. The policy has never been presented to the House. The Government is expending funds that have not been approved by the House since that policy has never been introduced in the House. We have no funds in last year's Estimates to embark upon a program of advertising to explain a policy which has never been introduced to this House, to explain why the Government may be coming in with a policy to do away with the Crowsnest pass rate agreement.
Therefore I submit that the expenditure is being made without the approval of this House. It has not been included in the Estimates of this House and, because it is being made without our approval, our rights and privileges as Members of Parliament are being trampled upon for many, many generations it has been the undisputed right and privilege of Parliamentarians to be presented with the revenue and expenditure proposals by the Government.


Mr. Deputy Speaker:: The Hon. Member raises as a matter of privilege some details concerning the manner in which Government funds are expended. At this stage the Government has laid before the House a statement of its proposed expenditures, and at this stage the House will be dealing, through the procedures that have been followed, with these matters. If at any time expenditures are made by Departments that are not approved by Parliament then there are appropriate means for Members of this House to take action through the committees and through other measures available to them.
At this stage it hardly seems to be a matter of privilege to raise a question concerning the way in which money is spent, when the Government has just laid before the House a statement of how it will spend the funds for which it is requesting Parliamentary approval.


Victor Fredrich (Vic) Althouse: Mr. Speaker-
February 22, 1983


Mr. Deputy Speaker:: 1 say to the Hon. Member for Hum-boidt-Lake Centre that I have ruled that there is no point of privilege in the matter which he has raised before the House. Does he have something else to raise?


Victor Fredrich (Vic) Althouse: Yes, Mr. Speaker, I do not wish to argue with you but I would point out that my remarks were perhaps misconstrued.


Mr. Deputy Speaker:: The matter has been dealt with.


Gordon Edward Taylor: Mr. Speaker, my point of order does not involve the expenditures that are going to take place in the future.


Victor Fredrich (Vic) Althouse: Mine did not either.


Gordon Edward Taylor: I am suggesting that there is a flagrant abuse when money during the last year which had been voted on is spent for advertising a policy that has not yet been adopted by this House.


Mr. Deputy Speaker:: We are dealing with exactly the same point. It may be a grievance, it may be a matter that Hon. Members may seek to raise on Opposition days or by other methods that are available to them, but it is hardly at this point a matter of privilege.


James Ross Fulton: Mr. Speaker, I think I could probably help you on this point. If you check the "blues" that my colleague, the Hon. Member for Humboldt-Lake Centre (Mr. Althouse) was referring to, you will see that he was not referring to-


Mr. Deputy Speaker:: The Member is raising the same point. The Chair has ruled on the point and will not hear further argument. The Chair listened to the argument which was raised as a matter of privilege. Whatever else it is, it is not privilege.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
David P. Smith: Mr. Speaker, the following question will be answered today: No. 4,583.


Mr. McCuish: 1.	Did public consultations and discussions with officials of the Canada Post Corporation on the subject of the definition of a "letter'' take place during the past year and, if so, on what dates and at what locations were meetings held?
2.	(a) What were the names of the individuals, groups and organizations that were involved (b) were they contacted in advance of the meetings and, if so (i) through what means (ii) what was the cost involved?
Order Paper Questions
3.	Which officials in the Corporation participated and was a report with recommendations prepared for the President and Chief Executive Officer?


David Berger: The Canada Post Corporation has informed me as follows: 1. Yes. See part 2 for dates and locations.
Organizations	Location	DatesCustoms & Excise	Ottawa	February 5, 1982 May 24, 1982Canadian Direct Mail Association	Toronto	June 18, 1982Magazine Association of Canada	Toronto	June 18, 1982Canadian Chamber of Commerce	Montreal	June 21, 1982 September 1, 1982 October 26, 1982Canadian Daily Newspaper Publishers Association	Ottawa	June 22, 1982Canadian Federation of Independent Business	Toronto	June 23, 1982Canadian Business Press	Toronto	June 23, 1982Consumers Association of Canada	Ottawa	June 30, 1982Ontario Municipal Electrical Association	Toronto	July 28, 1982 October 5, 1982 November 3, 1982Ontario Natural Gas Association	Toronto	July 30, 1982 November 3, 1982Canadian Bankers' Association	Ottawa Toronto	August 31, 1982 October 29, 1982Canadian Payments Association	Ottawa	August 31, 1982Canadian Depository for Securities	Toronto	October 29, 1982Retail Council of Canada	Toronto	November 4, 1982Canadian Manufacturers' Association	Toronto	November 4, 1982Montreal Board of Trade	Montreal	November 16, 1982Nepean Hydro	Ottawa	November 24, 1982Canadian Gas Association	Toronto	July 30, 1982 November 3, 1982Canadian Greeting Cards Association	Toronto	June 18,1982Canadian Electrical Association	Toronto	November 3, 1982Canadian Organizations for Small Business	Ottawa	July 1982
2. (b) Yes. (i) by telephone, (ii) approximately $6,830 for travel expenses.

February 22, 1983
Adjournment Motion
3. The following officials of the Corporation were involved at different times in these meetings:
L. Sperling
R. W. Rapley P. Mclnenly Y. Gariepy
D. Campbell R. A. Harling
Vice President, Corporate Planning & Business Development
Group General Manager, Corporate Affairs General Counsel, Legal Services Vice President, MOPS Planning and Administration
Marketing Planning Branch Marketing Planning Branch
Yes, a report was prepared for the President and Chief Executive Officer.


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


Mr. Deputy Speaker:: Shall all the remaining questions stand?


Some Hon. Members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION


[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that Bill C-143, to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs; and the amendment of Mr. Skelly (p. 22957).
Hon. Romeo LeBlanc (Minister of Public Works):: Mr. Speaker, I am delighted with this opportunity to take part very briefly in the debate and support the measures being proposed by the Minister of Finance (Mr. Lalonde) in Bill C-143. I most certainly wish to emphasize the importance of these proposals which are aimed at maintaining adequate funding to stimulate the housing industry and to help those in Canada who are most in need of housing. As Hon. Members are aware, housing and residential construction has become a major government activity in creating employment and economic growth.
The housing sector has a beneficial impact on all other sectors of economic activity, and most important of all, it makes a massive use of Canadian materials and services rather than imports.

The House would like me probably to provide some facts for this assertion. Each 10,000 unit increase in housing starts creates over 25,000 person years of employment.


Miss Begin:: Hear, hear!


Roméo LeBlanc: Close to 8,000 of these jobs are in the construction industry.


Monique Bégin: Excellent. That is what we want.


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 45, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the Hon. Member for Fundy-Royal (Mr. Corbett)-Agriculture- Application of feed freight assistance program to Maritime farmers, (b) division of funds between Quebec and New Brunswick; the Hon. Member for Saskatoon West (Mr. Hnatyshyn)-The Administration-Cape Breton coal agreement-application of guidelines on ministerial conduct, (b) knowledge of Minister of Energy, Mines and Resources; the Hon. Member for Vancouver East (Mrs. Mitchell)-Social Security-Canadian Council on Social Development poverty statistic, (b) request for pension increases.


