1983-02-17

GOVERNMENT ORDERS


Hon. Marc Lalonde (Minister of Finance) moved: that Bill C-143, to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, upon my appointment as Minister of Finance I said that one of my basic tenets would be fully to inform the Canadian people fully of the economic situation as I saw it. I have done this repeatedly and consistently since my appointment as Minister of Finance, and I will continue to do this today and in the future Not only is it a right for the Canadian people to know of the economic situation in the country, but I also believe it is essential for the confidence and solidarity that will ensure economic recovery.
I am pleased to open debate on the borrowing authority Bill which is before us today. This Bill is one in a series of necessary steps being taken to deal with the extremely difficult economic situation facing this country. The Bill is a reflection of the massive financial support that the Government of Canada is providing to the economy and particularly to the victims of the recession. It reflects the severity of the recession itself.
The need for a borrowing Bill before the end of this fiscal year on April 1 was spelled out in my economic statement of October 27. At that time, the Government reaffirmed its commitment to help those who need it the most through the Unemployment Insurance Program, the Canada Assistance Plan and a number of other initiatives such as direct job creation.
This help was given at the very time when revenues were falling rapidly because of the recession. The inevitable effect of this humane and vital provision of economic support is an increase in the deficit and in the borrowing requirements of the Government. I laid it all out in October and I appreciated the wide support for this approach from Members of the House and individuals and groups all across Canada.
In fact, the need for this Bill at this time was one of the few sure things on which we could depend in an inherently volatile economic situation. If any Hon. Member is surprised by this Bill, then he or she was not paying attention to the real world outside.
After I assumed the Finance portfolio almost five months ago, I was asked how long I would need to settle into the job. My reply was to the effect that I was not sure how much time I would need, but I already knew how much time was available; that is, virtually none. Looking back, I now realize how fortunate I was not to have had a lot of time to settle in. The economic and financial ground on which we were treading had all the less desirable qualities of quicksand. The last thing any of us would have wanted to do, indeed, would be to settle in.
Clearly, the economic situation is starting to show more positive developments. There are more and more signs of an emerging recovery. However, it would be premature to say today that the economic and financial footing has completely stabilized. The risks remain high, but they will diminish considerably if we all work together in a determined effort to pull this country through. We in this House should be vigorously supporting the emerging new economic momentum, and that means getting on with the business at hand.
The Bill is just one in a series of important steps following the October statement. Another major step was the introduction of the income tax legislation which would provide certainty by clearing up unresolved tax issues dating back to November, 1981, and which includes adjustments announced in my October statement.


Miss MacDonald:: And more.


Marc Lalonde: At the same time, extensive pre-budget consultations have been going forward vigorously, toward the goal of presenting a new budget before the end of this fiscal year, if the parliamentary schedule allows.
Before looking in some detail at the Bill before us, I want to provide a brief update to the economic and fiscal situation. In my October statement to Parliament, I indicated that the real Gross National Product was expected to fall by 4.4 per cent in 1982, and that unemployment was expected to decline very slowly through 1983.


Mr. Epp:: And then what happened?


Marc Lalonde: Indications are that the recovery did not commence in the late months of 1982, as I hoped it would, and

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I now estimate that the decline in the real GNP last year was close to 5 per cent.
One of the victims of this recession, among others-


Arthur Jacob (Jake) Epp: Is the Liberal Government.


Marc Lalonde: -has been the art of economic forecasting. As one forecaster for Chase Econometrics in the United States described it, "the year 1982 will go down as probably the worst year in memory for economic forescasters".


Arthur Jacob (Jake) Epp: And Finance Ministers.


Flora Isabel MacDonald: For two million unemployed as well.


Marc Lalonde: For example, in the summary of forecast prepared by the Conference Board of Canada, the average forecast of some 15 private sector groups last summer was for a decline in real GNP of 0.7 per cent. That is a long way from the likely outcome of minus 5 per cent at the moment.
Of course, there is some good news.


Mr. Blenkarn:: Like what? Face an election.


Marc Lalonde: Sure. The Hon. Member asks like what.


Arthur Jacob (Jake) Epp: You are resigning! Tell us.


Marc Lalonde: I ask the Hon. Member to listen very patiently, to consider the reality, and he might learn a few things. Inflation has moderated quite rapidly since the six and five program was put in place last June, very rapidly indeed.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Marc Lalonde: The 12-month increase in the Consumer Price Index to December was 9.3 per cent, well down from the 13 per cent peak reached in the summer of 1981.


Flora Isabel MacDonald: And unemployment was up.


Marc Lalonde: There has been a 7.2 per cent average annual increase in the Consumer Price Index since last June. That trend appears to be continuing downward so that we can indeed look forward to reaching a 6 per cent range in the course of 1983. Also, and in parallel, interest rates have fallen very substantially, and it is now possible to obtain a one-year home mortgage for under 12 per cent and a five-year mortgage for 13.5 per cent.


Mr. Lewis:: If you have a job.


Marc Lalonde: These, at least, are encouraging signs. I might once again point out to the Hon. Member opposite that tomorrow, for instance, the largest Canadian bank will lower its prime lending rate to 11.5 per cent. One would have to go back several years to find as low a rate of interest in the Canadian economy.


Mr. Fisher:: 1978.


Marc Lalonde: As my Parliamentary Secretary indicates, the interest rates have not been as low as they will be tomorrow since 1978.
Many forecasters have recently again revised down their expectations for this year. If I may quote Chairman Mao, "Those who forecast should forecast frequently".


Arthur Jacob (Jake) Epp: Look what happened to him!


Marc Lalonde: Most of the private sector forecasts which i have recently seen have projected real GNP growth for 1983 to be in the 1 per cent to 2 per cent range. I plan to outline the Government's own projections for 1983 and the years beyond in my forthcoming budget speech.
As I have already indicated, the delay in the economic recovery has had the effect of further reducing federal revenues and increasing financial requirements. Under the Financial Administration Act, statutory borrowing authority must be obtained from Parliament in order for the Government to increase its outstanding debt. The Bill currently before the House seeks new borrowing authority of $19 billion. This amount is made up of $5 billion supplementary borrowing authority for 1982-83 and $14 billion interim borrowing authority for 1983-84.


Arthur Jacob (Jake) Epp: Why?


Marc Lalonde: As Hon. Members will recall, so far this fiscal year the Government has obtained borrowing authority amounting to $21.1 billion. This amount is made up of $3.5 billion of unused borrowing authority carried forward from earlier years; $6.6 billion for 1982-83 provided by Bill C-111; $7 billion provided by Bill C-125 and a further $4 billion provided by Bill C-128.
As a matter of interest to Hon. Members, I would like to set out the Government's debt program so far in the current fiscal year and the amount of borrowing authority that has been used to date. To February 1 1, 1983, a total of $20.6 billion of borrowing authority had been used of the $21.1 billion authorized. The use of borrowing authority is made up of $0.9 billion as a result of foreign borrowing and about $19.7 billion as a result of the domestic debt program. The main component of the foreign borrowing was the borrowing of $750 million U.S. in the Eurobond market last June. The domestic debt program comprised approximately $7.1 billion raised through the net issue of treasury bills; $4.5 billion through the net issue of marketable bonds; and after taking the net redemptions into account, $8.1 billion through Canada Savings Bonds.
Hon. Members will note that the amount of borrowing power already obtained for 1982-83 is smaller than the $22.2 billion financial requirements forecast last October in my statement in this House. The latest projections now forecast financial requirements at $26.1 billion for 1982-83. The upward revision of $3.9 billion of financial requirements since
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October reflects a downward adjustment of S2.5 billion to the revenue forecast, an upward revision of $1.2 billion to projected total outlays and a $0.2 billion change to estimated annual budgetary transactions.
The projected budgetary deficit for the current fiscal year rises to $27.2 billion, up from $23.6 billion since the October statement. The increase in the deficit is slightly less than the increase for financial requirements because of the non-budgetary component of the latter which I have mentioned.
From the press reports of the past two days, it appears that some have been confusing the financial requirements of the Government with the Government's deficit. This is somewhat surprising since over the years the two numbers have not been identical. As I just mentioned, the figures as of October 27 were $22.2 billion for financial requirements and $23.6 billion for the deficit. The deficit, of course, reflects the same economic pressures that have increased our financial requirements since October. It equally reflects the Government's commitment to ease the impact of the recession on individual Canadians and the economy as a whole.
Revenues from the corporate income tax, the personal income tax and the petroleum and gas revenue tax have all been falling short of previously anticipated levels. The increase in total outlays is primarily the result of non-discretionary cost increases for statutory programs, most notably public debt charges, Government contributions to Unemployment Insurance extended benefits, equalization, Established Programs Financing and veterans' pensions.
It also includes a $240 million adjustment to cover anticipated additional requirements under the Canadian Home Ownership Stimulation Program. As of January, 1983 a total of 158,900 grants worth $476 million had been issued under this program, which obviously has been a great success. Finally, non-budgetary transactions are now expected to provide a somewhat smaller net source of funds than forecast earlier because of further widening in the Unemployment Insurance account deficit.
In summary, about 72 per cent of the increase in the estimated financial requirements for 1982-83 since the updated projections in October, 1982 reflects revenue losses and higher than expected debt charges as a result of the delay in the start of the economic recovery. Another 28 per cent consists of a variety of recession-related expenditures such as those required under established income support programs. Increases in Unemployment Insurance payments account for almost one-third of these expenditures.
In light of the estimated financial requirements for 1982-83 which I have just outlined, Part I of this Bill requests additional borrowing authority for this fiscal year of $5 billion. This amount of borrowing authority, in addition to the amounts already available for this Fiscal year, will result in total authorized borrowing authority equal to the financial requirements for 1982-83.
Members will note that in Part I of this Bill, as in Bill C-125 and other previous borrowing authority Bills, some portion of
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the authority is to be non-lapsing. In the case of the present Bill, the non-lapsing amount will be $2 billion. The need for the non-lapsing authority rises from the uncertainty of the date of the passage of this Bill and the desire to tailor the Government's borrowing operations to financial market conditions. Thus, it may be that some of this year's financial requirements will be temporarily met by a rundown in cash balances. Nonetheless, the financial requirements must ultimately be met by borrowing and the non-lapsing amount in the authority provides a basis for such borrowing after March 31 of this year.
Concerning fiscal year 1983-84, it is still too early to forecast what the total financial requirements will be. They will, of course, depend upon the measures to be included in the budget. They will also depend upon the course of economic developments through 1983 and 1984, and my officials and myself are still reviewing the economic outlook. The results of this review will be outlined in the budget which I will present to the House.
However, I would like to announce at this time that the Government has reviewed the expenditure framework for 1983-84, and for planning purposes has agreed on a total outlay target of $88.9 billion for 1983-84. This represents an increase of 9.6 per cent relative to total outlays in the current fiscal year.
The President of the Treasury Board (Mr. Gray) will be providing Parliament with detailed expenditure Estimates for 1983-84 on February 22, when he tables the Main Estimates, and I will be providing Parliament with full information on the Government's expenditure plan, including any changes the Government may make for the current fiscal year, at the time of my budget.
I intend to introduce a Bill covering all of the borrowing authority needed for fiscal year 1983-84 after providing Parliament with the necessary information in my budget. This Bill will also take into account the interim borrowing authority to be granted on the basis of the Bill now before the House.
It is desirable that Parliament have adequate time to study and debate the budget as well as the new borrowing authority. At the same time, it is necessary for the Government to carry out its debt program in an orderly, efficient manner, and this will require borrowing authority. Our request in Part II of the Bill for $14 billion borrowing authority for part of 1983-84 is based on both these considerations I have mentioned.
Financial requirements in 1983-84 will continue to be high. The amount of interim authority requested, however, is sufficient to last into the summer, and this will provide a stable basis for debt operation while Parliament is considering the budget and the related borrowing authority Bill. I might note that the first fiscal quarter is a period of particularly heavy seasonal cash requirements because of tax reforms which amount to roughly $6 billion and other factors. It is, therefore,

February 17, 1983
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of particular importance that borrowing operations not be hindered by borrowing authority constraints.

