1983-03-15

[Stage Direction]
The House resumed from Friday, March 11, 1983, consideration in Committee of Bill C-139, to amend the statute law relating to income tax (No. 2)-Mr. Lalonde-Mr. Corbin in the Chair.
The Assistant Deputy Chairman:: Order, please. The Hon. Member for La Prairie (Mr. Deniger) has the floor.
On Clause 1-Value of benefits


Mr. Deniger:: Mr. Chairman, I would like to take advantage of this opportunity, in the debate on the Income Tax Bill, to make a few comments on automobile standby charges. For many hours the House has been debating this Bill and particularly the policy on automobile standby charges. Like most Members, I have received a host of recommendations and advice regarding this new tax. Of course, the easy way out would be to remove the tax altogether. However, I do not think that would be wise, in view of the extent of the Government's deficit and its financial requirements.
I feel that as responsible legislators, we should not be considering the nature of this tax but its methodology and application. When I discuss the matter with my constituents who include some of those 140,000 Canadians who are driving cars or vehicles provided by their employers, they all agree, Mr. Chairman, that there is a certain time during which they drive the car or vehicles for personal use, and they fully understand that this is a benefit that constitutes income, and that like any income it should be taxed, and I think it is irresponsible to try and argue against this principle.
What I would like to suggest to the Minister-whether he does it in this Bill or in the next budget-is a new method for collecting this tax.
[DOT]	(1110)
At the present time, car users, car dealers and travelling salesmen are responsible for these charges, which means they
themselves must keep track of what is personal use and what is not. There is a proposal before the House to set the monthly standby charge at 2 per cent of the cost of a car belonging to the employer, and so forth.
I think that if I were to draft this legislation, I would do it quite differently. I would put the onus on the employer, and I shall explain. Instead of taxing the user, I would tax the company, which would be done as follows. A company that provides a car to an employee has thereby incurred an expense that is tax-deductible, and I would like the company to charge the employee, that is, the user, an amount for the personal value of this service. For instance, if the car has a four-cylinder engine, the employer could charge $40 a month, $60 for six cylinders and $80 for eight cylinders, for personal use by the employee. What does the employee have to do? The employee who, let us say, has a nice car, a V-8, for instance, would have to pay $80 a month, after paying taxes. This is what is called after-tax dollars, and the amount would be paid to the company, which would then be taxed on this additional income.
This way, the Government's main goal, to tax personal use, has been achieved, because we are taxing the employer. Instead of taxing 140,000 users, we would then be taxing perhaps 1,000 employers who are providing cars to these users. From the accounting point of view, it would seem to be a far simpler, more practical and more effective procedure. I also feel that the employee, who would have a monthly premium to pay, would realize what his car is worth daily and monthly. That is quite clear, and as far as the company is concerned, it would be very happy to use that method.
Mr. Chairman, this is not an original proposal, because as you probably know, the same method is being used in various States in the US. It is a foolproof method and a very satisfactory one as far as the Government's objectives are concerned. That being said-and I agree with the Government that personal use should be taxed since it is a benefit or income and as such should be taxed-it seems to me that we should ensure that not employees but employers are responsible for the tax on this benefit. While I am on the subject of cars, I shall, if I may, say a few words about capital cost allowance and how it affects the automobile industry.

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Earlier, before the Committee on Finance, Trade and Economic Affairs, the Minister of State (Finance) (Mr. Cosgrove) was asking for a borrowing authority of several billion dollars. The increase in the Government's borrowing requirements and the deficit is of course due to the fact that this year, the Government had to spend about $8 billion, if I am not mistaken, on additional unemployment insurance benefits. It seems the additional amount is needed as a result of the disastrous situation in the automobile industry, which is mainly concentrated in Central Canada-in Ontario and at Sainte-Therese. What should be understood when discussing the automobile industry is that the industry has a very broad impact in Canada. As a result, there are workers who have lost their jobs, in every riding in the country.
I feel that if we are to make a positive contribution towards helping the automobile industry, which is the largest employer in Canada, perhaps, in addition to reconsidering automobile standby charges as I mentioned earlier, we could also take another look at the rules for capital cost allowance for cars that are leased or purchased by companies.
Mr. Chairman, yesterday a delegation of dealers in Japanese cars met with the Minister of International Trade (Mr. Regan). They complained about the fact that the measures we have adopted have resulted in the loss of 2,300 jobs. I for one would prefer to use tax measures to help the automobile industry, and I think the best way to do that would be to increase the capital cost allowance on North American cars.
We used to have 30 per cent for the first year. Our budget has restricted this to 30 per cent for the first six months and 15 per cent for the last six months. However, the 15 per cent for the last six months constitutes a real danger to the automobile leasing industry and is in fact jeopardizing the very survival of Canadian car dealers. I realize that the Government urgently requires substantial amounts of money. In fact, I share its views on the aims of the Income Tax Act. However, I do have some problems with respect to the application of this legislation to the automobiles. Furthermore, I would like the Minister to consider the amendment we proposed a few months ago, by which a capital cost allowance of up to 40 per cent would be allowed companies such as Tilden, Hertz, Avis and others, on cars rented on the daily basis.
I wish the Government would consider this amendment for the benefit of thousands of car dealers and thousands of companies engaging in automobile leasing, for the benefit of hundreds of companies which buy fleets of cars which are of course of North American origin, often built in Canada. If they were not built in Detroit or Toledo, these cars are from Windsor or Oshawa or Sainte-Therese. These are cars that were built here. What is happening now is that the new tax system discourages companies from purchasing North American cars and is in fact an incentive to purchase imported cars which may be made in Japan or in Germany.
In concluding, Mr. Chairman, I would like the Minister to give some thought to the comments I have just made. I am
anxious to hear his reply. I would also like to make a few comments subsequent to the Minister's reply. However, if the Minister is unable to respond-and I am aware that it is important to complete consideration of this Bill as soon as possible so that taxpayers can receive their tax refunds-if the Minister is unable to give the House a satisfactory answer right away, I would like him to consider my comments as representations in connection with the budget we all hope will be brought down within the next few weeks.


Mr. Cosgrove:: Mr. Chairman, I thank the Hon. Member for his thoughtful presentation and his recommendations to myself and the Minister of Finance. There is no question that the Hon. Member put his observations in the context of total Government responsibility. For example, he indicated that any benefit offered to one segment of the community under our tax domain is quantifiable and no doubt can be equated to income. If there is no tax on such benefit, it means that other Canadians have to carry that charge through paying taxes in some other area. Therefore, I appreciate that the Hon. Member thought about that in his question.
The Hon. Member prefaced his question by saying that any feature of the tax system that gives a preference or permits a deduction or exemption is a charge on the over-all Government operation and finally becomes part of the deficit and the borrowing Bill which was before the Finance Committee.
Similarly, I am pleased that the Hon. Member has drawn our attention to the competition between the North American product and the imported product. He used the example of Japanese vehicles. There was one point he did not comment on either in his preface or his larger presentation. That is an alternate way of assisting the North American industry in selling its product and thereby either maintaining present employment levels or, optimistically, looking at prospects for potential growth of the North American industry.
With the greatest respect to the Hon. Member, I do not think the answer to the health of that industry is through Government action in giving exemptions, either by way of depreciation or waiving of income benefits that some people receive. In effect, the economy would then be carrying one sector that is not competing. The difficulty is that the sector is not competing.
The problem with the North American product is that other countries, including Japan and Europe, are offering products such as vehicles which the Canadian public wants to buy. They express their preference with their pocketbook. The only answer is for the industry to compete better. We cannot expect the Government to set the standards and be the final arbiter as to what products Canadians are going to purchase. One of the reasons the industry is not doing well is that Canadians in large numbers are buying other products. I think there is a message there for the industry.
March 15, 1983

I believe I have dealt with capital depreciation in a general way. On the specifics of the method imposing the tax which the Hon. Member referred to, I would like the Parliamentary Secretary to comment on that. There have been previous submissions on that point and the Parliamentary Secretary might expand on the specifics of that proposal, which is an interesting one.


Roderick Blaker: Order. Before recognizing the Hon. Member for Mississauga South, the Chair should inform the House that on Friday, March 11, the Hon. Member for Mississauga South moved a motion which the Chair has not put to the House. I believe at this point I should read the motion to the House. The Hon. Parliamentary Secretary rises on a point of order?


Mr. Fisher:: Yes, Mr. Chairman, just a small point of order. I was going to provide some additional information to supplement the Minister's answer in reply to the Hon. Member for La Prairie.


Roderick Blaker: That is quite in order.


Douglas Glenn Fisher: Mr. Chairman, I look forward to the comments of the Hon. Member for Mississauga South, as usual, but I would like to clear one important matter up.
First of all, Mr. Chairman, 1 would like to point out that the Hon. Member for La Prairie has consistently given us outstanding advice on these matters over the past year. I have filled my office as Parliamentary Secretary for almost a year now and throughout that period the Hon. Member has discussed with us the problems associated with the standby charges and with capital cost allowances. His advice has been vital in making up the final version of this Bill. I believe he would like us to go a little further and to be even more understanding, and 1 compliment him on his vigour and enthusiasm in raising these issues. We saw a good deal of his understanding of the matter in his discussion earlier.
He went right to the core of the question in saying that "personal use" is the key issue. He then suggested to us an interesting method whereby the employer would collect a rebate from an employee for personal use of an automobile.
I would point out to the Hon. Member that under Revenue Canada's interpretation bulletin IT-63R, we find under Section 6, and I quote:
A payment by an employee to his employer for his personal use of the automobile reduces the benefit added to income under paragraph 6(l)(a).
He will find if he goes to the existing Act and to this Bill that the same provision is carried on. It is a question of degree after that. He has pursued an opportunity which is already in the law. He is suggesting to us that for a simplification we should use this everywhere. I believe it is a very good idea, one that warrants the consideration of the Minister of Finance, and I will personally ensure that he takes a good look at it. I would also ask the Hon. Member to point out to employers and to his
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own contacts that this opportunity exists already and they should take advantage of it.


Mr. Hawkes:: A point of order, Mr. Chairman. Did the Parliamentary Secretary say that the Hon. Member for La Prairie (Mr. Deniger) is responsible for that regulation? Is that what he said?


Roderick Blaker: That sounds more like a question than a point of order.


Douglas Glenn Fisher: Mr. Chairman, I must confess that the ability of the Hon. Member in Her Majesty's second official language is better than mine. I apologize for that. I view it as a personal handicap on my part and nothing of which I am proud. I missed the question. Could the Hon. Member repeat it, please?


Frederick James (Jim) Hawkes: Mr. Chairman, did the Parliamentary Secretary say that the Hon. Member for La Prairie was responsible for this regulation? Is that the sum total of what that was all about?


Douglas Glenn Fisher: Is that a point of order, Mr. Chairman, or in the course of normal debate?


Roderick Blaker: I am afraid not. Order. The Chair will now proceed with the reading of the motion moved by the Hon. Member for Mississauga South on Friday. It is moved:
That Subclause 1(4) of Bill C-139, an Act to amend the statute law relating to income tax (No. 2) be amended by adding the following, immediately after line 24 on page 4;
"(2.2) For the purposes of subparagraph 6(l)(e)(iii) a benefit relating to the operation of an automobile shall only be the cost of motor fuel paid for by the employer but utilized by the employee in personal use of the automobile"


Mr. Blenkarn:: Mr. Chairman, I believe we have had a rather long discussion with respect to Clause 1. I just wanted to make two or three points with respect to the amendment, and unless other Members really want to say more with respect to automobiles, I propose we move on to other sections of the Act.
As you know, sir, it has been our position that this Act should have full and complete discussion as far as possible. Frankly, we spent rather longer than I had hoped on Clause 1 on Friday, and it is unfortunate that the Minister and his Parliamentary Secretary refused to answer questions appropriately, particularly those of the Hon. Member for Calgary West. Had they done that, we would have moved out of Clause 1 earlier.
Speaking to the amendment, sir, at the top of page 2 Members will note Clause l(a)(iii) reads:
-that was a benefit in relation to the use of an automobile, except to the extent that it related to the operation of the automobile;

March 15, 1983
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When you read that it does not make any sense at all, so you go to the explanatory notes which the Minister said were so clear and everyone could understand. We have asked the Minister to explain those explanatory notes but he cannot. The explanatory notes say that this amendment adds that Subclause to provide an exception for any benefit relating to the availability of an automobile for personal use, but clarifies that operating costs of an automobile used for personal purposes which are paid for by the employer must be included in income.
Well, Mr. Chairman, what we are saying is that the operating costs to be included in income should be restricted to the actual operating costs of the automobile, essentially the fuel. Remember, this is the employer's car and the employee is using it part-time for personal use. As to the licence, obviously the owner has to license the car and there is no reason why that charge should be borne in part by the employee. When you get to the question of insurance, in the case of a salesman's automobile it is usually much higher than that which the individual himself might pay, particularly in view of the fact that corporations often insure for much higher limits than individuals would necessarily insure themselves. Therefore, because of the wording of the Clause, the employee is being asked to pay a disproportionately high charge for maintenance.
This has never been the law in the past which is why this amendment is here. It is a further burden on the employee. You will recall, sir, that we objected to the inclusion of this particular part because it was not within the Ways and Means motion, but the Chair ruled it was. Nonetheless, this is a further burden on the employee. We say that burden should be restricted to the actual cost of operating the vehicle, the gasoline in the tank. If the employer pays the gas bill, then the employee should pick up his share of the gas bill with reference to his mileage.
If we could have a reply from the Minister on that, and perhaps some other views, I think we could get on with the Bill at this point.


Paul James Cosgrove: Mr. Chairman, the Government does not support the amendment and we would be prepared to express our view in a vote very quickly. The difficulty in the amendment proposed by the Hon. Member for Mississauga South is that we do not share with him whatever rationale he has for drawing the distinction between fuel and other expenses. For example, what is the rationale for exempting the cost of tires, grease or oil and not that of fuel? Similarly, the cost of insurance or a licence. The car will not go without fuel, and it certainly should not be on the road without insurance or a licence. We find no rationale for the amendment and cannot accept it for that reason.


Mr. Rose:: Mr. Chairman, on the same subject I would like to read into the record a letter to the Minister of Finance, a copy of which I received. I will not read the whole thing, but I
would like some clarification on it for my constituents. The constituent writes:
It grieves me considerably to have to write to you on a situation you have inherited with your position. However, my grievance is costing me considerably, all a result of the increased tax portion of my company automobile.
It is costing me $3,158.16 taxable benefits portion annually, for an automobile worth $10,049.48 annually (all costs included). That represents 31 per cent. My personal mileage, 10,000 km versus 45,600 km business mileage represents only 21.9 per cent "Real Value" or to rephrase the statement I'm taxed 1/3 on 1/5 value, net.
He then goes on to talk about some other personal problems and ends with this paragraph:
With these excessive tax rates and nasty twists being annually developed, how is one expected to get ahead? Why is the incentive to perform and exceed being taken away, especially from the young who will one day be expected to take over the management and operation of our businesses, provinces and country.
Now, I would like to inquire of the Minister or his Parliamentary Secretary what kind of answer I should give my constituent. Whether or not you want to include tires, gasoline or insurance, or whatever, what do I say to him about the proportion of personal use involved, roughly one-fifth, and is there any chance that there could be a proportionate write-off in some way to assist him?


Douglas Glenn Fisher: Mr. Chairman, I appreciate the Hon. Member's representation. I think there are many taxpayers with similar specific questions so I am sure that more than just that one person will find this question useful. I hope I will be able to answer to his satisfaction.
We have set the 12,000 kilometre minimum standby charge because we believe that is roughly what everyone else would pay for personal use of the car. We have used 12,000 kilometres as a reasonable cut-off point. Many people will use business cars for smaller portions of personal use, but by the time you get to 12,000 kilometres you are using your car for roughly the same amount of personal use as most other citizens would be. So the Government has, perhaps arbitrarily, drawn a line and said that at 12,000 kilometres everyone is being treated equally. It is what everybody would drive personally and it is also what other people would pay in after tax charges.
However, I ask the Hon. Member to remember two or three qualifiers. First of all, it is the personal choice of the taxpayer to drive the company car for personal use. The taxpayer can easily decide not to do so, to use either other methods of transportation or to buy a different vehicle altogether. It is the taxpayer's choice. I suspect, and this is what I have found in my dealings with my own constituents, that people drive the company car under these circumstances because it is still fairly cheap to do so. In fact, using the Hon. Member's example of, I believe he said, $3,100 taxable benefit, if the taxpayer is in a one-third tax bracket, which is a fairly rich one, he is paying $1,000 tax on the $3,100 benefit and at that price the taxpayer is getting a car with all the luxuries and operating expenses that go with it. A $1,000 car today, per annum, is quite cheap. After the individual has finished driving it, the insurance and everything else is included.
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U0)
Third, the Hon. Member asked about prorating and he is quite right that 12,000 kilometres is a dividing line. The standby charge comes into full force after 12,000 kilometres and the taxpayer prorates his liability under 12,000 kilometres. I think he indicated that his constituent has 10,000 kilometres of use, so he would pay five-sixths of his standby liabilities.
I would ask the Hon. Member to take into consideration that 12,000 kilometres is a dividing line that we think is fair to everyone, that personal use is the choice of the taxpayer and that, even so, it is quite an inexpensive way to get a car; and finally, it is prorated below 12,000 kilometres.


Frederick James (Jim) Hawkes: Mr. Chairman, I also want to move on to other Clauses. We moved an amendment that has the impact of reducing the number of items taken into expenses for the calculation of what is, in effect, about a 300 per cent tax increase. I suggest that it is reasonable for the Government to give more consideration to that idea than it has up to this point.
I have three short questions. We have suggested to the Government during our discussions that it is unfair for the value of the original price of a car to remain the same year after year, because when an automobile is used for one year or two years, or for 100,000 kilometres, its value declines. Yet the Government wants to tax the user as if it were still a brand-new automobile. Has the Minister reconsidered that principle of cutting down on the valuation?


Paul James Cosgrove: Mr. Chairman, there was an amendment which I believe was put by the Hon. Member for Mississauga South. 1 cannot recall whether we have actually disposed of that amendment as yet. The Hon. Member for Mississauga South indicates that we have disposed of that motion. If the Hon. Member for Calgary West really wants to move along to a new Section, as he has indicated, I respectfully suggest that we really should not be discussing items which we have not only dealt with but voted on.


Frederick James (Jim) Hawkes: May I repeat the question? Will the Government consider changing the value of that automobile each year? As its value declines the taxpayer must pay for personal use based on the value of the automobile. Why should the taxpayer have to pay the same amount in the third year as he would have to pay in the first year when, in fact, the value of the automobile has declined?


Paul James Cosgrove: Mr. Chairman, I want to go on record as saying that I do not think it is useful for this Committee to entertain discussion of matters that have been dealt with and voted on by the Committee.


Roderick Blaker: Order, please. Perhaps the Hon. Member for Calgary West could clarify the matter which he is raising now for the benefit of the Chair and the House. The Hon. Minister of State for Finance contends that the Hon. Member for Calgary West is debating an issue which is contained in a Clause which the House has already disposed
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of. It would be useful for the Chair if the Hon. Member for Calgary West would clarify that point.


Frederick James (Jim) Hawkes: Mr. Chairman, it shows some confusion that exists in the Minister's mind from time to time. We are on Clause 1 which deals with the method of calculation of the benefit to a taxpayer. Part of that method of calculation is the value of the automobile, the value of the expenses and so on. The Committee has disposed of a specific amendment which we presented and which would have changed part of that calculation. To that extent the Minister is correct.
However, the subject matter is Clause 1 and the amendment thereto. The amendment which we are currently debating deals with the calculation on the expense side. The strong feeling that we have that that calculation should be changed could, in fact, be modified somewhat if the Government indicated a willingness to change the calculation on the value side. However, the Government clearly does not even want to talk about it. It does not want Canadian taxpayers to know about it or even its backbenchers to know about it.
We will leave the question of the value of the automobile because the Minister will not answer it. Let us proceed to the expense calculation. The impact of our amendment would be to reduce the expenses simply to the fuel used. There are some parts to that expense method that simply run against the grain because they are wrong.
Why does the Minister insist on charging a private taxpayer a portion of an expense amount for private use which is calculated on an insurance benefit that is based on commercial rates? Every taxpayer in this country knows that a taxi driver pays enormous amounts of money for personal insurance on that automobile. Premiums of $3,000 and $4,000 are not unusual. Private individuals who use an automobile for personal use can purchase insurance for $500 to $700. Simply because my company must pay a high insurance rate, why should I have to receive a taxable benefit based on that commercial insurance payment rather than something related to what I would have to pay to insure my vehicle privately? Why does the Government insist on inflating my tax liability based on that expense item called insurance?


Douglas Glenn Fisher: Mr. Chairman, I suppose that the question raised by the Hon. Member is one of degree. It seems to me that when we evaluate these individual costs, we can probably go through the operation of an automobile and find some costs that are more expensive, as I am sure he will find, and some that are less expensive because an employer is supplying them instead of the private individual.
The Government is trying to take a simple course of action for the calculation of these costs. I suggest that the most straightforward answer to his question is simplicity. If the individual calculates these costs and then prorates for personal use, he has a very simple calculation to make and that ends it. On the other hand, I would again want to come back to the principle which is the most important principle of all. It is up to the private individual to decide whether he wants to use the car or find some other method of transportation. If the
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individual finds that an extra few dollars on an insurance policy is onerous, then perhaps the individual could calculate the alternatives available. As well, the individual could calculate what other taxpayers pay in particular circumstances. For example, there are those taxpayers who use private vehicles for company business and who charge kilometrage to their employer rather than using the company car. The same example would apply there.


Frederick James (Jim) Hawkes: It becomes more and more frustrating. We have moved from principles of equity and fairness and all of a sudden there is simplicity. The principles of Canadian tax law change before our very eyes day after day. It is simple to say that every taxpayer in the country who uses a company automobile for personal purposes will deem the insurance costs to be $600, and they will have to calculate in that portion that the Government decides they should. That is simple, Mr. Parliamentary Secretary.


Douglas Glenn Fisher: Right.


Frederick James (Jim) Hawkes: It is totally unfair that a person on my left who works for a company whose insurance fleet coverage is so bad that they are paying $5,000 for each vehicle will have to pay more tax than somebody on my right who drives the same car, the same everything, but whose fleet coverage is very good with a $3,000 insurance premium per vehicle.


Douglas Glenn Fisher: That is not true.


Frederick James (Jim) Hawkes: That is unfair.


Douglas Glenn Fisher: Use your head and start thinking.


Frederick James (Jim) Hawkes: Why does the Government have the following formula built into this Bill? The value of the automobile is fixed on the date of purchase and lasts for five years. If the car costs $10,000 at the outset, the Government says that car is still worth $10,000 five years from now. We all know that is nonsense but that is simplicity in the Government's terms. We also know one other thing about that five-year period of time. Repair costs go up. As the vehicle is used more and more and gets older, repair costs increase. A taxpayer with a five-year-old vehicle will be paying more tax dollars to the Government of Canada because of that repair side of this equation than the person on my left who has a brand-new vehicle which is worth more, gives better service and has less problems. That is the Government's idea of simplicity, Mr. Chairman.
Can the Parliamentary Secretary tell me why he wants it both ways? The only logical explanation that I can conceive of is that this is a money grab. It has nothing to do with simplicity, fairness or anything else except a money grab. It is unfair to Canadian taxpayers. Will the Government consider taking the repair part of this taxation liability out of the equation? If the Government is going to keep that automobile value as if it were brand-new, why does the Government not also assume the car needs no repairs? Brand-new vehicles do not need
repairs; they are under warranty. If that is the value the Government is putting on one side of the equation, why does the Government not drop the repair side?


Douglas Glenn Fisher: Mr. Chairman, the Hon. Member has a fascinating theory.


Frederick James (Jim) Hawkes: Fascinating?


Douglas Glenn Fisher: It is a theory that I think ordinary practice will not bear out. He is concerned about questions of equity. Bear in mind the simple principle that we are asking people who use their cars for personal use to pay for that use in after-tax dollars. That is the principle. Can the ordinary taxpayer who does not have a company car but has his own car work out some complicated depreciation plan the way the Hon. Member is suggesting? Can this ordinary taxpayer come to the Government and say: "Government, my car is three years old this year; therefore, I want to write some of it off and get a benefit?" The ordinary taxpayer cannot do that. What we are asking is that the personal use of a vehicle be paid for in aftertax dollars and that business-related use be paid for in pre-tax dollars.
Let me carry the Hon. Members' example one step further. He said that there are questions of equity on maintenance. Let us explore that to its logical extreme. If the Hon. Member is counting angels on top of a pin, I will too.
Let us take an individual who has a personal car and drives it on an authorized basis for company use. The longer he hangs on to that car, the more his repair bills will be. Should we allow that individual a complicated set of calculations? No. All we do is say to him that he can collect a kilometrage charge from his employer on a tax-free basis. We do not want to make his life more complicated. We do not come to him and say: "This is the first year of the life of the vehicle, therefore, it can only be so much but the second year will be so much plus some and the third year will be even more". We do not do those kinds of silly calculations. We just say to the individual taxpayer that when his car is for personal use, pay for it with after-tax dollars. When his car is for business use, the car is treated on a tax-exempt basis. It is very simple and very straightforward.
I would like to tell the Hon. Member that I have received a letter which I will show to him. It concerns his behaviour here. This letter is from a chartered accountant, not a constituent of mine. He says that we should be charging the Hon. Member for elementary accounting lessons, and I think that is right. We cannot charge him for the time he has wasted in the House with these silly examples, but at least the Hon. Member should have the decency to pay us for his basic education.