Roméo LeBlanc: It is very useful, Mr. Speaker, to have a cheering section close by.
The remaining jobs occur in manufacturing, trade, transportation services, forestry and other industries. These initiatives are not make-work plans, or make-work projects, helpful as such projects might be. Money invested in housing produces real, durable products that respond to the fundamental needs of the Canadian people.
As the Minister of Finance has pointed out, it is not possible to relate the proposed borrowings to specific programs, but the need for additional borrowing arises from the extraordinary measures which the Government has undertaken to assist those most urgently in need of help and to continue and accelerate the economic recovery. Many of those extraordinary measures are related to housing. During 1982, the Government author-
February 22, 1983

ized a budget of over $1 billion to stimulate the housing industry.
I would like to remind Hon. Members of some of the highly successful initiatives the Government has introduced. To date, nearly 165,000 Canadian families have availed themselves of the $3,000 grant provided under the Canada Home Ownership Stimulation Plan to buy homes. That involved a commitment by the Government of almost half a billion dollars.
As Hon. Members are aware, the plan was extended to assist with the purchase of new homes built before the end of April 1983, and another $100 million was provided for this purpose. This program has had its intended effect.
I would like to remind Hon. Members that the number of single detached houses started in January 1983 across Canada was more than 4,800. This was the largest ever recorded for any January in Canadian history. Housing starts have rebounded to the level of 165,000, on an annual basis, in January. This sharp rise in production continues a trend which began in the last quarter of 1982, and I am confident that it is going to continue well into 1983.
At the moment our forecasters are talking about 150,000 starts in 1983. That would be a considerable improvement over the previous year. I would like to aim higher. I think, with interest rates staying low, chances are that we will be beyond the forecast level of 150,000.
Housing starts are not the only area where our efforts are being rewarded with success. As a matter of fact, as the Minister of Finance has pointed out, mortgage interest rates are now 12 per cent for one-year mortgages, the lowest level in several years. Six and five is working, and inflation rates have declined significantly. At the same time, $115 million has been established in grants for renovations under the Canada Home Renovation Plan. This program is very effective, creating jobs at a cost of $5,000 per person-year because of the way this program triggers private expenditure.
Under the Canada Rental Supply Plan, commitments were made in 1982 to provide interest-free loans for the construction of some 11,000 new rental housing units in communities where vacancy rates are low. There remains authority for an additional 19,000 units under this program.
I would like to point out that the effect of these very substantial investments by the Government are multiplied by the leverage which they exert on private money. Under the Canadian Home Renovation Plan, for instance, our experience shows that every Government dollar invested levers three more dollars of private money. The Government's contribution to date of $115 million represents a total investment of public and private funds amounting to about $450 million.
These Government housing initiatives have proved to be extremely successful, more successful than even our optimistic expectations. They have been most enthusiastically received by Canadians, which suggests that they are responding to a very generous genuine need. In this area, I wish to pay tribute to
Borrowing Authority
my predecessor, the Minister of State for Finance (Mr. Cosgrove), who brought most of these programs forward. These measures have increased public confidence in the home ownership market and made an important contribution to economic recovery and more employment.
While I am speaking of the strides we are making toward overcoming the current recession and improving the housing conditions of Canadians, I might draw to the attention of Hon. Members that the shortage of housing for rent that has plagued so many communities is very much improved. The latest Canada Mortgage and Housing Corporation vacancy survey shows that almost 2.5 per cent of rental units were vacant as compared to about 1.5 per cent six months before. The forecast is that the vacancy rate will rise even higher in 1983 as more builders take advantage of the Canada Rental Supply Plan.
All the measures taken are designed to help restore the country's economic health and they make large demands on the Government's financial resources. The steps the Government has taken in housing have provided the basis for concerted national action to get housing moving again. The success of the Government measures has required the commitment and co-operation of other orders of Government, of the industry and of the lending institutions. We have worked together in a spirit of national purpose and commitment to get housing going and to contribute to economic renewal.
The Government's actions have demonstrated its concern for existing home owners, for first-time home buyers and for renters. Canadians see housing as central to their social and financial security, and our measures have helped restore that security. Confidence is needed if first-time home buyers are to purchase a house, and this confidence has been provided.
There are substantial rewards for the economy and for individual Canadians in achieving these results. A lot remains to be done, but federal housing actions in the past year will create an estimated 180,000 jobs. These jobs will be in rental construction, the construction of single family dwellings and the renovation and installation of existing homes. Jobs will be created in the production of building materials and in the manufacture and distribution of appliances and other household furnishings. These benefits will flow to all regions of this country.
The federal Government wants to increase the housing supply and its wants to restore security and confidence. The Government, through its actions, has provided over a billion dollars for housing initiatives. This is in addition to the Government's ongoing support for social housing, for rehabilitation under the RRAP, for home insulation and for support of native housing. These are new funds allocated to housing. It is important that Hon. Members and the public understand that these funds do not represent the replacement of private funds with federal funds. As I said earlier, many actions did trigger considerable investment of private funds in the housing sector. These funds provide incentives to Canadians. They represent the Government working with Canadians to create an environ-

February 22, 1983
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ment, a partnership, for economic recovery and for renewed security and confidence.


Arnold John Malone: Mr. Speaker, I know that everything that happens in the Minister's Department of Flousing is not evil. Bearing in mind that one program has some merit to it, the $3,000 grant for a home buyer, why would the Minister have a cut-off date, even though it has been extended, of April 30 for those areas below latitude 55 when he knows full well that in places like The Pas, Grande Prairie or Fort St. John there is still frost in the ground? In some cases, it will take all of the $3,000 grant simply to put the footings or the foundation in frozen ground. Why have a policy which causes someone to spend that which you get in order to get that which you got?


Roméo LeBlanc: Mr. Speaker, I have received representations from Members opposite and on this side of the House. We are reviewing the lines as they were drawn. This, I must say, was done with the very large expertise and knowledge of the officials of the Corporation. But we have undertaken to review this and find out if we can accommodate more Canadians in their housing needs.
I would like to make it very clear that our intention is to encourage the construction of houses, and I will do everything which is within the legal powers given to me to make sure that Canadians are not excluded by conditions of climate, if we can help it.


Arnold John Malone: Mr. Speaker, if the Hon. Minister would bear in mind that the objective is to get houses built, I think he might take this as a representation to extend that date. Alternatively, would he give consideration, if he is not going to do that, to sending the Minister of Agriculture (Mr. Whelan) out to speak a chinook over the building sites, or sending the Prime Minister (Mr. Trudeau) out to wrestle the footings into the ground, or even to sending the Minister of Finance (Mr. Lalonde) out as an ice breaker so those footings can be put in the ground prior to the end of April?


Roméo LeBlanc: Mr. Speaker, I take these as representations without necessarily endorsing some of the rhetoric. But the Hon. Member is right. The goal of this program is to encourage housing. We have tried to be as flexible as possible and this we will continue to do.


Philip Derek Lewis: Mr. Speaker, the Minister has made extensive reference to the Government's spending plans with reference to housing, and we can understand the disaster he has followed and what he is trying to do. But we notice today that the Estimates show that six and five has been replaced by 9.6, and the Government is asking for $88.9 billion. Today the Government is asking for permission to borrow $14 billion for the 1983-84 year. Can the Minister tell the House what the Government's estimates are for revenues for 1983-84?


Roméo LeBlanc: Mr. Speaker, I doubt very much that this is in the venue of my responsibility. I believe the questions I heard
in the previous debate would have been more properly put to my predecessor, or my colleague, the President of the Treasury Board (Mr. Gray).