Let me now explain in more detail why passage of this bill and provision of interim borrowing authority for 1983-84 is important.
As members are probably aware, Government of Canada securities currently outstanding amount to more than $113 billion, and financial requirements are such that they will require that the outstanding debt increase by an average of about $2 billion every month. In addition, previously issued debt is coming due and must be re-financed. For example, something in the neighbourhood of $1.25 billion worth of Treasury bills must be re-financed each week and there are significant maturities in the bond market.
Clearly, given the size of the financial operations which I have just described, even a savings of a small fraction of one per cent can imply significant dollar amounts. Since the major objective of debt management is to minimize public debt charges it is important that the borrowing program can be planned and operated in an orderly and efficient manner and that the Government have the flexibility to respond to attractive financing opportunities. Clearly, adequate borrowing authority is necessary for this to be achieved.
Another important objective of debt management is compatibility with the smooth and efficient operation of the financial markets. Besides being cost-effective, this helps to ensure that federal borrowing operations do not interfere with borrowing activities by other levels of government or the private sector. Adequate borrowing authority is essential for the type of planning and flexible response to changing financial market conditions which ensure that the financial markets are not disrupted by government borrowing.
There is an additional need for ensuring adequate borrowing authority which has been mentioned in previous debates-that is the impact of exchange market operations. The estimated financial requirements which I have been discussing do not take into account any possible impact from exchange operations. When the Canadian dollar is firm, as it has been in recent months, exchange reserves will increase. To finance this increase, Canadian dollar must be borrowed and charged against the borrowing authority. On the other hand, in periods when the Canadian dollar is under heavy pressure and our U.S. dollar working balances are low, these U.S. dollar balances are supplemented by drawing on the standby credits which the government has with the Canadian and international banks.
Thus, if the government is to carry out its responsibilities under the Currency and Exchange Act in an efficient and cost-effective manner, borrowing authority must be in place to accommodate exchange market pressures.
To sum up, dealing with this bill in a business-like and responsible manner and providing adequate interim borrowing authority will benefit the taxpayer by helping to minimize public debt charges. It is also in the interest of other public and private sector borrowers who could be affected if government borrowing operations were distorted, and will assist government policies to support the continuing smooth functioning of both the financial and the exchange markets. As some members may know, Section 39 of the Financial Administration Act permits the Government to raise funds with terms to maturity not to exceed six months if, in the opinion of the Governor in Council, there will be insufficient funds to meet disbursements.
In the event that Section 39 is used, I would not wish that its use result in authority to borrow more than I am requesting in the bill currently before this House. Therefore, I would be prepared to amend the bill at committee stage to deduct from the $5 billion sought for this year any amounts borrowed under Section 39. In any case, Section 39 is an emergency-measure and is not designed for long-term use. The Government would be extremely limited in its debt operations since it would be able to raise new funds only through the issue of three- and six-month Treasury bills.
The sale of one-year Treasury bills and bonds has been and will continue to be a major source of funds for the Government. Use of these sources is not possible under Section 39.
While I have put considerable emphasis on the need to carry out the government's borrowing operations in a business-like and cost-effective manner, I would not wish to leave members with the impression that I lack confidence in the strength and flexibility of Canada's financial markets. The people working in the Canadian financial markets are among the most skilled and resourceful in the world. Our financial markets have in the past shown a great ability to adapt to meet changing demands placed upon them. This view of the financial markets has been confirmed in my consultations with business and financial people when I have asked for their advice on the risks of crowding out in the debt markets because of the high government borrowings. Canada continues to have an extremely high savings rate-13 per cent of disposable income-which supports the view that our capital markets are equal to the task. One might add that the best evidence to date for this view is that interest rates have fallen dramatically even during a period of heavy government borrowing. Let me emphasize again, however, that any disruption in the Government's debt program caused by delay in passing this legislation will risk unnecessary public debt charges and inconvenience for other public and private sector borrowers.
As I have made clear, government has a responsibility to provide support to economic activity through the deficit in times such as these. But government has an equal responsibility not to impede the private sector from playing its role as the
February 17, 1983

main engine of economic growth in the recovery period that lies ahead.
So, while Honourable Members may share my concern about the government's debt program, an even greater concern is the health and vitality of the private sector. It is of course impossible to link the funds borrowed by government to specific expenditures. However, I have already outlined the major causes of the increased financial requirements, and they are part and parcel of the impact of the recession which the deficit has served to cushion. Likewise, in the next few months, the Government faces heavy spending commitments arising out of measures designed to ease that impact. In addition, in the next few months the Government will have to pay out more than $6 billion in tax refunds-a source of considerable immediate stimulus to the economy in its own right. I would remind Honourable Members that timely payment of refunds depends on approval of the income tax legislation which I mentioned earlier as one of the vital steps to economic stability. There is thus added urgency in getting on with the task at hand over and above the need for orderly and efficient management of the debt program.
Before closing, I want to emphasize that financial requirements have risen because of unexpectedly harsh cyclical forces. The Government of Canada remains committed to its longer term goal of systematic restraint of its expenditures as a proportion of the GNP, and to systematic reduction of the deficit as well. It is important to recognize that substantial reductions in the deficit were achieved in fiscal years 1979-80, 1980-81 and 1981-82, as illustrated by the fact that the Government's financial requirements dropped from a level equivalent to 4.8 per cent of GNP in 1978-79 to only 2.5 per cent of GNP in 1981-82. The weak economic situation at the present time has seriously eroded Government revenues and inflated Government expenditures; a strong recovery would obviously have the opposite effect.
Canada has suffered an extremely severe recession. Tax bases have fallen and unemployment has risen. The fiscal position is very sensitive to economic conditions and has been dramatically affected by these developments. We must keep these matters in proper perspective when interpreting the present deficit level.
I might add that in my consultations during recent months, there has been strong support from a wide range of groups for continued restraint by Government, particularly as exemplified by the six and five program. Yet while there has been widely shared concern about the deficit, no one has asked me to cut away the safety nets for those truly in need. Nor was I asked to increase greatly the burden of taxation at this time. There is wide agreement that the best way to reduce the deficit is to support the economy through this difficult period and return as quickly as possible to economic growth.
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Our plans have been dealt a severe blow-no question about it. So have those of virtually all Canadians. The temporary increase in the deficit to help those who need help the most is playing a vital role in maintaining the strength needed to provide a base for economic recovery. It is time for all of us to play our part in building up that strength and that recovery in the months and years ahead.
I therefore invite Hon. Members to address this Bill at long last on second reading. We will have an opportunity to debate it in the House and to consider it at committee stage. There will be opportunity for full debate on the Income Tax Act, which has been before the House for some time and has already been the subject not only of extensive consideration by a parliamentary committee for many weeks since last fall but has also been examined by the House for several days, on second reading.
I have indicated the importance of addressing this issue in a responsible and expeditious way in order to ensure that we will have a debt management program that will be efficient, will involve the least possible cost to the taxpayer and cause the least possible disruption of financial markets.
The money required for the rest of this year has been fully explained. I have indicated why the money is required, what the financial situation of the Government is for 1982-83, and that the additional amount of $14 billion for 1983-84 is required as an interim payment. After my budget, I intend to introduce another borrowing authority Bill which will cover the full 1983-84 period. At that time Parliament will have a full opportunity to examine the total requirement of the Government in 1983-84 in light of the budget that I will present and the Estimates that will be presented to the House on February 22. Parliament will, therefore, have before it all the facts that it needs to make a decision in the full knowledge of the implications of the various decisions that are required.
As far as the Bill is concerned, it is quite clear. I do not think I need add much to what I have already said.

I therefore invite the House to give serious consideration to and expedite the passage of a Bill that is of vital importance to ensure that our country's economic recovery, which has now started, will continue, to prevent problems on the financial market and to provide for sound and effective management of the public debt. The funds borrowed by the Government will benefit Canadians. As I said before, these funds are mainly borrowed on the domestic market and are used to finance Government programs aimed mainly at easing the impact of the recession on many Canadians, especially on those drawing unemployment insurance benefits, those on welfare and those benefiting from the Government's direct job creation programs. These sums are also necessary because as a result of the recession, both individuals and corporations are paying less in taxes than they were paying when wages and corporate profits were higher.

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I hope now that economic recovery has started it will continue throughout 1983. According to our projections, inflation will continue to drop, and economic growth is expected to accelerate in the course of the year as incomes of private citizens and corporations increase. When this happens, government revenues, and the Canadian Government's revenues in particular, will increase as well, making it easier for the Government to reduce the deficit and the substantial financial requirements it cannot avoid at the present time if it is to take at all seriously its responsibility as a Government, during a recession as serious as the one we have experienced.


Donald Alex Blenkarn: Mr. Speaker, I wonder if the Minister would answer a few questions before I commence my remarks. There are some things about which he has left us in the dark and perhaps he would answer some questions first.


The Acting Speaker (Mr. Blaker):: I want to make it clear to the Hon. Member for Mississauga South (Mr. Blenkarn) that the new system of ten minutes for questions, answers and comments referred to in the Permanent and Provisional Standing Orders does not apply to the presentation of a bill.
If there is unanimous consent to an exchange of questions and answers, that automatically implies that the Minister would accept them. The House may wish to proceed in that fashion, but there is nothing in the Provisional Standing Orders that would permit an exchange of questions and answers.


Philip Derek Lewis: Mr. Speaker, Members of this Party would agree to giving unanimous consent at this time to allow the Minister to answer a few questions.


Marc Lalonde: Mr. Speaker, the Bill is going to committee and I will appear before the committee, when there will be plenty of opportunity to answer any questions put by Members on this side of the House or on the other side. I do not think we should change the rules of the House at this time. If the Hon. Member has any questions he will have plenty of opportunity to ask them then. As a matter of fact, I am very eager to hear what he has to say-if he has anything to say.


The Acting Speaker (Mr. Blaker):: There is not unanimous consent.


Donald Alex Blenkarn: Mr. Speaker, it is with a great deal of sadness and distress that I address the House today. That sadness and distress is more explicit because the Minister of Finance (Mr. Lalonde) is afraid or unwilling, or both, to give to the House the financial projection that it is entitled to receive. We have received no tables, no statements, no projections with respect to unemployment, with respect to the deficit in the Unemployment Insurance Fund or with respect to what is happening with the Established Programs Financing Act which he says is paying out more money. That Act is somehow tied to a floating GNP rate.
We have no idea why the Minister wants a $2 billion nonlapsing borrowing authority for next year. He pulls out of the air a need for $5 billion, which he says he will have to borrow within six weeks because the year end is March 31. Yet he refuses to explain himself. He refuses to answer questions. But what does he say to this House and to the people of Canada? He says: "Trust us."
Yesterday we found out how we should trust the Liberals, and this Minister who signs agreements that make sure a friend of his gets a fee of $600 a day. The Minister has told us about the people who are unemployed. He has told us about the employment programs of this Government. What about the $800 a day for a former Minister? What about $450 a day for a former candidate? These are the very important employment programs?
The Minister said he did not have time to settle in because of the quicksand, but he has settled this country in quicksand, and he knows it.


Mr. Lambert:: Don't forget the National Energy Program.


Donald Alex Blenkarn: The Minister said Chairman Mao was concerned about forecasting. I thought that remark in his speech, comparing his activities to the activities of Chairman Mao was rather interesting. The forecast cannot be given to us because it is Chairman Mao's operation perhaps that is running this Government.
We do not have any figures, sir. We are asked, because of the condition of the financial markets, to rubberstamp a Bill which, in total, gives the Government of Canada the authority to borrow an amount of $19 billion against the credit of Canada. We have a Minister who refuses to stand up in this House and answer questions. That is unforgivable.


Mr. Cosgrove:: That is not what he said.


Donald Alex Blenkarn: It is totally wrong and it is not the kind of thing that we should expect from any Government.
Let me remind the Minister of what his predecessor said to the Standing Committee of Finance, Trade and Economic Affairs in May, 1982. I shall now read his statement into the record. The then Minister of Finance said this:
I would not expect the House to act upon an additional request for borrowing authority without providing it with detailed information on the economic situation and the implications of that situation on the government's fiscal situation. I do not think it would be appropriate to ask the House for additional borrowing authority until I have laid out in some detail an update of both the economic situation and the fiscal situation, and I certainly will be doing that before I would come back to the House for additional borrowing authority.
That has been the pattern of all responsible Governments, all responsible Ministers, until now, until yesterday, until today. We have a Minister who says: "Trust us; we want $19 billion, trust us". But every projection and everything he has said to date leaves us with no ground whatsoever on which to trust him.
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Canadians are pretty concerned because the Minister says the only thing that is holding up the country is Bill C-139, and somewhere along the line the passage of that income tax Bill, which significantly increases taxes, will somehow make it possible for this whole problem of borrowing to go away. That does not make sense.
If you have a situation where both the economy and business in the country are turned off, how would you expect to turn them on again by increasing small business taxes by 12.5 per cent, by reducing capital cost allowances in the first year by 50 per cent and by limiting interest deductions for new capital expenditure? Indeed, how would you expect any businessman to want to go ahead and expand when facing him is Bill C-139, a most destructive Bill, a most disincentive-minded Bill, one that is anti-entrepreneurial, anti-growth and anti-business? Yet this Minister talks about the private economy being the engine of growth, and he asks us to trust him.
The Minister has taken us down a garden path which is a garden path over quicksand, Mr. Speaker. He has talked about quicksand. Let us talk about the quicksand in which he has put this country.
First, the amount of this borrowing Bill will destroy confidence in this country. There is no question that this Government is now asking us to approve borrowings, presumably unlimited borrowings, because $19 billion, he says, will only last him until this summer. The Minister is asking us to approve borrowings that amount to nearly $1 billion a week from now until the end of June. He says that will give us confidence to build the country, to make it grow.
He also says he is not going to crowd out the business field. Let us examine that. On a current basis, the personal savings this year are somewhere around $31 billion per annum. That is not $19 billion between now and the end of June; that is $31 billion for the whole year. Between now and the end of June personal savings are nowhere close to the amount required by this Government.
The Government has been helped recently because there have been some corporate savings as a result of a depression in the corporate field. Business has been turned off; inventories have been depressed. Therefore, some savings have been generated from the lessening of business activities in the country. But that is not likely to continue. Indeed, if it does, if the business community continues its net savings, heaven help our opportunities for employment in the country.
This Bill and the Government's borrowing requirements, on top of Government borrowing requirements from all Provinces-and I remind the House that even the Province of Alberta, previously a Province which generated huge surpluses, is now out in the market looking for money-will, in fact, crowd out business and people who want to borrow to expand, to build homes, to build plants and to provide jobs. This Bill is the expropriation of virtually all the savings in the country to finance Government. It would be all right if the Government were using money in a productive fashion, but we all know that this Government is really a great consumer, a great spender
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for consumption, rather than the spender for the creation of capital, new work, new buildings and new projects. This country's savings are being taken by the Government and spent on consumption. If we allow this to happen, it will prevent any recovery from this depression. I say depression, not recession, because that is our situation today. The Government has failed to devise any program or give any direction to ameliorate the depression in any way or give us any hope or confidence for the future.
Some say that Government spending and borrowing is stimulative. I would remind the House that when the Prime Minister (Mr. Trudeau) was first elected in 1968, the Government deficit was $497 million. There were 358,000 people unemployed. The Minister has told us today that his deficit for this year will be very close to $27.5 billion, or $27,500 million. Unemployment today is at 1.6 million or 1.7 million. How many people are discouraged or really are not working? How many are involved in worksharing or are on training programs? Those people are not working either. Therefore, what is the real unemployment figure? Perhaps it is 2 million or 2.5 million. The Government said unemployment is at 1.6 million, but what is the real figure?
Has the Government's borrowing been in any way stimulative? The answer is no. In fact, it has been one of the main factors that has led to the destruction of employment and the destruction of the hopes and dreams of Canadians.
We must remember that interest must be paid on money that is borrowed. If $5 billion is borrowed at 12 per cent interest, it means that $10 billion is needed to pay back in five years. This borrowing Bill which asks for $19 billion means that $38 billion will be paid in five years, if it is paid back by then. If it is not, it doubles in the next five years and doubles again in the five years after that. That is where the Government is headed when it introduces one borrowing Bill after another.
We now see the introduction of borrowing Bills that do not give us any projections. We do not see any projections because, if the Government projected its future borrowing requirements and the interest it would have to pay on that money without any possibility of paying it back, Canadians would rise up and throw the Government out. I say that Canadians will rise up and throw the Government out. We must throw the Government out because it has destroyed our system. It has destroyed our business sector and has destroyed the hopes and dreams of many Canadians. It is now in the process of destroying our financial system completely. Our financial system cannot realistically support the debt which the Government is asking us to approve.
We are often asked what we would do if we were in Government.