Some Hon. Members:: Oh, oh!


Mr. Lambert:: You are so arrogant you should be in the Cabinet.


Roderick Blaker: Order, please. The Hon. Member for Calgary West.
March 15, 1983


Frederick James (Jim) Hawkes: Mr. Chairman, the Government intends to throttle this House later this day. This is amazing. First, the Government moves closure on the Bill. We have time allocation. Suddenly we see Liberal Members standing up and taking the time of the House. Not only do they cut the Opposition's debating time to a day, but the Government cuts that day in half through that kind of behaviour and no doubt we shall get filibustering from the Minister too.
Let me come back to the issue, Mr. Chairman. I, as an individual taxpayer, can decide whether to buy an automobile that is five years old. I pay less for it and I understand that I will probably have larger repair bills. I can make the opposite economic decision and buy a new automobile with full knowledge that I will pay less in repair bills. The Government is saying that if I work for a company, and for whatever set of reasons it is more convenient to use that company automobile part of the time for personal use, I will not have the choice. If I own the automobile I can decide to repair it. If I get a fender bumped a little bit and there is a dent and I do not have the money for the repair, I do not have to repair it. If the company decides to repair it, then under this provision I have to pay tax. That is the basic unfairness.
We are being charged as though we owned a new automobile when, in fact, it is not a new automobile. Then we are being charged for all the repairs which the company decides to make on it. The individual's choice has disappeared. This is totally unfair and I urge Members opposite to vote for the amendment which the Hon. Member for Mississauga South has moved because his amendment at least puts some sense of fairness back into the system.


Roderick Blaker: Is the House ready for the question?


Some Hon. Members:: Question.
Amendment (Mr. Blenkarn) negatived: Yeas, 11; Nays, 22.


Roderick Blaker: I declare the amendment lost.


Marcel Joseph Aimé Lambert: Mr. Chairman, I rise on a point of order. It is always very constructive to see that while Members on this side are being counted seats are filling on the other side of the House. Four Members came into the chamber while the vote was being taken.


Mr. Pinard:: Mr. Chairman, my learned colleague is fully cognizant of the Standing Orders and our parliamentary practice, and he knows that when a vote is taken in Committee of the Whole, Hon. Members may enter the House, they are not necessarily expected to be in their seat, and they may be counted as long as the Clerk has not reached their row. The three Members involved were in the last row and they were here at the appropriate time to be counted. Besides, you have
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ruled that the amendment was negatived, so it seems to me this is not a point of order.


Roderick Blaker: Shall Clause 1 carry?


Some Hon. Members:: Agreed.


Donald Alex Blenkarn: On division.
Clause agreed to on division.
On Clause 6-


Donald Alex Blenkarn: Mr. Chairman, we do not intend to debate Clause 6. We want to point out that we cannot agree to this Clause because it is very unfair and adds an enormous burden on those who are selling property that is available for redevelopment. It does not allow people to make an appropriate capital gain on the sale of real estate.
Rather than hold up the Bill, we would like to proceed with a number of other sections. We feel that the Government should allow full consideration of the Act, and in order to do that we are prepared to allow Clause 6 to pass on division.


Roderick Blaker: Shall Clause 6 carry?


Some Hon. Members:: Agreed.


Donald Alex Blenkarn: On division.
Clause agreed to on division.
On Clause 7-Shareholder debt


Donald Alex Blenkarn: Mr. Chairman, we believe that Clause 7 should carry on division. It deals in part with loans to shareholders. We have some real concern about Subclause (1). Subclauses (2) and (3) deal with automobiles and we have some concerns with them as well. We are prepared to allow Clause 7 to carry on division, however.


Roderick Blaker: Shall Clause 7 carry?


Some Hon. Members:: Agreed.


Donald Alex Blenkarn: On division.
Clause agreed to on division.


Roderick Blaker: The House will now consider Clause 8.


Donald Alex Blenkarn: Mr. Chairman, Clauses 8 and 9 and Clause 128(12) should be grouped together. They deal with small business bonds and that is a separate issue.


Paul James Cosgrove: Mr. Chairman, we agree with that. I take it there will be one vote on all three Clauses.


Donald Alex Blenkarn: On Clauses 8, 9 and 128(12) there should be one vote.


Roderick Blaker: Is that agreed?


Some Hon. Members:: Agreed.
On Clauses 8, 9 and 128(12)-

March 15, 1983
Income Tax


Mr. Gurbin:: Mr. Chairman, this give us an opportunity to look at some of the background of the Small Business Bond. I have a number of questions about it because of the way the situation has evolved. Since the concept of the bond was introduced in the Crosbie budget in 1979 it has proved to be an interesting and in some cases a very good and reasonable measure for businesses to expand initially or in cases of financial distress, to refinance.
I should like to express some concern that it is available only in cases of bail-out for those who are in financial distress now and that we do not have the opportunity to use the mechanism for people who want to expand.
I wonder what the rationale of the Government was in changing the concept from one of assisting expansion to one of assisting those in financial distress. I understand the difference between the Small Business Development Bond and the Small Business Bond, but what financial parameters were used to decide that it was no longer in the best interest of businesses to allow them to use this to expand and instead use it only as a bail-out mechanism?
Does the Government know the cost compared to the benefit to the Government through taxation, increased employment opportunities, business expansions and so on? 1 know the Government can relate to a lost-tax position, but can it compare that to the expansion that took place and the additional economic activity that took place?


Paul James Cosgrove: Mr. Speaker, I will begin by adopting the comments of the Elon. Member for Bruce-Grey that the section was of help to many small businesses. The amount of take-up by small businesses and banks has been very encouraging, not only under the original section, but as well subsequent to the amendments which are in this section. Advantage has been taken of them since the announcement was made.
One of the complaints about this provision initially was that it applied only to unincorporated business entities. One of the amendments before us is to expand that to unincorporated sole proprietorships, thereby opening the provision to a larger number of Canadian businessmen.
In response to the question raised by the Hon. Member for Bruce-Grey, I should point out that we felt that, as well as applying this to the unincorporated person, we should include those in financial difficulty.
Realizing that this section was limited in scope, the Government was relying upon the participation of the banking institutions to assist business. Considering the amount of funds available to assist in this area, and bearing in mind that there was no take-up under the provision, it was felt that the Government had to target on those businesses in more serious difficulty and those which, without funding under this provision, would otherwise fail. The provision for expansion seemed to address the most needy of small businesses, those close to using this provision as a last resort. Under the circumstances we felt that that was a group that really should be addressed first.
As I say, with the limited resources that the banks would use in this vehicle, we thought that the money should go first of all to those who, without the money, would not be able to continue.


Gary Michael Gurbin: Basically, I do not disagree with the idea that there needed to be an extension of this to those who are unincorporated, and that if there are limited resources they should be made available to those most in need.
However, the Minister, probably because I was not clear enough, has not responded to the basic question as to why the expansion orientation of this whole mechanism, which was implicit in the original suggestion, was changed so that it is now only useful to those who are in financial distress. That is irrespective of the amount of available resources. What parameters were used or what was the basis for the Government stating "This is costing us too much", or "It will not work this way", or whatever the rationale was, so that now we need to change it only for those in financial distress, in contrast to allowing it to be used for expansion and letting enterprise develop with the use of it?
I would also make one final and quick point. From time to time we on this side argued very strongly and, in the end, achieved the effect of making it available to unincorporated as well as incorporated farms. However, at the time that it was useful for expansion, only those who were incorporated were able to use it. The program initially had the effect of forcing people, if they were to expand, to become incorporated. The argument used at that time by the tax Department in stating that it really could not handle this very well unless people were incorporated is really denied by the fact that it is now used for unincorporated businesses. What was the real basis for saying that it could not use this for expansion any more?


Paul James Cosgrove: Mr. Chairman, the officials advised me that it was the recognition of the fact that the scheme was limited in terms of the amount of money available to any business, whether it was business to be used for investment or to be used in the case of failure-those businesses which were not concerned about expanding, but were concerned about continuing on because of the state of their balance sheets.
We recognized the fact that there was only limited future funding available because of the remarkable take-up in the first year or so. The Government therefore recognized that we had to make some choices and that with those limited resources available we should attempt to direct assistance to the businesses which, without this help, would have failed.
That was our first concern. I admit, in so doing, that we therefore precluded the initial use by businessmen which had been for investment purposes. However, it was assistance to those most in need, bearing in mind our information from the banks that the amount of funds had been, by and large, remarkably taken down. The access of the banks to this vehicle had, by and large, been exhausted.
March 15, 1983


Gary Michael Gurbin: We are coming very close to the question now. What is the practical limitation on the ability of the banks to use this? Obviously, bank profits are healthy. My understanding of the basic mechanism is that for tax purposes they are able to transfer their profits into a dividend pay-out. Therefore, what is the limitation? In addition, what would be the judgment of the Government as to whether it is really costing the Government money in terms of tax revenue as compared to additional economic activity generated by those businesses which would expand?


Paul James Cosgrove: Mr. Chairman, I believe the Hon. Member asked the question in a form which really pinpoints the issue. This vehicle would be available to banks only if they were in a taxable position.
Hon. Members will recall that last year the Standing Committee on Finance, Trade and Economic Affairs began an analysis of bank profits. Six months after the study was under way, with the downturn in the economy, rather than concern over bank profits there was concern over the ability of banks to make profits in the very weakened economic climate. As a result the Committee, instead of returning with recommendations as to how the banks should divvy up their excess profits, stated its concerns over the ability of banks to continue to serve their purpose under the original legislation in the country. It recommended that the Canada Deposit Insurance Corporation, for example, be enhanced and that the original security of $20,000 for depositors under the legislation be increased to $60,000, which reflected some concern over the ability of the banks and financial community to serve Canadians in a depressed economy. Again, that was reflected in the banks' taxable position. Toward the end of 1982, it was very apparent that their taxable position was deteriorating because their profits were deteriorating.
The first quarter of 1983 has shown another bounce and the ball is going the other way, we hope. However, it is too soon, in this quarter, for us to judge whether that is a trend which will accelerate and, in fact, what the taxable position will be. If that trend continues through the rest of the year, it is conceivable that the Government may in the future decide that the restriction to serving only those businesses in financial difficulty should be rethought. However, on our best projections, considering the picture for 1982 and projections into the first quarter of this year, that is not what we perceived would be the case. For the time being, therefore, we think that we should maintain the section and this program which is directed, first, to those who would end up on the bankruptcy casualty list without it.


Gary Michael Gurbin: Would the Chair help me? How much time do I have left in which to speak?


Mark Willson Rose: Infinite.


Roderick Blaker: The Hon. Member began speaking at 12.05 p.m. He is allowed 20 minutes.


Gary Michael Gurbin: I would direct a further question to the Minister. If there are figures, I think it would be useful to place
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them on the record in relation to the Government's position as to cost of lost revenue compared with additional economic activity created. Again, various figures from different sources have been stated for the record, and I think it would be helpful to get an idea of the Government's position.
The second question which I would like to pose for the Minister relates to the way in which the tax Department will treat these cases, whether it will involve the original situation or the current type of situation of distress. There is real concern that these matters be considered by the tax Department, not so much in the case of expansion, but, more particularly, in situations of distress.
As time goes on and, hopefully, businesses are in sounder shape and things are going better for them, the tax Department might say: "All right, you obtained the bond, but you really did not qualify for it because you were not that badly off'. I think a number of applications have been tested or considered by the corporate sector in an attempt to find out whether some kind of pre-judgment could be given. What sense of confidence is there that there will not, in fact, be a number of those cases which will not be accepted by the tax Department on the basis that there was really no justification at the time?


Paul James Cosgrove: Mr. Chairman, the Hon. Member really asks two questions. He reverted to the question he asked previously. The Department does not have a precise answer to the amount of economic activity that was generated by the plan. They believe there is no way they could give that figure with precision. I can, though, confirm that the take-down of the plan was over $2 billion worth of support for small businesses.
On the second question, if implicit in the question is the consideration of whether this Section should be reopened so as to make it available to those companies which are looking for expansion as they did previously, or to avoid the funds being used now for financial difficulty situations where there will be a remarkable turn around in short order, I think all I can say is that the Department will continue to monitor the take-down of the funding. No doubt the general economic indicators of the Department will also signal to the Department whether the Section should be reconsidered.


Gary Michael Gurbin: Mr. Chairman, when the tax Department is looking at a particular case, or at the involvement of different shareholders in a particular company, for instance, there are a whole range of things that could happen that would bring into question the legitimacy of their original application. I can see a lot of opportunity for confusion, dispute and difficulty in a particular situation where there may be ten different people on a board of directors. In a small community, or even in a large community, I think this is likely to happen. Someone who is intimately involved with a particular application may also be involved either in the same way or in a peripheral way with some other application. I wonder if there are any general

March 15, 1983
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guidelines that the Minister could indicate right now, or could he tell us how rigidly and how strictly is that kind of arm's length approach going to be applied when it comes time for tax consideration?


Paul James Cosgrove: Mr. Chairman, I guess that really gets down to the decision of officials in the Department of Revenue who would be administering the law and the rulings under this Section as to whether businesses comply or not. I am advised by the officials that there is some procedure for obtaining a preliminary opinion whether a company in a particular situation did meet all of the criteria. Presumably information on all of the peripheral things that the Hon. Member has talked about would be made available to the officials in the Department and, having that in mind, if they make an initial ruling based on all of the available information at that time, the Department would not change its mind later on. The question of whether the Section should be changed later on or not is something different.


Roderick Blaker: Order, please. The Hon. Member's time has expired.


Mr. Darling:: Mr. Chairman, if I could follow up the remarks and questions from my colleague from Bruce-Grey, I believe the Minister stated that a total amount of $2 billion had been approved in loans, and I would assume this would mean the Government had guaranteed that amount, which was loaned, of course, by the chartered banks. Is that right? There was no guarantee?


Paul James Cosgrove: That is not a provision of the Section, Mr. Chairman, and it is not a practice of the Government.


Stan Darling: Mr. Chairman, I would ask the Minister if there are any figures as to how much of that $2 billion was loaned by the chartered banks before the new restriction came in that only to those in need would the money be available. I am curious about that amount.
Also, when the original small Business Development Bond was brought in by, I believe, the Crosbie budget-and I commend this present Government for carrying on with it-at that particular time it was restricted to small limited companies. I am just wondering if it would not be better to go back to the original plan where there would be more money available, because now, as I understand it, it is only for those in need. I have had several of my constituents come to me and say that they were in dire circumstances and needed money and they asked if they could avail themselves of this Small Business Development Bond. Of course, I would point out to them that they would have to go to the chartered banks and present their financial statements. In the great majority of cases, they were turned down. The banks said that they knew that they were in need of money but that they were in such serious need of money that the banks would not lend it to them. This to me is far from fair. I will admit that money cannot be loaned to a bankruptcy but there are a great many people who could have got this money but were turned down.
My question to the Minister, first of all, is how much was loaned before and how much after?


Paul James Cosgrove: Mr. Chairman, under the original provision I am told there was over $2 billion used by small businesses through the banking system. Since the provision was expanded on the one hand and also directed toward financial difficulty or dire straits situations, there has been somewhat over a $200 million taken down. In the example given by the Hon. Member, I do not follow the Hon. Member's logic. If indeed the person who has asked for help is a person described by the Hon. Member as being in dire straits, presumably he is the very person whom the amended Section helping people in difficulty is directed toward. He is the person who would now qualify. It is only a person who wants to expand, who is looking to grow, who does not have that present urgency and dire situation that the Hon. Member refers to, who would now not qualify.


Stan Darling: Mr. Chairman, what I was pointing out was that there are certain businesses which are on the verge of bankruptcy. There are a great many firms that are hanging in and are able to keep their heads above water, even in this economic climate, and I will go back six months ago when the economic situation was even gloomier than it looks at the present time. There were certain strong businesses then which wanted to expand, wanted to consolidate, yet were not eligible.
It is an old military axiom that success and not weakness should be reinforced. I understand that the banks have put up $200 million. I would be interested in knowing how many of those loans went sour; in other words, where they were trying to prop up weakness.


Paul James Cosgrove: Mr. Chairman, the Hon. Member's question is really supplementary to that of the Hon. Member for Bruce-Grey. We looked at what the choices were, and since the provision was designed to be administered through the chartered banks, we knew it was dependent upon their profit and tax situation. We knew the provision had been widely used and very successfully, but the available funding was drying up.
Faced with that circumstance, the Government proposed that assistance should go to those the Hon. Member described as being in dire straits. He used a figure of speech in military operations-that you support your strengths. In the military sense, you must also assist the wounded. The military does not abandon the wounded.
Obviously we have to be concerned about those who, without this help, would have been clients for bankruptcy court. We felt that under the circumstances we had to assist those who, without this kind of help, would have been in real difficulty. We are hopeful that with the upturn in the economy those who are strong will be assisted by it and will not require assistance from the Government.


Stan Darling: Mr. Chairman, I again come back to the percentages. The banks have only loaned one-tenth as much to
March 15, 1983

those in a serious financial position compared to the old basis. It was loaned to those with an okay credit rating, those who could very well repay the loan.
I agree with the Minister that we must assist those small businesses that are in a very serious situation. I emphasize again that many small businesses could have been saved if the Government had gone to the banks and tried to work something out for those businesses that were close to the wall. I do not have to remind the Minister of the great number of bankruptcies that have been announced; it is common knowledge. Many could have been prevented if the Small Business Development Bond was available to them. However, they reached the stage where they were just hanging on while the banks were giving them consideration. When the final line was drawn, they were turned down and went into bankruptcy.
With the upturn in the economy, is the Minister going to recommend to his colleagues that the Small Business Development Bond be available to individuals and companies so that they can enlarge and modernize? That would result in more people being taken off the unemployment rolls. It would be a good deal for the Government as well as the individual businessman or small limited company. There would not only be savings with regard to payment of unemployment benefits, but the Government would start collecting income tax and other taxes as well. 1 hope the Minister has some good news for us on this. Is there anything in the offing to the effect that this money will be available through the Small Business Development Bond to other than those in dire straits?


Paul James Cosgrove: Mr. Chairman, the best news would be that the economy was performing so well that the Government would not be required to provide assistance to any businessman. It would be perking without this drain against Government resources.
There is something Hon. Members should consider when comparing situations. First, with regard to the planned program for expansion assistance-assisting those in dire straits as described by the Hon. Member-the expansionary use of the bond was for a period exceeding two years. That is in comparison to the new provision which has only been in place for six months. He has to keep that in mind.
Second, I responded to the Hon. Member for Bruce-Grey that the Government will monitor the results of this program. I cannot say what the Government will do except to say that it was as a result of an analysis of the use of the program, the fact that the taxable income was not there for the banks and there was a limited use of this Section. Therefore, we had to make some changes. The Government will continue to monitor it. Whether changes in the Section are warranted will depend on the performance of the economy.


Stan Darling: Mr. Chairman, would the Minister or his officials make a guesstimate that with the more favourable financial outlook for the banks, which had a better year this year, they will be more sympathetic to loans under the Small Business Development Bond, or will it not make any difference? I believe it was half prime plus 1 or 2 per cent at which
Income Tax
the bonds were negotiated and the money loaned. The bank would not have to declare this in its profits because of the greatly reduced interest rate it provided to these special customers. Does the Minister have an optimistic view of more use of the Small Business Development Bond in the new climate?


Paul James Cosgrove: Mr. Chairman, I could give many qualifiers as to why my answer could not be optimistic, but I am by nature optimistic. I am optimistic that the banks will be able to offer the program, but I cannot speak for the banks. The Hon. Member referred to their having a better year. They have had a better first quarter this year over last. The banks will obviously watch their own performance in making their decision.


Stan Darling: I appreciate that it is the first quarter, but at least it is looking better. Do either the Minister or his officials have a breakdown of the money loaned under the new plan, whether to partnerships or individuals as against limited companies, as was the case originally? I am curious to know whether a lot of individuals have been able to take advantage of it, or is it still by and large mostly small, private companies that have it?


Paul James Cosgrove: Mr. Chairman, that is a very good question. I do not have the answer available this morning. I will undertake to see if this information is available and make it known to the Hon. Member.


Stan Darling: Mr. Chairman, the amount of $2 billion was mentioned. I am not clear on this. Was the legislation under the old set-up amended where individual entrepreneurs could qualify on the expansion basis, not on the need basis? If so, how much of the $2 billion went to incorporated companies and how much was available to sole proprietors or individual businessmen, such as farmers, etc.?


Paul James Cosgrove: Mr. Chairman, the provision which was in place for expansion, which is the $2 billion plus I referred to, was available only to incorporated entities and, therefore, the total amount was used under those circumstances.


Stan Darling: Mr. Chairman, I have one further question. It is actually not a question but, shall we say, a plea. In other words, the ordinary individual businessman or small proprietors, such as partners who are not incorporated, have not been able to take advantage of the Small Business Development Bond as it was originally planned by this Government as well as the previous Conservative Government. The only individuals who have been able to take advantage of that have been those with their backs to the wall, who were in really serious financial trouble, and no reasonably successful proprietorships have been able to qualify or have been able to have an application granted.


Paul James Cosgrove: Mr. Chairman, I will consider the Hon. Member's plea as a representation. As I have indicated, the bond was originally only available to incorporated entities. The

March 15, 1983
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law has now been changed to include sole proprietorships. In any further amendments or alterations to the program we will seriously consider the representations of the Hon. Member.


Mr. Orlikow:: Mr. Chairman, I find it interesting and puzzling that the Minister uses as his explanation for the change in the Act, which means that money will not be available to borrow for expansion or development, the argument that the Government wanted to use the relatively limited amount of money which was available for those companies which were in danger of going bankrupt. I find it puzzling, Mr. Chairman, because of the billions of dollars in loans and grants which the Government has been able to give to some very large corporations, such as Dome Petroleum, Chrysler and Maislin Industries, the Government's argument that it has a limited amount of money for small business.
I find interesting the Minister's explanation that the banks were limited because they did not have such a good year last year. Well, we know that in the first quarter of this year bank profits were up by 41 per cent, and we know that because of the tax system which this Government has implemented over the years bank taxes are down, if the banks pay any taxes at all-and there are one or two which last year paid no taxes. The rate of tax is down to about the same rate as individual taxpayers in the lowest tax bracket.
The program before it was changed was very successful. It was lauded by the Canadian Federation of Independent Business, which has expressed some very serious objections to and criticisms of the change in the Small Business Development Bond to the new system. The Ministry has said that the new system provides for the Small Business Bonds and permits loans to be made to unincorporated businesses, but according to the Canadian Federation of Independent Business it has been used almost exclusively by farmers. Small, unincorporated businesses have not availed themselves of this to any extent. Indeed, the loans made are well down in number.
Given the fact, Mr. Chairman, according to some figures released yesterday and today, that last month we had the second highest number of business bankruptcies ever in this country, it seems to me pretty obvious that the program is not working. I would like to ask the Minister to explain, not just to me but to the people who belong to the Canadian Federation of Independent Business, why the ability to loan money for expansion was removed from the new program.


Paul James Cosgrove: Mr. Chairman, the Hon. Member used the example of Government assistance to firms such as Chrysler through the guarantee program to that firm, saying that if we can do it for Chrysler, why can we not offer some assistance to small-businessmen. In my experience, Mr. Chairman, although Chrysler Corporation has large plants and employs large numbers of people in the manufacturing plants, they are served right across this country by hundreds of smaller firms, including sole proprietorships, smaller partnerships and small-businessmen. The automobile industry is not just a large plant in operation. It was for that reason that the Government decided to offer the guarantees to Chrysler, because there were
representations made at the time when Chrysler was in serious difficulty for support, as I say, not only for the larger plants but for people right across the country who saw their livelihood going down the tube if Chrysler folded. I personally received dozens of representations from people not only in my constituency but in many other constituencies when that was a hot issue two and a half years ago.
I believe it is simplistic to say that the assistance which has been provided to some of the larger firms has been designed to assist just the large corporations. It helps the small people, the small businesses and single proprietors. It is also simplistic to say that this provision is the only way in which, conversely, the Government provides direct assistance to small businesses or to the smaller players in the economy. For example, the preferred rate of 25 per cent to small businesses is a benefit to the small business sector which, taken cumulatively, is worth over a billion dollars to that sector of the economy. Therefore, we are providing assistance in many ways other than the particular Section before us.
I cannot comment on the accuracy of the figures which have been given by the Hon. Member for Winnipeg North because, as I have indicated, our Department does not have that breakdown. The Hon. Member indicated he has figures which show that the take-up was by farmers almost exclusively. I do not have the figures to weigh that comment, but certainly it was available to all other sectors. The provision was available to other people who wanted to use it.