Mrs. Mitchell:: Mr. Speaker, I would like to ask several questions in one, if I may. I wonder if the Minister is aware of the MURB disaster which his predecessor created? In my riding most of the affordable, decent housing was torn down for the end-of-the-year MURB programs. Now they are sitting there as holes in the ground with nothing being built on them. That is typical, I believe, of the expedient, short-term kind of programs which they have featured.
I wonder, also, since the Minister talks about extremely successful programs, if he is aware that the reason why vacancy rates are lower, at least in western cities, is the economic situation where key populations have shifted eastward again. In fact, there has not been an increase in affordable housing for people.
Also, has the Minister considered taking a look at social trends whereby home ownership and homes which are subsidized with Government grants are going largely to couples without children? Families with children are still living in apartment buildings and will continue to do so because they cannot afford private homes. I do not think there is any program related to this.
Finally, Mr. Speaker, what is the Minister going to do about increasing, rather than decreasing, allocations for non-profit housing units, particularly in order to have some kind of housing for low income people who, as he knows, are increasing in great numbers?


Roméo LeBlanc: Mr. Speaker, I hope that I cover most of the points raised by the Hon. Member for Vancouver East (Mrs. Mitchell). I was briefed on the MURB situation when I was out there a couple of weeks ago and I recognize that it is a problem which will not be easy to solve, but we must address it. Some areas felt that the program of MURBs was quite successful. Other areas felt the program had contributed to building some luxury condominiums. On balance, it was not recommended that the program be prolonged beyond a certain date, while trying to find ways to accommodate those who had made commitments to it.
The Hon. Member raised the matter of affordability and, of course, that is the other problem of housing: affordability versus availability. I might say, Mr. Speaker, in spite of the programs which I have described of $1 billion new dollars in 1983-84, the fact is that we are continuing the social housing program. We have increased it. We have borrowed on the coming years and we hope to do it again. There is no reduction. At the moment we are asking the Minister of Finance that he delay our payback of those additional units which we obtained from him in the past two years, and I hope we will be successful in this venture.
On the home ownership grants which are going to non-families or to smaller families, I must say to the Hon. Member that the variation in the housing market in Canada can introduce some distortions, although I am not sure I would define it as

. j
February 22, 1983

black and white, as she did. But the Hon. Member should remember that the home ownership program was really put into place to encourage the construction of housing, to stimulate economic activity and to create jobs, and it was not felt that a definition, as she seems to advocate, especially in a market which is as volatile and turbulent as the market in the area she represents, would have been a very successful job-creation program, an economic activity stimulant. As I said earlier, Mr. Speaker, there is no less commitment to social housing. It is an expensive form of housing, especially where the write-down of interest at 2 per cent comes into play, but being expensive does not mean it should not be done. The difficulty I have with this program is trying to find a way to make the queue made up of those who are waiting a little bit shorter, and to find ways of getting more "bangs for the bucks" in this program.


Benno Friesen: Mr. Speaker, the Minister took some pride in pointing out that the housing industry was a great stimulus to job creation. I have been hearing that for the past eight and a half years here. I remember the AHOP Program, which was used as job creation more than it was for building houses. I would like to ask the Minister, first of all, whether he does not feel that when he is trying to solve two problems that may not be resolved with the same program, he is not over-heating the market in the housing industry by trying to create jobs?
I would like to ask him also if he subscribes to the theory, apparently propounded by Mr. Norman Levi in British Columbia, that those who are on income assistance should be able to assign some of that tax money to the purchase of homes so they can increase their capitalization?
Finally, the Hon. Member for Vancouver East (Mrs. Mitchell) mentioned non-profit housing. Does the Minister have any way of ensuring that those who live in non-profit housing are in fact the ones who really need that kind of help, because at the present time I can assure him that there are a lot of people living there who-


Mr. Deputy Speaker:: I must tell the Hon. Member that his question has to be cut short now in order for the Minister to have any time at all in which to reply.


Roméo LeBlanc: Mr. Speaker, no discussion I have had with the industry, and they represent really national organizations, indicates that there is a worry about over-heating the market, as the Hon. Member suggests. Even with the optimistic figures which I have given, the fact is that the ideal housing start figure which the industry feels is useable is roughly 200,000, so we are well below that range and there is a bit of catching up to do. There may be some markets where there will be some distortion. That is why in programs like the Rental Supply Plan, we tend to look very carefully at vacancy rates in order not to create a surplus or artificial supply.
Concerning non-profit housing, I must remind the Hon. Member that some years ago a decision was made that we should try to create an environment in which people of modest
Borrowing Authority
income would live in subsidized accommodation alongside people of higher incomes. I might say that I recently had occasion to see two co-operative projects in Vancouver and felt that it was quite a wise investment, both in human and economic terms.


Mr. Deputy Speaker:: The period of questions and answers has now expired.


Arnold John Malone: Mr. Speaker, I am pleased to have the opportunity to speak on Bill C-143. I suppose that while we are talking about that, I might say that there is an interesting ring for some Hon. Members in the numerals 143, because Members, such as the Hon. Member for Wetaskiwin (Mr. Schellenberger), the Hon. Member for Pembina (Mr. Elzinga), the Hon. Member for Vegreville (Mr. Mazankow-ski) or myself, when we leave this place to go home we take Flight 143. That, of course, is the flight into reality.
Bill C-143 is the flight-I am sorry the "fright" out of reality, and it is a frightful flight. That flight takes us down that frightful trail of $19 billion for most of which there is no budget. To say there is no budget is to say there is no plan. That means the Government is asking us for money to spend with no plan upon which to base its spending. What a frightful flight of reality it would be to grant that request of a Government with the record this Government has for spilling money or dropping it and kicking it away, letting it blow in the wind, trying to buy all kinds of projects which do not make sense, buying oil companies when the price of the company has doubled in value, but thinking it can have it. Nevertheless, the Government's answer is to ask for $19 billion without a budget to guide us to where it is going and to expect that Parliament, as the Minister said, would grant in haste the kind of request contained in the Bill, and to say also, "Trust us". That kind of trust is rather like not suspecting the tomcat when the canary is missing, because the Government's record is such that it is obviously suspect. We know that the Government is wasting the money of the Canadian people.
I want to spend some time today discussing how this institution began. 1 will not dwell on it, but I believe it is important. This House of Commons is called the House of Commons because it represents the common people. It started some 730 years ago with the Magna Carta. One of the principal reasons for the existence of this place, from the outflow of its history, was to control the King's purse. The entire revolt against the King in England was over wasteful spending, and because the King did not give justification for taxing his subjects. Today we find more and more that we are moving away from the notion that we are citizens of this country and adopting the motion that we are subjects of this country. We find it in our tax legislation.
The Hon. Member for Kenora-Rainy River (Mr. Reid) raised the point that now our income is printed on the front of our tax forms. What the Government is doing is to reverse the presumption which had existed following Magna Carta, that Parliament, the House of Commons, was the place where common people went to represent their constituencies and to
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February 22, 1983
Borrowing Authority
control the purse. The presumption was that we had the right to the fruits of our labour and that some of it would be used for the general good of all.
Taxation is a fact of this century, not of 700 years ago. It is a new fact, but now the presumption is changing so that the Government says, "It is our money and we will allow you to retain some to build your homes, to run your farms, to carry on with your activities". The presumption is changing, which is demonstrated by the very fact that printed on those tax forms is information concerning the amount of money one earned, whether or not one was divorced, and one's social insurance number. We are creeping a long way away from the presumption of what the Government ought to be doing. It is important to realize that any Government which gives its presumption to the people recognizes the fact that its vested power is extended from the people. Power rests with the people. That is not the presumption today. The presumption today is that power rests with the Government. Government will make whatever decisions it wants, and be damned with the House of Commons and common people and common representation.
The Government's attitude is, "We matter, and only we matter. We will tell them whether or not they can bring their intentions before the House of Commons and whether or not they will tell them to the House of Commons itself'. Therefore, the notion of debating $19 billion, with no plan for its expenditure, should not surprise us. There is no budget before us. The Government simply wants the money. It wants to draw it away from the people. We are back to pre-Magna Carta times. We are back to the time when the King treated his people as subjects, not as citizens, when he had the notion that it was his right to raise whatever amount he wanted. It was King John who simply wanted to build a bigger castle and attack already overly suppressed people even more. That is the kind of Government we have today.
In speaking of property rights, let me say that in my constituency today many people think that what the subject of property rights concerns is whether or not they can keep their own farms or houses. That is not the question at all. That is an example to the question. What the question concerns is whether the individual has first prerogative to the fruits of his labour. That presumption has been changing in the last 15 years, under the present Prime Minister (Mr. Trudeau). The new presumption is that the Government has the first prerogative to the fruits of our labour, and it will leave for us that amount which it thinks we can have.