Paul James Cosgrove: We know. That is why you left.


Mr. Malone:: Oh shut up, Cosgrove.

February 17, 1983
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Donald Alex Blenkarn: A year ago we told the Government that it was about time that a committee of the House was formed to seriously set the priorities for Government spending, to eliminate all but the most absolutely essential expenditures. That view was echoed by the Auditor General in his Report to the House last fall. It was further echoed in a proposal made by the Canadian Chamber of Commerce in their pre-budget submissions to the Minister.
The fact of the matter is that the situation has become most serious. The Minister says that his revenues are down and that 72 per cent of his problems are a result of decreasing revenue. The answer to those problems is that we must set our priorities straight and at some point come to grips with whether our priorities are for old age pensions or VIA Rail. We may have to come to grips with whether it is parks or payments made to people under the Canada Assistance Plan. We are getting to the point where we can no longer finance the budget with these kinds of requirements.
There is no question that it is acceptable to borrow money over a short period if one is able to pay it back. However, money cannot be borrowed year after year when there is no possibility of paying it back. There is no hope to pay back the money being asked for in this borrowing Bill.
We are told that the President of the Treasury Board (Mr. Gray) will produce his Estimates on February 22. I suggest it is about time that he did so. 1 hope those Estimates will effectively reduce some of the Government's costs. I hope those Estimates will eliminate some of those troughs from which money is drawn by program after program to pay for more administrators, more forms and more patronage jobs-the CHIP, the NIP, the DIP and a host of others. There is a volume of programs that requires administrators and people to review those programs that, when analyzed, may be desirable but not totally necessary. The House of Commons must come to grips with our spending to keep it more in line with our ability and the ability of the country to meet those expenditures. Until we accomplish that, people will not be employed again, Canadians will not be able to own their own homes and the confidence in our country will not be restored. Our nation will not be built. We should be talking here about building our nation.
A nation cannot be built by trying to borrow itself rich. No one has ever borrowed themselves rich. You do not print yourself rich either.


Mr. Evans:: It depends what you do with it.


Donald Alex Blenkarn: My friend from Ottawa Centre (Mr. Evans) says that it depends on what you do with the borrowing. Let us examine what is done with the borrowing. It is mostly spent on the interest from previous borrowings. The Government has to borrow more money all the time just to pay the interest. The last projection we saw included $17 billion in interest. We do not know what the current projection is because we do not get one. We do not get a projection because the Minister is afraid to give it to us.
As we proceed with this borrowing Bill, we see a further erosion of the tax base in the country. The Minister said in his press release that his tax receipts are down. He says that he will therefore have to borrow the money to make up for that reduction. In any business, if one's income is down one does not go to the banker and say: "Because my income is down I have to borrow more money". Bankers will throw you out. That is what we have to do with the Government. We have to throw it out. The Government cannot tell us that its revenue is down and therefore, since it cannot possibly cut its spending, it must borrow the money for its expenditures. That is just incredible. There must be some relationship between borrowing and the ability to pay it back. Payback of this borrowing is impossible.
What we really have here is a Government which no longer has the support of the people of Canada. Forty-nine per cent of the people of Canada replying to a Gallup poll indicated that they do not want this Government. They want another Government, a Government composed of people from this side of the House. The Government and the Minister of Finance know that. However, rather than let the people of Canada have their way in a general election, which the people of Canada now want and need because of the Government's profligate waste, it has entered a scorched earth policy. With its tax measures, its bureaucracy, its regulation and its control, it is destroying businesses. With its attitudes-the way in which it looks after its friends and runs a fat trough, the way it operates without giving any projections or basis for sound economic belief, management and leadership, which it should be supplying-it destroys public confidence. Now with this Bill and its management of the economy of the country, it is destroying the very financial system itself. Its attitude seems to be that, if it cannot govern, no one else will govern because there will be no country left to govern. That is the way it goes about it. That attitude is what we must stop, and we must stop it in this House of Commons now.


Paul James Cosgrove: Blenkarn for leader.


Mr. Thacker:: Cosgrove for dog catcher.


Donald Alex Blenkarn: We could go on to discuss some of the things which I think will disturb the financial markets more than anything. The Minister spoke of the fact that his financial requirements will be exceptionally heavy for the first quarter of the next coming year. That is why he said that for the spring quarter he has a borrowing requirement of $14 billion. He may need more than that. He said that he may not spend all of the $5 billion he wants between now and March 31, so he may want to use some of that money in the first quarter as well.
A capital market account written by Hugh Anderson for yesterday's Financial Times, of Canada, indicated the following:
It's one thing to talk glibly about financing $30 billion deficits, but it is another thing to actually see it done. We're looking at a federal issue every three
February 17, 1983

or four weeks, which means the provinces will have to rush in somewhere between, whenever the market seems firm enough.
What this means is that anybody who wants to buy bonds this year will have plenty to choose from. There will be no need to chase a rising market. As they say about the bus you just missed, there'll be another one along in a minute.
It is a rush-hour all right. It is a rush-hour for the Minister to go out to the markets of this country to borrow the kind of money he is talking about in the Bill. It is that very rush-hour attitude toward borrowing that we on this side cannot tolerate.
Imagine the nerve in saying to the House of Commons, "Here is a Bill for $19 billion. I do not have any projections, fellas. Maybe I will make a budget, maybe I will give you some projections then, but in the meantime, trust me and ram it through in a hurry, because if you do not, you will upset the financial requirements of the country and will make me use Section 39 of the Financial Administration Act, and perhaps somewhere along the line we will have to pay more for our money than we would otherwise."
That is not believable. On the very face of it, it is incredible. The Government, by presenting the Bill in the fashion it has, has lost the moral right to govern.


Some Hon. Members:: Hear, hear!


Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, it is with very little pleasure that I rise to speak to Bill C-143 today. We have just witnessed a spectacle in the House of Commons today with the Minister of Finance (Mr. Lalonde) standing and asking the people of Canada, through the Members of this House, to approve the borrowing of another $19 billion.
I am afraid that the Government, most recently through the Minister of Finance, has presented us with a horror story and has turned the House of Commons into a house of horrors. He has turned Parliament into a horror house and, quite frankly-


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: -the people of Canada will find out from newscasts later today that the Minister of Finance is asking for additional borrowing authority which will push the deficit projection up to $27.2 billion, up 16 per cent from October. That is a 16 per cent error in four months. If there is anything that clearly demonstrates to the people of Canada that the Government is completely out of control when it comes to fiscal management, a 16 per cent error in four months must certainly do so.
To add insult to injury, the Minister tells us in his statement that next year the Government will abandon its six and five program. It has spent hundreds of thousands of dollars in fancy brochures sent to every person who would consider picking one up, and many people who would not even consider it, saying that it wants everyone in the country to follow the six and five restraint program. It has passed Bills in the House providing that Family Allowances will be restricted to 6 per cent this year and 5 per cent next year so that the mothers and children of Canada will have their expected incomes restricted to 6 per cent. Senior citizens receiving Old Age Security will not receive an increase reflecting the rate of inflation, keeping
Borrowing Authority
their measly pensions at the existing level. The Government will restrict those increases to 6 per cent and 5 per cent. The same is true concerning retired Armed Forces and RCMP personnel as well as retired civil servants.
The Minister of Finance came into the House of Commons today and said: "Folks, we have great news for Canadians. We will jack the deficit up now by an additional 16 per cent from what we thought back in October, up to $27.2 billion, and next year our expected expenditures will be in excess of 9.6 per cent. Abandon six and five. Our revenues will be up by at least 9.6 per cent." Mark my words, Mr. Speaker. Based on the ability to project which has been demonstrated by Hon. Members opposite with their senior civil servants advising them, if they say that it is expected that expenditures will be up by 9.6 per cent next year, we know that that is an error, virtually by definition.
Yes, the Government has created a horror House of Commons. I have listened to the Minister of Finance representing the Government and saying: "I want Hon. Members opposite to listen carefully to me because they might learn a few things". Can one imagine a more unlikely instructor, teacher, professor or guru than the Minister of Finance, who has been telling Hon. Members opposite to listen carefully, to learn about fiscal management? My goodness! That is like asking Jesse James to advise on banking or Clifford Olson to advise on parenting skills. This man opposite, masquerading as Minister of Finance, has turned this place into a theatre of the absurd.
The people of Canada are going to be out there today listening to what is coming out of this House on the Government side, shaking their heads in disbelief and saying that they cannot believe that this Government is adding $5 billion more without saying a single word about how it is going to spend those funds. Then it says it has another great idea; it is going to ask for an extra $14 billion. $14 billion, $15 billion, $25 billion, who cares?
I remember when not six months ago the then Minister of Finance stood in his place and projected a deficit of up to $23 billion plus. At that time I said I would not be a bit surprised if, when the final results come in on this deficit raise, it will be closer to $30 billion. Members opposite howled and laughed and scoffed and said: "What a dreamer; what an unbelievable projection that is!" Yet we have the Minister of Finance rising today and saying that the best guesstimate of the Government at this time is $27.2 billion. Mr. Speaker, we know that the deficit is going to be higher than that. We know absolutely that it is going to be higher than that.
Let me talk positively for a moment about the Minister's speech. He spoke for 45 minutes and when I listened to those 45 minutes of delivery I identified two statements that I thought were of a positive nature.


Mr. Ogle:: He had the day right.

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Borrowing Authority


Nelson Andrew Riis: He had the day right, my colleague for Saskatoon East Mr. Ogle says. He did not have his figures correct because, as he admitted, he has been so far out in any projections and virtually all of the projection houses have been so far out that we can ignore them, and he said he was going to predict that next year things were going to get better anyway. I think that his credibility and the Government's credibility has gone the way of the dodo bird. It is no longer here.
However, to give credit where credit is due, the Minister of Finance said that the deficit would be used for contributions to Unemployment Insurance extended benefits. We in this Party say that is a positive move. It is a desperate move but it is positive. It is going to ease the pain for literally hundreds of thousands of Canadians-one could almost say millions of Canadians. Almost 2 million Canadians will listen to this news with some glee. Also he said that this deficit that he is asking us to support in principle today includes a $240 million adjustment to cover anticipated additional requirements under the Canadian Home Ownership Stimulation Program. We say that that is positive as well. Apart from those two statements in 45 minutes of delivery, that is it. I cannot think of another positive thing to say about what the Minister of Finance has said in this House this morning.
Not only is this situation in which Canadians find themselves today a fiscal disaster but it is a human disaster, a human calamity. We hear all kinds of things about $14 billion here, $5 billion there, the need to strengthen the dollar and so on. In other words, a total delivery using numbers in terms that 90 per cent of Canadians do not understand. But I notice that he did not once refer to the people of Canada. He did not once refer to the hardships that millions of people in this country are experiencing today. He did not refer to the pain of people sitting at home who have been unemployed for months and months and know that they are about to go on welfare unless something happens, so they listen to the Minister of Finance (Mr. Lalonde) today to see what is going to happen. And what does he tell us? He does not tell us a single thing about what is going to happen. He just says: "Give us more money, that is all that I ask for".
That is like my young son, who is 12 years old, saying to his father: "Dad, I want to borrow $200". I would say: "That is interesting, son, but what are you going to use that $200 for? Are you trying a little business venture? Are you going to do some investing? Do you want to purchase something?" He replies: "Dad, I am not telling; just give me $200. I am not going to tell you what I am going to use it for. Trust me." I trust my son but I would have a little reluctance in falling over myself to give my son $200 to spend as he deems appropriate, without some discussion.
Can you imagine a small businessman, a farmer or fisherman going to his bank or credit union and saying: "I want to borrow $200,000. I need this money. Please, let us sign the papers." Of course, the banker or the financier would ask: "What is this money going to be used for? How are you going to invest it? What is your cash flow? What is your marketing strategy? What is your track record? How many people are
employed? How are you going to approach the sales?" If that businessman said: "I am not going to tell you anything. I have no idea how I am going to spend $200,000 but I sure would like it", the banker would say to that small businessman, farmer or fisherman what we are saying to the Minister of Finance-"Forget it, because we are not going to give you authority to spend taxpayers' money"-


Paul James Cosgrove: Yesterday you wanted to double the deficit.