David Orlikow: Mr. Chairman, I was not suggesting for a moment that the Government should not have made loans to Chrysler, to Massey-Ferguson or to other companies which are involved in the production of goods, some of which are exported. What I am saying is that it seems obvious to me there is a vast difference in the way in which the Government approaches requests for assistance from large corporations and the way in which it approaches requests for assistance from small businesses.
It has been pointed out frequently that 65 per cent of the jobs in this country are provided by small businesses. When we see the record rate of bankruptcies which have occurred for the last two years, every month more bankruptcies than in the same month a year earlier, we have to be concerned.
I point out to the Minister that while there may have been some justification for loan guarantees to productive companies like Chrysler, according to The Financial Times Canadian banks made loans of $4.2 billion to a few large corporations for takeovers. Many of these takeovers added nothing to the productive capacity of this country and most of the loans have now been classed as non-productive loans, which means that the companies are not even paying the interest let alone the principal. So I say to the Minister that there is a vast difference between the way this Government and the banks look at the problems of large coporations and those of small corporations.
March 15, 1983

As far as the point I have made that the new bonds are being used mainly by farmers is concerned, that information came to me, as I am sure it did to the Minister's office, as a result of a survey by the Canadian Federation of Independent Business which showed conclusively that the new bond was not being used to the same extent as the Small Business Development Bond.
The Minister has not answered my question, and that of other Members, which was simply this. There are small businesses which are not going bankrupt, which have survived this recession. They are in a position to expand and modernize. They want to be able to use the bond as they previously did, to buy new equipment, to modernize and expand. Yet just at this time when, hopefully-and 1 am not as hopeful as some Members-we have turned the corner and the recession is over-because there are some signs of improvement-the Government cuts these small-businessmen off by saying it will no longer permit them to borrow money as they did under the Small Business Development Bond program.


Paul James Cosgrove: Mr. Chairman, I would have to repeat the gist of my last answer to the Hon. Member when he says that the Government has dealt with the two sectors in a different manner. The support of firms such as Chrysler was not just because the Government was directing assistance to so-called large firms. It was because we recognize that the large firm is just one part of a large industry and that many small-businessmen right across this country are involved in the manufacture of parts for those vehicles. That in itself is an industry. Many of these people are sales people, small firms, small operators, small garages and outlets, and they were all in jeopardy. It was not just the so-called big Chrysler operation, there were many small-businessmen who stood to lose if the Government had not moved to provide that guarantee. If the Hon. Member uses the example of Chrysler to support the contention that the Government has dealt with the two sectors in a different way, then I disagree with him most emphatically.
As to the other point, Mr. Chairman, it was raised by two Members earlier in the proceedings. We have indicated that the Government was faced with a choice. There were limited resources available under the program and we decided we should direct the assistance to those who need it the most. The Hon. Member tells me that surveys show that farmers took advantage of it to a greater extent than did other small-businessmen. All I can say is that I hope other sectors in the small business category do not need the program or will not have to call on it in the future. I hope that is the case.


Mr. Thacker:: Mr. Chairman, we are discussing Clause 8 and Clause 9 which deal with the Small Business Bonds. I am wondering if the Hon. Minister can tell us in short order how many loans have been granted under each of these two categories and the amount of money involved. Earlier he referred to a figure of $2 billion which, since the most recent changes, has dropped down to $200 million.


Paul James Cosgrove: Mr. Chairman, my officials advise that the $200 million I referred to earlier was used under both Clause 8 and Clause 9. I do not have a breakdown of how much is attributable to each. My officials indicate that we can get that information and I will make it available to the Hon. Member.


Blaine Allen Thacker: Mr. Chairman, I am sure everyone here would be interested in that. Will the Minister give us his view as to why there was $2 billion lent under the original Section and only $200 million since the changes? What does the Minister feel occurred in the economy to result in such a dramatic change?


Paul James Cosgrove: Mr. Chairman, if we look at the performance of the economy since the introduction of the initial Section in 1979 and the performance of the economy in the last 24 or 30 months, obviously the economy was performing very strongly immediately following the original program. More recently the economy has deteriorated, as have all the economies of the industrialized world. So while businessmen were looking at expansion at one time, in the last little while they were looking at survival.


Blaine Allen Thacker: Mr. Chairman, from a political perspective, we note that the original Section was brought forward under the Conservative Government and the new one was brought forward under the Liberal Government, along with a dramatic downturn in the economy.


Roderick Blaker: Order. Perhaps the Hon. Member would like to call it one o'clock.

It being one o'clock, it is my duty to rise, report progress and request leave to consider the Bill later this day.
Progress reported.


The Acting Speaker (Mr. Corbin):: It being one o'clock, I do now leave the chair until two o'clock this afternoon.
At 1 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mr. Gaston Gourde (Levis):: Madam Speaker, it was reported in the press recently that a resolution of the National Council had risen from the ashes of the Parti Quebecois to

March 15, 1983
warn the farmers of Quebec against the danger of Bill C-85 to establish a corporation called Canagrex. Nevertheless, the Canadian Federation of Agriculture, the Agricultural Producers' Union and the majority of groups interested in the growth of the agri-food sector are in favour of the Bill, and it should have been adopted long ago.
Just as an example, I would like to quote from a document titled "Canagrex meets a need" where it is stated that, in 1982, Agriculture Canada had tentatively identified potential sales of up to $5 million worth of maple syrup products on the very promising markets of Japan and the Federal Republic of Germany. Canagrex would be the ideal intermediary to secure those markets.
I therefore urge all farmers affected by this problem and other interested parties to put pressure on our Progressive Conservative colleagues so that they will let the Bill through immediately. As to the wooly theories of the separatist National Council, I would suggest that they are the best indication that the Bill should be adopted as soon as possible.



OLYMPIC GAMES


Mr. Joe Reid (St. Catharines):: Madam Speaker, the Minister responsible for Sport in Canada stated on October 22, 1982, that the federal Government had committed $200 million to the Calgary Olympic Games and that $500,000 had then been advanced to Calgary on its commitment.
Despite the fact that the Quebec provincial game "Hockey Select" was already under way, he vowed that Calgary would receive its $200 million one way or another.
At Committee stage on Bill C-95, the Provinces indicated a willingness to negotiate a sharing of that commitment. It has always been open to the Canadian Olympic Association or other appropriate sports organizations to make a proposal under which that body would operate a sports pool or lottery.
I want to assure the Canadian Olympic Association and Calgary that, if this Party were writing the cheques, an instalment form of payment out of general revenues would be already in place so as to ensure the success of the Calgary Games. Why does the Government not live up to its commitment and worry about the sports pool later?



REFUSAL OF AID TO HIGH SCHOOL BASKETBALL TEAM

Mr. Stanley Hudecki (Parliamentary Secretary to Minister of National Defence):: Madam Speaker, I find it disturbing and depressing that the Department of Fitness and Amateur Sport finds itself regulated to the point that it cannot give
some financial support to an amateur high school basketball team competing in an international tournament in the United States.
In my riding of Hamilton West the Cathedral High School boys' senior basketball team finished off a remarkable season with an invitation to the prestigious Catholic Invitational Tournament held annually in Cumberland, Maryland, in the vicinity of Washington, D.C. This is an annual event to which the eight most outstanding Catholic high school basketball teams in the United States are invited. This year, for the first time in the history of the tournament, a Canadian team has been accorded the honour of being invited to participate.
This school has won all tournaments in which it has participated during the year. On the basis of this performance, it has been selected as a worthy representative in the tournament in the United States on March 17.
Being a Catholic high school in the Province of Ontario, there are no provincial funds to support the school, either academically or in the field of athletics. Any trips involving teams from this school are largely funded privately, and a trip to Washington is a costly event.
The Department of Fitness and Amateur Sport should show some flexibility in handling money in its budget. It should not be restricted by rigid regulations administered by bureaucrats. A deserving team representing this country in international events could be encouraged, and amateur sport promoted, by a grant from the federal Government. I wish Cathedral High School every success in this prestigious tournament.



IMPACT OF TAXES ON PRICE OF GASOLINE

Mr. Benno Friesen (Surrey-White Rock-North Delta):: There is a fisherman in my constituency and on his last trip he paid $6,500 for fuel. Had he gone two miles south to tank up he would have saved $1,500.


Madam Speaker:: Order.



EDUCATION


Miss Pauline Jewett (New Westminster-Coquitlam):: Madam Speaker, the federal Government is tightening the noose on post secondary education in Canada by limiting future spending to six and five.
It is another illustration of the Government's shortsightedness-cutting funds to the very institutions most vital to our economic recovery, to research and development, and to the training of a highly skilled Canadian work force.
Canadian colleges and universities have been subjected to severe financial cutbacks for the past ten years, while student enrolment, due to severe unemployment, has increased. Canadian youth, unemployed at a rate of 22.5 per cent, are not only denied jobs but are now denied access to a decent education.
The federal Government has abdicated its responsibility to foster educational goals, as outlined two years ago by the then Secretary of State, now the Minister of Communications (Mr. Fox). The federal Government cries for greater accountability in funding education, but offers no concrete proposals to achieve this. Indeed, in dropping its fiscal transfers to the six and five formula, it robs the universities and colleges of $102 million for the coming year, and has given no indication of how this money will be spent.
The New Democratic Party calls on the Government to engage in urgent negotiations with the Provinces, universities and colleges, to restructure the current system of funding of post-secondary education before irreparable damage is done to the universities and colleges of Canada.



CANADIAN BROADCASTING CORPORATION


Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: Madam Speaker, reports from Poland of arrests and the continuing military suppression of Solidarity, a union which embodies the hopes and aspirations of the Polish people, seem to be never ending.
Recently the detention of journalists Alexander Malachow-ski and Anna Walentynowicz was carried out as reports reached Warsaw of action against other union figures in different parts of the country. It seems clear, by these and numerous other incidents, that the situation in Poland has not
improved significantly from December, 1981. That is why, Madam Speaker, I am very surprised at the move by the Canadian Broadcasting Corporation to cut Polish language broadcasts from Canada to Poland from 45 to 30 minutes.
I wrote the CBC on behalf of my constituents, asking for an explanation of this action. They informed me as follows:
The scarcity of both time and money, along with the fact that the immediate crisis in Poland had eased somewhat and there was, consequently less Canadian reaction to report, all combined to make the decision necessary.
I am not satisfied with this response. The scarcity of both time and money is not a viable reason for the CBC's cut. It is just as important now as it was in December, 1981, for the Polish people to hear these reports and be reassured that Canadians fully support their aspirations. The broadcasts are a symbol for the Polish people. They are a symbol that Canadians support their struggle for national reconciliation without outside intervention.


Madam Speaker:: Order, please. The Hon. Member for Erie (Mr. Fretz).



CANADA POST CORPORATION

[Stage Direction]
GRASS!E POST OFFICE CENTENNIAL
Mr. Girve Fretz (Erie):: Madam Speaker, many times I have stood in this House to point out the inefficiencies of the Canadian postal system. Delays in delivery and unjustified increases in postage rates have many times been dealt with from this seat. Today I intend to deal with yet another aspect of the Canada Post story.
In my riding there is a small community called Grassie, in the Township of West Lincoln. The Postmaster in this community, Mr. Carl Thomas, operates a general store in addition to his postal duties. Herein lies the problem.
Mr. Thomas and his family have operated this store and post office for the past half century. Here we have a faithful public servant whose ancestors were the people who built this country. He has gone quietly about his daily work without thanks or recognition, for many, many years. Yet, as Mr. Thomas's elected representative, I have no opportunity to offer my congratulations in the House of Commons when he is about to celebrate the one hundredth anniversary of the founding of his post office on March 31, 1983. Instead, I shall be compelled to send him a letter outlining my sincere best wishes and hopes for a happy and prosperous future. Is this fair? I think not. But I shall do the right thing and refrain from making any such remarks in the House of Commons, and send the aforementioned letter. Let us hope it gets there.


Some Hon. Members:: Hear, hear!



THE ADMINISTRATION

[Stage Direction]
March 15, 1983

Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, I want to return to the issue of the conflict of guidelines for Ministers and former Ministers, specifically guidelines A and B. This matter is not settled because the guidelines are not clear and there are further examples that raise serious questions.
Take the case of Norman Cafik. He was defeated in the May, 1979, election. He resigned from the cabinet on June 3, 1979. By September, 1979, press stories had him joining Ebco Industries Ltd. in Vancouver. By December, 1979, according to the British Columbia Companies Office, he was a director of Ebco Industries Ltd. He, as Vice-President, and the President, Mr. Eppich, approached the Department of Industry, Trade and Commerce for a grant. Meetings were held with officials and submissions were made. Perhaps it appeared there was lobbying.
The then Minister of Industry, Trade and Commerce, the Hon. Herb Gray, was briefed. On April 27, 1981, in Richmond, British Columbia, the Minister announced a $6.7 million grant. The pattern is very similar to the Gillespie affair.
Surely the guidelines and the conduct of former Ministers must now be examined by a parliamentary committee.



TRANSPORT


Mr. Jean-Guy Dubois (Lotbiniere):: Madam Speaker, I had the opportunity to rise under Standing Order 21 on March 3 concerning the new grain transport policy of the government. I informed the House at that time that the Minister of Transport (Mr. Pepin) had accepted a request by the Quebec coalition to meet with the federal authorities to discuss the grain transport situation. In his reply, the Minister of Transport asked the group which is most concerned by the situation and which has met regularly with federal members of Parliament to meet him to discuss the problem. Since then, Mr. Speaker, I have seen in the newspapers that all the other members of the coalition-and there are 12, 13, 14 or 15 of them, nobody knows exactly-who have regularly been absent from the various meetings also want to be represented.
I am concerned with this attitude, Madam Speaker, because I cannot believe that those five organizations could not manage to meet the ministers involved. If they had, they would be able to represent Quebec farmers, and report to other groups which
are associated with them or have spoken to them on the new transport policy. I find it quite unfortunate that Quebec farmers should be victimized and that these people are not willing for whatever reason to come and meet the Minister of Transport under the conditions he has set.


Madam Speaker:: Order, please!



ORAL QUESTION PERIOD


Hon. John Wise (Elgin):: Madam Speaker, I would like to direct my question to the Government House Leader. It is supplementary to a subject that occupied a fair amount of time during yesterday's Question Period. The subject matter, of course, refers to the economic crisis facing the agricultural industry today.
When we look at the bankruptcy increases in 1982 over 1981, we find that bankruptcies have increased in the agricultural community by some 60 per cent. If we look at the latest figures released by Consumer and Corporate Affairs today, we find, when we compare January and February this year with January and February last year, those bankruptcy figures have increased by another 14 per cent. What commitment is the Government House Leader prepared to give today to take immediate steps to deal with this specific problem, this crisis within the industry, of which each and every Member in this House is aware?


Yvon Pinard: Madam Speaker, the question raised by the Hon. Member was in fact debated at length yesterday during the oral question period. He has probably read Hansard and realized that there are various options available to the parties to deal with this issue. I wish to assure the Hon. Member that I discussed this matter a few minutes ago with the House leaders of his own party and the New Democratic party, that I made a suggestion and that I am expecting a reply from his House leader after he has had an opportunity to discuss the matter with his caucus. He might be able to give me a reply later this afternoon, but from what he has told me, it is also possible that he might do so only tomorrow after the weekly caucus of his party. In any case, I wish to assure the Hon. Member that I often referred to one of his own suggestions yesterday in my replies and that my proposal to his House leader takes the options he has mentioned into account.
March 15, 1983


REQUEST FOR MORATORIUM ON FARM FORECLOSURES-QUERY RESPECTING BILL C-653
John Wise: Madam Speaker, my supplementary question is for the Government House Leader. The position taken by my colleagues on this side of the House is that it is a very acute problem. I know certain positions have been made public in the House and elsewhere. I just challenge the Government House Leader to accept the long standing position taken by my colleagues and I that, to resolve this difficulty first the Government House Leader should move immediately to impose a short-term moratorium; second, to refer Private Members' Bill C-653 immediately without debate to a Committee. This could be the Standing Committee on Agriculture or the Standing Committee on Finance, Trade and Economic Affairs. Actually, the Standing Committee on Agriculture would be more appropriate because it can accommodate a larger number of Members. To my understanding this will not interfere with the discussions that have taken place between House Leaders.
Is the Government House Leader in a position today to give us a firm commitment that he will meet these two requirements? If he is, I can assure him that this will go a long way to resolving the difficulties faced by the people in the agricultural industry. Also the fasting exercises, in which the President of the Canadian Farm Survival Association is now involved in the Stratford jail may be resolved.


Yvon Pinard: Madam Speaker, it is difficult to be very specific in my answer to the Hon. Member's question without rendering public the substance of the discussions I had with his House leader. If I had permission I could make public the offer I made to him. I have nothing to hide. I see the Hon. Member is shaking his head negatively. If he had said yes, I think the Hon. Member for Elgin would be very happy.


GOVERNMENT POSITION
John Wise: Madam Speaker, I think it is very obvious why my colleague, the Opposition House Leader, is shaking his head.


Mr. Nielsen:: We can't believe you.


John Wise: Those discussions need not take place to deal with the specific offer? I have put to the Government House Leader a very reasonable proposal. Is he in a position today to accept that proposal? Yes, or no, Madam Speaker? The proposal could resolve the situation.
I think everyone in this House knows that study of Private Members' Bill C-653, or the subject matter of it, cannot be dealt with overnight. I think everyone in the House and everyone in the industry realizes that for anything meaningful to come out of those committee discussions we must have the full support of our traditional lending agencies. They must
Oral Questions
continue to co-operate with the whole of the agricultural industry because Canadian farmers will then have access to required capital to produce the food for Canadians and, indeed, for many hundreds of thousands of people around the world. Can the House Leader give that commitment?


Yvon Pinard: Madam Speaker, it is obvious to those who attended Question Period yesterday that we had a very specific request to have a House Leaders' meeting to deal with this matter. The question was asked specifically by the Right Hon. Member for Yellow-head. Very clearly, we were ready yesterday to send the Bankruptcy Act to the Committee, and move the proper amendments. That was one of the options that was suggested last Thursday by the Hon. Member himself. At least it was part of his question when he raised it in the House last Thursday.
We are ready today to go even further and refer something else to the proper committee, but we are not in a position to do so because we have to wait for the answer from the Hon. Member's House Leader. Therefore, if there is a delay it is not the fault of the Government. We were ready to move yesterday, and we are ready to move now. We have to wait until we have an answer from the Hon. Member's Party.


FINANCE
Mr. Geoff Scott (Hamilton-Wentworth):: Madam Speaker, my question is for the Minister of Finance. Given that one of the most crippling factors that faces farmers who are trying to survive is the high cost of energy, and now that OPEC has slashed the price of oil on the world market, will the Minister of Finance immediately bring in measures to reduce the federal tax on farm fuels in order to help alleviate the farmers' high operating costs?


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker, may I remind the Hon. Member that if the price of oil comes down in Canada it will come down generally. As well, most taxes on oil are generally provincial taxes.


Some Hon. Members:: Oh, oh!


Marc Lalonde: Indeed, look at the figures Province by Province, and Hon. Members will find that the Provinces have the largest share of taxes.
As far as the federal Government is concerned, all issues of taxation are related to the budget, and my hon. friend will have to wait for the budget to see whether there are any such measures in it.

March 15, 1983
Oral Questions


REQUEST FOR REDUCTION OF FEDERAL TAXES ON GASOLINE AND HEATING OIL
Geoffrey Douglas Scott: Madam Speaker, my supplementary is for the Minister of Consumer and Corporate Affairs. Can he assure the House and the Canadian consumers that the Government will bring down the federal taxes on gasoline and heating oil to reduce the burden on consumers following the agreement between OPEC members?


Hon. Andre Ouellet (Minister of Consumer and Corporate Affairs):: Madam Speaker, I congratulate the Hon. Member for having asked his question in French. However, he should have directed it to my colleague, the Minister of Finance.


ENFORCEMENT OF FEDERAL-PROVINCIAL OIL PRICING AGREEMENT
Hon. Edward Broadbent (Oshawa):: Madam Speaker, my question is directed to the Minister of Energy, Mines and Resources. I have a copy of the agreement dated September 1, 1981, which was signed by the Government of Canada and the Government of Alberta. That agreement says, with reference to prices, that, "The overall average Field price of conventional old oil. .. will not exceed 75 per cent of the actual international price of oil."
The Prime Minister agrees that this means that Canadian prices should track the international price. When the international price goes up, the Canadian price should go up, but it also means that if the international price goes down, the Canadian price should go down.
As of yesterday, the drop in world prices has meant that the Canadian price is now at 84 per cent of the world price level. Will the Minister take steps to enforce this agreement and ensure that it is lived up to, by bringing about a S3 a barrel drop in the price of conventional Canadian oil?


Hon. Jean Chretien (Minister of Energy, Mines and Resources):: Madam Speaker, if the Hon. Member reads the whole agreement I think he will know that we have an agreement which changes the price every six months. The next change in price will only be in July.
Of course, as he knows, the Premier of Alberta is of the view that the agreement only meant when the price increased. This means a ceiling when the price decreased.
We take a different point of view and we are discussing that with the Government of Alberta at this time. In fact I will be meeting with the Minister of Energy of Alberta, Mr. Zaozirny, on Friday, in Edmonton.


OBSERVANCE OF AGREEMENT
John Edward Broadbent: Madam Speaker, the Minister knows very well that there is a time lag between the wellhead price and the price that the consumer pays. He also knows that, as of today, Canadians are paying prices beyond what this agreement stipulates.
Considering the fact that a $3 a barrel drop in the price of conventional oil would mean a $1.6 billion stimulus to the Canadian economy and 33,000 additional Canadian jobs, according to the federal Government's own calculations, will the Minister take steps today to ensure that that agreement is lived up to and that the needed stimulus for the Canadian economy is provided so that Canadians who are out of work will be able to find jobs?


Joseph Jacques Jean Chrétien: Madam Speaker, I am sure that the Hon. Member does not want me to change the agreement unilaterally at this time. The agreement calls for a change in the price every six months. The last change occurred on January 1. The next one will be in July. In the meantime we will enter into negotiations with the Government of Alberta. Of course, we have an honest disagreement over that.
I now know the position of the New Democratic Party. The fact of the matter is that we must respect the view of Premier Lougheed who said that he made this agreement in good faith at that time because everyone predicted that the price would go up. There were not very many people who expected the price to go down. We have a disagreement with Alberta, and it is only fair at this time, before making a final decision, to discuss the matter with Alberta.


John Edward Broadbent: I did not ask the Minister to change the agreement. I asked the Government of Canada to live up to an existing agreement that it has signed. That is what we on this side of the House are asking.


POSSIBLE IMPACT OF REDUCED ENERGY COSTS
John Edward Broadbent: Is the Minister aware that, if Canadians were now paying prices in accordance with that agreement, they would be saving some 10 cents a gallon at the pump, and our manufacturers, who have to meet international competition, would have a net savings in terms of their energy costs? At this time particularly, when all of competitor industrialized nations are undergoing price reductions in energy costs, it is profoundly important for the Canadian economy to be experiencing the same drop in energy costs which this agreement calls for.
If the Minister of Energy, Mines and Resources is aware of those facts, why does he not take action to make sure that the agreement is lived up to?


Joseph Jacques Jean Chrétien: Madam Speaker, I cannot take action now because I have to respect the agreement. The agreement calls for changing the price every six months. I cannot change the
March 15, 1983


IMPOSITION OF DUTY ON ITALIAN TOMATOES
Mr. Robert Daudlin (Essex-Kent):: Madam Speaker, my question is directed to the Minister of National Revenue. The Minister will be aware that the tomato industry, particularly the tomato processing industry, has been desperately concerned since last June about imports coming into this country from Italy and other countries. He will also be aware that the producers themselves are concerned about the planting season and their transplants for this year. In fact his Department has been responsible for countervail investigations up to this point.
Could he advise the House whether or not that countervail investigation has concluded, and whether or not the producers and processors can look for some relief from this particular problem?
[Translation\


Hon. Pierre Bussieres (Minister of National Revenue):: Madam Speaker, as the Hon. Member has indicated in his question, Canadian processors have effectively asked us to investigate the possibility of imposing countervailing duties on certain types of tomatoes, namely canned round peeled tomatoes imported from certain countries. Our investigation has now been completed and we have concluded that those tomatoes are in fact subsidized by certain countries. In addition, since this has harmful effects on the Canadian industry, following this investigation, the Government has recommended and approved compensation charges of 10 cents a pound for canned round peeled tomatoes imported from Italy.
Oral Questions
[DOT] (M30)


PENITENTIARIES
Mr. Dan McKenzie (Winnipeg-Assiniboine):: Madam
Speaker, my question is directed to the Solicitor General. It is with regard to a garbage scandal at the Stoney Mountain Penitentiary in Manitoba as reported yesterday on Radio Station CJOB in Winnipeg. As the garbage truck hauls out the garbage daily, it hauls out dishes, flatware, edible food, blankets, boots and quantities of meat along with the garbage, and local citizens wait daily at the Stonewall dump to retrieve these goods. I would like to ask the Minister will he launch an immediate inquiry and bring this to a halt. Will he also see if the same practice is in place in all federal penitentiaries across Canada?


An Hon. Member:: It's called "make work".


Hon. Bob Kaplan (Solicitor General of Canada):: Madam Speaker, I will certainly inquire whether there is any truth at all to the allegations, and report to the Hon. Member.


Erik Nielsen: The Great Garbage Caper.