Some Hon. Members:: Hear, hear!


Arnold John Malone: The Government has no budget, no plan and no projections. We have only heard the request, "We want more money". Well, who does not? Who amongst us does not want more money? Who in the country would not want more money? Who amongst us can go to a bank manager and say, "Sir, I would like some more money. I would like $1 million"? The bank manager would ask, "What would you use it for?" If the answer were, "That is my personal affair, sir, and I will not tell you", who would expect the banker to lend the $1 million?
However, the Government comes to us, to the public and says, "We want $19 billion".
I will tell Hon. Members how much $19 billion is. Some years ago the United States bought Alaska for $8 million. If the United States decided to buy Canada for $24 billion- although I will not put it up for sale because it is not within my power-that would amount to $1 million for every Canadian in the country. However, the Government wants to borrow $19 billion. Some people might become a little excited just over being offered $1 million and getting rid of the troups opposite, because they might see some better value in their country than this borrowing and borrowing year after year. I suggest to Your Honour that while the perspective is there, it is important.
We have a Government which does not even have the morals of an alley cat. It would give Donald Macdonald $800 a day to find out what the people already know, that we need less Government and more incentive for small business. We need to have less borrowing and less inflation. Donald Macdonald will tell them that after he has spent millions of dollars, when Canadians could have told them that for nothing.
Michael Pitfield gets reward upon reward upon reward, and then gets sent to the Senate. Judd Buchanan is allowed to build an apartment house where virtually no other Canadian could. What is his licence for that? It is just that he was a Liberal and was in the Government. Because he was the Minister who looked after parks, he got the advantage in the park.
Now we have the Gillespie situation which comes down to the Minister of Finance (Mr. Lalonde) and the Deputy Prime Minister (Mr. MacEachen) and the giving of gifts to those who give gifts in that inner circle. Canadians are certainly not at all pleased that their dollars are being spilled in this way. To borrow is to receive value today to be paid back at some future time.
Today we have a $140 billion debt on our future. That is the accumulated federal debt, and it will not be paid back tomorrow, next month, next year or in the next decade. A debt of that magnitude, if it is paid back at all, will be paid by the next generation. We have mortgaged our children before they are even born. We have mortgaged the next generation. We have put a price on the unborn. That is what is happening with this enormous debt. Through selfishness and greed the federal Government has been willing to put a price on the next generation. We have condemned our children, our resources and our country to the selfish pleasures of the "right now".
Last December this country went into debt to the tune of $300 million per day-every day Mr. Speaker-Saturday, Sunday, weekdays and Christmas day. That is a 300 per cent increase over the same month the previous year.
We have leeches that suck, through this Government-that cause the Government to impose extraordinary taxation upon us. Those leeches come in the form of 480 Crown corporations, the buying up of oil companies at double their value for some
February 22, 1983

foolish reason such as just saying they are ours. They are ours, but those debts are ours and those payments are ours. This debt-ridden Government is ours. We are living with every increasing Government expenditures. The Liberals have wasted their tomorrows in pursuit of the moment.
We need to compare ourselves with other countries, Mr. Speaker. Today, in the 22 Latin American countries there is a population of 360 million. Those countries have a combined debt of $300 billion. It is important to bear that in mind. Canadians understand that Latin America is in a very difficult financial position. The Canadian debt per capita is seven times larger than the per capita debt of the Latin American countries, however. Their population is 15 times that of Canada but their debt is only a little more than twice ours. The 24 million people in Canada have a $140 billion debt, while the 368 million people in Latin America have a $300 billion debt.
The only reason that Canada is not a Venezuela, a Mexico or a Brazil is that this country is resource strong. With this debt of $140 billion the Government has taxed those resources, has taxed our future and the children of tomorrow. That is a mortgage against the future that we should never allow. I repeat, per capita our debt is seven times more than that of the peoples of Latin America.
The richest nation in Latin America, Brazil, has a debt of $80 billion, less than ours, and it is teetering on the edge of bankruptcy. The only reason that we are not bankrupt is that we have the largest volume of fresh water in the world, the largest hard-rock mineral base in the world, and the largest amount of forest in the world. But we have mortgaged the future of our resources and our children.
The Government does not care how it manages the economy, Mr. Speaker; it only cares that it manages power. Power is the quest of the Liberals, not their achievement. If they can retain power, achievement is irrelevant. They simply want to hang on to the reins and continue to drive, without any regard for the potential of the men and women in this country who want to use their initiative to make the country grow. They want to believe that the country is ours because of their work. The Government wants to have control-to schackle and encircle people with bureaucracy.
In this country today the small business sector requires twice the secretarial staff, the number of lawyers and accountants, of the comparable small business sector in the United States. That is how much bureaucracy controls and directs our small business sector. We should recognize that the small business sector is the engine of our society.
The Liberals have requested the borrowing of $19 billion without any planning. It is now taxing without hope. It is a hopeless tax on hope itself-a tax on tomorrow, a tax on our future. They are borrowing against tomorrow's dreams simply to sustain their wasteful spending.
_ \
The Prime Minister was right at least once when he said
"the land is strong". The late Right Hon. John Diefenbaker was also right when he commented that it had to be.
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Mexico could not sustain its debt, Venezuela could not sustain its debt, Poland could not sustain its debt, and Brazil is teetering on the brink of bankruptcy. Money is not wealth. That fallacy was adopted by Mexico, Venezuela and Poland, but most particularly Mexico. In the belief that money was wealth, they printed more money and borrowed more money.
A recent article in The Economist pointed out that in one short period Mexico borrowed $80 billion but that it would have been a wealthier country today with more people employed and a greater industrial base, had it only borrowed $40 billion.
When you borrow, you borrow against tomorrow; you borrow today to have a new tax tomorrow because borrowing is a debt against the future. That is the way it is in Mexico. In this country we are in danger of running our resources into the ground. There is a risk that they will be for sale at wholesale prices tomorrow, simply to excuse us from our debt.
The currency would have been stronger in Mexico, had it borrowed less. Its foreign payments would have been less, it would have retained more of its domestic earnings and its unemployment rate would have been lower than it is now. Canada is following the example of Mexico. Borrowing dollars is not a creation of wealth.


Mr. Deputy Speaker:: The Chair hesitates to interrupt the Hon. Member for Crowfoot (Mr. Malone), but his allotted time has expired. He may continue with unanimous consent of the House. Is there unanimous consent?


Some Hon. Members:: Agreed.


An Hon. Member:: No.