Nelson Andrew Riis: -"to go out and borrow $14 billion plus $5 billion without telling us a single thing about how it is going to be spent".
Do Government Members think we are dodos over here, that we are going to stand here and give them authority to do that? I am looking forward to their speeches a little later, to listen to how on earth they are going to explain to the people of Canada why the Government is going to ask for $19 billion without telling us how it is going to spend it.
Perhaps it will say that it will rely on its track record. If a small businessman used that approach when seeking money and said: "Just look at my track record; I have been a dismal failure for the last decade", again we will respond as that banker would respond. We will say that that is not good enough, that we are not prepared to give that kind of support today and we are not prepared to give that kind of support tomorrow.
I said, Mr. Speaker, that this was not only the beginning of a fiscal calamity or disaster, it is a human disaster. There is an old Hindu proverb that says: "Where there is no dream, the people perish". That Canadian dream has now become a Canadian nightmare and the people are perishing. Canadians are despairing from one end of this country to the other. It can be seen in their eyes. When one visits a hard-pressed part of the Third World, as my colleague for Saskatoon East has many times, and walks the streets talking to groups of people, there is a sense often of despair in the people's eyes. They have struggled for 40 years of their lives trying to raise their families, only to find that the corruption in those countries often makes it impossible for them to succeed. They eventually get that hollow look in their eyes, that depressed look, that sad look, that look of "I have given up".
One can look at pictures of people during the 1930s in our country, during the depth of the Depression, and see that same hollow look in their eyes. One sees in pictures of refugee camps today that same hopeless look in their eyes, that emptiness. That is what we are seeing in Canada today.
I think the most disappointing experience I have had in the last few weeks was when I was visiting a number of secondary schools in my constituency to talk to the graduating classes, only to find that those young people are saying: "What is the use? Why should I continue to study hard and go on to a postsecondary education when almost everyone I know is either out of work or will be shortly? Why should I study hard in my schooling? What is the hope of struggling and going on? What is the purpose? My father has worked 20 years in a plant and
February 17, 1983

is now laid off; he is 54 years of age and likely will not get a job again. My brother who has completed university is driving cabs because he cannot find a job in the computer industry."
That is the kind of weight, Mr. Speaker, that is coming down on the shoulders of Canadians; but, most important, it is coming down on the shoulders of Canada's youth. In Canada's youth is Canada's future, and that depression, that weight and despair are pulling down that group at the age when they should be full of zest, life and vitality. Exactly the opposite is happening. I emphasize that part of the reason is the actions of this Government and the kind of statement it is making to the people of Canada through Bill C-143.
The people of Canada have been losing faith in their elected representatives and in their Governments. I suspect that if the popularity level of many politicians today was to be evaluated, they would be at the bottom of the heap along with child molesters, tax collectors and the like. Why is that? What is happening? When we look at the record of this Government, it becomes very clear.
We have two million people out of work. We have thousands and thousands more going on welfare because their Unemployment Insurance benefits are terminating. Employees are under incredible stress because of cutbacks and the resultant additional workload. People are experiencing burn-out and overwork more than ever before. They are struggling to make ends meet. Single parents are attempting to raise children on an income of $9,000 a year. By and large, the senior citizens of this country live below the poverty level in spite of what the Prime Minister (Mr. Trudeau) says about the floating poverty line.
With this kind of situation, with people tense and concerned about the future for themselves and their children, the Prime Minister says: "Shucks, all Canadians are skiing or down in the Caribbean on beaches". What does that tell us about the Prime Minister? He has not only lost touch with the people of Canada but with reality. If he thinks that Canadians are doing one of two things, either skiing or on beaches in the Caribbean, any psychiatrist will tell you that is a clear indication that this man, who is presumably leading our land, has lost touch with the real world. There are not many people from the constituency of Kamloops-Shuswap who have money to spend on the ski slopes or on holidays on Caribbean beaches. Virtually no one there is in either of those two categories.
This is the same man who thinks it is a good idea to limit the income of pensioners, to limit the income of families through Family Allowance restrictions, and to give the chairman of the task force looking into the state of the economy $800 a day, plus expenses. When travelling across the country, he will get much more than that. The Prime Minister thinks that is appropriate. That is more than senior citizens get to live on for an entire month. The Prime Minister thinks it is appropriate in these times of restraint and difficulty to give that individual $800 a day plus.
Borrowing Authority
It is very clear that our Prime Minister never goes door-knocking in his constituency or those of others. He never sits in coffee shops and talks to normal folk. He does not sit in pubs and talk to those who work in the mines, plants and offices of this country. He does not talk to normal people.
The Prime Minister of Canada does not speak to normal Canadians. He speaks to the high-powered group of advisers around him, the senior lobbyists, senior mandarins, people who are not struggling and are not threatened by job loss, the Ian Sinclairs of the world. That man is quite prepared to take a 6 per cent restriction of his increase, which will be in excess of $50,000 for the next year.
It is a dark day for Canada when we have to look to an individual to provide leadership during these very difficult times who has lost touch with reality. One begins to wonder whether that same loss of touch has not rubbed off on other members of his Cabinet when we find the Minister of Finance standing in his place and asking us to push through post-haste $19 billion so that they can get on with the job. Some job he wants to get on with!
The people of Canada are having a difficult time supporting with enthusiasm this present Government. Government Members have criss-crossed Canada asking people to restrain, introducing monetary policies that force people to restrain. Now they have changed their minds and are criss-crossing the country asking people to spend, invest and expand. You cannot go out one day and ask people to cut back and restrain, and then get on the next plane and ask them to spend, borrow and expand.
In his darkest moments before going to sleep at night, I am sure the Minister of Finance wonders why the people of Canada are not expanding their plants, factories and firms. The reason is that they have lost faith in the political leadership of this country. There is only one way to change that. In order to bolster and build confidence in the future of this country, we have a big task at hand, namely to change the leadership of this country. 1 want to say that it is time for a new vision.


Mr. Whelan:: Diefenbaker said that years ago.


Nelson Andrew Riis: Yes, Mr. Diefenbaker said that years ago. J. S. Woodsworth said it years ago as well. They said we need a vision for the people of Canada, we need a dream, we need to give some hope. In order to accomplish that, we have to give some direction. We have to send a clear message to Canadians in every part of this land that this is the economic plan that we wish to see for this country. This should be done after a great deal of consultation with all levels of Government-federal, provincial, regional, local-and proper consultations between management and labour. That would provide the people of this country with a vision of what Canada should and could be.
Canadians know in their hearts that they live in the richest country on earth, a country with more natural resources per capita than any country on the face of this globe. Here we are struggling and stumbling over ourselves as the Government lurches from crisis to crisis. The Official Opposition are
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February 17, 1983
Borrowing Authority
running at each other with swords trying to impale and disembowel each other. We wonder why people have lost confidence. I suggest that we consider an alternative. I wonder if it would be proper for me to move a motion at this point regarding the Bill before us. I would move, seconded by the Hon. Member for Kootenay East-Revelstoke (Mr. Parker):
That this Bill be not read the second time until after February 22, when we have had time to examine the tabling of the Main Estimates for the fiscal year 1983-84.
I have indicated very clearly that it is time in this country for a new vision. Canadians in their hearts and souls know what this country can be. It is time to put fear and uncertainty behind us and take steps to see what Canada can be and ought to be. It is time we faced the future head on with a bold innovative and creative program for the future of our country.
One of the guideposts, Mr. Speaker, which we must include in such a vision is a commitment in this country to full employment. With the small population which Canada has and its abundant resources in both natural, human and financial terms, there is no reason why we cannot set as a realistic goal full employment for Canada.
We are at a very critical point in our economic history right now, Mr. Speaker, where we are either going to advance or retreat, and, unfortunately, we have to look to the Members opposite to give us either the direction to advance or to bring in policies which will guarantee a collapse of the economy in this country.
I heard the Minister of Finance earlier talk about the future and I remembered distinctly reading in Hansard the comments which the various Ministers were making in 1930. It seemed like deja vu, Mr. Speaker. In 1930 Government Members were standing up and saying: "Things are about to turn around. We are optimistic. Indicators point to an economic upturn. We have confidence in the future. We are not going to do anything, but we have confidence."
Unfortunately, that is exactly the point at which Canadians find themselves today. We must now launch an energetic program of recovery which will have full employment as part of its mandate. It will involve the co-operation of all regions of Canada, as well as the various sectors of the economy, both in economic terms as well as political. We must make a commitment to retain the existing social programs which are in place and to build and improve on them. We must no longer allow ourselves to be an appendage to the economy of some other country.
We realize that to accomplish these goals there will be costs which Canadians are going to be asked to share. There will be some very difficult times in accomplishing these goals. But the sacrifices, Mr. Speaker, must be made on the basis of equality. Fighting a war on inflation or building a recovery program must not be done on the backs of Canada's unemployed. It must not be done on the backs of Canada's women or Canada's minority groups, as the present Government is doing at this time. It must be done on an equal basis, and that means we
must continue to oppose Bill C-139, a Bill to amend the Income Tax Act, because it perpetrates an injustice in this country. That Bill is telling Canadians that taxes will be increased for low and middle-income groups but will be decreased for the wealthy, and that is something, Mr. Speaker, that the Hon. Members of this House must oppose until their dying breath. That kind of injustice will make economic recovery impossible in this country.
Another factor which will make economic recovery in this country impossible is that there are two million people out of work. This figure is growing by the week and, by the Minister of Finance's own admission, will continue to grow during 1983. It is impossible to have economic recovery in this country with the albatross of two million unemployed around the neck of our economy, and it will be impossible until the Government addresses that problem head on.
The Government's priorities in the upcoming budget must be three-fold-jobs, jobs and more jobs. It will be a clear signal to Canadians that this Government means business and that it is going to get the economy moving once again when it deals, along with its recovery package, with the serious unemployment situation.
We in the New Democratic Party have a concern about this deficit. We see it as an unproductive deficit because it is unplanned. I remember the previous Leader of the Progressive Conservative Party supporting something he called, I believe, a "stimulative" deficit. We would like to see the Minister of Finance stand up and clearly demonstrate how this increased deficit will eventually result in a reduced deficit. I would like to hear the Minister of Finance say: "If we are going to go into a deficit situation, this is our recovery plan. This is the way we are investing these borrowed funds to result in an eventual return to the people of Canada." But he does not say that, Mr. Speaker, and we know that this money is not being invested in economic recovery infrastructure. This deficit is just continuing more frivolous Government spending, by and large.
If it is not, then I would beg the Hon. Members opposite to stand in their places and explain how this additional $19 billion of borrowing is going to result in eventual economic return to Canadians. A deficit per se is not necessarily a disaster. Every businessman knows it is sound business practice to borrow money and invest it in order to get a return. That is what the New Democratic Party has been saying for some time, that if we are going to borrow money, let us ensure it is wisely invested, at least.
In terms of planning for a deficit, I believe it is critical that we, as Parliamentarians, realize that our economy in this country is at a crucial turning point, that where our economy went down in a recession or depression, most of it is going to be coming back in a different location. The economy of the 1980s and 1990s will be significantly different from the economy of the 1960s and 1970s.
I ask Hon. Members opposite whether they realize the incredible economic transition and revolution which is going on in this country at this point, because I see no evidence that they do. During this excellent opportunity for the Minister of
February 17, 1983

Finance to give the people of Canada a demonstration that the Government understands the significance of this economic turmoil and is prepared to deal with it, for him not to utter a single phrase, which would indicate the Government understands what is happening to the Canadian economy, I think is tragic. It is unforgivable. If the people of Canada had a thread of hope and the Government had a thread of credibility left, it has been ripped apart today.
It is interesting, Mr. Speaker-now that the Minister of State for Economic Development (Mr. Johnston) has arrived-to find that we have just completed a so-called agreement with the Japanese auto industry. I want to say to the Minister that a small country like Trinidad, which welcomes the import of automobiles because it does not make any of its own, said to the Japanese companies: "You can sell all the Japanese vehicles, including trucks, in our country that you like, but you have to assemble not 20 per cent, not 50 per cent but 100 per cent of those vehicles in our country. We want to create employment for our people in Trinidad."
The Japanese companies went along with this, Mr. Speaker. That is a country with a population of 1.2 million people. Here in Canada we have 24 million people, the seventh major trading country of the world for the Japanese auto industry, and we do not have them assemble a single automobile in Canada. What kind of negotiating, what kind of planning, is that?
In summary, let me say that the Minister of Finance missed a golden opportunity today to present the Government's game plan strategy to the people of Canada, to tell the people of Canada how the Government would be using this borrowed money for their benefit. He said nothing. My closing comment, Mr. Speaker, is that we have been asked to buy a pig in a poke and we are not buying it.