HARBOURS
Mr. Lloyd R. Crouse (South Shore):: Madam Speaker, I wish to direct my question to the Minister of Transport. On March 24, 1982; on May 12, 1982, and on June 4, 1982, I wrote to the Minister of Public Works and the Minister of Transport concerning the inadequate depth of water in Liverpool harbour in Queen's County, Nova Scotia, and the obvious need for immediate dredging in that area. All I have received to date has been acknowledgments of my letters from the Minister's special assistant.
Since ship refits for Government and private industry have been lost by Steel and Engine Products Limited due to inadequate water depths, while the operations of Bowater's Mersey Paper Company, Mersey Seafoods, and the Liverpool Queens Industrial Commission have been severely curtailed, with a resultant loss of employment opportunities for the town, when can we expect an announcement from the Government that dredging will be carried out in Liverpool harbour?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I have found there is usually a good reason why my Department is experiencing a delay. I will find out why we are delaying in this particular instance and answer as soon as I can, most certainly today.

March 15, 1983
Oral Questions


CHANGE OF DEPARTMENTAL RESPONSIBILITY
Lloyd Roseville Crouse: Madam Speaker, my supplementary question is directed to the same Minister. At a meeting which was held in the Board Room of Bowater's Mersey Paper Company Limited on April 16, 1982, almost a year ago, attended by officials from Bowater's Mersey Paper Company, Steel and Engine Products Limited, Mersey Seafoods Limited, Federal Public Works, the Canadian Coast Guard, and Ports and Harbours, Mr. Fioratos of Ports and Harbours stated that responsibility for harbour dredging in Liverpool harbour had been transferred from Public Works Canada to Transport Canada.
I therefore ask the Minister if he is aware of this change of responsibility and, if so, why no action has been taken by his Department in response to urgent requests for dredging in this harbour, as made over a year ago by the responsible management of a number of important Nova Scotian companies.


Jean-Luc Pepin: Madam Speaker, I am very much aware of the transfer of jurisdiction from Public Works to my Department. However, I am not aware of this particular incident. I will very soon become aware of the reasons we or somebody has delayed.


HAZARDOUS SUBSTANCES
Mr. Fred McCain (Carleton-Charlotte):: Madam Speaker, through you, I would like to address my question to the Minister who is responsible for the UFFI program. A circular was developed, containing directions for those who have used UFFI to receive the help available from the Government. Would the Minister explain why this circular, a copy of which I have in my hand, was not distributed to Members of the House of Commons? I have checked among several Hon. Members and they have not in fact received the circular.


André Ouellet: I will certainly find out, Madam Speaker. I know that several weeks ago, the UFFI Information and Coordination Center sent an information circular to all the Hon. Members of the House of Commons and the Senate. If that new circular was not sent to the Hon. Member, it will be my pleasure to make one available to him this very afternoon.


DISSEMINATION OF INFORMATION
Fred Alward McCain: Madam Speaker, the only way those who need assistance from the UFFI program can possibly know the regulations is if they receive copies of this circular. Not only did I not receive it, but I was not able to receive additional copies from the Minister's office to mail out to those of my constituents who did not receive it and
therefore do not know the most recent regulations pertaining to the Program.
Would the Minister commit his Department to determining who is eligible for UFFI benefits but who may not have applied and may seriously need help under this Program? Would he undertake to inform all those people in Canada who have taken advantage of the UFFI Program, of what regulations prevail and how they can receive help?

Hon. Andre Ouellet (Minister of Consumer and Corporate
Affairs): Madam Speaker, Canadians are well aware of the Canadian Government's UFFI Program, thanks to the paid announcements in the news media and also to the information campaign carried out by various provincial organizations on behalf of UFFI home-owners. I know that several members have also sent information on that subject to some of their constituents. Should there be UFFI home-owners among the Hon. Member's constituents who have not yet been advised of the federal program, I will gladly provide the Hon. Member with enough copies of this information circular for him to advise his constituents.


TRANSPORT
Mr. Doug Lewis (Simcoe North):: Madam Speaker, my question is directed to the Deputy Prime Minister. Last summer the Government bailed out Maislin Transport with an unprecedented $34 million loan guarantee. Can the Deputy Prime Minister tell us whether all the terms of the loan agreement have been met to the satisfaction of the Government's supervisory committee? Specifically, have the shareholders of Maislin provided the additional $2.5 million worth of capital which they promised, or have they simply sold off the Gateway pension fund and transferred the proceeds?


Hon. Allan J. MacEachen (Deputy Prime Minister and Secretary of State for External Affairs):: Madam Speaker, the Minister responsible is not in the House today. I do not have in my hand the details necessary to answer this question, but I will attempt to obtain them and draw the matter to the attention of the Minister.


COMPANY LOSSES-GOVERNMENT INTENTIONS
Douglas Grinslade Lewis: Madam Speaker, the Deputy Prime Minister will know that in the three-month period ending September 30, 1982, Maislin reported losses of $1 million per month. Media reports indicate that those losses are continuing. What steps are being taken by the Government to protect the taxpayer's $34 million guarantee? Specifically,



March 15, 1983

is the Government planning that CN will buy out Maislin and thus complete the bail-out of the Liberal Government's friends?


Allan Joseph MacEachen: Madam Speaker, there is no intention on the part of the CN to buy out Maislin. We are attempting to protect our interests on the Board by having officials of the Government of Canada on that Board in an effort to ensure that the public interest is protected. The Hon. Member will realize that when we did make this decision we knew that the firm was in financial difficulty. We made the decision because of the large number of Canadian jobs which were involved. Certainly it would be our hope that this particular firm would succeed and maintain those jobs which were placed in jeopardy by the economic circumstances which prevailed.
May I add, to clarify an answer which I gave yesterday, that up to the present time no request for additional assistance has been made by Maislin to the Government.


GOVERNMENT COAL PRICING POLICY
Mr. Sid Parker (Kootenay East-Revelstoke):: My question is directed to the Minister of Energy, Mines and Resources, if he will resume his seat, Madam Speaker. I tried to raise this question in the Transport Committee meeting this morning, but was advised that the Minister of Energy, Mines and Resources was the one who should answer the question. We now have an indication that legislation dealing with the Crow rate will give the Government the right to change the price of coal within the Dominion coal blocks in my riding and even to dispose of the coal blocks by Order in Council without coming to Parliament. Could the Minister tell the House just what his Government wants to do with these 50,000 acres in coal blocks which are estimated to contain approximately $450 billion worth of coal?


Jean-Luc Pepin: Madam Speaker, I gave the information this morning in the Committee looking at my Estimates. The reason why this item will be in the legislation on the Western Rail Initiative is simply to eliminate an abnormality which exists now which would limit the selling price of that coal to $2 a ton. We thought that this was not acceptable any more, and we have made provisions in the Bill to eliminate that abnormality.
What will happen to the coal mine and to the coal in the area is something to be decided in the future. At the moment, as my hon. friend knows, there is a major development taking place in the northern area of his Province and consequently now may not be the best time to develop the Dominion coal
Oral Questions
area. In due course the impediments which existed in the legislation will have been removed.


REQUEST THAT COAL ACREAGE BE RETURNED TO BRITISH COLUMBIA
Sidney James Parker: Madam Speaker, it seems funny that the Minister of Transport wants to interject now, when I could not get this information out of him at the Committee. I would like to ask the Minister of Energy again, since the fact of the matter is that the Province of British Columbia turned that 50,000 acres over to the federal Government at the time the agreements were reached on the Crowsnest, and the fact of the matter is that the railway systems want to get out of the Crowsnest agreement, will he give both the House and the people of British Columbia his guarantee that these 50,000 acres of land will be returned to the Province and to the people of British Columbia, if the Crowsnest agreement is broken.


Joseph Jacques Jean Chrétien: Madam Speaker, I must advise the Hon. Member that I cannot give that guarantee. The minister of Transport has just replied to this question; we are indeed the rightful owner of this property; we will look into this situation if and when a problem arises.


RAILWAYS
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, my question is directed to the Minister of Transport. With respect to the proposal to abolish the Crowsnest Pass rate, in view of the fact that ten years ago the average price of grain stood at $4.50 per bushel and the current forecast for 19821983 is $5.17 per bushel, which is an increase of a mere 13 per cent, and in view of the fact that over the past nine years the inflationary increase has been 135 per cent, how can the Minister justify imposing an increase of some 550 per cent on freight rates on the western farmer, under his proposal?


Jean-Luc Pepin: Madam Speaker, there is a relationship which should be made here between the cost of transporting grain and the selling price of that grain. During the war years the cost of transportation represented 17 per cent of the price of the grain. It went down to 10 per cent, then it went down to 8 per cent. It is now down to 2'A per cent. So 2Vz per cent is the percentage of the transportation represented in the total price of grain. Consequently, transportation cannot be held guilty for the difficulties in the price of selling grain at this time. My hon. friend should realize that the contribution of transportation to the cost of grain is really minimal, and that is why the question that he raised is not a relevant one.

March 15, 1983
Oral Questions HOUSE OF COMMONS


PRESENCE IN GALLERY OF DEAN OF IRISH PARLIAMENT
Madam Speaker:: I would like to draw the attention to the presence in our gallery of Mr. Oliver Flanagan, T. D., who is the longest serving Member of the Parliament of Ireland, a former Minister of Defence, and also a former Minister of Environment of his country.


Some Hon. Members:: Hear, hear!


TRANSPORT
Erik Nielsen: Madam Speaker, my question is directed to the Deputy Prime Minister and is supplementary to that put by the Opposition House Leader with respect to Maislin Industries, to clarify an answer given to me yesterday that the Government has received no application from Maislin for additional financial assistance. May I ask him to inform the House whether there have been any requests from Maislin, either formally or informally, for additional financial assistance to Maislin?


Allan Joseph MacEachen: Madam Speaker, I made it a point before coming into the House to inquire about that matter and I was advised that no requests for additional assistance had been made. That is my information. I have every confidence that the information is correct but, if the Hon. Member has further information, I would like to have him help me.


Erik Nielsen: Madam Speaker, it is not only the Deputy Prime Minister who needs help; it is the entire Government over there that needs help at this time.


OFFICIALS' DISCUSSIONS
Erik Nielsen: Madam Speaker, will the Deputy Prime Minister inform the House whether any officials of the Government have met recently, let us say within the last two to four weeks, with officials of Maislin for the purpose of discussing the company's financial circumstances and, if any such meetings did take place, was there any conclusion drawn that the economic liability of Maislin would likely cease around June of this year?


Allan Joseph MacEachen: Madam Speaker, I would assume that the officials are on their toes. They would have had discussions with Maislin in the normal course of their duties, but beyond that I have no information that there have been meetings that would lead to the conclusion that the
viability of the operation is now to end at the end of June. That is not information which I have received.


NATIONAL DEFENCE
Mr. Pierre  Gimai@: Madam Speaker, I was informed yesterday by Mr. Adrien Tremblay, the mayor of the municipality of l'Ascension in my constituency, that the Canadian Armed Forces were looking for a firing range to be used for their F-18 training program in my constituency.
My question is for the Minister of National Defence. First, did the Canadian Forces actually ask the Quebec government for a specific area in the vicinity of l'Ascension to develop a firing range? Second, what is the status of those negotiations, if any? And, third, would the Minister object to the authorities at the Bagotville base making available to the municipal council and regional leaders information on this matter especially on the way these ranges are normally operated?


Hon. J. Gilles Lamontagne (Minister of National Defence):: Madam Speaker, as the Hon. Member for Lac-Saint-Jean and his colleagues from the area are very much aware, the deployment of the F-18 fighter at Bagotville will of course require tens of millions of investments at the Bagotville Armed Forces base and in the area.
Concerning the negotiations on the exchange of property for the proposed firing range, they are now being conducted with the Province of Quebec which, hopefully, will understand the value of this project for the entire Lac-Saint-Jean and Saguenay community, considering this is indeed part of Canada's strategic defence because of the Bagotville base.
I myself will be going to Lac-Saint-Jean and Bagotville, at the end of April, and in the meantime I can say that the base commander has been instructed to consult with civilian authorities in the area in order to fully explain the situation.


CONSUMER AFFAIRS
Mr. Svend J. Robinson (Burnaby):: Madam Speaker, my question is directed to the Minister of Consumer and Corporate Affairs. As a result of the Government's callous delay in the processing of tax refunds, thousands of Canadians have been driven into the hands of loan sharks who buy the tax rebates and child tax credits of, among other people, single parents, the poor, the unemployed, and students.
March 15, 1983

In view of the fact that the effective annual interest rate charged by these social vultures is well over 150 per cent, what action is the Minister prepared to take to amend federal legislation immediately to put an end to this usury that affects over 200,000 low income Canadians this year?
Oral Questions
Mississauga South. I was under the impression that we had an excise tax program that rebated to the farmers the amount of the federal excise tax. Has that program been discontinued, or do the farmers still receive the federal tax rebate and, for that matter, all commercial users of gasoline as well?


André Ouellet: Madam Speaker, the Hon. Member should have a talk with his House Leader and get him to co-operate with the Government in order that the Bill be disposed of as soon as possible and taxpayers get their refunds. In the circumstances, this would probably be the most effective and the fastest course of action.


REQUEST FOR REFERRAL TO COMMITTEE
Svend Johannes Robinson: Madam Speaker, that kind of attitude will continue to drive Canadians to the so-called tax discounters. The Quebec Government put an end outright to the practices of these tax discounters. The federal Government should do the same. Will the minister at the very least agree to refer these predatory practices, 150 to 200 per cent interest rates, to a House Committee to determine how the federal Government can directly assist the individuals involved, possibly with the co-operation of the credit union movement? Will he urge his colleagues to stop their stalling and finally start sending out long overdue tax refunds? This will stop driving desperate Canadians into the hands of these loan sharks.


André Ouellet: Madam Speaker, I think that Canadians should be made aware of that kind of tactic and should find other methods to solve their yearly income tax problems. That kind of attitude is not new. A bill has already been passed in this House to provide for specific settlements. Of course, this is not any ordinary loan and, consequently, the Act does not apply in the same way as on ordinary loans, but I suggest the question put by the Hon. Member illustrates an attitude and a behaviour on the part of some businesses that is wrong, and it is my hope that Canadian taxpayers will no longer patronize those agencies whose fees I consider altogether indecent.


FINANCE
Mr. Hal Herbert (Vaudreuil):: Madam Speaker, my question is directed to the Minister of Finance. It is really supplementary to the question asked by the Hon. Member for


Marc Lalonde: Madam Speaker, the Hon. Member for Vaudreuil is quite right. Indeed there is a program of federal excise tax rebates available to farmers and commercial operators. That program has been in existence for several years, at least since 1975, and has been used extensively. To give an example, in 1981 refunds were made to Ontario farmers in the amount of $3 million, $2 million in Manitoba, $4 million in Saskatchewan, and $4 million in Alberta. This is available to all farmers in Canada. What they have to do is keep their receipts and ask for a refund of the federal excise tax. That is used extensively by commercial enterprises which use it to the tune of several tens of millions of dollars. I want to make it quite clear that the federal Government has a program for the purpose of rebating excise tax to farmers.
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AGRICULTURE
Gary Michael Gurbin: Madam Speaker, my question is directed to the Government House Leader. It is supplementary to questions posed earlier by the Hon. Member for Elgin. After nearly a year of discussion and delay, as a measure of the sincerity and interest that the Government has in this legislation to help those farmers who are in financial distress, will he accept the suggestion of the Hon. Member for Elgin, a position put forward by the Conservative Party, that there be a short-term moratorium on further farm foreclosures and bankruptcies? Will he do this until this House, the banks, and the farm community have had an opportunity to deal with whatever legislation is appropriate?


Yvon Pinard: Madam Speaker, I said earlier to the Hon. Member for Elgin that following a specific request by his party yesterday, I had a meeting with the Opposition House Leaders to discuss the quickest way of finding a remedy for the present situation. Yesterday, on the floor of the House, 1 made a proposal that was rejected by the Official Opposition. Today, at a meeting, I went even further, but since I may not reveal the contents of the discussion without the consent of my colleague who refused to give it, 1 cannot give further details on the suggestion I made. All I can say is that the proposal made by the Government would be far more effective than the one the Hon. Member has just made.

March 15, 1983
Oral Questions


CASE OF HUNGER STRIKER
Gary Michael Gurbin: Madam Speaker, my supplementary is also for the House Leader. I am not sure what discussions took place, but the conditional response that the Government has had to date gives us little confidence that we can expect to see measures like this, or any other measures, that will deal with the problem's resolution. If the Government House Leader is serious about what he is saying, and if he really intends to do something, will he accept an invitation from the Member for Elgin and myself to visit the young farmer in jail in Stratford and make the kind of commitment to him that is necessary so that he will stop his fast, and so deal with the problem? Will he make a commitment that the Government will act and take the necessary steps that will bring forward legislation so that this farmer will end his fast and the situation will be resolved?


Yvon Pinard: Madam Speaker, the Hon. Member is referring to his friend who has been charged before the courts in Ontario, and I have already indicated quite clearly that I did not intend to comment on this case because of the sub judice rule. Therefore, I have nothing to say regarding the Hon. Member's friend, except that as far as the property of Canadian farmers is concerned, several days ago I made proposals in agreement with the Minister of Consumer and Corporate Affairs with a view to finding a remedy. If we have not yet been able to amend either the Bankruptcy Act or the Bill presented by the Member for Lambton-Middlesex, it is not because we have been careless but because the Hon. Member's party has been too slow in giving its agreement.
Yesterday, we made a concrete proposal, and the problem could have been resolved today if the Progressive Conservative Party had agreed to adopt an amendment to the Bankruptcy Act. Today, I repeated my proposal, adding another even more attractive component, and I have yet to get a reply. Therefore, my hands are tied. However, if the Hon. Member has any influence and if he is really sincere and serious about the issue, he should speak to his Parliamentary House Leader and urge him to act. To us, the main thing is the well-being of our farmers, and we want to safeguard that well-being through the proposals I have made. We are also concerned about the wellbeing of fishermen and small businessmen and all this could be covered by an amendment to the Bankruptcy Act. Proposals are on the Table, and if there is any delay, it is not the Government, but the Hon. Member's own party that is at fault.


NATIONAL DEFENCE
Hon. Allan B. McKinnon (Victoria):: Madam Speaker, my question is for the Minister of National Defence. He will recall that last August he said that the evaluation of the Canadian patrol frigate proposals would be presented to the Government for a decision in the Spring of 1983. Will he tell the House whether he has as yet presented those proposals to Cabinet?


J. Gilles Lamontagne: Madam Speaker, the frigate program, which is one of the last major capital investments in the Defence Department and a major re-equipment program, is going according to schedule. The evaluation by my Department is in the final phase. I expect to be able to present these evaluations to the Committee on National Defence and External Affairs of Cabinet. After that it will be up to full Cabinet to decide exactly what to do in this regard. I hope everything will go well and that we can go forward with the program as soon as possible.


DATE OF DECISION
Allan Bruce McKinnon: Madam Speaker, I would prefer to have something a little more definite than "as soon as possible". When does the Minister expect the Cabinet to make a decision, when will he announce the winning consortium, and when will the shipyards start working?


J. Gilles Lamontagne: Madam Speaker, I could give a very short answer to that: as soon as possible, as soon as the evaluation is finished, and as soon as Cabinet takes a decision. I hope to have a decision from Cabinet before we recess in June.


MEDICAL CARE
Frederick James (Jim) Hawkes: Madam Speaker, my question was for the Minister of National Health and Welfare. Perhaps I can direct it to the Deputy Prime Minister. The Minister of National Health and Welfare has informed the CMA that funding for health care will depend upon the moving average of the Gross National Product. If the Gross National Product goes down, will health care funding go down?


Hon. Monique Begin (Minister of National Health and Welfare):: Madam Speaker, the legislation now in place, the EPF, which is being continued by this Government, provides for an arithmetic formula taking into account three factors- redistribution, population growth, and GNP growth.
March 15, 1983


PETITIONS
Madam Speaker:: I have the honour to inform the House that the petition presented by the Hon. Member for Saskatoon-East (Mr. Ogle) on Monday, March 14, 1983, meets the requirements of the Standing Orders as to form.


PRIVILEGE
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Madam Speaker, I rise on a question of privilege of which I gave you notice at the earliest possible opportunity.
Yesterday in examining my mail I was shocked to read that the parliamentarians for World Order, a group of Parliamentarians of all Parties dedicated to peace, disarmament and development, had been delisted and excommunicated as a parliamentary association by a small Committee of Members of Parliament of this House which to my knowledge never had any mandate from this Parliament or this House to decide which groups of Parliamentarians should be accepted or not-
Madam Speaker:: Order, please.


Some Hon. Members:: Hear, hear!


Madam Speaker:: Order. 1 believe the Hon. Member has himself indicated that this matter is not dealt with in Parliament but has to do with problems of administration of the House of Commons. These questions are not decided by Parliament, as the Hon. Member himself stated at the beginning of his presentation. Grants to the Interparliamentary Association are a matter which are dealt with by the Members themselves in committees decided by Members themselves. It is not a question of privilege, of course, and does not answer any of the criteria for a question of privilege.
Therefore, I would ask the Hon. Member to use the channels which are open to him, namely, the Advisory Committee on the Interparliamentary Association, or to discuss it directly with me so I would be informed on these problems and, perhaps, I myself could discuss it with the members of the Advisory Committee. But certainly it is not a question of privilege


Mr. Allmand:: I rise on a point of order, Madam Speaker. If a question of privilege is not the correct procedure, there must be some procedure by which an Hon. Member can address his question on the floor of the House. I would like you to direct me-
Point of Order-Mr. Munro (Esquimalt-Saanich)


Madam Speaker:: Order. Order, please. The Hon. Member might find some occasion to deal with this question in the House on the occasion of a speech, or whatever procedure he might find helpful to him. Certainly he has avenues open to him to discuss this question. I repeat again, the Hon. Member could take it up with myself or he could discuss it with the members of the Advisory Committee on the Interparliamentary Association. The Hon. Member tried to raise this on a question of privilege. I told him he did not have a question of privilege. He then rose on a point of order which has nothing to do with order in the House and again deals with the same question. I must urge the Hon. Member to use the channels which are open to him in order to discuss this question.


Mr. McGrath:: Madam Speaker, I rise on a point of order. I say to you, with the greatest of respect, that you did not hear the Hon. Member before you ruled. I believe you should at least hear him before you rule whether or not he has a question of privilege. I submit, in my respectful submission, that my privileges are affected by the subject matter of the Hon. Member's question of privilege. He feels he has a question of privilege. I believe that before the Chair rules the Chair at least has an obligation to hear the argument.


Some Hon. Members:: Hear, hear!


Madam Speaker:: The Hon. Member has given me notice of his question of privilege, and in his statement has given me an idea of the subject matter with which he wanted to deal in his question of privilege and where he felt that his privilege was affected. It is very obvious to me that this question has nothing to do with the privileges of the House, and that was made quite clear to me in the first few sentences of the Hon. Member's presentation. He does not have a question of privilege and I must stand firm on that. He has other avenues open to him to discuss these questions, as does the Hon. Member for St. John's East (Mr. McGrath). I understand the Hon. Member's preoccupation and frustration with this question, but this is not the forum in which to address it.


POINT OF ORDER
Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, I rise on a point of order. During Statements under Standing Order 21 this afternoon, I thought I heard the Hon. Member for Hamilton West (Mr. Hudecki) introduce a congratulatory message which caused you, on March 1, to shoot me down and ask me if I would take my place.
I would like to reserve my views on this until I have had a chance to examine the "blues" and Hansard, and I could raise it tomorrow if my impression of that particular message is correct.

March 15, 1983
Petitions


Madam Speaker:: In that case, the Hon. Member should wait until he sees the "blues" and let me know. It seems to me that the Hon. Member might have said something to the effect that he did want to congratulate someone, but then he did have some substance to his statement, that it was not made entirely to congratulate someone on a special occasion. I might be mistaken, but I thought that the statement made by the Hon. Member for Hamilton West (Mr. Hudecki) was quite in order. I also will look at Hansard and if I find I did let the Hon. Member go along with a congratulatory message, I should not have done so; but it did not seem to me that he had.


Donald W. Munro: Madam Speaker, I had a Saint and a Canadian in mind on March 1 when I was making my statement, and I got as far as the "Saint" but I did not get to the "Canadian". I should, therefore, like to reserve my position and raise the point of order tomorrow once I have examined Hansard.


Madam Speaker:: The Hon. Member has already said that.



ROUTINE PROCEEDINGS


Miss Aideen Nicholson (Trinity):: Madam Speaker, I have the honour of tabling the Seventh Report of the Standing Committee on Miscellaneous Estimates.
[Editor's Note: For above reports, see today's Votes and Proceedings.]
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PETITIONS
Mr. David Kilgour (Edmonton-Strathcona):: Madam Speaker, I have a petition and would ask your leave to file it. The petition quite simply states that there is a crisis of confidence in Canada which can only be solved by a general election. It is signed by 2,045 residents of Edmonton, mostly from Edmonton-Strathcona. This petition should have been filed some time ago.


Mr. Bill Domm (Peterborough):: Madam Speaker, I have a petition to present to the House addressed to the attention of the Hon. Minister of Communications (Mr. Fox). It is from a
large group of petitioners in the City of Peterborough who oppose the proposed First Choice Pay TV broadcast of pornographic films for the following reasons. They believe much of the material to be shown will be morally objectionable and degrading and will portray women in accordance with degrading and demeaning sexual stereotypes. They also believe that in practice children and young people in large numbers will view these pornographic films regardless of the time they are shown.
I bring this petition to the attention of the House in the sincere hope that action will be taken by the Minister with respect to the intention of Pay TV to broadcast this type of material.