Mr. Deputy Speaker:: There does not appear to be unanimous consent. Are Hon. Members rising to ask questions of the Hon. Member who just spoke?


Douglas Glenn Fisher: Yes, Mr. Speaker.


Mr. Deputy Speaker:: The Parliamentary Secretary to the Minister of Finance (Mr. Fisher).


Douglas Glenn Fisher: Mr. Speaker, I was intrigued by the speech of the Hon. Memer for Crowfoot (Mr. Malone). I think he reasoned some of his ideas in an interesting way. Although I did not agree with him in many cases, I should like to extend my congratulations to him for having thought out a speech rather than resorting to the use of many cliches.
Dealing specifically with his comments about Mexico, Poland and Venezuela, I point out that Mexico ran into serious difficulty because of the extent of its foreign borrowing, not because of the extent of its borrowing. Also I point out that in our instance foreign borrowing is a very small part of this package and is used to shore-up the dollar, not to finance the general operations of Government. When the shoring up operation is over with, the money is repaid out of the foreign currency account. Perhaps the Hon. Member would like to

February 22, 1983
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comment on the fact that there is a very real difference between the amount of foreign borrowing by Mexico, which put it into difficulty as he pointed out, and the very small amount of foreign borrowing on our part.


Arnold John Malone: Mr. Speaker, I recognize the point the Hon. Parliamentary Secretary to the Minister of Finance (Mr. Fisher) is making, that when the debt is an internal debt, it is paid back to the country some day. This does not refute the argument that when we incur a debt, it must be repaid at some time. That "some time" on a debt as large as $140 billion is not likely to be in our time. Therefore what it has done is to tax tomorrow, and that point still stands regardless of whether we pay out of the country or within the country.


Mr. Darling:: At 19.2 per cent interest.


Arnold John Malone: Yes, 19.2 per cent is the very shattering interest rate on which we borrowed much of that money. Although the Hon. Member said that all our debt is not foreign debt-and I accept that-he needs to concede that a great portion of it is foreign debt. It is a combination. Those factors taken together do not diffuse the fact that there is a great concern about borrowing when one borrows too much.


Mr.   de Corneille@: Mr. Speaker, I would like to try to clarify a statement of the Hon. Member for Crowfoot (Mr. Malone). I understood him to say that he wanted to warn Members of the House and all those people who might be listening that the $24 billion would cost every man, woman and child $1 million. While one may regard a deficit as being an unfortunate thing, certainly one wants to maintain a balanced budget, if possible. It seems to me that in these times it is obviously not possible. I wonder why the Hon. Member would exaggerate and speak about it costing $1 million a person? Are these his statistics? Are his statistics carried on the same basis?
Another example of the statistics of the Hon. Member is when he spoke about spending $300 million a day, perhaps in reference to the deficit, or just in reference to spending. Taking into account Saturdays, Sundays and every other day of the year, that would be in excess of $100 billion. Therefore I think his estimate of the rate of expenditures is somewhat high. He ought to clarify his statistics because they put his entire point in doubt.


Arnold John Malone: Mr. Speaker, if the Hon. Member for Eglin-ton-Lawrence (Mr. de Corneille) checks Hansard tomorrow, he will find that I was not referring to this year. I was referring to the month of December. That was the rate at which we were going into debt during that particular month. It was at the rate which I quoted. I can verify my statistics. If he wishes to check with me afterwards, I will do that for him.
become incredibly wealthy by lending their money to the Government and getting a guaranteed rate of return of 19.5 per cent with no risk? That being the case, why would they put it into industry?
Would he also agree that because the federal Government borrows all local money within the country, Crown corporations, private industry and provincial Governments must go offshore to Japan, New York and Germany?


Arnold John Malone: Mr. Speaker, it is not difficult to come to an agreement on such a point.


An Hon. Member:: Explain.


Arnold John Malone: I believe it is the Hon. Member for Restigou-che (Mr. Harquail) who is asking me to explain. The explanation is quite simply in the fact that the nation has a Gross National Product, it has a total wealth. Quite obviously, the subtraction of the larger portion taken for Government leaves less for the private sector. The Government is now borrowing at the rate of some $19 billion per year. It is simply leaving less of the pie, less of the total opportunities of acquiring loans, for the private sector or other Crown corporations.
If we start from the presumption, which has always been there, that it is the private sector that creates wealth and that it is the public sector which at best redistributes wealth, we are now in a position where nearly 50 per cent of the Gross National Product goes for Governments in the country. Once we pass 50 per cent plus one penny, we have a country in which we are trying to redistribute more wealth than we have the capacity to generate. When we reach that point, the whole system will have broken down.


Mr.   de Corneille@: Mr. Speaker, I am wondering whether the Hon. Member overlooked my question. It seems to me that he did. When he spoke about $24 billion, he said that it would cost each person in Canada $1 million. If he uses his calculator, I think he will arrive at a figure of about $1,000.


Arnold John Malone: Mr. Speaker, I stand corrected on that. Obviously it is $1 million for every million Canadians.


An Hon. Member:: A billion for every million.


Arnold John Malone: A billion for every million. I can see that I got my "tang tongueled". I apologize if, in his trying to take down some notes or something which would be worth-while for the economy of the country, at one point I misled him. Certainly he is correct.


Mr. Deputy Speaker:: Are other Hon. Members seeking the floor to ask questions? If not, the Chair recognizes the Hon. Member for Restigouche (Mr. Harquail) on debate.


Blaine Allen Thacker: Mr. Speaker, I have a question for the Hon. Member. The Parliamentary Secretary to the Minister of Finance (Mr. Fisher) seemed to argue that because the federal debt was internal, there somehow was no problem at all. Would the Hon. Member agree that it does matter because it means that the people of Canada who already have wealth


Maurice James Harquail: Mr. Speaker, I am very pleased to have the opportunity to participate in the debate this afternoon on Bill C-143. Also I am pleased to have had the opportunity to listen to the Hon. Member for Crowfoot (Mr. Malone) as he gave various interpretations and translations of what it was he was actually saying. Certainly I
,'V
February 22, 1983

express my appreciation for his keen co-operation in that regard.
Some Hon. Members have expressed concern about the timing with regard to Estimates, budgets and the Bill which is before us now. Insofar as Part I of this Bill is concerned, it is covered adequately, I believe, in the October statement which takes us through and covers the end of the fiscal year.
As you know, earlier this afternoon, the President of the Treasury Board (Mr. Gray) tabled his Estimates. I believe that is in keeping with that desire and concern expressed with respect to the debate in which we are now participating.
I appreciate the opportunity to tell Canadians some good news. This is the good news that I was attempting to allude to this afternoon in Question Period with respect to the successes of the Government in bringing down the inflation rate and the interest rate in Canada.


Arthur Ronald Huntington: Inflation is now 9.6 per cent.


Maurice James Harquail: This subject is one we used to hear a lot about from Members sitting to your left, Mr. Speaker. But in recent months the silence has been deafening with respect to those successes and also with respect to mortgage rates being down; inflation being down to 6 per cent-


Philip Derek Lewis: Where is unemployment?


Mr. Munro (Esquimalt-Saanich):: How about all the other
scams?