The Acting Speaker (Mr. Blaker):: Order, please. The Hon. Member for Kamloops-Shuswap (Mr. Riis) has presented a motion, a reasoned amendment, which asks that the Bill not be read a second time now but rather be read only on certain conditions. I am not clear from his motion whether it is two conditions or one, but it seems to imply it ought to be either after February 22 or after the presentation of the Main Estimates, or both. However, both of those are conditions.
It is brought to my attention that the motion as an amendment may suffer from a lack of relevance to the principle of the Bill, and 1 underline the word "principle". However, I want to rely, in ruling on the admissibility of the motion, on the attaching of conditions. In that regard I refer the Hon. Member to Erskine May, Nineteenth Edition, page 500, subparagraph (2)(k), which reads:
-nor is it permissible to propose merely the addition of words to the question, that the Bill be now read a second time, as such words must, by implication, attach conditions to the second reading.
That is the intent of the motion put forward by the Hon. Member for Kamloops-Shuswap, and with regret I have to find that it is out of order.
Borrowing Authority


Miss Pat Carney (Vancouver Centre):: Mr. Speaker, we have before us today a request by the Government to borrow an unprecedented amount of money to pay unspecified bills for programs which are not yet clearly identified. The $19 billion which the Government is seeking to borrow represents a Government which is bankrupt in terms of revenue, bankrupt in terms of ideas and policies, and bankrupt in terms of moral authority to impose this kind of burden on the Canadian taxpayer.
This blank cheque which we have before us, and which we are asked to authorize, represents nothing more than an unwanted legacy for the next Government of Canada, which will be a Conservative Government. It is an attempt by the Government to put off to the future the difficult task of paying for the debts run up by a Government which has proved itself incapable of managing the country's economic affairs.
Taxpayers should clearly understand that borrowings of this size represent a deferred tax increase on them, a tax increase that taxpayers will inevitably have to assume. It represents a constraint on this Government's ability to govern and on future Governments' ability to set national priorities for years to come. It represents the legacy of a Government which has clearly washed its hands of any attempt to manage the economy in a credible manner, and instead is dumping the entire responsibility for the economic problems facing this country on to the backs of the overburdened taxpayer in the future.
Finance Minister Lalonde insists that this huge borrowing authority is required to underwrite the costs borne by the recession. His assumption is clearly that borrowings on such a huge scale, which amount to claims on Canada's economic future, will help resolve the economic problems facing us. If that were in fact the case, we would be much more receptive to his demands. But Mr. Lalonde-


Douglas Glenn Fisher: Order.


Pat Carney: -does not make this case based on any evidence. I recently completed a trip through the interior of my home Province, British Columbia. It was a sombre experience in the sombre season of mid-winter. In the towns I visited the lumber mills are silent, the mines are shut down, the motels and restaurants are nearly empty. "For sale" signs and foreclosure notices sprout forlornly along the streets which are subdued and quiet. There is an uneasy absence of activity. Now, we would like to think that these billions sought by the Government will help restore some life to these centres. However, there is little indication they will.
Like other MPs, I continually deal with the problems of the unemployed who stop us in supermarkets, on the streets, in the coffee shops, asking for advice. They want to know what to do when their Unemployment Insurance benefits run out. They want to know how to survive until their welfare cheques are processed. Most of all, they want to know when there will be an end to all this economic stress. But again, there is no indication when faced with this Bill that it contains any answers except to borrow, borrow and borrow again.

February 17, 1983
Borrowing A uthority
All across the country the silent plants, the business failures, the fire sales, equipment auctions and the half-excavated apartment sites are mute testimony to the failure of this Government to address the real problems faced by the economy. These real problems stem from deep structural changes. These changes include the probability that some of the mines of this country will never reopen. Half the labour force in the mining industry is out of work. There is a grim realization in the construction and forest industries that many of the people who are now out of work will never return to their jobs. There is a growing fear that many of our young people may spend the best part of their youth looking for job opportunities which are simply not there. None of these problems is addressed in this Bill seeking the authority to borrow $19 billion.
Any creditor who went to any financial institution in this country seeking this kind of credit or financial borrowing without giving more details on how the money will be spent, and more importantly how the money will be repaid, would be refused by any responsible financial institution. Yet this Government is asking for its second borrowing authority Bill in three and a half months. It is asking for $5 billion in supplementary borrowing authority for the current fiscal year which ends in six weeks' time, and for $14 billion in interim borrowing authority for the next fiscal year, 1983-84, which the Minister suggests might last him until mid-summer. It is asking for this scale of borrowing at a time when many small businessmen in this country have had their lines of credit slashed and which face the mercenary practices of the Department of National Revenue, which is squeezing every dime out of every pocket, out of every bank account, out of every receivable it can lay its hands on.
The irresponsibility shown by this Government and its arrogance in seeking this kind of borrowing authority without specifying a clear and sufficient reason for doing so merely adds to the rage of Canadians who are frustrated, who are seeking a job to support their families, who are trying to keep their own businesses afloat, or who have had to shelve their own plans for developments or planned expansion because they simply do not have the money or the credit facilities to do so.
We would be much more willing to debate and pass this Bill if we knew what the money was needed for, when it is needed, how reliable the Minister's information is, and how much of this borrowing authority is requested because of the Government's mismanagement of public debt. We would also be much more confident if the Government's performance over the last few years had been more credible. But this Government has shown no inclination to reduce its expenditures, nor have we seen much benefit accruing from its high rate of spending for the past few years.
I would like to consider these two points in more detail. First of all, I would like to deal with the issue of credibility and accountability. The Government seeking this incredible borrowing authority has a track record of wildly inaccurate
forecasts. In his November, 1981 budget, Mr. MacEachen, then the Finance Minister, said the budget deficit would be $10.5 billion for 1982-83. Seven months later the unfortunate Mr. MacEachen revised that figure upwards to $19.6 billion. By October of the same year the budget deficit had risen still higher, to $23.6 billion and still climbing. Today the Minister indicates that the current forecast of the budget deficit for the current fiscal year will be in the order of $27 billion.
I would remind the House that this is the Government which thought its financial requirements for this year would be $6.6 billion. That figure again was adjusted upwards to $17.1 billion, and then $22.2 billion. Today the Government is asking for another $5 billion on top of these amounts.
Given that track record, how can we believe any figures the Government gives us now? How can we believe these figures when the Finance Minister indicates he will be back before this House, possibly as early as mid-summer, to seek even more borrowing authority?
It is now one o'clock, Mr. Speaker.


The Acting Speaker (Mr. Blaker):: Before I leave the chair, I wonder if I might draw to the attention of Hon. Members that the practice is to refer to Members or Ministers by their title or their riding rather than by their names. Personally, I hope Members may some day choose to refer to one another by their surnames rather than by riding title, but in the meantime that is the rule.
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. Jean-Guy Dubois (Lotbiniere):: Madam Speaker, I am pleased to rise today under the provisions of Standing Order 21 to speak about the new grain transportation policy.
Last week, the Canadian Federation of Agriculture held a meeting in Ottawa and delegates from the Province of Quebec were in attendance. Along with a few ministers, we had the opportunity to meet with the Quebec delegation, particularly the President of the Agricultural Producers' Union of Quebec, permanent APU member Jacques Proulx, Federated CoOperative President Mario Dumais, Mr. Paul-Emile Saint-Pierre, a Federated Co-operative official, as Mr. Dumais is for
February 17, 1983

the APU, and Mr. Andre Bergevin. We had discussions on the impact of the new grain transportation policy.
This policy has been the main topic of conversation, particularly in Quebec. I should like to tell the people of my riding, Quebecers in general, and especially the farmers in Quebec that we reached two agreements at that meeting. First of all, Madam Speaker, APU and Federated Co-operative officials will get together with Agriculture Canada and Transport Canada officials to talk about the various figures which have been mentioned in the Province of Quebec about the cost of transportation and other production costs, and as a result of those talks it has been agreed that we would meet with the people who are responsible for that matter here in Ottawa and with the Quebec caucus Members who are directly concerned with this question, with a view to airing the different opinions we might have and calmly considering all possible solutions, if any.



SCIENCE AND TECHNOLOGY


Mr. Joe Reid (St. Catharines):: Madam Speaker, Canadians are proud of their country. Yet, when they think of their future, and read reports such as that recently released by the Conference Board of Canada predicting that the recession-ravaged Province of Ontario will suffer yet another loss of 25,000 jobs, putting that many more or that same number out or work, they wonder about their future as well as that of their country.
We have a labour pool of skills and a wide range of educational facilities. Yet we as a nation spend comparatively few dollars on research and development, science and technology.
Recently the Minister of State for Science and Technology (Mr. Johnston) announced that Canada would not host the building of the International Centre for Generic Engineering and Biotechnology. At the same time he recognizes the need for such a centre here in Canada. Brock University has ready and available a fully equipped laboratory suitable for that purpose, and in the interest of both present and future Canadians I urge the Minister to plan accordingly.



FINANCE


Mr. Bill Yurko (Edmonton East):: Madam Speaker, the Minister of Finance (Mr. Lalonde) addressed this House earlier today on the borrowing requirements of the Government and briefly on the fiscal state of the nation. It was not a comforting scenario that he presented.
The projected Government deficit for the current year has exceeded $27 billion, an astronomical amount equivalent to $1,125 per person in Canada, or in excess of $3,000 per working Canadian. He announced that the 1983-84 federal Government expenditure framework is targeted at $88.9 billion, up almost 10 per cent over the current fiscal year. He also advised that revenues from corporate income tax, personal income tax, and petroleum and gas revenues have fallen substantially. This suggests a massive deficit for the 1983-84 fiscal year. He concluded that Canada has suffered a severe recession. Tax bases have fallen and unemployment has risen.
An economic crisis exists in the land, Madam Speaker, and a First Ministers' conference should be scheduled immediately to plan the road to recovery co-operatively.



PHYSICAL DANGERS OF KICK BOXING

Mr. Stanley Hudecki (Hamilton West):: Mr. Speaker, kick boxing is a form of martial art that is growing in popularity both in Canada and abroad. In kick boxing, both the hands and feet are used by the opponents to strike blows to the head of each when they meet in a ring to engage in competition.
What is unknown at this time, however, is how dangerous kick boxing can be. According to a spokesman for the Ontario Athletic Commission, there have been reports of severe facial injuries, including facial fractures, especially among youngsters who take up the sport. The impression of one Toronto neurologist, who is considered an expert on boxing injuries, is that kick boxing is a dangerous sport that should be looked at closely by the Ontario Commission.
Reports such as these have led the Ontario Government to ban kick boxing pending a government study into the possibility of serious head injuries to those participating in the sport. The Government of Ontario is to be complimented for taking the initiative in planning the study. I strongly urge the Department of National Health and Welfare and all provincial Ministers of Health to follow the example being set by the Ontario Government and initiate a full scale investigation into the sport of kick boxing, to co-ordinate their investigations and studies to control the serious body damage that this sport can generate, and to implement adequate regulations.



METRIC CONVERSION


Mr. Gordon Towers (Red Deer):: Madam Speaker, I have in my possession an internal memo from the Metric Commission in which a bureaucrat wrote and explained to a leading Canadian company president that metric conversion was a voluntary process. This will come as news to a great many Canadians.

February 17, 1983
The latest victim of the forced march toward metric is the dairy industry. The three-quart pouch packs and jugs will go metric next April, and the President of the Ontario Dairy Council estimates the new milk packages will probably cost about 40 cents more. The President of Dominion Dairies is on the record as stating "We're at a time when we should be avoiding increased costs. There is no doubt in my mind that increased costs will be passed on to consumers."
There are no indications that, once packaging new metric containers has been paid for, prices will be reduced. There are no benefits to be derived from the conversion of milk. To the contrary-it is the view of one of Canada's largest milk retailers that the industry and consumers are being "cheated and ripped off' by the unnecessary and expensive conversion costs. It is idiotic and unfair for a Government to put an unnecessary extra burden on the consumer at this time.



HUMAN RIGHTS


Robert Joseph Ogle: Madam Speaker, yesterday at a United Nations meeting on human rights in Geneva a report was delivered which indicated that two million people throughout the world have been executed in the last 15 years without trial, without appeal, and without lawyers. I should like to go on record today as indicating that the people who have been executed are human beings like you and me-men, women, people politically involved, people not politically involved, rich, poor-a cross section of humanity. Thirty-seven countries were listed as being involved in the event.
The person who made the statement to the United Nations Commission yesterday is Amos Wako, a Kenyan lawyer. He asked that the world community monitor this taking of human life. I think the House of Commons and the Government of Canada should be aware that this injustice is taking place around the world.
I would ask the Government to think seriously about forming an all-party standing committee on human rights to monitor, to publish, to condemn but, most important, to be a parliamentary group that would advise the Government about this abuse as it relates to the whole section of activity that takes place between countries.



EMPLOYMENT AND IMMIGRATION


Mr. Andre Maltais (Manicouagan):: Madam Speaker, I want to emphasize that the Canada Community Development Programs sponsored by the Department of Manpower and Immigration are very important in my region. Thanks to those
programs, we have made significant achievements in cooperation with other Departments.
Last week, I met with some people who are working within those programs, and I would like to ask the Minister of Employment and Immigration (Mr. Axworthy) whether it might not be advisable next year to look into the scale of salaries paid under these programs and to make a distinction between people who have a family to support and others who have fewer responsibilities, because they are all paid the same salary. I wish the Department would examine this matter and review the salary scale since, under this program, there are men and women who have heavier responsibilities and might be paid more.
Therefore, Madam Speaker, I would urge the Minister to take this matter under consideration because, in my opinion, it is essential that we continue to work in cooperation with the Department of Fisheries and Oceans, Transport Canada, and the Department of Indian Affairs and Northern Development to create temporary jobs. Our only difficulty stems from the salary scale, and I think that could be improved very quickly.