BUSINESS OF THE HOUSE
Hon.   Paul. J. Cosgrove@Minister of State (Finance: That, in relation to Bill C-139, an Act to amend the statute law relating to income tax (No. 2), one additional sitting day shall be allotted to the further consideration in Committee of the Whole stage of the said Bill;
That, at fifteen minutes before the expiry of the time provided for Government business in that sitting, any proceeding before the Committee shall be interrupted, if required, for the purpose of this order and, in turn, every question then necessary in order to dispose of the Committee of the Whole stage of the said Bill shall be put forthwith and successively, without further debate or amendment.
He said: Mr. Speaker, this is a motion for time allocation on Bill C-139, an Act to amend the Income Tax Act, which has a background of 18 months and goes back to the period of time of the November, 1981 budget when most of the measures contained in the legislation were first announced. During this long period there have been frequent debates in this House, extensive consultations right across the country with affected segments of the private sector and detailed studies by members not only of the Standing Committee of this House but as well a parallel Committee in the Senate.
The various stages of House debate have consumed 25 sitting days, the equivalent of six full weeks of debate under the new rules, Mr. Speaker, and involving no less than 200 speakers. It became more and more obvious as time went on that the Opposition Parties were deliberately delaying passage of this very important legislation. They have ignored the obvious urgency of having these important measures passed in order to achieve three things: an end to the uncertainty in the business community; provide a legal basis for the payment of millions of dollars in tax refunds; and to clear the way for the introduction of the 1983 budget. For months the Opposition has been following a strategy of forcing the Government to resort to time allocation on very important Bills. We saw this tactic in the operation of the six and five capping legislation, and more recently on the borrowing authority legislation. The Government's request for co-operation and pleas for a reasonable solution have met with continued obstruction.
March 15, 1983

Let me review the record of the past 16 months, Mr. Speaker. Following the introduction of the 1981 budget, we had a full six-day budget debate with 47 speakers. Over the ensuing six months the Government entered into a series of consultations with private sector groups which led to several important modifications in the budget proposal. Various announcements were issued setting out the scope of these modifications.
In April of 1982 an explanatory paper concerning the proposed shift of the sales tax to the wholesale level was issued. A paper on the budget process was tabled. Revised rules on the taxation of charities were made public after consultation with charitable organizations.
In May a document was issued on draft regulations relating to capital cost allowances.
The budget of June, 1982 contained a detailed package of draft income tax legislation which was distributed nationwide for comment by tax law practitioners and interested taxpayers. That budget also announced revised rules on the taxation of life insurance income, including the exempt policy concept which reflected many weeks of consultation with representative groups of the life insurance industry as well as individual companies and many individual agents right across the whole of Canada. Other modifications were announced at the same time affecting such things as the interest expense deduction, the automobile standby charge and the provision for forward averaging of the incomes of athletes and artists. This budget was debated for six days with 51 speakers taking part.
Many comments were received on the draft legislation and in early August the draft was referred to a Special Committee of the Standing Committee on Finance, Trade and Economic Affairs. That Committee met through August and September while Parliament was in recess and prepared a detailed study of the legislation after hearing numerous witnesses. A lengthy report was prepared by that Subcommittee and many of the suggestions were subsequently adopted. The proposed legislation was reviewed once more.
An economic statement was delivered by the Minister of Finance (Mr. Lalonde) on October 27. Among other things, the proposal to tax certain employee benefits, including health and dental plans, was dropped. Exemptions were introduced in the taxation of work in progress. The date for implementing the shift in the sales tax was deferred, and the application of new rules for the taxation of charitable organizations was delayed for further study.
At this point, Mr. Speaker, the tax proposals had been under active study, as I indicated, in all those forums for a full 12 months, not to mention the opportunities which the Official Opposition and the NDP took to conduct their own hearings right across the country on the budget legislation.
Finally, on December 7, 1982 Bill C-139 was introduced to encompass all the modifications which had been made. It was accompanied by explanatory notes setting out the intent of the legal language. That was the first time, Mr. Speaker, in the
Time Allocation
history of our tax legislation that such a step had been taken to assist Canadians generally in their understanding of this complicated legislation.
Since the introduction of Bill C-139 we have heard a parade of Opposition speeches, most of them repetitious. On second reading alone we had 99-I repeat, 99-speakers, 74 of them Conservative and 17 from the New Democratic Party. It had been the hope of the Government after all these studies had taken place that the matter could have been dealt with expeditiously by this Parliament. Now, more than three months after its introduction, after all that consultation and opportunity for discussion by Canadians generally, we are still a very long way from obtaining passage in the normal course which we had hoped this Parliament would follow.
At this point I might recall a remark made in the House by the Hon. Member for Etobicoke Centre (Mr. Wilson) on November 10 when he exercised his responsibility as financial critic and demanded to know when the Government was going to bring in tax legislation for the 1981 budget in order to ease the uncertainty of the business community. In retrospect, Mr. Speaker, those were hollow words judging from the performance of the Official Opposition since that time.
Well, Mr. Speaker, the Government indeed is as anxious as was the Conservative Party at one time to end the tax uncertainty. It is anxious indeed to permit the processing and distribution of millions of tax refunds worth over $6 billion which will go to Canadians, some of whom are unemployed. That is the intent of the motion before the House today, Mr. Speaker. That is what we seek to accomplish by this motion.


Donald Alex Blenkarn: Mr. Speaker, this is the most disgraceful closure of a Bill we have had before this Parliament. This Party has done its level best to move this Bill forward in Committee of the Whole House. It is a horrendously complicated Bill. It involves nearly 300 pages of the worst kind of draftsmanship one could ever imagine.
So far we have completed nearly one third of the Bill. We have dealt with automobiles, standby charges and the cost of maintenance. We have dealt with professional work in progress. The Government has not dealt with it, we have. We asked the Government to do something for the notaries and the Government refused. The Government has amendments in that respect but it does not want to allow the Bill to stay in the House so those amendments can be presented in the normal course. We have dealt in detail with insurance companies and policy taxation, with annuities and guaranteed investment certificates. We have dealt with capital costs on the demolition of buildings. We are presently dealing with Small Business Development Bonds. However, there is a host of other things which should be dealt with where people in Canada have presented logical arguments as to why there should be change-minor change in many cases-in the Bill. Yet the Government does not want to listen, does not want to proceed, does not want to be honest, but it does want to ram this Bill through without discussion.

March 15, 1983
Time Allocation
It is a disgrace, Mr. Speaker, to the democratic process that the Minister should stand in this House this afternoon and attempt to ram a Bill through by saying it has had ample discussion. He knows it has not. Let us talk about the ample discussion that income tax legislation should have. The Government knows that, in an incarnation with another Minister of Finance, it passed a budget in both 1977 and 1978. When this Party had the opportunity to form the Government for a limited period of time during 1979, we presented to this House an income tax Bill of not quite 100 pages. That Bill was brought to a Committee of the Whole House. There was really only one difficulty with it and that was the provision for a special rate of tax of 33 per cent for service corporations. The budgets of 1977 and 1978 were approved by a Liberal Government but the tax Bills that resulted from those budgets were presented by a Conservative Government. Closure was not imposed by that Conservative Government. The Bill was debated in Committee of the Whole House for five days. Both sides considered that to be reasonable.
In the case of the Bill before the House, there have been four days and two hours of debate on a horrendously complicated piece of legislation which deals with the most changes to the Income Tax Act since 1971. The Government claims that the House has spent too much time on the Bill and is not moving ahead. We have made arrangements to group Clauses, Mr. Speaker; we have presented reasoned amendments; we have presented matters that have been brought to our attention by constituents who want answers from the Government; Member after Member has read into the record letters received from constituents, but the Government cannot tell them how to reply. In many cases the Minister cannot offer any help because even he cannot read the Bill.
The Minister and the Government want to eliminate democracy, to eliminate discussion and debate. They have some idea that they are the fount of all wisdom. From the Place Bell Canada tower in the City of Ottawa it seems they are going to try to control Canada, to control the business of Canada and, indeed, destroy the business of Canada.
The Minister mentioned that this Party toured Canada and held public hearings. In January, 1982, Mr. Speaker, 65 Members of this Party gave up part of their recess to hear public evidence on this issue and, as a result of that evidence, some changes were made. With other Members I came back to Ottawa in August and September to listen to witnesses give evidence on a Ways and Means motion. As a result of that evidence some other changes were made. There have also been other changes that deliberately went against the decision of the Finance Committee but the Government does not want to explain why it took this action.
There are matters in the Bill that still have to be dealt with, such as soft cost, RRSP interest deductibility, work in
progress, capital gains reserves, IAACs and so on. Representatives of the airlines have written to point out that the iniquitous tax imposed on Canadian airlines is responsible for some massive deficits.
The Government does not want to deal with the fact that the world price of petroleum has dropped dramatically but wants to ram through the provision of the Bill that deals with that matter. The Government does not believe that the people have the right to be heard. It believes that because it elected more Members to the House of Commons on February 18, 1980 than any other Party, it has the right to do what it damn well pleases. It believes that Members of Parliament are here for one purpose only, and that is to stand and bow to you, sir, when it decides to call a vote.
We have an obligation to represent our constituents and to represent all parts of the country, and some of them, Mr. Speaker, have no use for this Government. But they want to be represented and they demand to be represented.
The Government has brought in a motion for closure on this Bill. There is no justification for that, Mr. Speaker. It smacks of dictatorship and the House should not put up with it. There is a time when Governments have the right to move things along, when they can claim that there has been ample discussion, but that is not the case here. The Minister of State for Finance (Mr. Cosgrove) has a series of amendments to the Bill which he wants to present, but apparently he has now decided he does not care whether they are presented or not. All he wants to do is ram the Bill through, even though it contains errors in drafting and even though there are people like notaries who have not been covered in the exemption provisions. He does not care because his people in the Place Bell Canada tower know everything. They know how small business operates and how to crush it. They know how people want to protect their families with insurance and they know how to wreck that. They want to make sure that people do not save for their old age. They have an interest in grabbing as much money as they can.
The Government talks about fairness in the House, but when we point out that the provisions are not fair, it claims that it needs the money. In the last analysis it says: "If you do not pass the Bill we cannot pay the income tax rebates". Mr. Speaker, Section 152 of the Income Tax Act demands that the Government pay those rebates, so it is breaking the law if it does not. Anyone who has to borrow money because Government will not pay the rebate is borrowing because it has breached the Statutes of Canada.


Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, I want to make a comment about the Government of Canada which, perhaps, is the lowest blow of all. The behaviour of the Liberal Government reminds me of the Social Credit Government of British Columbia.


Mr. Lang:: That is the lowest blow!


Nelson Andrew Riis: The Government does not care about Parliament. It does not care that we are living in a participatory democracy; it just goes ahead with the actions it feels are in the best
March 15, 1983

interests of its Members and its friends as politicians, not of the people of Canada.
The Government of the Province of British Columbia thought it was going to be so short of money that it had to grab from the renters of British Columbia, so it arbitrarily changed the law. Without introducing a bill in the legislature it said that there was no longer an opportunity for people to claim the rental tax credit on this year's tax return. It informed the federal Government and, in the usual Liberal-Socred alliance, the Government agreed to co-operate.
That is the kind of mindless arrogance that has resulted in countless letters, telegrams, phone calls, night letters and briefs to Members of the Opposition Parties. People are saying that the tax Bill must be changed and that we must do what we can to stop this madness.
The Parliamentary Secretary to the Minister of Finance (Mr. Fisher) has said on a number of occasions, as has the Minister of State for Finance (Mr. Cosgrove), that because a certain number of days have been spent debating this Bill, it must pass. It is as if there is a secret formula whereby after so many days of debate a Bill must pass. It is as if it is not necessary to listen to the Opposition bringing forward their concerns and those of their constituents. It is as if the Government may just ignore reality, spend x number of days on the Bill and then it must pass.
I would remind the Minister of State for Finance that we have spent 12 days only at second reading and Committee stage considering 139 Clauses contained in 295 pages, designed to impose additional taxes at a time when the Canadian economy is on its knees. If those taxes could be considered fair and just and treated Canadians equally, I would co-operate fully with the Goverment. What we are dealing with is a tax Bill that is unfair, which treats one set of Canadians one way and another set of Canadians quite the contrary. It is a money grab of the most wicked kind. I will outline three of these four obvious concerns.
Let us consider first that last year thousands of Canadians who earned in excess of $50,000 did not pay one penny in income tax. Nothing has changed in this Bill to change that situation. As a matter of fact, the situation will be worse this year. The Bill before Parliament will have middle and low-income earners in Canada paying more taxes. Their taxes will be increased.


Mr. Young:: That is nothing new.


Nelson Andrew Riis: Upper income earners will have their taxes decreased. If you are making the taxable income in excess of $24,645, even the tax rate will be reduced three percentage points. In other words, the effective tax rate will be reduced from 28 per cent to 25 per cent if you have a tax rate in excess of $24,465.
However, if you are a real high income earner, earning in the area of $ 133,000, then your tax rate will be decreased from 43 per cent to 34 per cent. However, if you are a regular
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normal Canadian citizen, probably having your taxes deducted at source, you will maintain the same tax rate, but because of the deindexing proposition you will have increased taxes to pay. Liberals say that is fair, that it is in the best interests of all Canadians, Mr. Speaker.
We can look at another section. I hesitate to go into it because it becomes so incredibly obscene. It shows the difference between the taxes paid by individuals and the taxes paid by the corporate sector. I looked back to the year 1952. I found then that of all the federal tax revenues, 46 per cent were paid by individuals and 54 per cent were paid by corporations. In 1962 that situation changed. Of all federal tax revenues, 60 per cent came from individuals and 40 per cent came from the corporate sector. In 1980, of all federal tax revenues, 30 per cent came from corporations and 70 per cent came from individual taxpayers in Canada. Over the years, the situation has completely reversed. As the years go by more and more of the federal burden is being placed on the individual taxpayer while the corporate citizens pay less and less. As Members of the Government are bound to do, they rise in their seats and say, "But the corporate sector does pay income tax. It pays its fair share."
I want to identify two of our favourite corporate citizens, namely, the Royal Bank of Canada and the Bank of Montreal. Are people aware of how much these two corporate citizens, who did not do badly last year-the Royal Bank of Canada made $330 million before tax and the Bank of Montreal made $239 million before tax-paid in tax last year? How much income tax actually occurred in terms of their payment? These two corporate citizens paid no income tax, not a single penny. No income tax was paid, despite the hundreds of millions of dollars earned in profits. That is no fault of the Royal Bank of Canada or the Bank of Montreal. It is the fault of the Government of Canada which has allowed the banks to get away with this kind of financial skullduggery.
If you look at the big five banks in Canada-and last year was a difficult year for the banks-you will find they earned $1.6 billion. The five major banks paid in taxes a total of $132 million, or an effective tax rate of 8.1 per cent. That rate of 8.1 per cent is the tax rate of an individual who has a taxable income between $7,500 and $8,000 per year. I suspect that when you put the Royal Bank of Canada, the Bank of Montreal, and the other big banks alongside an individual whose taxable income is $7,500, there is something drastically wrong if they are sharing the same effective tax rate.
We see today a Bill which will influence the lives of every Canadian. We have seen the Government introduce a $6 billion blackmail charge against the Opposition by saying that we, in the Opposition, are holding $6 billion from going out to those people who ought to be receiving their tax refunds. That is absolutely not the case. If we had had a little co-operation from the Government benches and if the Government had shown us an indication that it was prepared to analyze seriously the tax Bill and to listen seriously to the concerns raised by

March 15, 1983
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individuals and groups across the country, we would have been very co-operative. But there has not been a single example on the part of the Government to indicate its interest in approaching this situation in a co-operative way.


Peter Joseph Lang: How about health insurance?


Nelson Andrew Riis: I believe this is a very, very dark day for most Canadians when the Government, in which Canadians have put their faith over the last number of years and during one of the deepest depressions our country has experienced since 1930, is now going to impose 125 pages of new taxes on Canadians. This Government is going to tax everything that moves in this country. If that is the Liberal's idea of assisting us during difficult times and if the Liberals are going to permit tax legislation to go through that still has such incredible injustices built into the system, we will continue to do everything we can to oppose this hideous piece of legislation.


Mr. Roger Simmons (Burin-St. George's):: Mr. Speaker, the Hon. Member for Mississauga South (Mr. Blenkarn) should really stop misleading the Canadian people. I listened to him a few moments ago. There is just no truth in what he said. The Hon. Member for Mississauga South should at least get his facts straight. I can respect a difference of opinion, but I have no respect for a tactic which allows a man to stand in the House and give out information about tax returns which is blatantly false. It is shameful that he should have done that here this afternoon.
My good friend, the Hon. Member for Kamloops-Shuswap (Mr. Riis) needs a little friendly advice. He is the latest armchair socialist to take over the finance portfolio for the New Democratic Party. He has got it up here, Mr. Speaker, but he does not have it down here in the gut. He has no fire in the belly. He thinks socialism well but he does not act it well. He does not live it very well. But as a mental exercise, it is fascinating to listen to my good friend from Kamloops-Shuswap. Nevertheless, I will give him just a sentence of friendly advice. Before he gets to use particular examples about tax implications, he should really know what he is talking about. I say to him that before going public he should check his points because he will find he is wanting in some respects.
I listened with interest earlier to the Hon. Member for Etobicoke Centre (Mr. Wilson), who is out on the election circuit this afternoon, I would think, trying to get himself elected. It seems everyone on the other side these days is a leader looking for a Party. They are all looking for a Party. Among them is the Hon. Member for Etobicoke Centre who stood in his place and called for even more tax changes. He is not satisfied with the 125 pages, or whatever there are; he wants still more. I wish Hon.Members would get their heads together over there. Maybe they want 126 pages, maybe they want 124.5 pages. Could they make up their minds, Mr. Speaker? Could they all get together? I know they fight among themselves, but certainly on this important tax Bill they should be able to bury their hatchets and their knives and get their act together. They should decide whether they want more changes, fewer changes, the same number of changes on more pages or more changes on fewer pages. We are hearing it all,
Mr. Speaker. How does the Hon. Member for Etobicoke Centre square his call for more changes with his oft-repeated plea to end the uncertainty? Let us end the uncertainty, he says. Let us tell the taxpayers of Canada where we stand, he says in one mouthful, and in the next mouthful he says, "I have a few more changes I would like to have accommodated before we end the uncertainty."
Of course, he goes on to talk about how the Tories would reduce the deficit. Yet, while he makes those pledges, every additional tax change that he advocates would mean less Government revenue. How does he balance that with his call for decreasing the deficit? How can he decrease the deficit on one hand and advocate tax changes that would even further reduce the amounts accruing to the public Treasury on the other hand? How does he propose to reduce the deficit? He should be more specific on that particular point. Perhaps he will choose to be more specific about how he would reduce the deficit when he speaks during the leadership campaign.


Mr. Crosby:: What about the CNR?


Roger Simmons: I see that my friend, the Hon. Member for Halifax West (Mr. Crosby) has briefly come awake. I welcome him. We meet here every afternoon. You should come by more often.
How would his friend from Etobicoke Centre reduce the deficit? Would it be by reducing social programs such as the Family Allowance and the old age pension? Would he cut out the Child Tax Credit? Would he reduce Unemployment Insurance benefits?
I have just listed four beneficial programs which cost the Treasury of this country a lot of money. If the Hon. Member for Etibocike Centre wishes to talk seriously either in the leadership campaign or in the House about reducing the deficit, he should give specific examples of how this will be done. I say to him, with respect, that the public is sick and tired of the generalities uttered by him and his colleagues in the Opposition. The public wants to hear in specific terms how these often talked about reductions will in fact take place.
Does he advocate high unemployment? Is he in bed with the Member for York-Peel (Mr. Stevens) who, at one time, advocated the Tory Government reducing the Public Service by 60,000 people? Would they do that?


Mr. Kempling:: Which election are we fighting now?


Roger Simmons: There are only so many ways to reduce the deficit. I take it from that outburst that my good friend, the Hon. Member for Burlington (Mr. Kempling) is backing the Member for Etobicoke Centre. That makes three people already this week for whom he has pledged his support.
I have mentioned higher unemployment, higher taxes and the reduction in social programs. If those Members on that side of the House advocate reducing the deficit, they will have to indicate how they will do it. To relate further the advice
March 15, 1983

that the Member for Etobicoke Centre gave to the House, he said that Revenue Canada ought to go ahead and process the tax returns. On what assumptions? Is it on the assumption that everything in the Bill will become law? He would then be the first one to scream that it is an affront to Parliament and that we are taking Parliament for granted again. He will say that we are assuming that this Bill will be passed without changing a letter of it. Does he stand on both sides of the issue?


Blaine Allen Thacker: Try the old law until it is changed.


Roger Simmons: My friend, the Hon. Member for Lethbridge-Foothills (Mr. Thacker) says to use the old law. I remind him that that is not what the Tories did when they were briefly in office. I will remind him that the Tories-


Blaine Allen Thacker: That was your Bill.


Roger Simmons: The mortgage tax credit Bill was your Government's bill. The Government House Leader of the day, the Hon. Member for Nepean-Carleton (Mr. Baker), proceeded to have the income tax form printed to accommodate the changes that were in that Bill. His explanation for doing that was that he advocated punctuality. Are we not all for punctuality? I say to him and to my friend from Lethbridge-Foothills, who finds himself wrong again on particular information because you did not do it on the basis of the old information which you are now asking us to do, you based it on that.


The Acting Speaker (Mr. Corbin):: Order. I apologize to the Hon. Member for interrupting him, but he should address his remarks to the Chair.


Roger Simmons: Mr. Speaker, when my hon. friend from Lethbridge-Foothills gets me so involved in a matter of precise information, the temptation is so great to educate him on those matters that I forget the formalities involved. I apologize.
Before 1 leave the speech made by the Hon. Member for Etobicoke Centre, let me say that the more I listen to him in the House, particularly in recent days, the more I realize that I have heard those ideas before. After some thinking, I realized where I had heard it all before. I occasionally read bedtime stories to my three-year-old and six-year-old boys. The story they enjoy the most is Chicken Little. Chicken Little kept saying, "The sky is falling". The Hon. Member for Etobicoke Centre continually says that the sky is falling. Chicken Little Wilson.
We have also heard from the Member for York Peel during this debate. I always listen to his remarks with care because he says too many different and contradictory things. What he says one day may bear no relation at all to what he said the day before or what he may say the day after. He complained that there is too much paper and too many changes. Once again I say to him that he is out of sync with his colleagues. The Member for Etobicoke Centre wants more changes and more paper. Poor old Sine is out of sync once again.
Let us get on with this legislation. Let us pass this Bill and remove the uncertainty for millions of Canadians.
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The Acting Speaker (Mr. Corbin):: Before recognizing the Hon. Member for Peterborough (Mr. Domm), I should again remind the Hon. Member who just spoke that Hon. Members should refer to colleagues in the House by constituencies or portfolios.


William Henry (Bill) Domm: Mr. Speaker, I am reluctant to look at you while referring to the Member for Burin-St. George's (Mr. Simmons) for fear that you might get the impression that I am talking about you when I am not. I am talking about the kinds of statements made by the Member for Burin-St. George's when he refers to the tax Bill. I find it somewhat unbelievable that a Member of the Government would resort to the kind of tactics that he is using.


Roger Simmons: Mr. Speaker, I rise on a point of order. I have the honour of representing 75,000 people who live in a riding called Burin-St. George's. I would appeal to the Hon. Member for Peterborough (Mr. Domm), since I always try to pronounce the name of his riding correctly, to do justice to my people by pronouncing the name of their riding correctly. It is Burin-St. George's.


The Acting Speaker (Mr. Corbin):: Order. The point is well taken. The Hon. Member for Peterborough.


William Henry (Bill) Domm: Mr. Speaker, I apologize to the Member for Burin-St. George's for using the name of his riding in vain. I would point out, however, that he so seldom speaks in the House of Commons and I have not heard the name of his constituency pronounced often enough to be familiar with it.
With all due respect, I would also request that the time taken away from me, a Member of the Opposition, be taken into consideration when I reach my time limit.
The Hon. Member for Burin-St. George's stated that he would like the House to consider how many changes the Opposition really wants. It would appear obvious, even to those not quite as astute and reportedly as smart as the Hon. Member who just spoke, that we will probably need as many changes as the Government has made to the budget. That is why it has taken so long to get through this matter which is before the House today. There are so many amendments needed to the changes proposed by the Government that it is indeed regrettable that the Government has again resorted, as it so often does, to limiting debate on such an important subject during these very difficult economic times. It is difficult not only for the business community but for the agricultural community and the other citizens who have to pay taxes as well.
The Hon. Member for Burin-St. George's asks how the Opposition would reduce the deficit. We have been addressing that very question. I wish the Government would take into consideration some of the expenses that it incurs as a result of lack of judgment and poor judgment on priorities as perceived by Canadians. I do not think there are too many people in western or eastern Canada who would not like to see the end to the waste at Mirabel. I find it to be inexcusable that a Government would tolerate a loss of some millions of dollars a week in

March 15, 1983
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operating costs at an airport. It is totally unjustifiable. For days on end, the Liberals debate the cutting of 50 cents from the benefits of senior citizens and from Family Allowance or baby bonus cheques while they waste inexcusable amounts of money.