Maurice James Harquail: -and the prime rate at the bank being down to 11 per cent and the Bank of Canada rate being down to around 9.3 per cent. It is not passing strange because the Opposition Members will be the last ones to admit any achievements of this order of magnitude with respect to the facts that I have just laid before the House and for the information of all Canadians.
It is particularly significant to look at the rate of inflation since June when the Government announced the successful six and five program. This is voluntary restraint on prices and wages. The rate for that period was 6 per cent. It is a clear confirmation that the program is working. All sectors of the economy have contributed to this achievement. I think that is a point worth-while noting, and we should congratulate Canadians especially for their co-operation during these difficult times that affect the entire world, certainly our neighbours south of the border.
I have mentioned the important and good news in the battle to achieve recovery and to achieve lower interest rates, which have fallen to the attractive limits at which they are now. This is restoring consumer confidence and bringing things around to where we would all like to see them. Resulting from this there has been an encouraging development in the construction sector, one of the key areas of our economy. As recently as last September, housing starts were running at a low level of 86,000 units on an annual basis. By January, the figure has
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risen to 165,000 units, a gain of 90 per cent in just four months. This is a direct result of the initiatives of this Government. It is related also to what I said in my opening remarks about the lower interest rates that we have been able to achieve.
My colleague and friend, the Hon. Member for Westmor-land-Kent (Mr. LeBlanc), the Minister responsible for CMHC who spoke before me this afternoon, confirmed the good news that housing starts have increased substantially since that low of 86,000 in September, 1982. In January, 1983, housing starts were up to 165,000, a 90 per cent increase over September. Sales of passenger cars increased 37 per cent from July, 1982, to 66,800 units in December, 1982.


Donald W. Munro: What kind of cars? Were they Ladas or Toyotas?


Maurice James Harquail: The Conference Board in Canada indicated that consumer confidence jumped 36 per cent from 54.8 per cent in the second quarter of 1982 to 74.7 per cent in the fourth quarter of 1982.
This is the type of thing of which we should be speaking. We have heard and we have listened to sincere Canadians who have invited and encouraged all Canadians, particularly those in the business sector, to speak of these confidences and to bring forward the good news so co-operatively we can restore the confidence we all want to have.
Senior business executives in their recent statements have become more optimistic about the near term prospects for the Canadian economy, and according to the Conference Board survey of business attitudes. According to the same survey, business confidence in Canada's investment climate has also improved. We have seen a turnaround as well, Mr. Speaker.
A question was mentioned earlier with respect to employment. There has been some improvement in that area although not anywhere near where we would like it. We hold no monopoly on this question. All Canadians are concerned about finding jobs and seeking employment opportunities, notwithstanding the efforts of the various Departments.
I have talked about housing and industrial development, the upswing and the good news coming from the United States and in our own economy. It is also important to flag some of the initiatives the Government is taking with respect to job creation. I know that in my own Province it has been very substantial and effective. I will mention the CCDP, the Youth Employment Program, the LEAP Program, the NEED Program and the various training programs that amount to millions of dollars. Just recently an agreement has been signed on behalf of the federal Government by the Minister of Employment and Immigration (Mr. Axworthy) and the Minister of Labour and Employment for the Province of New Brunswick. This agreement involves a total expenditure of $24 million. This will be a co-operative federal-provincial cost shared program to put funds directly into the economy and create those much needed jobs to which I was just referring.

February 22, 1983
Adjournment Debate
Earlier this afternoon I had the opportunity to raise once again the important question of the megaproject that has been talked about since the budget of 1981 when the Deputy Prime Minister (Mr. MacEachen), the then Minister of Finance, interrupted his budget speech remarks to announce that the Noranda group and its subsidiary, Brunswick Mining Ltd., were planning to go ahead with this project. The project is estimated to cost over $370 million. It will create 1,500 person years of employment during the construction stage and will realize over 550 permanent job upon its completion. This is a significant project and one on which I am inviting all Hon. Members to show a spirit of co-operation in urging all Ministers who have a direct responsibility in the economic portfolios, the Minister of Industry, Trade and Commerce (Mr. Lumley), the Minister of State for Economic Development (Mr. Johnston), the Minister of Energy, Mines and Resources (Mr. Chretien) and the Minister of Finance (Mr. Lalonde), to bring pressure to bear with respect to the holding company, the Noranda group, and to encourage the subsidiary company, Brunswick Mining Ltd., to go ahead with this much awaited and needed project.
I see it is close to six o'clock. What I propose to do at this time is to call it six o'clock and come back another day to complete my remarks on this Bill.


Mr. Deputy Speaker:: Does the House agree to calling it six o'clock?


Some Hon. Members:: Agreed.



[Stage Direction]
A motion to adjourn the House under Standing Order 45 deemed to have been moved.

Robert Alfred Corbett: Mr. Speaker, on February 10 I put a question to the Minister of Agriculture (Mr. Whelan). I presume that his Parliamentary Secretary or his designate is here this afternoon to respond. At the time, I raised the issue that the cost of feed grain in the Maritime region of Canada will be greatly increased due to the current proposed policy of the Government to do away with the Crow. I expressed concern of behalf of the farmers who felt that they would be adversely affected, and, indeed, are adversely affected, due to a reduction in the Crow rates.
Prairie farmers now pay approximately 18 per cent of the transportation costs of their feed grain, whereas in Truro, Nova Scotia, and in that part of the country, livestock producers and poultry producers are paying upwards of 75 per cent of the costs of their feed grain. Of course, it is very
difficult to compete under those circumstances and the Government proposal will make it that much more difficult in years to come.
The Government has recognized that the Maritime Provinces and New Brunswick in particular have a tremendous amount of agricultural property that has potential for the production of feed grain. As a result, it is looking forward to the time when New Brunswick as well as the rest of the nation will become self sufficient in the production of feed grains. However, the Government recognizes, and certainly the farmers in the region do, that this is a substantial distance down the road.
I asked the Minister if he would consider allowing the Feed Freight Assistance Program to remain in place in the meantime along the guidelines that were proposed by the Maritime Farmers Council in a recent brief to the Minister of Agriculture. They stated in that brief that all three provincial federations of agriculture and the Maritime Farmers Council have committed considerable effort toward developing a feed grain plan for the region. They believe that this new approach they are proposing would be fair and appropriate for all three Provinces and, indeed, would encourage a balanced development of Maritime agriculture.
The main points they were making to the Minister of Agriculture were; the restoration and future indexation of the level of support under the Feed Freight Assistance Program which prevailed in 1976; and the transformation of the FFA Program to a market and resource neutral system of direct feed cost equalization payment. When the Minister responded to that portion of my question, he stated as reported at page 22707 of Hansard:
We are very much aware of their concerns, but we think that a lot of them are unwarranted, for instance the increase in the price of grain.
That is precisely the point I was making. They are concerned about the increase in the price of grain. If the Minister of Agriculture were a farmer in that region, he would naturally be concerned, along with the rest of the farmers, because he would obviously not be in a position to compete with his counterparts in the Prairies and in the rest of Canada. I would ask the Parliamentary Secretary to direct himself specifically to that particular expression of concern expressed by these farmers.
My second concern on behalf of the farmers of the region is that the Government has earmarked $130 million to assist those regions, which are now not self-sufficient, in becoming self-sufficient in the growing of grain over the next five years. The Government has stated that it will give Quebec, which is semi self-sufficient in the production of feed grain, $90 million of the $130 million. It has earmarked $16 million for the Province of Ontario, which is completely self-sufficient in the production of feed grain. The Minister acknowledged this in his response to my question when he said in Hansard at page 22707:
-one will see that Ontario has a grain surplus producing area.
February 22, 1983

The Government will give New Brunswick, which is totally dependent on outside feed grain, $4 million over the same period of time to increase its feed grain production.
I would like the Parliamentary Secretary to please address himself to those specific points and tell the farmers of the region how it is that the Government has come up with those figures and what it will do to help tide them over until a period of time elapses and they become self-sufficient in feed grains.