AGRICULTURE


Mr. J. R. Ellis (Prince Edward-Hastings):: Madam Speaker, on Thursday last in answer to a question by my colleague from York-Sunbury (Mr. Howie) regarding severe frost damage to Eastern Canada apple producers, the Minister of Agriculture (Mr. Whelan) indicated that he was aware of requests from both Ontario and Quebec. To use his words, "Quebec's damage is in the order of $62 million." Recently the Ontario Apple Marketing Commission went on record as requesting assistance for the apple growers in Eastern Ontario whose trees had been destroyed. My understanding is that the Eastern Ontario figure is close to the Quebec figure. The interesting part is that the better producing orchards were hardest hit.
In the few minutes I have I would like to add to the mix a problem which I have mentioned to the Minister many times in the past. It has to do with damage to sour cherry trees. One orchard in my riding has lost 8,000 trees as a result of the cumulative effect of frosts in 1980-1981. There is a market for this product, and the initial cost of replacing the trees is perhaps not beyond the reach of the owner. However, to pay the interest rate necessary to support such a loan for the five to seven years before the trees begin to bear fruit is just not possible. I want to use this time to urge the Minister of Agriculture as strongly as possible to take whatever action he can to help in this matter of great importance to area farmers.
February 17, 1983



UNEMPLOYMENT INSURANCE


Mr. Cyril Keeper (Winnipeg-St. James):: Madam Speaker, we all know about the situation of Pat Albert of Sudbury who was to have his unemployment insurance benefits cut off for a day because he had attended the funeral of his wife. It is not the first time this kind of injustice under the rule has taken place. Thank goodness the Government is bowing to public pressure and Pat Albert will not have this one day's benefit taken from him, and a 48-hour policy directive for funerals will be issued.
But the problem is bigger than this individual case. What we have here is a situation of David and Goliath. The unemployment insurance system is Goliath. It has the power of information, the knowledge of the Unemployment Insurance Act, the knowledge of the regulations and administrative directives, and the power to change those directives. Poor David is the individual Canadian unemployed for the first time who is faced with this administrative machinery. We have to give David a slingshot.
We have to create advocacy agencies for unemployment insurance claimants, funded by the Department of Justice. This would give professional knowledge to individual citizens when they have to deal with the unemployment insurance bureaucracy and would make it possible that, once in a while, the rules would work for the individual and not just for the bureaucracy. David could then slay Goliath once in a while.



HARBOURS


Mr. Mel Gass (Malpeque):: Madam Speaker, I would like to address the very serious problem of silting in Rustico harbour, which is presently harming the fishing industry in Prince Edward Island. This problem could eventually affect the existence of the Village of North Rustico which depends heavily on the livelihood of its local fishermen.
The channel in Rustico has been dredged on a regular basis since 1966, and every year since 1976. The cost for dredging in 1981-1982 alone amounted to three-quarters of a million dollars. Little has been done to solve this problem, as dredging is merely a band-aid approach to a more serious problem. The dredge spent the best part of 1981 dredging the harbour channel. In 1982 the channel filled in again and was worse than the fishermen had seen in years.
The people of North Rustico wrote to the former Minister of Fisheries and Oceans, the Hon. Romeo LeBlanc, on the problem, but no action has been taken. I pursued the issue in the House on November 18, 1982, and I have written letters to both the Minister of Fisheries and Oceans (Mr. De Bane) and to the Minister of the Environment (Mr. Roberts) but have not received a reply from either Minister.
Oral Questions
This issue has been raised many times and we are expecting that action will be taken, as the Minister of Fisheries and Oceans has indicated the need for improved facilities in small craft harbours, as stated in the Kirby Task Force Report released today. In view of this I urge that a study be conducted of the Rustico harbour situation. Once this information is obtained, measures could be taken to rectify the problem on a permanent basis. This is a very serious problem on which immediate action should be taken.



ORAL QUESTION PERIOD


Mr. Harvie Andre (Calgary Centre):: Madam Speaker, my question is for the Prime Minister. The Prime Minister by now will have had an opportunity to review all the documents dealing with the Scotia Synfuels Coal Project, particularly the memorandum of understanding of October, 1980, and the agreement of June, 1981. He will have had an opportunity to satisfy himself that, in fact, his current Minister of Finance, then Minister of Energy, Mines and Resources, acted in violation of the guidelines.
Has the Prime Minister obtained on a voluntary basis or has he asked for the resignation of the Minister of Finance? What action has he undertaken with regard to this very important matter?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the action I took was quite simple and direct. I discussed the matter with the Minister of Finance and I obtained from him the information that the first knowledge he had to this arrangement was on September 3, 1981. That seems to confirm the point I was making yesterday that the Minister of Finance, at that time the Minister of Energy, Mines and Resources, was dealing with parties in an open fashion-


Mr. Crosbie:: Very open. Certainly open sesame.


Pierre Elliott Trudeau: -that the so-called laundering period of the former Minister, Mr. Gillespie, had elapsed.


An Hon. Member:: They should all go to the laundry.


Pierre Elliott Trudeau: 1 do not even know whether the Minister ascertained that, but obviously he was dealing in an open way with honourable parties, a former Minister who had respected the guidelines in terms of a two-year period. I saw no indication for me to ask for his resignation. On the contrary, I congratulated him for ensuring that the public interest, particularly that of the people of Nova Scotia and of the workers, was being advanced by this deal which we had

February 17, 1983
Oral Questions
entered into, 1 think formally, on September 25, 1981. In those circumstances indeed the Minister had acted not only honourably but very directly in the public interest by signing that proposal which was put to him by a consortium.


MINISTERIAL CONDUCT GUIDELINES
Harvie Andre: Madam Speaker, perhaps the Prime Minister might clear up some uncertainties by tabling the documents in question since we have it that the agreement between the Government of Canada and the consortium was signed on June 30, 1981. The Minister of Energy, Mines and Resources was a signatory on behalf of Her Majesty in right of Canada, which is in clear conflict with what the Prime Minister has just told this House. Can the Prime Minister assure this House that none of his Ministers have acted in any way in violation, and I quote from his guidelines, Appendix II; for current Ministers serving:
In any official dealings with former office holders, Ministers must ensure that they do not provide grounds or the appearance of grounds for allegations of improper influence, privileged access or preferential treatment.
Will the Prime Minister assure this House that none of his Ministers, the current Minister of Finance, the Deputy Prime Minister, the Minister who was responsible for regional economic expansion during that period, acted in violation of those guidelines? If he cannot give that assurance, or if subsequent facts show that assurance is not valid, will he insist on the resignations of the Ministers in question?


Pierre Elliott Trudeau: Madam Speaker, on the first point raised by the Hon. Member concerning the date, after having verified the matter, I see that there was a memorandum to the Treasury Board dated September 3, 1981. I ascertained from the Minister information to the effect that he only saw that memorandum at the beginning of September, 1981. Presumably it may have been on his desk a few weeks prior to that. I would imagine that the month of August was one when he did not see it. He saw it early September and he signed the memorandum to Treasury Board a few days later, and the agreement with the consortium was signed, as I said, on September 25, 1981, retroactive to the end of June, 1981. That is how the date of June 30 appears. The agreement between the consortium and the Government of Canada became effective on June 30, but the agreement was signed on September 25.


ANNOUNCEMENT OF PROJECT AT NOVA SCOTIA PRESS CONFERENCE
Harvie Andre: Madam Speaker, the memorandum of understanding of the consortium was signed in October, 1980. The parties to that agreement were Petro-Canada and Devco, two Crown corporations.
The Prime Minister's guidelines clearly state that Ministers' behaviour extends to Crown corporations. That is violation No. 1. The memorandum of October, 1980, contemplates, and I quote " . . . that the consortium will be able to obtain, directly
or indirectly, a contribution or grant of 40 per cent of the Study Project Costs, up to $1 million from the Oil Substitution Fund and/or from other sources of Government funding". Clearly they had discussions with the Government in regard to that. The agreement of June 30, 1981, includes this memorandum of October, 1980, as part of its whole. Therefore, the effective date is October, 1980.
Finally, last night on television we saw the Deputy Prime Minister-the current Secretary of State for External Affairs-with Mr. Gillespie at a press conference in Port Hawkesbury, Nova Scotia, announcing to his constituents the jobs that will come out of this project. Is the Prime Minister trying to tell the House that none of his Ministers knew anything about this until September, 1981, when the Deputy Prime Minister was announcing it to his constituents in April of 1981? How can the Prime Ministrer reconcile what he has just told the House with those facts?


Some Hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, I am not, to use the words of the Hon. Member, trying to tell the House that none of my Ministers knew. In fact, as the Hon. Member just said, the present Secretary of State for External Affairs announced the project in the spring of 1981, along with Premier Buchanan. Obviously he knew.
What we do know is that there was no agreement signed. There was no formal authority.


John Carnell Crosbie: So what?


Pierre Elliott Trudeau: Well, I am standing here ready to answer supplementary questions. It is a matter of fact and a matter of law that the agreement was signed on September 25, several months after the announcement had been made.


Mr. Baker (Nepean-Carleton):: Play your little games.


Pierre Elliott Trudeau: How the announcement was made earlier is, I think, a matter for political conjecture. But knowing how politics are played in the Province of Nova Scotia, I guess it was a matter for both the Government of Nova Scotia and the federal Minister in Nova Scotia wanting to make sure that the other level of Government did not get credit for this project, which everybody was happy to be associated with, before the other got credit for it.
The fact remains that the then Minister of Energy who signed the agreement on behalf of the Government of Canada only knew about it in September of 1981.


John Carnell Crosbie: So what?


Flora Isabel MacDonald: Oh, oh!


Pierre Elliott Trudeau: I hear some groans from the Member for Kingston and the Islands. If she wants to elaborate on that groan and contradict this assertion, and assert that the Minister of Energy knew of it in some way before that date, she is free to make that accusation. She is welcome to make it.
February 17, 1983


REQUEST FOR RESIGNATION OF FINANCE MINISTER
Hon. Ray Hnatyshyn (Saskatoon West):: Madam Speaker, the Prime Minister's answer can only be described as incredible. We have the three-monkey proposition in terms of ministerial responsibility: hear no evil, speak no evil, see no evil. The three monkeys are sitting in the front benches of the Liberal Party right now.


Some Hon. Members:: Hear, hear!


Ramon John Hnatyshyn: To suggest that the Minister of Finance, the then Minister of Energy, had no knowledge of anything that went on in his Department with respect to this project when the Deputy Prime Minister was down there announcing it to the whole world on national television, just simply will not be bought by any reasonable Canadian,


Some Hon. Members:: Hear, hear!


Ramon John Hnatyshyn: In view of the fact that this is a question of ministerial responsibility-which has deteriorated while he has been Prime Minister to the point where you almost have to have an Abscam situation, or be seen in full colour pictures with your hand in the till before you are asked to resign in that outfit-when will the Prime Minister ask for the resignation of the Minister of Finance? When will he do it? I suggest that he do it right now.


Some Hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, you will have noted that I do not always take advice, particularly that preferred by the Hon. Member. 1 do not plan to take it in this particular case. He is saying that it was public knowledge. No doubt it was in Nova Scotia. I can assert that-


Some Hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Well, if the Hon. Members opposite seem to intimate that they knew about it before, why did they wait until yesterday to ask the question? Presumably it took the despatch from the Canadian Press that was alluded to yesterday for them to be aware of it.


Mr. Crosby:: This January 25.


Pierre Elliott Trudeau: If we were all supposed to be aware, why were they not aware since there was a public announcement? Therefore, I repeat my assertion that there was obviously some political posturing in Nova Scotia in the spring of 1981.
All I say is that the matter was not known by Cabinet. It was not signed by Cabinet. It was not authorized by the Treasury Board until the month of September, 1981.


John Carnell Crosbie: The fix is in.


Pierre Elliott Trudeau: Once again I ask the Opposition, who will stand up over there to say that they knew all about it, that it was public knowledge? I did not hear that allegation until
Oral Questions
yesterday, as I say, which presumably means that they did not know about it either.


Ramon John Hnatyshyn: Once again the Prime Minister is wrong because the matter was raised by my colleague from Halifax West in January of this year with the Minister of Energy, who boasted about what a wonderful project this was.


REQUEST THAT PRIME MINISTER SEEK MINISTER'S RESIGNATION
Ramon John Hnatyshyn: Madam Speaker, I will ask the Prime Minister one question. The guidelines are clear. They simply prohibit, absolutely and categorically, any lobbying on the part of Ministers within two years from the giving up of the portfolios of their former Departments. They also provide very clearly that any Minister who contravenes the spirit of the other guideline with respect to giving preferential treatment to former colleagues commits a breach of the guidelines. I suggest to the Prime Minister that the only sanction that is appropriate in these circumstances is to ask for and obtain the resignation of that Minister. In any other parliamentary democracy there would not even have been a question on the floor of the House of Commons. I ask the Prime Minister again: will he do the honourable thing in the House and ask for the resignation of the Minister of Finance?


Some Hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, let me attempt to follow the train of thought of the Hon. Member.


John Carnell Crosbie: Do the right thing. Never mind that specious reasoning.


Pierre Elliott Trudeau: First he says that this agreement was public knowledge and that everyone knew about it. I indicated that they obviously did not know about it until yesterday.


Some Hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Madam Speaker, I listened to the questions opposite. I wish they would listen to the answers and be a bit more courteous.
I said that certainly the Cabinet did not know about it as a Cabinet until September, 1981. The Hon. Member says that I am wrong. To prove that I am wrong, he says that it was raised in the House two weeks ago, in January, 1983. I would point out to him that January, 1983, is some considerable time after September, 1981. There is a year and a half lapse between those dates. It seems to me that his assertion about what happened two weeks ago-


Walter David Baker: You are finished, you know.


Pierre Elliott Trudeau: -is, as most of his questions, completely irrelevant.

February 17, 1983
Oral Questions


Walter David Baker: You are rotten. The whole crowd of you are just rotten.


Mr. Chretien:: Get up and challenge him.


Walter David Baker: Challenge, my ass. You should be ashamed of yourselves.


An Hon. Member:: That's right.


Pierre Elliott Trudeau: Madam Speaker, the Hon. Member for Nepean-Carleton asks that we challenge his ass. I do not know what his ass has to do with it, but I know that he is behaving like one.