Peter Joseph Lang: We're bringing in closure because you are filibustering.


William Henry (Bill) Domm: In one year, the Government wasted $1 billion propping up Petro-Canada and providing money to a Crown corporation, some $400 million being the cost of interest to the taxpayers of Canada, in order to keep it afloat. Over the past couple of days we have heard the nightmare story taking place in Montreal concerning Maislin Trucking. We have reason to be suspicious that the Government might continue with its policy of propping up a friend through the corporation known as Maislin Trucking.
We are also concerned about the expenses borne by commissions to determine, because the Government is incapable of determining it, why we are in such a heck of a mess in Canada. We are in such financial difficulty because the Government is incapable of dealing with the problem. Therefore, it also appoints failures from former Governments to sit on commissions at $800 a day to try to determine not only how we came to be in this mess, but also how we will get out of it. The reason they are out of it is because when they, as Ministers, were in it, they could not solve the problem themselves. That is the kind of waste of taxpayers' dollars about which we are concerned.
Further, we must sit here for an afternoon, realizing that at the end of the day's session the curtain has been brought down on discussions affecting industry, agriculture, and consumers in Canada. What about the payoffs in salaries and bonuses and the rip-offs involving former Cabinet Ministers, matters which we have been debating for some two months? Do the people of Canada realize that a former Minister of Energy, Mines and Resources, while he was in office, put himself in a position whereby he could influence existing Cabinet Ministers in order to turn a $25,000 investment into hundreds of thousands of dollars, if not close to three-quarters of a million dollars in taxpayers money, that giant rip-off being known as the "Coal-gate Affair"?
How much will the people take? How much does the Government expect them to take? How can the Hon. Member for Burin-St. George's (Mr. Simmons) tell Members of the Official Opposition how the Liberals would reduce the deficit when they have been sitting there-


Roger Simmons: Take you off the payroll.


William Henry (Bill) Domm: -for the past two months, trying to justify those kind of horrendous nightmare stories? There is no excuse for it. We are dealing with an incapable Government. Hon. Members opposite take the opportunity to come into the House of Commons and spout off about what our Hon.
Member for Mississauga South (Mr. Blenkarn) says or what our Hon. Members from Toronto say, yet do not say anything specific.
I say, with all due respect, that the Hon. Member for Burin-St. George's who just spoke in the House of Commons, made accusations against Members of the Official Opposition and spoke in innuendoes. Never once, in the preamble to his remarks on the Bill, did he give an example. He made the kind of statements which have caused the people of Canada to be concerned about the morality, integrity and honesty of Members of the Government, not only those on the front bench but also those on the backbenches.
I will close my remarks by saying that there is one area which simply cannot go without some comment. According to the current proposed legislation in the Bill, which is being subjected to closure, any change of ownership in life insurance policies would result in a disposition which would cause prebudget contracts to be deemed to be post-budget contracts. When have we heard that before from the Government? When, after a budget, has the Government stripped away contracts with civil servants which were signed prior to a budget? Through the six and five program, under the guise of bringing down inflation, it will take away 50 cents from a child allowance payment while we are spending $800 a day to feed a former Cabinet Minister's well-being.
Perhaps two situations merit exemptions from these rules, and we hope that in the third reading stage and in committee this will be accepted. First, under life insurance, I am referring to juvenile policies owned by a parent and, second, to policies owned by one spouse on the life of the other spouse. How can the Government justify its proposed changes which would remove those benefits and make them taxable?
In the second case, if, for example, a wife owned an insurance policy on the life of her husband but pre-deceased him, he could be expected to become the owner of the policy on his own life through the successor ownership clause. In this particular case again, an old pre-budget policy could become a post-budget policy and subject to new tax rules.
The Hon. Member for Burin-St. George's sits over there and asks why I read it. I read it because it is fact, and I want it recorded in Hansard. It is not fair. It is against all principles in the contracts signed in life insurance policies, which the Government is stripping away from the beneficiaries. Once again, the individual's efforts to become financially independent at the time of the death of a loved one or, in many cases, the passing on of a policy to a beneficiary, are thwarted by a Government. Some of these people have entered into contracts decades ago.
Also, the scheme for raising revenue becomes a source of immediate and ongoing liability. If a retiring policy holder does not have enough income, the Government will have to supplement it. Is it not better to let him use all policy funds in a life insurance policy before tax to buy the annuity and pay the tax on it?
March 15, 1983

Each crisis, be it the death of a parent or a spouse, the loss of a job, or old age, will result in further financial hardships as a result of the proposed changes to taxation of life insurance contracts. Does the Government really wish to make those already suffering suffer more?


Blaine Allen Thacker: The answer is, yes.


Peter Joseph Lang: Mr. Speaker, before I begin addressing some of the relevant points concerning the Bill, I would like to comment on some of the remarks of the Hon. Member for Peterborough (Mr. Domm), because they exemplify remarks to which we on this side of the House have become very accustomed, one Conservative Member saying one thing and then another standing to say exactly the opposite.
Earlier this afternoon we listened to the Hon. Member for Mississauga South (Mr. Blenkarn) indicate that the Government was not being responsive and co-operative in listening to the concerns of people and various groups affected by the Bill and making the appropriate changes where it could. Then, 20 minutes later, we heard the Hon. Member for Peterborough indicating that the Government is making too many changes. It is the same old story. This is one particular instance. But, more generally, we consistently hear the Conservative Party opposing the Government and its program of restraining Government expenditures. They have opposed reducing transfer payments to the Provinces to six and five. They have opposed reducing transfer payments to individuals to six and five. They have opposed cuts to VIA Rail. They have opposed limiting Government operating expenditures. Those are the four major areas of Government expenditure, and the Opposition has opposed reducing and controlling expenditure in all those areas.
Then Members like the Hon. Member for Peterborough stand to list off a few old chestnuts which amount to less than one-tenth of 1 per cent of Government expenditures in an attempt to tell the people of Canada that they are willing to deal, in a major way, with cutting Government expenditures to reduce the deficit. It is just hogwash.


William Henry (Bill) Domm: Current chestnuts.


Peter Joseph Lang: I have given the Hon. Member a number, a statistic. I challenge him to debate that statistic and to come up with some facts.


Blaine Allen Thacker: I rise on a point of order, Mr. Speaker.


Peter Joseph Lang: At the same time, they say that they are-


The Acting Speaker (Mr. Corbin):: Order. The Hon. Member for Lethbridge-Foothills (Mr. Thacker) rises on a point of order.


Blaine Allen Thacker: Mr. Speaker, I am sure the Parliamentary Secretary would not want to mislead the House. He indicated that this Party had opposed restraint. This Party voted for the
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general principle of restraint in Bill C-124, and the Parliamentary Secretary, I am sure, would want to acknowledge that fact.


Some Hon. Members:: Debate.


Blaine Allen Thacker: We object to the manner of the cutback, not the general principle of restraint.


The Acting Speaker (Mr. Corbin):: Order.


Peter Joseph Lang: Yes, Mr. Speaker, the Conservative Opposition Members support restraint in principle, but when they come down to the particulars, to the though decision involving the actual application of restraint, then they stand and cry that they have a tremendous social conscience and that they cannot go along with that kind of restraint. That does not wash.


Blaine Allen Thacker: Cut out the $800 a day to Donald Macdonald.


Peter Joseph Lang: The Conservative Opposition has opposed Government restraint in every major area. Then the Conservatives have come along and said, "Do not increase taxes. In fact, if we were in power, we would reduce taxes". At the same time they are saying that they would not hold down Government expenditures, by their actions, not by their rhetoric. At the same time that they are saying they would not raise taxes, they say they would reduce the deficit. The people do not buy it. We do not buy it.


Blaine Allen Thacker: We would create jobs.


Paul James Cosgrove: They have no credibility.


Peter Joseph Lang: Returning to the purpose of this debate, which is to limit time on the Bill-


William Henry (Bill) Domm: Closure.


William James Kempling: The guillotine, the axe.


Peter Joseph Lang: -this issue involving tax reform has been before Parliament for over 16 months.


William Henry (Bill) Domm: Twelve days.


Peter Joseph Lang: As other Members on this side of the House have indicated, there has been plenty of time in which to debate the Bill. Many constituents of mine who are involved in the life insurance industry have come to Ottawa and made representations to the former Minister of Finance, to the present Minister of Finance (Mr. Lalonde), to the Parliamentary Secretaries and to the Minister of State for Finance (Mr. Cosgrove). We have been able to obtain a number of very positive changes to the original legislation. I would like to indicate some of them.
Concerning whole life policies, all policies taken out before December 2, 1982, even though issued after the November 1981 budget, will be treated under the old tax rules. That is a major change.


Paul James Cosgrove: It is very fair.

March 15, 1983
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Peter Joseph Lang: Post-December 2 policies will be exempt from the new tax measures if their premium payments are spaced over at least 20 years and if their annual build-up of cash values does not exceed a specified portion of their face values. A third change is that non-exempt policies, those policies which do not meet the above test for protection to savings ratio, will be periodically taxed under accumulating funds on an accrual basis. A tax will be calculated and applied every three years. However, the tax can be paid annually by policy holders who want to make the most use of their $1,000 annual investment income deduction.
There have been a number of other changes. Single premium policies, such as those with new money, that is, fluctuating interest rates, will not be exempt. However, universal policies may go either way. The industry spokesmen have indicated that these are very positive changes enabling them to continue on with the important roles and purposes of the whole life insurance industry.
The second point, Mr. Speaker, is that during this time we want to come out of a long recession and achieve economic recovery. We know the importance of consumer demand. We know we are not heading for an export-led recovery, Mr. Speaker. We know we are not heading toward an investment-led recovery because investment was down last year and again down this year. We are heading for a consumer-led recovery, and we can hasten that by putting $6 billion back into the economy with the return of tax refunds, but not by delaying it by filibustering tactics in the House.
That is the second very important reason why we must get this legislation through.
The third are the humanitarian reasons. There are many people, as all Hon. Members know, who are feeling the pinch of a tight financial squeeze. They need the money. Hon. Members opposite have suggested that people have had to go to loan sharks. If the Hon. Members opposite are really sincere, really concerned, then they should pass this Bill that has been before the House in one form or another for over 16 months.


William James Kempling: How dumb can you be? Sixteen months. You are out of your mind.


Howard Edward Crosby: Mr. Speaker, our purpose today is to consider the motion that was brought before the House with respect to the termination of the debate on Bill C-139 which amends the Income Tax Act of Canada. I do not know any piece of legislation on the statute books of the Parliament of Canada that affects more Canadians in a more important way than the income tax law. In the last reported taxation year, there were 15,100,000 Canadians who filed income tax returns, and of that number over 10 million paid income tax.
When we stand here in the House of Commons and look to our Leaders in the Government who tell us that we must end the debate on this taxation measure, I hope they realize that
they are talking to 15 million fellow Canadian citizens and 10 million taxpayers who might not want this debate ended, if they knew the manner in which they were affected by those tax measures.
We have heard speeches in this House of Commons made by Government Members that contain the worst kind of public deception. We just heard a speaker on the Government side talk about the months and months of delay in processing these tax measures. I have before me Bill C-139 which states on its front page, "First reading, December 7, 1982". One does not need a calendar to tell them that is a very few months ago. The Members on the Government side will say: "Yes, but the measures were there, they were there in another form and we had a chance to look at them in another form." Mr. Speaker, the form in which these tax measures came into the House of Commons was in the budget of the former Minister of Finance in November of 1981, and those tax measures were presented to the House of Commons at that time by the Minister of Finance who is no longer the Minister of Finance. Because of the stupidity and the gross deception of that November 1981 budget, he is no longer with us as Minister of Finance. He has gone off to destroy the rest of the world's economies, having destroyed the Canadian economy with his foolish, stupid and ill-conceived measures. It is those measures that are now presented to us in the form of Bill C-139.
Let me tell you something about those tax measures that were presented to the House of Commons by the Member for Cape Breton Highlands-Canso (Mr. MacEachen) when he was Minister of Finance for Canada. Those measures included a provision under which seven million working Canadians would have been taxed in respect of their health benefit plan. 1 am sorry that we in the Progressive Conservative Party stood in the House day after day after day and warned the Minister of Finance about the bad effects of that tax measure for all Canadians, because he withdrew that tax measure. If he had kept it in force, if he had taxed seven million working Canadians in respect of their health benefit plans, he would have been thrown out of office at the next election along with practically everyone on the other side of the House, because Canadians are not going to stand for the stupidity and the crass results of that kind of tax measure.
Over 45 of those original tax measures have been changed or abandoned or diluted in some other way. Unfortunately, one that was watered down when it should have been completely eliminated was the proposal of the then Minister of Finance in November of 1981 to remove from taxation exemption the $1,000 of pension income received by our senior citizens, if they were also involved in a Registered Retirement Pension Plan program.
What that meant was that thousands of members of the Canadian Armed Forces, of the municipal police forces and public servants across this land who retired early in their careers on small pensions and who had to provide for their later senior years when they could not work at all, were going to be deprived of that very small benefit that meant a great
March 15, 1983

deal to them. There again the former Minister of Finance, when he realized the effect of the tax measure, was shocked into action. He modified it. He did not withdraw it, which he should have done. He was afraid to admit to the people of Canada that he made such a terrible mistake. He listened to his advisers in the Department of Finance when they said this benefit ought to be taken away from our senior citizens, and thereby prevent them from providing for their later years in which they could not work or earn an income.
It is unfortunate for the Progressive Conservative Party politically that it prevented the Government from making these terrible mistakes because the Government and Government Members would have been punished in the polls at the next election. Instead, we stood here, as is our public duty, and performed our function as the representatives of the people and begged and cajoled the Government into making these changes. As a result, they will not suffer politically from the errors of the past. They had an opportunity to correct them.
The Minister of State for Finance (Mr. Cosgrove) and other Members supporting the Government say in the House of Commons that we should allow these measures to pass immediately. It is unfortunate, as I said, that we did not allow them to pass originally because then they would have paid for their errors. As it is now, they managed to come out without those measures that will wreak havoc among Canadian taxpayers.
They still expect us to act on their advice, which is to pass their Bill. We cannot do that. We are the people who stand between the Government and the taxpayers of Canada. We are the ones who have to stop the Government of Canada when it brings forward tax measures that are harmful to the people of Canada. We have done that job, and we have done it well. We must continue to do it, we must continue to protect Canadians against their Government. That is the most unfortunate thing that I have ever said in this House of Commons, that we have to stand here and protect Canadian taxpayers, the citizens of Canada, against their Government, the Government that would have taxed their health benefit plan, that would have seen thousands of health benefit plans across Canada collapse because the workers were not willing to pay tax in respect of those benefits.
We had to stop that measure. We did stop the measure. What do those people on the other side of the House of Commons, the Members of the Liberal Party, condemn us for? They stand up and say we are delaying the refunds of taxes to the Canadian people; those Canadians who have overpaid their taxes will not get their refunds because of the delaying tactics. What kind of proposition is that for a responsible Member of Parliament, never mind a Cabinet minister, to take? He knows the reason why we are debating this Bill in the House of Commons. He knows the reasons why we have been all over the budget resolutions six ways to Sunday, studying them, trying to improve them.
Adjournment Motion
Then they try to get the message across to the Canadian taxpayers that we are hurting them, we the people who stood in the House of Commons and stopped the taxation of health benefit plans and pension benefits granted to senior citizens, as well as 40 or 50 other measures which the Government was forced to withdraw. 1 do not think the people of Canada are that stupid, that they will fall for that kind of a line from any Cabinet Minister or any Liberal Member of Parliament. The people of Canada know what we are doing in the House of Commons. They know that we are the ones who are trying to protect them against the insidious tax measures proposed by the Government of Canada.
The people of Canada know why they need all that revenue in the form of taxation. They need it to carry out their lustful expenditure programs. One of the Members from Newfoundland challenged us to list some of the programs of the Government that resulted in excessive expenditures. I can do that very simply. If you will give me one minute, Mr. Speaker, I will rattle a few of them off.
Canadian National Railways this year recorded a deficit of $220 million. That is after they sloughed off all their losing propositions such as VIA Rail and CN Marine. They still lost $62 million in an investment in an offshore company, the Cast Shipping Group. They threw away $62 million, enough to get Sydney Steel back on the road and employing 2,000 Cape Bretoners in the constituency of the Hon. Member for Cape Breton-The Sydneys (Mr. MacLellan). Instead, they threw it away on an offshore company. They said there would be no deficit for Canada Post after three years. Wrong. The deficit after three years is $500 million. Air Canada has a deficit. The National Harbours Board had $400 million written off its past expenditures, $250 million for the Port of Montreal. The Petro-Canada budget is $2.7 billion, more than the whole of the Atlantic area. That Crown corporation is spending $2.7 billion. Do you think there is some waste there? They have 200 engineers with nothing to do. That is only the beginning. I could go on and on. Mirabel, $50 million a year, Dome Petroleum, Davie Shipbuilding $200 million on the Gulf Span Ferry which the Minister of Transport (Mr. Pepin) said would never be built.
Thank you for your indulgence, Mr. Speaker. I have at least another $2 billions' worth. I beg the chance to respond to the Member from Newfoundland.



PROCEEDINGS ON ADJOURNMENT MOTION


Roderick Blaker: Order, please. 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 Surrey-White Rock-

March 15, 1983
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North Delta (Mr. Friesen)-The Administration-(a) Responsibility for actions by Ministers and Officials, (b) Government mandate; the Hon. Member for Winnipeg-Assiniboine (Mr. McKenzie)-Air Transport-Winnipeg Air Traffic Control Centre-(a) Effect on families of proposed transfers, (b) Future of present employees; the Hon. Member for Winnipeg-Birds Hill (Mr. Blaikie)-Medical Care-(a) Contract to manage Hawkesbury Hospital, (b) Query respecting Minister's position.



ROUTINE PROCEEDINGS


[Stage Direction]
The House resumed consideration of the motion of Mr. Cosgrove;
That, in relation to Bill C-139, an Act to amend the Statute Law relating to Income Tax (No. 2), one additional sitting day shall be allotted to the further consideration in Committee of the Whole Stage of the said Bill;
That, at fifteen minutes before the expiry of the time provided for Government business in that sitting, any proceeding before the Committee shall be interrupted, if required, for the purpose of this order and, in turn, every question then necessary in order to dispose of the Committee of the Whole stage of the said Bill, shall be put forthwith and successively, without further debate of amendment.
Mr. David Berger (Parliamentary Secretary to Minister of Consumer and Corporate Affairs):: Mr. Speaker, my colleague, the Hon. Member for Kitchener, (Mr. Lang) talked earlier about how amusing it is to see Members of the same Party contradict themselves. If they listened to the previous speaker, it was many times more amusing, one person contradicting himself, not once, not twice, but many times in his speech.
The Hon. Member talked about the lustful expenditure prorams of the Government. He mentioned a number of programs such as VIA Rail. As my colleague from Kitchener was saying, this Government tried to make an honest attempt to reduce the expenditures of that service and increase its efficiency by according more dollars to capital spending and reducing its operating deficit so that it would be in a better position to be competitive and perhaps make a profit in the 1980s. That Member was against it. In one speech he talked about the lustful expenditure program, and then cited all kinds of examples where the Government tried to cut expenditures which he and his Party opposed.


Howard Edward Crosby: Mr. Speaker, I rise on a point of order. I appreciate the difficulty in cutting through the incompetent presentation of my colleague. I do not know whether he is talking about me or some other speaker but, for the record, I should have the opportunity to point out that I said nothing of VIA Rail other than to say that it was cut from the operations of Canadian National.


David Berger: The Hon. Member talked about the taxation of health benefits. Some brilliant minds addressed themselves to the problem of the income tax system, how it can be simplified and made more equitable for all taxpayers. I ask the Hon. Member to address himself to that question. Many Canadians do not receive health benefits from their employer. The employer has the alternative of paying an employee a salary or a health benefit. The employee will be taxed on the salary, but not on the health benefit. There is a certain injustice in the system in that you can reward an employee in a certain manner in which he will be taxed and in another manner for which he will not be taxed. Not all persons in our society, obviously, can have the same benefits. So there are, certainly, inequities in our tax system which the previous Minister of Finance tried to correct, and it is a question which many academics and tax experts have addressed themselves to, but it is obviously too complicated a question for the Hon. Member to understand, so I will not ask him to try to figure it out.


Howard Edward Crosby: I rise on a point of order, Mr. Speaker. You can appreciate my difficulty. The Hon. Member has challenged me to explain a tax measure. I will be very happy to explain it.


Paul James Cosgrove: No one interrupted your speech.


The Acting Speaker (Mr. Corbin):: 1 appreciate the Hon. Member's interest, but he has already spoken in debate. We must now hear the Hon. Parliamentary Secretary.


David Berger: Just to conclude this part of my comments, Mr. Speaker, let me say that it would be really something if the Hon. Member could sometimes suggest some answers to this House rather than always griping about so-called problems. He is a great expert at complaining, but he is pretty short on answers, and the answers he does have are quite lacking if one wants to take a look at them.

Mr. Speaker, yesterday, when the Minister of State (Finance) (Mr. Cosgrove) gave notice of allocation of time to consider the committee stage of Bill C-139 dealing with income tax legislation, another Member who was in the House just now, the Hon. Member for Lethbridge-Foothills (Mr. Thacker) reproached him for restricting debate on a Bill he described as being two and one half inches thick and containing hundreds of clauses. There again, the Hon. Member would have the Canadian public believe that we did not spend enough time considering this Bill. He forgot to mention that the Bill is a compilation of tax measures arising from three budgets that were brought down, respectively, in November 1981 and in June and October 1982. He also forgot to mention that a number of amendments were added, following consultations after the November 1981 budget was brought down, that thousands of speeches were made and questions asked in the House and elsewhere in this country, and that articles appeared in the press and hundreds of news reports were filed.
March 15, 1983

Furthermore, that same Bill is being considered today, sixteen months later. It is therefore entirely false to tell the Canadian people that today we are considering a Bill, containing hundreds of clauses, that was not examined either by the House or by the Canadian people.
As my colleague from Kitchener (Mr. Lang) said earlier, many public interest groups, including the life insurance sector, have said that they were satisfied with the latest changes made by the Government. Furthermore, I think this is a typical example of the Opposition's attempts to obstruct the proceedings of the House, day after day. We had another taste of this with the National Energy Program announced in October 1980. It subsequently took one year and seven months-until June 1982-to pass the various Bills that were part of this Program. The same applies to the 6 and 5 policy, which is a popular policy that has been very well received by the Canadian public. It was announced in June 1982, but it was not until January 1983 that the various Bills relating to the policy were passed in the House. I would like to give an example of the support this policy or program has been receiving from the Canadian public. In January, I sent out a questionnaire to 42,000 householders in my riding. I received more than 2,000 replies, and in their response to one of the questions, most people thought the 6 and 5 program would bring down inflation. This was in fact the case, not long ago, when the inflation rate finally dropped to 6 per cent on an annual basis. This is one more example where the Canadian public was made aware of the advantages of a government program, where the majority supported the program and where it took the Opposition months and months to debate before it was prepared to let us pass the legislation.
Finally, Mr. Speaker, I would also like to repeat the point made by my colleague for Kitchener, the Parliamentary Secretary to the President of the Treasury Board, when he said that $6 billion in refunds would be paid to taxpayers as soon as this Bill was adopted. After all the debate in the House and in view of these facts, I think it is vital that this Bill be passed as soon as possible and referred to committee, so that we can at last proceed with the next item on the agenda regarding questions of national importance.


Mr. Charles Mayer (Portage-Marquette):: Mr. Speaker, this is an important debate this afternoon. To my mind, at least, it points out the problems which the Government has run into in terms of managing House time. I would like to speak about some of the specifics as far as the problems of managing House time are concerned.
It is evident that this Government does not know what it is doing when you consider that this is by far the longest session on record. We are getting very close now to three years of being in one session. Presumably, under normal conditions we would expect to have a Throne Speech and a budget debate and disposition of the Estimates on an annual basis, and that would be considered as one session of Parliament.
One cannot help but wonder why we have not encountered more of these problems sooner as far as this Government is
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concerned because effectively, as the Hon. Member who spoke previously pointed out, we are dealing with several budgets. We are dealing with the budget which came down in October of 1981 which was amended in April of 1982. We had what amounted to a mini-budget in June of 1982, and we had a financial statement or financial update from the new Minister of Finance (Mr. Lalonde) last fall when we came back after the summer break. When you jam all of those things into one extremely large and complex Bill, it must amount to many technical amendments to the Income Tax Act. It is no wonder that the Government is pressed for time. For those of us in the Opposition who have concerns about some of the measures in the Bill which are going to affect our constituents adversely, it would be irresponsible of us to pass this Bill without having some kind of adequate discussion in the House. That is one of the issues which has to be addressed when we talk about closure.
I am a relatively new Member in the House, but I know this is the fourth time that we have had closure since this House returned on January 17. That clearly is an indication that the Government is not able to manage House time. 1 can give you an indication of where they could have saved one day's time. I am part of the Special Committee on Standing Orders and Procedures, and one of the recommendations of the Committee was that the size of committees should be smaller. We recommended that the size of Committees move down from 20 to 30 Members to a range of 10 to 15 Members. There is a problem in terms of redistributing or allocating the memberships on the various committees so that it is in accordance, on a percentage basis, with the number of Members which each Party has in the House. What would be fair, I believe, as far as the smaller committees are concerned, is a figure of 11 Members. That would allocate six Members to the Government, four to the Official Opposition and one to the NDP. That would have been acceptable to our House Leader, and I think we would have been able to live with that. Instead, the Government chose to pick a figure of ten Members and divide it up so there were six Liberals, three Conservatives and one NDP. The reason the Government did that, we are told, is that the chairmen of the committees would be neutral and never have to vote. If you take the neutral chairmen, that leaves five Government Members to four Opposition Members. To my mind that is totally ludicrous. Under Standing Order 13, Mr. Speaker, you do not vote except in the case of a tie where the Speaker casts the tie-breaking vote. I do not know whether there has been a situation in this House where the Speaker has had to vote, but the provision is there in case of a tie.