Mr. Jim Schroder (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, as indicated by the Minister of Agriculture, feed grain prices in the Maritimes will not change because of this Government's decision to improve the grain transportation and handling system in Western Canada. The price of feed grain in Eastern Canada is determined by the cost of either U.S. or Ontario corn in Eastern Canada. Changes in freight rates in Western Canada will not influence the price of corn.
When freight rates for western grains increase, the net price that the western farmer receives for his grain delivered to a local primary elevator will be lower by the amount of the increase in freight rates. Thus a hypothetical $5 per tonne increase in freight rates on the Prairies will result in Prairie grain prices being lowered by $5 per tonne. In turn, the price of grain outside of the Prairies will not be affected.
The Feed Freight Assistance Program currently lowers the price of western feed grain by $10 to $18 per tonne on grain shipped to the Maritimes. Since its introduction during World War II, the Feed Freight Assistance Program has fostered the development of the livestock industry in the Maritime provinces. In fact, our Prairie brothers often complain that the Feed Freight Assistance Program and low freight rates for Prairie grain disadvantages Prairie livestock production, with livestock producers in the rest of Canada benefiting. Since the Feed Freight Assistance Program lowers feed grain prices in the Maritimes, it can work against the development of enhanced grain production there.
The Minister also received representations from the Maritimes to amend the Feed Freight Assistance Program to provide incentives for expanding local grain production.


THE ADMINISTRATION-CAPE BRETON COAL AGREEMENT- APPLICATION OF GUIDELINES ON MINISTERIAL CONDUCT. (B) KNOWLEDGE OF MINISTER OF ENERGY, MINES AND RESOURCES
Ramon John Hnatyshyn: Mr. Speaker, in the last few days we have seen a dying Government lose every vestige of its claim that it is a moral administration.
The guidelines which require certain conduct of Ministers read in part as follows:
In any official dealings with former office holders, Ministers must ensure that they do not provide grounds, or the appearance of grounds, of improper influence, privileged access or preferential treatment.
It has been repeatedly suggested to the Prime Minister (Mr. Trudeau) that at the very least there is a clear and unmistakable appearance of improper influence, privileged access and
Adjournment Debate
preferential treatment. We have a former Minister who makes a deal through his former Deputy, Mr. Cohen. How many people in Canada have ready access to the Deputy Minister of Energy, Mines and Resources? I suggest, not your ordinary person off the street.
Throughout negotiations, the Department of Energy, Mines and Resources was heavily involved. Memorandums of agreement were signed between Petro-Canada and Mr. Gillespie. Mr. Gillespie appeared with the Deputy Prime Minister (Mr. MacEachen) at a public gathering to announce this deal.
I think it is fair to say that many people would say that if a former office holder is dealing with a Government, Minister or a department for which he was once responsible, in a financial transaction, and is doing so before the expiration of his two-year prohibition period, as mentioned in the conflict of interest guidelines, that would give the appearance of improper influence and privileged access. Even Alastair Gillespie thinks that the ordinary person would get that impression. I quote a Canadian Press wire story of a few days ago:
Gillespie admits that outsiders-"ordinary people"-might believe his role as an energy minister and the experience he gained there, gave him a privilege or special advantage to get the development going.
Surely that is precisely why these guidelines were put in place. They are to prevent former office holders from doing business with the Departments or agencies for which they had responsibility within two years of leaving office. The reason is that to do so would give rise to at least an appearance of improper influence, privileged access and preferential treatment. Therefore, for a present Minister to involve himself with a former Minister is clearly a breach as well. This case is obviously a breach of the guidelines.
The Prime Minister and the Deputy Prime Minister insist on avoiding the issue. They refuse to come clean with Parliament. The Deputy Prime Minister has even come to the extraordinary conclusion that these guidelines are merely tools which a Minister or former Minister may consider in shaping his or her judgment. To quote the Deputy Prime Minister:
These guidelines are self-enforcing. There is no monitoring agency. They are up to the conscience of the individual.
The sum total of what this means is that if in the mind of a particular Minister or former Minister the public interest is served, or perhaps the personal interest of one of the Minister's friends is served, these guidelines can be ignored. They are self-enforcing. Away with honour! Away with the notion that the Prime Minister has a responsibility to ensure that the guidelines are honoured! These guidelines are self-enforcing. The Minister's conscience is his guide. When we are given the Deputy Prime Minister's logic, when we are told he was guided by his own conscience when he dealt with Mr. Gillespie, it becomes more apparent how easily a breach of the guidelines occurred.
There is further evidence today that the project continues to exist only because of the presence of Mr. Gillespie and the

February 22, 1983

Adjournment Debate
cozy relationship he maintains with various Ministers of the Crown. And I say that, Mr. Speaker, because we have learned today that the great liquefaction project is of very dubious value from an economic point of view. A study within the Minister's own Department recommends that the project as currently conceived should not be supported by the federal Government. I quote:
Calculations made by the Department indicate that a capita! grant with a net present value of approximately $864 million in 1982 dollars would be required to raise the projected rate of return from 4.2 per cent to 21.4 per cent. Each permanent job created in Cape Breton would have to be valued at over one and one-quarter million dollars. From an energy point of view, the Scotia Coal Synfuels Project appears to be a high-cost source of synthetic fuels.
Those are not my words but words from the briefings and documents prepared by the Department of Energy, Mines and Resources. This deal not only appears to be a conflict, but most definitely is a conflict, and may very well be a bad deal on top of everything else.
These guidelines cannot be casually tossed aside by the Minister. I suggest that when the Prime Minister returns, he has the obligation to address the issue, make full disclosure of the facts in this matter and do the honourable thing, following parliamentary tradition.


David P. Smith: Mr. Speaker, the Hon. Member for Saskatoon West (Mr. Hnatyshyn) has again raised the question of an alleged contravention of the conflict of interest guidelines by a Minister of the Crown, the former Minister of Energy, Mines and Resources and now Minister of Finance (Mr. Lalonde). The Hon. Member and his Party have repeatedly confused the requirements of present Ministers of the Crown with respect to the cooling-off periods required of former Ministers.
During the period when the Minister of Finance was the Minister of Energy, Mines and Resources, he was subject to the same principles regarding activities of current and former holders of public office as were parliamentary secretaries, Governor in Council appointees, public servants and exempt staff members. These guidelines are very explicit, and it may be remembered that on the evening of February 17 I outlined these principles in great detail. I am sure the Hon. Member has now had an opportunity to review those principles which I set out.
The objectivity and the impartiality of Government service must never be jeopardized and there must be no cause to believe that individuals have received preferential treatment or privileged access to Government personnel or services. Of course, there is no time limit to that. You cannot receive preferential treatment beyond the two-year period. You cannot receive it at all.
I suggest that the Hon. Member is doing a great injustice to the former Minister of Energy, Mines and Resources if he is in any way implying that the Minister was intimately involved in this project, despite statements by the former Minister of Energy, Mines and Resources.
What bothers me, Mr. Speaker, is that the Hon. Member for Saskatoon West talks about honour. I believe that the Minister of Finance is as honourable a Member as there is in this House. He is a very dedicated Minister. We may all have policy disagreements, but his commitment to Canada and to the people of this country is surely beyond dispute.
When a Minister stands in the House and says he did not contravene those guidelines, I do not understand why it is not left there. What has happened to the great parliamentary tradition that we accept the word of Hon. Members? The Minister has said this repeatedly, and I believe it is a sad day when we are prevented from dealing with the issue because people want to attempt character assassination. I know this is the old stock in trade of the Leader of the Opposition (Mr. Nielsen), but I am surprised that the Hon. Member for Saskatoon West, who normally likes to deal with issues, now wants to go this route. That is disappointing. Has my time expired, Mr. Speaker?