Some Hon. Members:: Hear, hear!


Madam Speaker:: Order.


FINANCE
Nelson Andrew Riis: Madam Speaker, Canadians are proud that we are governed by a parliamentary form of government. It is a form of government that has been with us for centuries, and a form of government whose first order of business is the raising of taxes and the responsible spending of taxpayers' money.
Today the Minister of Finance introduced a borrowing Bill which asks Parliament to approve the borrowing of $19 billion, with absolutely no explanation of how those funds would be expended.
Does the Minister of Finance not agree that to proceed at this time with this $19 billion borrowing authority would essentially violate the very tradition of parliamentary democracy?


Marc Lalonde: Madam Speaker, 1 would like to remind the Hon. Member that we began a debate this morning on this very Bill, and that the $19 billion is divided in two pieces, $5 billion to finance the operations of the Government between now and April 1, and $14 billion to meet interim financial requirements for the beginning of 198384.
This morning I spoke in the House for 45 minutes, giving the House all the relevant information on why this money was required and what it would be used for. 1 also indicated that, once the general debate has taken place on second reading, the Bill will go to committee, and that I would be very pleased to appear before the committee with my officials and go into all the details and questions which Hon. Members may want to raise concerning the use of those funds.
So, far from trying to get parliamentary approbation of expenditures without providing any figures or information, on the contrary, as I said, I took three-quarters of an hour this
morning to provide that information. Moreover, I will be happy to appear before the committee and go into even more details if my hon. friend wishes to have more information. This is what Parliament is all about, this floor in the House of Commons, and parliamentary committees. Indeed, this is how Parliament works in a democracy.


Nelson Andrew Riis: Madam Speaker, I, too, was in the House when the Minister spoke, and 1 listened to his speech for 45 minutes. If he explained how the Government would expend $19 billion, I must have my hearing checked, because I certainly did not hear those details at all. I also suspect that businessmen in Canada would love to hear what the Minister has had to say. It would be interesting if, in fact, when they went to their bankers, their bankers would say, "Yes, we will loan you the money without your telling us what you will be using it for". It would be rather unique to twentieth century banking practices.


REQUEST THAT CONSIDERATION OF PART II BE POSTPONED
Nelson Andrew Riis: Madam Speaker, my supplementary question is also directed to the Minister of Finance. He explained that the Bill before us is in fact a two-part Bill, the first part requiring the expending of $5 billion and the second part concerned with future expenditures of $14 billion. In light of what the Minister has just said, would he be prepared to postpone any further consideration of Part II of the Bill until after next Tuesday, when the Estimates will be tabled in the House of Commons and parliamentarians can have an opportunity to see just what it is the Government is planning to do in the year ahead?


Marc Lalonde: Madam Speaker, I indicated in my speech this morning that next week, on February 22, the President of the Treasury Board would table the Estimates for 1983-84 in the House and that those Estimates would include expenditures to the sum of $88.9 billion, representing an increase of 9.1 per cent, I believe-


An Hon. Member:: Nine point six per cent.


Marc Lalonde: -9.6 per cent over the expenditures of 198283. My friend already has the figure of expenditures forecast for 1983-84. He knows fully well that the Government will need to borrow large additional sums of money to finance the deficit next year. As I have indicated, $14 billion will take us into the summer. I indicated that right after my budget I would table additional borrowing authority legislation.
As far as the specific question raised by the Hon. Member is concerned, I would indicate to him that we are only proceeding with second reading of this particular Bill at the present time. Today is Thursday, I believe.


An Hon. Member:: Close.


Marc Lalonde: The House Leader will take his representation into account, but one thing is certain. The Bill will not go into committee before the Estimates have been tabled. By then, my
February 17, 1983

friend will have all the information and again more details than he may want to have about the expenditure plans of the Government for 1983-84. I want to assure my friend that the House will have all the information it needs to consider this very important issue, because 1 feel that Hon. Members of the House are indeed entitled to know what the funds will be used for.


THE ADMINISTRATION
Arthur Jacob (Jake) Epp: Madam Speaker, I would like to direct my questions to the Prime Minister, and they are questions to follow up those asked by my colleagues, the Hon. Member for Calgary Centre and the Hon. Member for Saskatoon West.
The Prime Minister has established that the Deputy Prime Minister knew about this deal, and the Deputy Prime Minister is nodding his head in assent.


Mr. Nielsen:: He announced it.


Arthur Jacob (Jake) Epp: He announced it. Therefore, if the Deputy Prime Minister knew about this deal, the Government knew about this deal. There is a concept of collective Cabinet responsibility, and the Prime Minister cannot say that because he or his Minister of Finance might have a faulty memory, the Government, therefore, did not know. The Deputy Prime Minister knew, and 1 would therefore like to ask the Prime Minister how he can possibly say, in view of the fact that the person sitting beside him knew, that the Government did not know and therefore has no responsibility.


Pierre Elliott Trudeau: Madam Speaker, there are agreements being signed all the time between the Government of Canada and various Provinces and public and private bodies. These agreements are going on all the time. They do not come before Cabinet. What comes before Cabinet is a general policy and, in that sense, the Minister of Energy, Mines and Resources, in the later seventies, had conceived a policy of oil substitution. That was approved at the time and is part of our energy policy, but an agreement made between the Government of Canada and the Government of a Province-of every Province, except for Quebec, I believe-is something which is made under that policy, which does not come back to Cabinet every time there is to be agreement.
This oil substitution policy, as I hear it now, entitled the Government of Nova Scotia to receive some $7 millon from the Government of Canada to invest in projects which it judged to be worthy of oil substitution. It is such a project which this consortium was proposing to the Government of Nova Scotia, essentially, as they are the ones that have the funds in the Consolidated Revenue Fund of Nova Scotia.


An Hon. Member:: Not true.
Oral Questions


Pierre Elliott Trudeau: It is something which was to take place in the Province of Nova Scotia. To my memory, it never came before Cabinet at all. All I know is that it came before a committee of Cabinet in early September, 1981, that committee being the Treasury Board. That is how the matter was authorized in terms of federal participation in this agreement.
However, it is certainly a misunderstanding of the rules of Parliament and the Government to assume that every agreement is known by every Minister. The important thing is that they be authorized by law of this Parliament and that they be authorized by the Minister responsible for signing such agreement under the terms of the law which creates that Ministry. This is presumably what happened in that case. As I say, I have no memory of it having come to Cabinet. There is no reason most of other colleagues would have known of that agreement. Those who knew of it, presumably, were the Minister of Energy, Mines and Resources and the Minister responsible for Nova Scotia, the lead Minister for Nova Scotia.


Mr. McGrath:: The Deputy Prime Minister.


Pierre Elliott Trudeau: The Deputy Prime Minister. Therefore I fail to see the logic whereby the Hon. Member says that the Deputy Prime Minister knew of it and therefore everyone knew of it. That is not the case.


Erik Nielsen: The Government knew about it.


Pierre Elliott Trudeau: Well, the Hon. Member for Yukon said that the Government knew about it.


Madam Speaker:: Order, please. 1 am afraid, that answer was long enough.


Pierre Elliott Trudeau: Yes, I agree.


POSITION OF FINANCE MINISTER
Arthur Jacob (Jake) Epp: My supplementary question is also directed to the Prime Minister. The Deputy Prime Minister knew. The Prime Minister likes to give us all kinds of theories and concepts about parliamentary Government but he also knows that the concept of collective responsibility remains. The Government is responsible because one of its members knew. Additionally, the Prime Minister has now just said that the Minister of Energy, Mines and Resources knew.
As I understand the conflict of interest guidelines, there is not to be any inducement. What happened under this agreement about which the Minister of Energy, Mines and Resources knew, and which he signed on behalf of the Government, and therefore the Government is responsible, is that there was an arrangement in the agreement whereby a former Minister could in fact hold the people of Canada responsible for a great deal of money and he could personally profit.
Therefore I ask the Prime Minister, in his logic, as he tries to come to the ethical question, did he ever consider, as he

February 17, 1983
Oral Questions
works this thing through in his own mind, that on the basis of this knowledge and responsibility the Minister of Finance in fact should tender his resignation?


Some Hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, the Hon. Member refers to the concept of Government solidarity and collective responsibility. Yes, Madam Speaker, we are collectively responsible for the policies of this Government, and the policy of oil substitution is one for which we are all collectively responsible and informed about.
But a particular agreement signed maybe by the Minister of Employment and Immigration or by the Minister for Northern Affairs, which he is doing under his authority with funds which are authorized by the estimates passed by this Parliament-they do not all come before Cabinet. The Hon. Member was a Cabinet Minister, and he should know that. It just happens that this one did not come before Cabinet. It was signed in September. I made the point that the Minister of Energy knew, yes, he knew, as I said, at the very beginning of September, 1981. I have not heard arguments from the opposite side yet how that would induce me to ask for his resignation. He knew of an honourable deal, above board-


Some Hon. Members:: Oh, oh!


Pierre Elliott Trudeau: Groans again from the Opposition, Madam Speaker. Are they now saying that the deal is dishonourable?


Some Hon. Members:: Yes.


John Carnell Crosbie: Exactly.


Pierre Elliott Trudeau: Madam Speaker, I will then make sure that the Government of Nova Scotia is informed about that. I will make sure that they are informed that Premier Buchanan should not have been involved in such a dishonourable deal. All I know is that he was involved a long time before we were, since our Minister was only involved in the month of September, and the Premier of Nova Scotia had been involved presumably for nine months.


Some Hon. Members:: Oh, oh!


Pierre Elliott Trudeau: I guess I will return to my train of thought, Madam Speaker. The Government as a whole is not collectively responsible for some individual agreement-the Hon. Member shakes his head-


Walter David Baker: Madam Speaker, why do you not sit him down and get him out of his misery?


Ramon John Hnatyshyn: Those are the things you will be remembered by.


PRESENCE IN GALLERY OF MINISTER OF STATE FOR MINERALS AND PETROLEUM, OF YEMEN ARAB REPUBLIC
Madam Speaker:: Order. May I draw the attention of the House to the presence in our gallery of Mr. Ali Alberher, Minister of State for Minerals and Petroleum of the Yemen Arab Republic.


Some Hon. Members:: Hear, hear!


EMPLOYMENT
Cyril Keeper: Madam Speaker, my question is directed to the Minister of Employment and Immigration. In light of the seriousness of the unemployment situation amongst the youth and the approaching summer and the need for jobs by students, I wonder if the Minister is aware that there is still vital information missing with regard to the Summer Canada program. For example, with regard to community projects we still do not know what constituency allocations will be available, whether they will be up over last year, in light of the increase in unemployment.
With regard to internship for students, his advertisements in the papers indicate there will be public sector internships but there is no indication of the fact that there will also be private sector internships. Does he not recognize the need of all private businesses to be aware of the fact that there will be private sector internships, so they can have equal access to those funds for students jobs? With the deadline-


Madam Speaker:: Order. Would the Hon. Member please ask a question immediately, with no more preamble.


Cyril Keeper: Madam Speaker, my question is this. When will the Minister make available the information for constituency allocations since the application deadline is March 4 and we need that information? It is only a couple of weeks away. Also, will he be advertising the fact that there are private sector internships so that all businesses across the country can have equal access to those funds for student employment?


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, as the Hon. Member may or may not know, Members of this caucus have been working very actively over the past several weeks to develop a number of initiatives that will be designed to help young people to gain employment and training. Obviously the summer youth employment package is one of those. So what we want to do is to make sure that we have a fully balanced approach, so the funding of that program must be related to the over-all set of priorities we want to establish to help young people in a variety of different circumstances.
February 17, 1983

As far as information is concerned about the program, I simply draw the Hon. Member's attention to the fact that over the past week a number of specific advertisements have appeared in newspapers putting forward the information which he requires.


FISHERIES
Mr. Ted Miller (Nanaimo-Alberni):: Madam Speaker, my question is directed to the Minister of Fisheries and Oceans. Today the Minister tabled the response to the Kirby Commission as well as the Kirby Commission Report on the Atlantic coast fisheries.
In view of the fact that the most critical situation in the industry, that is the financing and restructuring of it, has been delayed another two months before any comment will be given on that subject, and in view of the fact that quality, marketing and fishermen's incomes have been deferred for more study, how can the Minister justify the length of time since the document was placed before Cabinet in October until now, four months' delay, before the response of the Government, which is inadequate at best, has been placed before Parliament and the Atlantic fisheries?


Hon. Pierre De Bane (Minister of Fisheries and Oceans):: Madam Speaker, the Hon. Member has touched upon several questions and he has failed to report exactly what I have said and what was said in the lock-up this morning.
On the question of restructuring, we are in the final stages of that very important question. On the question of marketing, I have already announced several decisions of Cabinet relating to the dock-side grading; that we want a price differential; that we are going to have a licence for exports for everything, interprovincial or international trade; but as for the particular mechanism, because there are a lot of diversions used, we would like to have more consultation with the different participants.
Regarding the income of fishermen, I have announced several things this morning, and I hope that I will have the support of the Hon. Member as the Government of Canada is asking all the Provinces which do not have collective bargaining legislation to enact that very soon to help our fishermen.


REQUEST THAT GOVERNMENT SECURE EQUITY IN EAST COAST FISH PLANTS
Edward Allan Miller: Madam Speaker, I would like to suggest to the Minister that maybe one of the problems that he has with the restructuring aspect is that there is a difficulty in the Liberal benches in terms of trying to determine whether this could be a major bail-out, in terms of simply a subsidy or a bail-out to the banks and to the fishing
Ora! Questions
companies, or whether indeed the Minister and the Government will take the initiative and demand some Canadian equity in those processing plants. Will they include within that equity some kind of a marketing strategy so that fishermen can be guaranteed a good income for the fish that they produce and that we can market good quality products around the world?
Will the Minister give us some commitment that we are not simply going to be giving money to companies which have mismanaged their operations and mismanaged their resources, but that Canadians and employers of those companies and people in those communities will have some say in the management of the Atlantic fisheries, finally?