The Acting Speaker (Mr. Corbin):: Order. I have been listening very intently to the Hon. Member, trying to relate his remarks to the motion now before the House concerning time allocation on Bill C-139. Perhaps the Hon. Member would enlighten the Chair as to the relevancy of his comments in relation to the matter now before the House.
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Charles James Mayer: I would be very happy to, Mr. Speaker. I am trying to point out that the Government has wasted House time by creating this foolish situation. If the Government cannot allocate time properly and has to bring in closure, that relates to time allocation. I am pointing out that if committees are an extension of the House where the greatest speaker of all, yourself, Sir, has instructions to vote in the case of a tie, then that should be the case in committee. Had the Government chosen to accept that principle, there would not have been a one day's debate on a striking committee report. I do not feel that has ever happened before, and it came about simply because this Government chose to misinterpret the rules drafted for it by the special committee. If the Government was serious about properly managing its affairs, not only in the House but in the country, it could create good will in this place by making use of some common sense provisions. The Government could have saved a whole day's time in this House if it had taken a different attitude towards the makeup of the Members on various committees.
Now, Mr. Speaker, the Hon. Member for Burin-St. George's (Mr. Simmons) gets up and talks about the Opposition not making any concrete or proper suggestions for alternative policies on Government spending. Let me give him one. In the fall of 1981 the Minister of Finance set the rate for Canada Savings Bonds at 19 per cent plus. At the time some of us thought that was a ridiculously high interest rate. Looking at it now, that rate cost the Canadian taxpayer something like $2 billion, a horrendous amount of money. We have suggested to the Government that it could have a better system of deciding on the appropriate rate for Canada Savings Bonds. Now, the $2 billion is an estimate, but it is a visible estimate. In addition to that, by setting the rate as high as it did, the Government tended to keep interest rates at a high level, which caused unknown additional problems for small-businessmen trying to survive.
I see the Parliamentary Secretary to the Minister of Finance (Mr. Fisher) is here, and I make that suggestion to him. Surely we have to have a system which sets the CSB interest rate at a realistic level. When you look at the boondoggle that went on in 1981 and the effect it will have on interest rates for probably another three or four years, you wonder why we cannot have a system which would function better.
There is a provision in this Bill, Mr. Speaker, which removes the income averaging annuity contract system and replaces it with forward averaging. I have heard that described as the most complicated system ever devised by man. One of the problems I have with all of these regulations concerning taxes is that they have become so complicated that the average person cannot understand them. Just look at the average income tax form. It is incredible; you almost need a Philadelphia lawyer to be able to understand it, let alone fill it out properly. Surely we can devise something which is a lot simpler than the present form. Not only would it be simpler to fill out,
it would cost less to administer. Now, there are some suggestions which will not cost the Government any money. Presumably they could even save money by reducing the number of bureaucrats required. So we do make some sensible and worthwhile suggestions on this side of the House. I would point out that I get a little upset when I hear people on the other side stand up and not defend their own Government's program- which presumably they should be doing as part of the Government-but try to turn it around and say that all the Opposition does is to criticize. In the brief time I have had I have made two or three points which the Government could consider, so let them not accuse us of speaking out of both sides of our mouth. Too often we hear people say that the only time we suggest something is when it will increase the deficit. That is not the case in these suggestions I have made.
Let me close, Mr. Speaker, by making one final suggestion. I understand from the questions and answers during the Question Period today that there is a possibility that Maislin Transport might be losing something like $1 million a month. If that is the case and the Government is involved, I would suggest that the money could be much better used to bring down interest rates on farm improvement loans where farmers are locked in at 16.75 per cent, because from the figures I have seen that would be much more useful to the economy than simply pouring $1 million down the hole every month for a money losing trucking outfit.


Douglas Glenn Fisher: Mr. Speaker, I think it is time for us to wrap up debate on this Bill. Let me give you a summary of the discussion we have had so far.
This debate started on November 12, 1981. There was a full budget debate. Then we had announcements from the Minister of Finance on December 18. I was in the House then so I know there were extended questions at that time. Then there was another budget brought in on June 28, 1982. There was a big, long discussion then. For a few Members of Parliament who chose to take advantage of it, the committee sat through the months of August and September and had carried on detailed discussions. Then we had a financial statement on October 27.
Then this Bill was brought in. On this Bill alone, Mr. Speaker, we have had seven days' debate on second reading, and so far more than four days' debate in Committee of the Whole. We have had over 75 Tory speakers participating on second reading, and 18 NDP Members, more than half their caucus in each case, Mr. Speaker. And what do we hear today? "We have not had a chance to say enough". Well, Mr. Speaker, if they have not had enough time after two budget debates, a financial statement, a special debate in the House and 11 days in Parliament then you are windbags and you do not deserve any more time.
Let us look at some of what we have accomplished, Mr. Speaker, because, quite frankly, this discussion really was fruitful and we should be honest about that. Some of the Members on the other side made contributions, just as did Members on our side.
March 15, 1983

From last April until February of this year there was extended debate with associations and business groups in the country about the federal sales tax. A budget paper was prepared and published. The business groups advised the Government, and the result was a new process for analysing a special new tax. The same thing happened with the Lortie Commission. We also have a new set of rules for charities. When the Finance Committee studies tax measures, new ground was broken.
A new technique of pre-budget consultation was practised by the former Minister of Finance last spring, and has been carried on by the present Minister through December and January. People from outside Government have been giving advice. A whole new set of rules on interest expense deductions has been drawn up and has been examined by them. Health and dental plans have been debated and, on the advice of outsiders, those provisions were dropped from the Bill. The advice the Government received from outside has been invaluable. Changes were made to the provisions governing work in progress, soft costs for construction and insurance regulations after over a year of negotiation with the industry, and there has been a change in the automobile standby charge provision. Anyone who claims that the Bill has not had adequate debate is debasing the advice received from outside groups who have made a real contribution to the process.


William James Kempling: What a windbag!


Douglas Glenn Fisher: When Hon. Members opposite claim that they have not had enough time to debate the Bill, I do not know what they mean. Let us compare the contributions of the outsiders with the contributions made by the Hon. Members opposite. The Hon. Member for Portage-Marquette (Mr. Mayer) has just made a thoughtful presentation, but he has exhausted his ideas, and so he branched off into a new discourse on Canada Savings Bonds.


Charles James Mayer: Mr. Speaker, I have a point of order. If the Hon Parliamentary Secretary to the Minister of Finance (Mr. Fisher) would be prepared to yield the rest of his time-


Douglas Glenn Fisher: Mr. Speaker, that is not a point of order. I object to that kind of interruption. I listened to the Hon. Member because he is an interesting man-


The Acting Speaker (Mr. Corbin):: Order, please. The Parliamentary Secretary has the floor.


Douglas Glenn Fisher: Mr. Speaker, I object to that interruption. I listened to the Hon. Member because he is a fascinating man and usually has concrete ideas to offer. Unfortunately, he has exhausted his ideas. He did not speak about the Income Tax Act at all, and indeed you had to interrupt him, Mr. Speaker. He was going on about committee rules and Canada Savings Bonds. That is the behaviour for someone looking for an idea. It is a Filibuster. Last Friday the Hon. Member for Calgary West (Mr. Hawkes) went over the same gound time and time again-
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Blaine Allen Thacker: Mr. Speaker, I rise on a point of order. Perhaps there is trouble with the microphones, but I am having trouble hearing the Hon. Member. I wonder if he could speak a little louder.


Douglas Glenn Fisher: Mr. Speaker, I was referring to the Hon. Member for Calgary West who asked all kinds of questions but hardly engaged in searching, intellectual debate.
There are 140,000 Canadians who are affected by the standby charge on automobile usage. As reported at p. 23721 of Hansard the Hon. Member for Calgary West asked how standby charges would affect diplomats in Africa, not people in Canada. Someone should tell him that he represents Canadians and he is supposed to talk about taxes here, and not waste the time of the House with that kind of frivolous detail. He did the same thing today. In serious debate, the Minister of State for Finance (Mr. Cosgrove) spoke about the new ideas we have on the standby charges. The Hon. Member for Calgary West wanted to talk about the motions that were defeated last Friday and insisted on his right to do so. That is because he does not have a new idea. This is a filibuster.
We heard Members of the New Democratic Party say that this Bill helps the rich. That just shows that they have absolutely no understanding of it. When they speak about the rate reduction, you would think they would listen to their bed mates in the Tory Party and understand that when we reduced the rates we also closed the shelters. But the shelters are only closed for people who pay high rates of tax.
I made an inquiry about how many people with a $25,000 income borrow money to invest in an RRSP. I was told that the average deduction for these retirement plans for people at that income level is $500. It is only when people have much higher incomes that they borrow for this purpose, and we have ended that deduction.
The NDP claims that this Bill favours the rich. They should also realize that we not only changed the rate but that we changed the deductions. It would be well for them to present that honestly, rather than presenting slogans which show that they do not understand the matter.
There has been a great deal of debate, Mr. Speaker, but it is time to move on with this Bill to clean up the tax system. The next step is to simplify the system. There has been lots of advice from Hon. Members opposite on that subject. I do not think we should do away with tax but I think we should simplify the Bill, and that is the next step.
At this stage we will get rid of some of the antiquated and unnecessary deductions and some of the shelters that were unfair. Let us get on with the job and recognize that we have cleaned up the budgetary process. We have already opened up the budget so that groups from outside can consult with the Government. We have opened up the process so that groups from outside can study the tax measures. We must give the Minister of Finance (Mr. Lalonde) and the former Minister credit for this. It brings in some fresh air from the outside world.

March 15, 1983
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Mr. Dan Heap (Spadina):: Mr. Speaker, I am glad of the opportunity to speak against the Government's decision to choke off debate on this Bill. The Hon. Member who just spoke bragged about the months that have been spent in delaying the Bill. It is 13 months since the 1981 budget, and during that time the Government carried on discussions with those people it wished to consult and suffocated public debate on the Bill. When it did introduce the Bill it made sure it was debated a day here and a day there, often on short notice. This was to make it as difficult as possible for the Opposition to comment wisely. The Government even played games with the use of time allocation in order to make things more difficult for the Opposition.
I have spoken on many occasions about one of the most unjust clauses in the Bill. Clause 64 removes the exemption for immigrants who send money to relatives overseas, except for a spouse, child or grandchild. I hope Hon. Members will vote against this Clause. Most immigrants earn low incomes. Although the Government says that some immigrants were claiming exemptions to which they were not entitled, the total amount of money that it would have been impossible for them to take improperly would be far less than one major corporation, such as Shell, could take by means of the loopholes provided by the Government. It is unjust for the Government to crack down on immigrants when it does not crack down on the 4,000 individuals who earn over $100,000 but pay no tax whatsoever. The Government does not crack down on Shell Oil which sometimes pays no tax whatever on a quarter of a billion dollars. Those immigrants are not among those who had an opportunity to be consulted in the consultation process bragged about by the Parliamentary Secretary. They were excluded from consultation by the simple process of not publicizing the occasions.
Another interesting fact that has not been brought out concerns the injustice of the present tax system. In no way has it been addressed by all the consultations and private discussions this Government has had with wealthy corporations and with the promoters of wealthy corporations. Government officials have not talked with working people nor have they talked to representatives of the garment industry. I mention this because Spadina is one of the areas in Canada where the garment industry is important. It employs about 10,000 people in Spadina. The garment industry has been compelled to subsidize industries like the oil industry, the banking industry and the mining industry. From 1976 to 1979 the taxation rate on the garment industry, clothing and textiles, was about 87 per cent higher than the average taxation rate on the oil, the mining and the banking industries. In fact, if the oil, the mining and the banking industries had been effectively taxed at the same rate as the textile and garment industry, this Government would have $1.7 billion more in its coffers and it would have no excuse for the cutbacks it has made in health, education and social housing. Instead, this Government preferred to give the tax break, not to an industry where wages are low and modernization is urgently needed, but to an industry that has more money than it knows what to do with
and exports money out of Canada. Another way of putting the point is that in Government benefits to industry, the garment and textile industry has had about $27 per employee per year, according to a 1978 Government study. Compare this $27 per employee per year in the garment industry with an average of $179 for industry as a whole. We know which industries pull that average up. Again it is the oil, the banking and the mining industries. Not only does the Government not take tax at the same rate from those wealthy industries but it gives assistance to the already wealthy industries at a rate several times higher than the rate at which it assists the garment industry.
I want to point out some of the long-standing injustices that have been noted, but noting them has made no difference to the Government's interest in correcting them. It has been pointed out that the statutory rate of taxation that is imposed on corporations generally is more than 46 per cent. In 1978, what corporations actually paid was around 30 per cent. Already a deception has occurred because the average taxpayer is not able to cut his personal tax bill by two-thirds as corporations have generally done. Again, the smaller corporations in the more hard pressed industries get less of this tax break than the richer ones.
Consider some of the tax rates paid. Cadillac-Fairview, according to a Government study, has been making $100 per month surplus on every one of its 15,000 apartments in Toronto. Every one of those 15,000 units nets Cadillac-Fairview on average $100 a month surplus. What sort of taxation does Cadillac-Fairview pay? The rate is 6 per cent. The Steel Company of Canada pays 7 per cent. Big deal! Union Gas pays a little under 6 per cent. The Toronto Dominion Bank, my goodness, it paid 18 per cent one year. Let us take a look at what happens to ordinary people and immigrants. Immigrants try to send money to relatives overseas, a family obligation which they recognize. This is a family obligation we value and claim to respect in this country. But those working people who are trying to send money to relatives overseas are generally taxed at a far higher rate than are corporations. If we pass this Government Bill, through Section 64 we will penalize people for acknowledging and acting on family obligations.
We are continuing to allow massive multi-billion dollar gifts to the wealthiest people, either individuals or corporations in this country, while we chisel working people who may earn $10,000, $15,000 or $20,000 a year in order to support their families. We chisel them by whittling money off and causing the lowest income people of this country to pay a far higher proportion of their earnings in tax than is paid by the people earning the highest incomes.
This whole tax Bill which the Government has put forth is a disgrace. When we come to Section 64 I would ask that Members of this House have the decency to vote against it.

Mir. Louis Duclos (Montmorency-Orleans): Mr. Speaker, 1 would like to take a few minutes to tell the House why I believe that the Government is quite justified in putting an end
March 15, 1983

to this debate. I shall not deal with the substance of this bill. During the last few months, the Opposition parties have had ample time to explain why they believe that some of the provisions of this bill should be amended. They may be right in certain cases, but obviously, they may also be wrong.
However, I would like to appeal to the sense of responsibility of the Opposition Members and ask them to show more understanding of the role of Parliament in a democratic society such as ours. Once members of a party have been elected democratically and allowed to air their views on behalf of the interests they represent, 1 do not think that they are entitled to obstruct systematically the operation of our democratic institutions.
Mr. Speaker, I find this bill satisfactory. It might not be perfect, but I believe that it is a good bill because it is prompted by a desire to be fair to Canadian taxpayers as a whole. I am well aware that most of the spokesmen for the Official Opposition have risen on behalf of special, not to say privileged, groups in our society, who are literally haunted by the prospect of having to share some of their wealth with the most disadvantaged members of our society, while the members of the leftist party have made speeches aimed mostly at placing an even heavier fiscal burden on the shoulders of the private sector, which remains the motor of development, progress and economic growth in a society such as ours.
Mr. Speaker, I would like the Opposition Members to show at least some sense of their responsibilities and remember that, by delaying this bill, they are penalizing underprivileged people in our society. For instance, they are penalizing those who, after working a few months early in 1982, now receive unemployment insurance and expect a rather substantial income tax refund. As long as this bill has not been passed by Parliament, the Department of National Revenue does not have the right or the authority to mail out the tax refunds to these people who are impatiently waiting for amounts which can be rather substantial. The Members opposite should also think about low income mothers who are waiting for this bill to be passed to receive their child tax credit, which can amount to over $1,000 in the case of a family with three children. These people are penalized by the filibustering which we have been witnessing in this House for too many weeks already.
Mr. Speaker, the Minister of State for Finance (Mr. Cosgrove) said earlier that, since the budget was brought down in November 1981, Opposition Members have had a total of 25 days of debate in this House to express their views. Moreover, in many cases, we have accepted suggestions by the Opposition as well as by Government Members. First, there was the debate on the budget of November 1981; then, there was another debate on the budget of June 1982; later on, in September 1982, the Committee on Finance, Trade and Economic Affairs spent about a month examining all amendments to the Income Tax Act resulting from these two budgets. These amendments were examined one at a time and recom-
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mendations made to the Minister of Finance who accepted many.
Finally, Mr. Speaker, there has of course been the present debate during which, as mentioned by the Parliamentary Secretary to the Minister of Finance (Mr. Fisher), 75 Members of the Official Opposition, or about three quarters of them, have had the opportunity to voice their concerns or points of disagreement about this legislation. I also believe that nearly 20 Members of the New Democratic Party have risen during this debate to express their views about this Bill.
Therefore, Mr. Speaker, it seems to me that the Government is acting responsibly, or perhaps that we are trying to make up for the lack of responsibility which seems to exist on the other side of the House, in deciding that what is at stake is so important that we must act now so that Canadians who are waiting for and are entitled to government refunds can receive them.


Mr. Thomas Siddon (Richmond-South Delta):: Mr. Speaker, in the remaining time that I have I would like to point out once again, for the record, the annoyance that we on this side feel at the Government's having introduced this motion under Standing Order 82 to terminate debate on this very important measure during the Committee of the Whole stage of Bill C-139. If one listens to the intensity of the speeches made earlier by the Hon. Member for Mississauga North (Mr. Fisher) and the Member who just resumed his seat, I think it is obvious to Members on this side that the Government Members feel very uncomfortable about many of the initiatives which remain in this mammoth Bill C-139 which is some 295 pages and contains 134 separate Clauses dealing with matters of tax reform that affect virtually every Canadian citizen in several ways.
The anxiety felt by Members opposite stems from that day back on November 12, 1981, when the former Minister of Finance introduced his first budget. It was the basis for these reforms which the Government is now trying to implement retroactively. Even after it has been collecting taxes for over a year based on certain of these initiatives, it is trying to create a mood of desperation in the country. The Government is suggesting that it is the Opposition who is holding up these very important tax reforms. In fact, those of us who have travelled the country and have listened to our constituents know that there are still many serious and fundamental flaws with this legislation that will haunt Canadians and hinder the development of our economy for many years to come.
It strikes us as being strange that in this session, which is the longest in Canadian parliamentary history, the government has had to use time allocation and closure 20 times, beginning with the famous Friday in October of 1980 when closure was used to limit and suppress the rights of Opposition Members to debate the resolution on the Constitution of Canada that was introduced in the House. The outrage that Members of Parlia-

March 15, 1983
Time Allocation
ment and Canadians from every part of this land felt as a consequence of that initiative still prevails in this country today, as any poll would quickly reveal to Government Members. That outrage arose not only because closure was used in a most inappropriate way on that occasion when we all wanted to have a say on the future Constitution of this nation, but because closure was used on several subsequent important occasions.
There was an attempt by the Government to try to frustrate the right of Canadian citizens to watch the committee hearings on the Canadian Constitution during the winter of 1981. Closure was brought in on other important measures, such as the reform of the Canada Lands Act, Bill C-48.
In the spring of 1981 we saw closure used to limit debate on the final disposition of the Constitutional resolution. Had it not been for a stand-off in the House, we might well have had an entirely different Constitution enacted from the one we have today. It was only because of the resistance shown by Members on this side at that time that some very serious and divisive measures were not imposed upon Canadians by the will of the Liberal majority opposite.
I,	and I know the majority of Canadians, will consent to the attempt by the Opposition in the House to ensure that the Government does not hastily pass some 134 separate items of tax reforms through the House, in a Bill which is 295 pages thick, with only four days' debate at committee stage and only seven days' debate at second reading stage. There are items in this legislation which cover all sectors of the Canadian economy and affect farmers, the forest industry, the manufacturing industry, small-businessmen, fishermen, those who are employed in trade unions and those who are employed in the north.


Mr. Dionne (Northumberland-Miramichi):: Mr. Speaker, I rise on a point of order. We have heard the Hon. Member make several references to the use of closure in the House. I think he is misleading the House and the public because, to the best of my recollection, closure has only been used once during this session.


Thomas Edward Siddon: Mr. Speaker, the comment I made was that in the present session of this House, closure or time allocation has been used 20 times. For those who are watching and do not know what time allocation means, it means that the Parliament of Canada is garrotted. It is given one or two more days at the most to complete debate on important legislation. We are now faced with a very important piece of legislation because it affects every Canadian in one way or another.


Mr. Deputy Speaker:: Order, please. As it is now 5:10 p.m., the two hours provided for consideration of the motion now before the House under the provisions of Standing Order 82 have expired; it is therefore my duty to interrupt proceedings and to put every question necessary to dispose of this motion.

The question is on the motion of Mr. Cosgrove, seconded by Mr. Gray.
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


Mr. Deputy Speaker:: All those opposed will please say nay.


Some Hon. Members:: Nay.


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


Mr. Deputy Speaker:: Call in the Members.


Madam Speaker:: I declare the motion carried. Motion (Mr. Cosgrove) agreed to.
* *


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Jim Peterson (Parliamentary Secretary to Minister of State for Economic Development and Minister of State for Science and Technology):: Madam Speaker, the following question will be answered today: 4,431.
Madam Speaker, I suggest that the remaining questions be allowed to stand.
Order Paper Questions


Mr. Mazankowski: 1.	For the fiscal year (a) 1980-81 (b) 1981-82 (c) 1982-83 (d) 1983-84 (e) 1984-85, did the Government commit itself to provide assistance to foreign countries, through either Petro-Canada International or CIDA, to aid in the exploration for and development of potential oil and gas reserves and, if so, for each country, what amount of aid was committed?
2.	What increases in proven reserves, if any, have been achieved so far?
3.	What commercial development of these new reserves is under way or currently being planned?


James Scott (Jim) Peterson: I am informed by the Department of Energy, Mines and Resources and the Canadian International Development Agency as follows: In so far as Petro-Canada International Assistance Corporation is concerned:
1.	(a)-(e) Petro-Canada International became operational in January, 1982 and has committed assistance for preexploration and exploration activities to the following three countries: Jamaica-commitments of $6.8 million for 1982 and 1983; Tanzania-commitments of $29.4 million for 1982 and 1983; Senegal-commitments of $16.2 million for 1982, 1983 and 1984.
2.	No increases in proven reserves has been achieved so far. Exploration activities are only in the preliminary stage at this time.
3.	Not applicable.
In so far as the Canadian International Development Agency is concerned:
Pakistan
1.	Since 1973, Canada has financially supported the Oil and Gas Development Corporation in Pakistan by approximately $31 million committed to date for the Corporation's activities in drilling, production and technical assistance in the oil and gas sector. At the present time the Government of Canada anticipates possible cash disbursements during the next two fiscal years of most of the balance of the line of credit.
2.	There is no reliable information on the increases in proven reserves since the Government of Pakistan and the World Bank data are different. The seismic equipment in use has identified typical structures but volume estimates of the reserve are not possible to determine. However, because of the joint efforts of the three principal donors, the World Bank, the Asian Development Bank and CIDA, significant discoveries have resulted over the last six years.
3.	In the case of oil, prospects are mixed for increasing production from existing oil fields in Pakistan. The Fifth Five-Year Plan called for production to increase from .49 million tons per annum in fiscal year 1978 to 1.7 million tons per annum in Fiscal year 1983 (10,000 barrels per day to 35,000 barrels per day). In fact, as a result of overly optimistic estimates of production per well, pricing problems, drilling problems and management problems, production remained virtually constant at 10,000 barrels per day until 1980-81,

March 15, 1983
Order Paper Questions
improving in 1982 mainly as a result of increased production from the Toot oil field and new production at 2,200 barrels per day from the Khaskeli oil field.
Production from Khaskeli could increase to some 5,000 barrels per day and production from the Meyal field is expected to increase to 13,000 barrels per day by 1987. If these targets are met, total production from known fields could reach 20,000 barrels per day by 1990.
The Directorate General, Energy and Resources, is projecting 20,000 barrels per day by 1985-86 and 27,000 barrels per day by 1989-90. In light of the recent World Bank unofficial reserves estimates such production figures are unlikely to be met unless upcoming tests on Toot and Dhodak prove to be very positive. Even with positive results on the assessment of these known fields it is likely that one additional field of Meyal proportions would have to be found and developed before 1990 to ensure that the 27,000 barrels per day figure is met for that year.
India
1.	In the case of CID A, two lines of credit have been extended to India:
A loan agreement for up to $15 million line of credit was signed on June 24, 1980 with the objective of increasing the proportion of Indian self-sufficiency in petroleum by contributing to the exploration and development of Indian oil and gas reserves. This line of credit was virtually fully committed by October 31, 1982. A second line of credit for up to $45 million was signed on November 21, 1981 with the same objectives. It is expected to be fully committed by November of 1984.
Disbursements under the $15 million line of credit should be completed by March of 1983. Disbursements under the $45 million line of credit are expected to be completed by fiscal year 1987-88.
2.	Accurate information on the increases in proven reserves is virtually impossible to determine since the Oil and Natural Gas Committee's (ONGC) program spans both offshore and onshore sites all over India. Announcements are made on a regular basis of the Government of India's intention to undertake major new drilling contracts and the ONGC has recently announced its intention to buy or lease a large number of new rigs in the next year or two. The line of credit, however, is designed in part to develop markets for Canadian industries and has, as such, no direct impact on the identification and exploration of oil and gas reserves.
3.	India's precarious energy situation is such that every discovery is being exploited as quickly as possible to reduce the costly import of oil. The Government of India has identified oil exploration and development as an essential component in meeting many of the other objectives in their Sixth Five-Year Plan. Shortages of oil impact in the power sector, in manufacturing, etc. to such a large extent that commercial development of new reserves is proceeding with all possible speed.