Mr. Deputy Speaker:: Almost.


David P. Smith: In addition to the above requirements which we have already discussed in some detail, I would like to draw the Hon. Member's attention to the requirement that office holders have a duty in any official dealings they may have with former office holders to ensure that they do not provide grounds or the appearances of grounds for allegations of improper influence, privileged access or preferential treatment. The Hon. Member today in the House was suggesting that because somebody can get somebody on the phone, that somehow constitutes lobbying, or somehow that constitutes an improper approach. Surely, we are not at the point where once someone has left Government service he cannot even have contact with his former colleagues?


Mr. Deputy Speaker:: The Hon. Member's time has expired.


SOCIAL SECURITY-CANADIAN COUNCIL ON SOCIAL DEVELOPMENT POVERTY STATISTICS. (B) REQUEST FOR PENSION INCREASES
Margaret Anne Mitchell: Mr. Speaker, on February 9, amidst very loud shouting from Government backbenchers, I asked the Prime Minister of Canada (Mr. Trudeau) to comment on the poverty statistics which had been released by the Canadian Council on Social Development, statistics which showed that 3.5 million Canadians were living in poverty in 1980. I estimated at least one million more people had become poor since 1980 as a result of direct Government policies, including high unemployment, part-time jobs, the imposition of six and five wage controls and the abandonment of a guaranteed income policy. I asked the Prime Minister to justify the increasing poverty which his economic policies had caused.
The Prime Minister shrugged off my question. He did not acknowledge or show serious concern for the increasing numbers of poor in this country, and he joined his Liberal

February 22, 1983

colleagues to laugh and joke about this. When, in frustration, 1 called him an uncaring millionaire, the Prime Minister refused to answer my supplementary question; an appeal to him to at least increase pensions to above the poverty line and provide some assistance for older women in their pre-pension years. His colleagues continued their disrupting uproar, which made it extremely difficult for me to be heard. The Minister of National Health and Welfare (Miss Begin) indicated that the Government can do nothing to help.
The following day when my Leader again questioned the Prime Minister about his lack of concern and lack of programs to assist the poor of this country, he debated a theoretical poverty line, and I quote from page 22706 of Hansard which reads as follows:
That line is very much higher than it was several years ago. It is a moving line. It means that the people of Canada generally are getting richer. It means, since the average Canadian is getting richer, therefore the average poor person becomes poor at a higher level than he did ten years ago. So it is a conceptual notion which is debatable-
These ridiculous and uncaring responses to the most serious problem in Canada, and the frivolous attitude of Government Members who tried to deny my right to speak on this matter, are completely unacceptable to Canadians. It is no wonder the Government refuses to act when the Prime Minister is so totally out of touch with the real economic situation of so many Canadians, and when he obviously could care less.
The CCSD report entitled "Poverty Facts" provided statistics which showed that in 1980, 10 per cent of Canadian families lived in poverty. These statistics showed that 66 per cent of elderly women were poor, two thirds of all poor families were headed by women, 46 per cent of single women were poor and 20 per cent of families with two wage earners had poverty incomes. This was in 1980. How many more thousands are poor today? These figures did not include native populations suffering from extreme economic deprivation. Statistics are often as neutral as debatable poverty lines.
The Prime Minister should meet with mothers on welfare who are trying to raise their families on $400 or $500 per month. One mother with two sons had only $21 a week after the rent was paid to feed and clothe her family. She is typical. The increase in welfare roles alone should prove to the Prime Minister how desperate this situation has become. In my riding of Vancouver East, 12,000 people are on social assistance, and that is a 28 per cent increase over the past year. A single person in B.C. receives $375 a month, but only $144 in Quebec. There are many families and individuals in Vancouver East who are trying with great difficulty to survive on pensions and meagre savings. Hundreds of unemployed workers who could hardly live on UI benefits are now lining up at welfare offices and food banks, because their benefits are gone.
Women have always had the lowest incomes and for them the situation is worsening on all fronts. Yesterday the Canadian Advisory Council on the Status of Women released a report which shows that women are more ghettoized than ever, with lower-paying jobs, while men are often paid twice as much for doing the same work. The NDP task force on older women,
Adjournment Debate
which held hearings in every province, found that women who are widowed or separated in their middle years and unable to work after a lifetime of homemaking are the forgotten poor. This group must be given priority, both in employment opportunities and income support.
The first step in doing something about poverty in Canada is to recognize that the problem exists and to try to empathize with those who are the victims. The Government must face up to the enormity of the problem and plan programs now which will help to alleviate suffering. Children must be a priority for action. Pension reform is urgent. Poor people in Canada cannot eat the unfulfilled promises of the Minister of National Health and Welfare. She must start planning now for the guaranteed income system which was promised over ten years ago. Poverty can only be solved by job creation programs and a positive strategy to bring about economic recovery, with incomes above the poverty line for all Canadians.


James Duncan Schroder: Mr. Speaker, on February 8, 1983, the Canadian Council on Social Development released its most recent fact book on poverty. This publication and, more particularly, the press release which accompanied it, have resulted in a considerable amount of confusion as to the actual situation involving low income Canadians. I am pleased to have this opportunity today to address the issues raised by the CCSD.
First, I would like to address the issue of how poverty is to be defined and therefore measured. As the Prime Minister (Mr. Trudeau) indicated in the House on February 10, 1983, the choice of a particular line by which to measure poverty is in many ways arbitrary. Consequently, there are diverse views on how to define poverty. Moreover, these views may change from time to time, as evidenced by the periodic revisions which are made to the measures in use. Indeed, the Canadian Council on Social Development reflected a change in views by revising its poverty definition as explained in the fact book. Such a change in definition, however, does not mean that poverty has increased as indicated by the Council's press release. Rather, it simply reflects a change in view as to who is poor and who is not at a given point in time.
The large number of definitions currently in use confuses the real issue: that is, what is happening to poverty in Canada?
In its fact book, the CCSD quite clearly acknowledged that the incidence of poverty has been consistently declining since the 1960s. An examination of the table on page 7, for example, will show that, even using the Council's definition of poverty, the proportion of Canadian households in poverty in 1979, being 21.0 per cent, is less than it was in 1967, at 22.7 per cent. Moreover, the Council states again on page 7, that the reduction in household poverty over the period 1973 to 1979 is mostly attributable to the reduction of poverty among unattached individuals, mainly the elderly. This, of course, is the period in which this Government substantially increased the Guaranteed Income Supplement for elderly Canadians.

February 22, 1983
Adjournment Debate
The Council's statement in its press release, that the rate of family poverty now shows every sign of increasing, is not substantiated by the facts available to date, particularly those in its own fact book. This Government has made substantial progress over the past decade in reducing poverty, and is continuing to provide for the needs of Canada's poor as
evidenced by the special provisions of the six and five program to protect the benefits of low-income families and the elderly.


Mr. Deputy Speaker:: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 o'clock p.m.
At 6.26 p.m. the House adjourned, without question put, pursuant to Standing Order.

Wednesday, February 23, 1983