A. Daniel McKenzie: Madam Speaker, I rise on a point of order. I would like to ask the Parliamentary Secretary about question No. 4,175. I have raised this matter on six occasions. This question was placed on the Order Paper on March 24, 1982. It is a question regarding correspondence between R. W. B. Bailey, Chairman of the SGPE Sub-Group, and Mr. R. Gagnon, Assistant Deputy Minister, Department of Consumer and Corporate Affairs, dated February 17 and February 19, 1982 respectively, on the subject of a hiring team to recruit Francophone employees. I have listed the number of Departments which have these hiring teams, and what schools and universities they are going to be going to. I want to know if there are any in Manitoba. I also want to know what nationalities they are going to be hiring. I met with the Human Rights Commission yesterday. They have a number of complaints listed with regard to the discriminatory hiring and promotional practices of the Government. They are saying that the delay in having these questions answered is holding up their deliberations.
This is the sixth time I have raised this question. Will the Parliamentary Secretary give me some kind of answer as to why this question is not being answered by the Government?


James Scott (Jim) Peterson: Madam Speaker, I wish to thank the Hon. Member for his question. I shall ask the Minister for an answer, but I would like to inform the House that we have already answered 3,973 questions, in other words, 83.9 per cent of all questions. Hon. Members are no doubt aware that it costs a great deal to answer all these questions, and we must also consider the taxpayer. However, I shall get the answer for the Hon. Member as soon as possible.


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


Some Hon. Members:: Agreed.



POINT OF ORDER


Fred Alward McCain: Madam Speaker, I rise on a point of order. I raised the question yesterday, and on March 4, in respect of the notification for the UFFI installation program. I would like to correct a remark which was made by the Minister yesterday when he said that the advertising had been done and the Hon. Member should disseminate the information to his constituents. The Minister misled the House, I believe, not intentionally, because as an Hon. Member I did not receive his notification of the deadline in my office until-
March 15, 1983


Madam Speaker:: Order. Order. The Hon. Member knows that he may not correct the statements of another Member. If that other Hon. Member finds that he has made a statement which he believes he should correct, he may do that himself, but the Hon. Member may not correct a statement of another Member.


Fred Alward McCain: Madam Speaker, my point of privilege is that it was impossible for me, as a Member, to disseminate the necessary information to my constituency. To substantiate my impossibility-


Madam Speaker:: Order. Order. The Hon. Member is debating the fact that he was not able to disseminate some kind of information because-


Fred Alward McCain: I did not have it.


Madam Speaker:: The Hon. Member did pose a question, I believe, during the Question Period concerning that, or was it yesterday? In any event, it is not a question of privilege. That is quite obvious. I am not quite sure now at this point if the Hon. Member is rising on a question of privilege or on a point of order.


Fred Alward McCain: Madam Speaker, my point of privilege is that I was told as a Member that I should have disseminated the information. As a Member, I did not see the information because it arrived in my office on a Friday after I had left my office late in the afternoon. I did not see it until the following Tuesday.


Madam Speaker:: Order. That is not a question of privilege. The Hon. Member is arguing a question which he has brought up in the House before. This is not the time to argue it. It is not a question of privilege, and I do so rule it is not a question of privilege.

The Hon. Minister of Consumer and Corporate Affairs (Mr. Ouellet), on a question of privilege.


André Ouellet: Madam Speaker, on a question of privilege, the Hon. Member who spoke just now implied that I misled the House.


Madam Speaker:: Order, please. There is no privilege involved, niether the Minister's nor that of the Hon. Member. Both Hon. Members are engaged in debate on a question that was raised during the day. However, no debate can be allowed on this question at this time. Neither the Minister nor the Hon. Member has a question of privilege.


Fred Alward McCain: Madam Speaker, I rise on a point of order. The Minister is correct. I acknowledge that. I said "UFFI". I should have said the Summer Works Program. My apologies to the Minister.
Income Tax


Madam Speaker:: Pursuant to the provisions of Standing Order 58, I do now leave the chair for the House to go into Committee of the Whole.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration in Committee of Bill C-139, to amend the statute law relating to income tax (No. 2)- Mr. Lalonde-Mr. Francis in the chair.
On Clauses 8, 9 and 128(12)-
Blaine Allen Thacker: Mr. Chairman, when we rose earlier, I was asking the Minister about the Income Tax Act, Section 15.1, Subsection 11, which is Subclause 8(6). The penalty section has been changed. It originally stated that a penalty is imposed where a false declaration is made in a joint election in respect of a qualifying debt obligation. I am wondering if the Minister would explain to the House what the original problems were, their extent, and what is being corrected with this new provision?


Paul James Cosgrove: Mr. Chairman, the difficulty in responding immediately in detail to the question is, of course, that the administration of the Act is under another Ministry, that of Revenue Canada. I can indicate that my officials point out that it was because of some experience with fraudulent declarations under the section that the amendment was brought forward. I do not have at my Fingertips the experience of the Revenue Department, but it is something I can obtain for the Hon. Member, and I will provide those details once I have had an opportunity to consult with the officials from the other Ministry.


Blaine Allen Thacker: Mr. Chairman, would the Minister make that undertaking to the House? It is rather important to us to know whether the fraudulent acts were the acts of individuals or through lending institutions. Does the Minister have any general information on that point?


Paul James Cosgrove: Mr. Chairman, again because it involves another Ministry, I do not have the particulars. I hasten to assure the Hon. Member that when I have those particulars I will undertake to provide them on the next occasion we consider this matter in Committee of the Whole. My officials have brought to my attention that it would be a fairly recent experience inasmuch as the original Section was introduced in the 1979 Income Tax Act. I am referring to Section 15.1(6) under the heading "False Declaration". This is now expanded

March 15, 1983
Income Tax
to include not only corporations but individuals. So there may not be a lot of expenrience but I will attempt to get the information and I do not undertake to make it available to all Hon. Members who are interested in these proceedings.


Blaine Allen Thacker: Mr. Chairman, I would like the Minister to consider Clause 9 which relates to Section 15.2 of the Income Tax Act. I might say, Mr. Chairman, that the explanatory notes to the Bill are tremendously beneficial to those of us who are not skilled in reading those very complicated Sections. This is a very valuable addition in trying to figure out exactly where these Clauses are and what they really mean. In the explanatory notes, referring to Clause 9(a), it says the issuer cannot deduct the interest on the bond but the recipient of the interest is deemed to have received a taxable dividend from a taxable Canadian corporation. That raises the question, Mr. Chairman, as to what has been the cost to the Consolidated Revenue Fund of the bonds issued to date and what is the anticipated loss in the future.


Paul James Cosgrove: Mr. Chairman, my officials are attempting to find that figure. I might say that I am very pleased some Members have found the innovation of explanatory notes useful because some other Members of this House have been very unkind to the Government in this respect and used it as an example of yet another complication and more paper work required by Government. I am very pleased some Members have found it useful because that was the intent of providing the explanatory notes. I know some members of the public have indicated it has been helpful.
On an annual basis the projection of the amendments which are before us would be that the cost to the CRF would be $25 million. Under the Section as it stood previously, that is the expansionary interpretation for use of the bond, the cost thus far, which is a bit harder, is calculated to be $125 million.


Blaine Allen Thacker: Mr. Speaker, the same Clause states that the bond must be issued after November 12, 1981, and before 1984. Does the Minister anticipate this provision going beyond 1984? As he well knows, we are almost into 1984 now, and he has actual experience to this point. Why would the Minister not consider an amendment which would take it, say, to 1985, which would then give people still more certainty as to whether or not they can get a bond?


Paul James Cosgrove: Mr. Chairman, I indicated this morning in response to another line of questioning, I think it was from the Hon. Member for Parry Sound-Muskoka, that, number one, we have targeted the aid under the amendments toward, for example, people in very difficult circumstances who will use the bond where otherwise they might go into bankruptcy. The question was raised: well, if the economy improves, would the Government consider going back to the original use of the bond which was to be available to people who are looking to expand their business rather than to preserve or maintain their business or prevent bankruptcy? My response would have to be the same to the question raised now by the Hon. Member for
Lethbridge-Foothills. The Government will have to keep an eye on the take-up under this Clause. We will have to see how the economy is going. Of course, I suppose the hope of all Hon. Members would be that the economy would be so strong that we could reach a decision that no special attention was required for businessmen, either for expansion purposes or survival or protection purposes.


Cyril Lloyd Francis: Order, please. It being six o'clock it is my duty to rise, report progress and request leave to consider the Bill again at the next sitting of the House.
Progress reported.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Benno Friesen: Mr. Speaker, for many years Canadians have been concerned about the changing standard of morality under the Government of the Prime Minister (Mr. Trudeau). There was a time, for example, when election promises were related to the Government's legislative program, but that is no longer the case. For many months, even years, Canadians have been trying to decipher the standard of morality of the Government. It has been coming to light in bits and pieces but has become more clear in what we now know as the "Gillespie affair". That is why on March 2 I put the following question to the Prime Minister:
On February 17, in answer to a question from the Hon. Member for Provench-er, the Prime Minister said, as reported at page 22938 of Hansard:
Yes, Madam Speaker, we are collectively responsible for the policies of this Government-
The Government as a whole is not collectively responsible for some individual agreement-
That is the nub of the problem in the country, Mr. Speaker. The Government wants to be accountable for concepts but not for administration. Putting it another way, the Government wants to be accountable for discussing an issue but not to be responsible when it makes a blatant error, as was the case in the Gillespie affair. That is why the Prime Minister replied to my question as reported at p. 23366 of Hansard as follows:
If the Hon. Member is talking about the meaning of responsible Government, literally, it means that the Government of the day is responsible to Parliament and can only continue exercising its powers with the authority of Parliament, that is, with the support of the majority of the Members of Parliament. That is what responsible Government means.
March 15, 1983

I think you will agree that that is a new definition of responsible Government.
We are now faced with a choice between the old concept of honour and the new concept of legality. The Prime Minister now seems to be defining responsible Government in terms of legality-if it is within the law, then it is all right. For many centuries women were not legally protected against wife beating but, just because there was no law prohibiting wife beating, that did not make it morally right to do so. It would appear that with the new standards of morality recognized by the Government, there will have to be a limitless agenda of laws to define what the Government can or cannot do. I do not dispute the fact that the law is an important protection, but if the law is the only protection, then conviction of an offence is the only way we can make the Government accountable.
The second part of the Prime Minister's definition is that if Parliament or a majority of Government Members validate any wrongdoing, that constitutes responsible Government. That raises all kinds of possibilities. If the Government can pistolwhip its backbenchers into voting for anything it says, then that will validate anything it does. That, by the Prime Minister's definition, is responsible Government.
I say again, and the Hon. Member can talk any time he wants to, that leaves out any kind of place for honour. It seems to me that we can trust anyone who knows nothing about law as long as they know a lot about honour. But you cannot trust someone who knows all about law but has no sense of honour. That is the choice we have in this country.
This Prime Minister is misdirecting and redirecting the cause of the whole Parliamentary system by redefining responsible Government to mean anything the Government will validate by a majority of Members-meaning if Government Members fall into line with anything the Prime Minister says-is responsible Government.
It was old Falstaff, the drunkard in the battle described by Shakespeare in Henry IV Part I who said, "What is honour? It is a mere scutcheon." It is kind of a coat of arms that you can toss aside. You can change loyalty, depending upon who your leader is because all you do is follow the standard. What did Falstaff do? He ran away in the heat of battle. He became a deserter because honour meant nothing. That becomes the shifting sand of the kind of morality which the Prime Minister is introducing. It means that morality is relative. There is no fixed standard and the Government can get away with anything as long as all of its lackies do anything it wants them to do.


James Scott (Jim) Peterson: Mr. Speaker, having listened to the Hon. Member for Surrey-White Rock-North Delta (Mr. Friesen), it would appear to me that the concept of responsible
Adjournment Debate
Government, and that is the issue, he is advocating is that which is determined by the Opposition to be responsible.
When this question was first raised, the Prime Minister (Mr. Trudeau) stated the constitutional position on the relationship between the individual and the collective responsibility of Ministers. In referring to "agreements which are made by individual Ministers or sometimes by officials under the authorities they have by statute or delegation", the Prime Minister said:
If someone acts improperly in such circumstances, it is not the whole Government that is acting. If a Minister is acting improperly or illegally, he has to be taken to task. However, one could not condemn the whole Government for some act by an individual, unless the whole Government itself had been part of the decision.
Commenting on the meaning of responsible Government, which is the issue here, the Prime Minister noted:
-literally, it means that the Government of the day is responsible to Parliament and can only continue exercising its powers with the authority of Parliament-
Do they want to substitute something else other than the authority of Parliament for this? I continue with what the Prime Minister said:
-that is, with the support of the majority of the Members of Parliament. That is what responsible Government means.
This position is backed up squarely by Sir Ivor Jennings, the leading authority on responsible Government in the twentieth century. He said:
The Government does not accept responsibility for an error of judgment or bad administration by one of its members. The process of Government compels a delegation of authority. The Cabinet must leave to each Minister a substantial discretion as to what matters he will bring before it. If he makes a mistake, then he must accept the personal responsibility.
The constitutional position is clear. The real question is whether there was any mistake or wrongdoing in this case. That issue has been discussed at great length in this chamber, and the House has cast its opinion and exercised its responsibility by way of a vote on this particular issue.


AIR TRANSPORT-WINNIPEG AIR TRAFFIC CONTROL CENTRE-EFFECT ON FAMILIES OF PROPOSED TRANSFER. (B) FUTURE OF PRESENT EMPLOYEES
A. Daniel McKenzie: Madam Speaker, on March 9, I asked the Minister of Transport (Mr. Pepin) a number of questions concerning the Winnipeg air traffic control centre. Tonight 1 am requesting that the Minister of Transport provide a response to the following points at issue affecting employees at the Winnipeg Airport terminal building.
First, the Department of Transport has identified the need to remove asbestos from the Winnipeg airport terminal building. Circular CRA 5/80 dated July 29, 1980 addresses the high level of asbestos in that building. The question is, is the Transport Minister, going to continue to allow workers to enter the building knowing full well the potential health threat? What about the public's access to this health hazard?
Second, does the Government have in place medical testing of the airport workers? If so, is it monitoring the health of the workers until such time as they are removed from the hazard?

March 15, 1983
Adjournment Debate
Third, transport management in the Winnipeg region and at Ottawa headquarters have prepared and supported a detailed proposal to build a new Winnipeg air control centre. Project manager, Ron McFarlane from Winnipeg gave, as an alternative, the division of the work load of Winnipeg controllers to Edmonton and to Toronto, and the relocation of Winnipeg controllers to those areas. What is the cost differential of constructing a new building versus relocating the Winnipeg controllers and associated equipment? What is Treasury Board's position today?
Fourth, does Transport Canada not have a proposed building site on Crown land and immediate access to detailed building plans from Edmonton, Montreal or Moncton? If funds were made available today, what is the earliest date of construction?
Fifth, since Friday, March 11, over 60 grievances have been filed with MOT relating to the asbestos problem, and more are being filed daily. What is the Minister's response to these health related complaints?
The Government has been aware of this potential health hazard at Winnipeg International Airport for some time. The threat is due to vast amounts of the decaying asbestos insulation falling from the ceiling, and contributing to air suspension of asbestos fibres. Scientific research has identified asbestos fibres as a serious health hazard and, in combination with cigarette smoke, the degree of hazard is increased approximately 55 times.
The Minister of Transport (Mr. Pepin) said that the prime concern is the health of the Winnipeg based employees. If the prime concern is, in fact, the safety of these individuals, then why will they have to work in these very unsafe conditions until 1988? I urgently request the Government to undertake immediate construction of a new air terminal administration complex.
The Minister of Employment and Immigration (Mr. Axworthy) angrily denied on March 4 that the employees would be moved permanently. He cut short a speech at the St. Boniface Hospital in order to clear the air. He said, "Any suggestion that the move of the air traffic controllers is permanent is an irresponsible fantasy." He went on to say, "Robertson doesn't know what he is talking about. Treasury Board doesn't make decisions, Cabinet does."
Let the Minister of Employment and Immigration convince Cabinet to build a new Winnipeg air control centre to clear the air.


Jesse Philip Flis: Mr. Speaker, I hope that the Hon. Member for Winnipeg-Assiniboine (Mr. McKenzie) did not expect me to answer all of the questions he posed tonight in two minutes. I think the most important question to his constituents is the health related complaints and the 60 grievances which he has mentioned.
I would like to draw to his attention that, according to samples taken by the Department of National Health and Welfare, asbestos fibre levels are well within the acceptable limits in areas used by employees. It is recognized that employees have taken their own samples which appear to indicate higher levels. These discrepancies are being addressed. In one particular instance where it was felt that levels were particularly high, the room in question was given a thorough cleaning and new samples will be taken in consultation with the employees.
As a long term measure, Transport Canada has decided to remove the asbestos in the administration building, which is where the concerns have been raised. The present plan is for this work to be done in the fiscal year 1987-88. Had the Hon. Member been at the Standing Committee on Transport this morning, he would have heard the air administrator, in response to constructive questions and suggestions by the Hon. Member for St. Boniface (Mr. Bockstael), undertake to see if the work could be advanced.
During the work, employees may have to be temporarily relocated. If they are, they of course will be eligible for all expenses allowed under the relevant Treasury Board directive. As the removal was not planned for the immediate future, the need to relocate and the details associated with it have not been fully established. When they are, I am sure they can be made available to the Hon. Member on his request.
I would like to emphasize that there is no intention of jeopardizing the health or safety of employees. All reasonable precautions to protect them have and will continue to be taken.


MEDICAL CARE-CONTRACT TO MANAGE HAWKESBURY HOSPITAL. (B) QUERY RESPECTING MINISTER'S POSITION
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, on January 26 I asked the Minister of National Health and Welfare (Miss Begin) a question concerning the approval which the Ontario Government had just given to a contract signed between the District General Hospital in Hawkesbury and the Canadian subsidiary of American Medical International, the contract under which the corporation would manage the hospital according to profit criteria and, of course, in return would receive a share of whatever profits it could generate.
At that time I asked the Minister whether or not she considered the contract to be in violation of one of the five basic principles of Medicare, the non-profit administration principle. She answered that it was her understanding that it was only the over-all health insurance plan which had to be run on a non-profit basis, but that institutions related to the plan could run on a profit basis. Of course, practitioners within the system have traditionally operated on a profit basis, and we are not quarreling with that at this point in time. The question is whether or not hospitals ought to be run on a profit basis, and whether or not that contradicts the principles of Medicare.
March 15, 1983

Today I hope I receive a longer and more elaborate response from the Ministry to my contention that this does violate the spirit of Medicare and sets a very dangerous precedent for health care in this country. One of the justifications for Medicare and one of the reasons so many people fought over the years for Medicare, was that we would have health care provided according to health care criteria and not according to the dictates of the marketplace.
With the operation of a hospital by a corporation in the expectation that it will receive a share of whatever profits it can generate from the operation of that hospital, the profit motive is being reintroduced into our health care system in a manner which my NDP colleagues in the House and I find to be totally unacceptable. It is on that basis that we encourage the Minister not only to do something about this particular instance, but also, perhaps, to do something about any potential instances, by coming forward with a proposal for Canada Health legislation, about which there is so much mystery right now.
No one knows exactly the latest proposal in the minds of those in the Cabinet, or in the mind of the Minister of National Health and Welfare. I have asked the Minister before to come forward with an actual proposal for a Canada Health Act. I hope she will do so, and that in such Act we will find clarification of the non-profit principle which would outlaw this kind of contracting on a profit basis for the provision of hospital care. I would hope also that in that Act, among other provisions, we might find clarification of the portability principle.
Just the other day, someone called my office concerning a move from B.C. to Manitoba. Having been hospitalized in Manitoba, after the patient moved from B.C., coverage was nevertheless provided under B.C. medical insurance until the end of the year. It turned out that the per diem rates in B.C. were different than those in Manitoba. The upshot of the whole problem was that the particular patient involved was sent a bill for $1,436 for 23 days in hospital in December. The fact is that this can happen under our system, when everyone believes that such a thing should not happen. This situation must be addressed by the Government and the Provinces so that this kind of burden will never be placed on the sick in Canada. They must meet to arrive at an agreement whereby this kind of penalty will not be imposed on people. In this case, it simply involved the misfortune of bad timing, through no personal fault; a bill of $1,436 was the result.
A Canada Health Act, if it is a good Act, could go a long way toward preventing such situations, among others. As I say, it must follow all five basic principles of Medicare. It must have regard to nonprofit, to portability and, I hope, and we will be demanding so, also have regard to universality and equal access. This brings in the whole matter of extra billing. However, it is not my intent to discuss that today.
I would like to hear what the Hon. Member has to say on behalf of the Ministry of National Health and Welfare
Adjournment Debate
concerning the status of the Canada Health Act. At this point, it is mysterious. People are writing letters about it and wondering about its contents. All we have is the draft the Canadian Medical Association is sending around to various Members of Parliament and to the public. It has no official status. We would like to know what the status of those negotiations is, and what the Government intends to do in the meantime, through legislation such as a Canada Health Act, to deal with this very dangerous precedent set by the Ontario Progressive Conservative Government. This is a precedent for the further privatization and commercialization of medicare in Ontario, a province where, I must say with a great deal of regret, medicare is severely under attack by a Government that obviously is not philosophically committed to the principle, and continues to charge premiums and so on. What does the Government intend to do about this?


Mr. Denis Ethier (Parliamentary Secretary to Minister of the Environment):: Mr. Speaker, it is understandable that the Hon. Member should talk and behave like this, for far from his interests and concerns are the hospital care and services for the people in the Hawkesbury area. Surely the Hon. Member for Winnipeg-Birds Hill (Mr. Blaikie) would not object to better hospital care or the construction of a new hospital in his region; why, then, does he persist in his opposition concerning the Hawkesbury situation?

In January, 1983, the Board of the Hawkesbury and District General Hospital entered into a 12-year contract with a private firm, American Medical International (Canada) Limited to manage the hospital's operations. This arrangement has been the focus of concern of some Canadians.
I must point out that the establishment, maintenance and management of hospitals is an exclusive provincial responsibility under Section 92(7) of the Constitution Act, 1867.
It has been alleged that the contract between AMI (Canada) Limited and the Board of the Hawkesbury and District General Hospital violates the principle of public administration of the national Medical Care Program. I wish to point out that the principle of "public administration," which appears in the Medical Care Act (Canada) refers to "a medical care insurance plan of a province." It requires the plan to be administered and operated on a non-profit basis by a public authority appointed or designated by the Government of the Province.
In any event, there is no comparable provision under the Hospital Insurance and Diagnostic Services Act (Canada), although, in fact all provincial hospital insurance plans are publicly administered. The Medical Care and the Hospital Insurance and Diagnostic Services Acts cannot be interpreted as meaning that medical practitioners cannot make a profit or that hospitals providing publicly-insured services must be publicly owned and operated on a non-profit basis in order for a Province to qualify for federal contributions.

March 15, 1983
Adjournment Debate
It is reported in the media that Mr. Grossman, the Ontario provincial Minister of Health, said that the Hawkesbury and District General Hospital will be closely monitored to ensure that health care does not suffer under a private management firm. Also, the hiring of AMI is seen as an experiment, and the hospital will be told to break its contract with the firm if it attempts to cut services as a money-saving measure. The hospital will not be permitted to charge for any insured services or to extra-bill patients, and it will be dealt with in exactly the same way as every other hospital in Ontario. All measures taken by AMI must be approved by the hospital board.
Hospital officials and the Ontario Ministry of Health officials are reported to feel that the contract will not result in a deterioration of patient care. In fact, it is hoped and believed that the quality of care will improve under increased management efficiency.


Mr. Deputy Speaker:: Order, please. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.
At 6.24 p.m. the House adjourned, without question put, pursuant to Standing Order.

Wednesday, March 16, 1983