Pierre De Bané: Madam Speaker, obviously the Hon. Member is more familiar with the Pacific fisheries than the Atlantic fisheries. 1 am on record since at least three months ago that the Government is not considering any bail-outs to the present shareholders. What we are interested in is devising a policy which is going to give 25 per cent of all the workers in the Atlantic Provinces, 1,300 communities, a system that will bring stability and decent and reasonable income to those people. For that, every segment, whether the processors, the Fishermen, the plant workers, the Governments, all of us will have to work together to implement that new system which expects from each participant his own effort, if we want to make it a profitable and viable sector, as it should be.


Some Hon. Members:: Hear, hear!


THE ADMINISTRATION
Erik Nielsen: Madam Speaker, the Prime Minister has a weird concept of parliamentary democracy, and an even weirder-


Eugene Whelan: Ask the question.


Erik Nielsen: The question will be coming, I assure the Minister of Agriculture-an even weirder idea of the standard of moral conduct expected from his Ministers.


Some Hon. Members:: No, no.


Erik Nielsen: There is no doubt that the Government is fixed by reason of its collective responsibility for the acts of any of its Ministers. The Minister of Communications has proven that. The Minister of Consumer and Corporate Affairs has proven that-


Some Hon. Members:: Hear, hear!


Erik Nielsen: -Bud Drury has proven that, and Walter Gordon, all whom resigned on far less grounds than exist here.

February 17, 1983
Oral Questions
The facts are that the Government knew of an immoral arrangement between the Government of Canada and a former Minister of the Crown. No weaseling around that can get the Minister off the hook, nor the Deputy Prime Minister.


Madam Speaker:: Order please. I am sorry to interrupt the Hon. Leader of the Opposition, but he knows that, just as every other Member has to do, he must ask a question and not make a statement of that length. His questions are welcome, but no statements please.


Erik Nielsen: I was simply following the precedent set by the Prime Minister which was found acceptable to the Chair.


Some Hon. Members:: Hear, hear!


Madam Speaker:: I do not know what that comment suggests, but when the Hon. Member looks in Hansard he will see that the length of the questions and the answers are pretty much the same. I am only urging Members to be shorter in their questions. A question is supposed to be short. It is absolutely normal that some answers have to be longer. That goes without saying. However, questions must be short.


Erik Nielsen: Madam Speaker, I assure you that the questions will be just as short as the answers.


Some Hon. Members:: Oh, oh!


Erik Nielsen: I will put this question, if the herd behind the Prime Minister will be silent for a while. He says that when his now Minister of Finance was Minister of Energy, he knew nothing about this deal until September, 1981. Can he tell me then why it is that the now Minister of Finance, when he was Minister of Energy, had his own press secretary, that is the press secretary to the now Minister of Finance, organize the trip to Port Hawkesbury in order to enable his Deputy Prime Minister to announce this project?


Pierre Elliott Trudeau: Madam Speaker, having heard the conduct of the Hon. Member for Yukon for some 15 years, I would want to say that I do not mind being judged by a man like that because his standards of morality are so low that a judgment of someone else as to their morality, to me means absolutely nothing. If the Hon. Member had higher standards of morality himself, then maybe he could sit in judgment against other people.


Some Hon. Members:: Hear, hear!


Pierre Elliott Trudeau: As to the matter of the press secretary, the press conference and the arrangements, I would find it rather preposterous that the Minister from Nova Scotia would only go to a press conference in his own riding under arrangements arrived at by the press secretary of some other Minister. Therefore, I take the suggestion by the Hon. Member for Yukon with a big lump of salt.


PRESS SECRETARY'S ROLE
Erik Nielsen: Madam Speaker, I will stack my standards against the Prime Minister's-


Some Hon. Members:: Hear, hear!


Erik Nielsen: And I will do that chronologically going back to 1942.


Some Hon. Members:: Hear, hear!


Erik Nielsen: The conduct of these Ministers is so rotten as to make any decent parliamentarian and any decent Canadian regurgitate.
Let the Prime Minister answer the question I put to him. He tells us that his former Minister of Energy, now Minister of Finance, knew nothing of this arrangement until September, 1981. How can he explain the press secretary to that Minister of Energy organizing the arrangements for the announcement by the Deputy Prime Minister in Port Hawkesbury in April, 1981?


Pierre Elliott Trudeau: Madam Speaker, the standing ovation that the Hon. Member for Yukon just got from Members of his own Party indicates that their standards of morality must be equal to his, which is not very high.


Some Hon. Members:: Oh, oh!


Ramon John Hnatyshyn: You don't see anybody standing over there.


Madam Speaker:: Order, please.


Pierre Elliott Trudeau: Madam Speaker, I would want the Hon. Members to remind themselves who raised the question of morality in this House. I didn't. It is the Member over there. Why the howls of indignation since I used the same language as their own Leader? As to the press arrangements, I know nothing of them.


Erik Nielsen: He did.


Pierre Elliott Trudeau: That is another thing I do not do-I do not look at each Minister's press secretary to see what arrangements they are making. I am happy to make inquiries. I will answer questions in the House the next time it sits. If the Hon. Member for Yukon wants me to inquire about that, I will be happy to do so.


ROYAL CANADIAN MOUNTED POLICE
Hon. Allan Lawrence (Durham-Northumberland):: Madam Speaker, I am really concerned that late on Friday the Solicitor General released a policy statement that emphasizes the destruction of RCMP files on individuals, because nothing will
February 17, 1983

defeat the concept of the freedom of information legislation more than if there are no files to produce when one feels wronged or, in later years, no files are available to indicate why public policy evolved as it did. As an example of some of the problems, can the Minister indicate if the files on the activities of Prime Ministers, both past and present, have been or will be destroyed and, if not, under which of the four exceptions that he has made, will they fall?


Hon. Bob Kaplan (Solicitor General of Canada):: Madam Speaker, I do not know if the Security Service has files on former Prime Ministers. As I indicated in the policy statement that I put out, the destruction will be subject to a review by the Dominion Archivist. I would imagine that if there are files that contain material of historic interest, as the mandate of the Dominion Archivist provides, those files would be retained. On the other hand, I am astonished not to have the support of the Hon. Member for a policy which I believe is widely supported by Canadians, of having the Security Service, under the direction of a committee in pursuance of the guidelines which I have established, prepare for the destruction of hundreds of thousands of files on Canadians which were not justified to be opened in the first place and which do not relate to the mandate of the Security Service. I would hope he would support that policy.


CONTENTS OF FILES
Allan Frederick Lawrence: Madam Speaker, I really would like to get the Solicitor General on record on this. Is he flatly saying that he has no knowledge of the existence or the contents of files relating to the present Prime Minister? Does this mean, and perhaps the Prime Minister could answer this, that the originals of those files may have already been destroyed?


Robert Phillip Kaplan: Madam Speaker, no files of the Security Service have been destroyed since the time that the McDonald Commission was established. I can give the Hon. Member that assurance. I indicated in my earlier answer the basis on which files would be processed and approved for destruction pursuant to the policy that I laid out. So far as my own interest is concerned, I occasionally review files of the Security Service, but I only do it when I feel it is necessary for me to do so in relation to an operational matter or policy decision or policy review relating to the Security Service. I do not know what policy the Hon. Member opposite followed. My policy is to look into these files which touch the privacy of individuals only when absolutely necessary.
Business of the House


NEWFOUNDLAND COURT DECISION ON OWNERSHIP OF OFFSHORE RESOURCES
Mr. Gilbert Parent (Welland):: Madam Speaker, my question is directed to the Minister of Energy. In view of the fact that the Newfoundland Supreme Court today brought down a rather momentous decision with regard to the Government of Canada and the Government of Newfoundland, would the Minister comment specifically on what negotiations, if any, will take place, now that that Supreme Court decision has come forth, with regard to negotiations over offshore oil in Newfoundland?


Joseph Jacques Jean Chrétien: Madam Speaker, there was a decision this morning by the Appeal Court of Newfoundland, which was unanimous, giving jurisdiction over the offshore to the federal Government.


Some Hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: But 1 would not want to make any further comment because next week the Supreme Court of Canada will take under advisement the reference which we, ourselves, made to the Supreme Court. That case will be heard in front of the Supreme Court next week. Therefore, I do not want to make any commitment at this time. I am quite pleased that the legal advice which I gave to the House as Minister of Justice has been recognized by the Appeal Court of Newfoundland, the same court which Premier Peckford praised so much in the case on the Constitution.


PETITION
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the three hundred and ninety-fourth report of the Clerk of Petitions stating that he has examined the petition presented by the Hon. Member for Comox-Powell River (Mr. Skelly) on Wednesday, February 16, 1983, and finds that the petition meets the requirements of the Standing Order as to form.


BUSINESS OF THE HOUSE
Philip Derek Lewis: Madam Speaker, today being Thursday, I wonder if I might ask the Government House Leader to give the House some indication as to the business of the House for tomorrow and next week.

February 17, 1983
Business of the House


Mr. Pinard:: Madam Speaker, as indicated yesterday, tomorrow is an Opposition day.

As far as the business of the Elouse for next week is concerned, Madam Speaker, on Monday we shall resume debate on the second reading stage of Bill C-139, to amend the Income Tax Act, and depending on the progress achieved that day, we could determine the order of business for Tuesday and Thursday. On Tuesday, we could very likely resume debate on Bill C-143, to provide the government with supplementary borrowing authority.
I have made some suggestions to the Progressive Conservative Party, and depending on their response, we might soon manage to complete the third reading stage of three urgently needed bills, first, Bill C-95, concerning events pools, the purpose of which is to provide large sums of money for the Olympic Games in Calgary; second Bill C-130, a very urgent one, to authorize continuing financial assistance to be provided to certain international financial institutions, and finally, Bill C-136, dealing with Small Business Investment Grants.
Should the Progressive Conservative Party's response concerning these three bills be favourable, we could complete on Tuesday the debate on the last stage, and on Thursday, we could consider the legislation on the borrowing authority, namely, Bill C-143.
What is sure, for the time being, is that we will deal on Monday with Bill C-139, and I will decide what will be the business for Tuesday on the basis of the Progressive Party House Leader's response and of course on the progress made with regard to the bill to amend the statute law relating to income tax.


Philip Derek Lewis: Madam Speaker, I wonder if the Government House Leader would comment on a trend which seems to be taking place. The Government House Leader indicated yesterday, and again today, that he is going to allot tomorrow, which is a Friday, as an Opposition day. Tomorrow will be the fourth allotted day in this period. Of those four days, three of them have been on a Friday. In other words, a short day.
I am sure that the Government House Leader is aware that, by allotting short days, the Government is cutting down on the debating time which is allowed to the Opposition. If in fact all of the allotted days were to be Fridays, a total of 25 hours, or 20 per cent of the debating time, would be taken away by the Government. What we really have, Madam Speaker, is closure by allotment. I ask the Government House Leader to assure us that, in allotting the rest of those days, a fairer treatment will be given to the Opposition in order that we can deal with these matters that way, rather than a long debate on a question of privilege.


Yvon Pinard: Madam Speaker, since we started our parliamentary reform experiment, we have had no more short days, because now, there is no private members' hour on Friday, and thus Fridays are much longer now than they used to be. Furthermore, I can assure the Hon. Member that we shall not use the kind of tricks they like to use on days set aside for Government Orders or shorten Opposition days by letting the bells ring indefinitely, nor do we intend to indulge in dilatory tactics to prevent them from considering private member's business.
That being said, I am certainly not going to schedule Opposition days on Friday as a matter of course. The schedule will of course depend on the progress of the business of the House and consideration by the House of certain Bills. I can assure the Hon. Member that I shall seriously consider his suggestion with respect to future Opposition days. However, I would like to point out that if we look at the time spent on the business of Parliament on a given day, on average, the House spends far more time on Opposition days, even on Fridays, compared to the amount of time spent on Government business on other days of the week, and that is due to the dilatory tactics used by the Opposition party in recent weeks.


Philip Derek Lewis: Just to correct an impression which may have been left with the House, Madam Speaker, on a Friday we cannot have much more than from twelve o'clock to one o'clock and from two o'clock to five o'clock, which is four hours; but on Mondays, Tuesdays and Thursdays, we can have four and three-quarters hours. That is exactly the point which I was making to the House and to the Government House Leader.


Mr. Rose:: Madam Speaker, in response to the business of the House for next week, I did not attend the meeting of the House Leaders and our Acting House Leader is not present at the moment, but I received some word from his Executive Assistant that, as far as our Party is concerned-and we are well aware that the Government calls the business of the week-we are not particularly pleased or impressed with the suggested calling of the three Bills mentioned earlier by the Government House Leader, since I do not believe this was discussed at the previous meeting. 1 would just like to put on the record that reservation about the business for next week.


Yvon Pinard: Madam Speaker, I would rather not comment on the topics discussed at the meeting of the House Leaders, but I can assure the Hon. Member that a proposal was made regarding the three Bills I mentioned before, and that I do not intend to call them within the next few days without a favourable reply from his party and from the Progressive Conservative Party.
February 17, 1983


Mr. Fraser:: Madam Speaker, my point of order refers to House business. I would like to ask, first of all, whether the Minister of Fisheries and Oceans will be in the House tomorrow to answer questions on the Kirby report.
My second question stems from the press conference which the Minister of Fisheries and Oceans held today. Is the Minister not going to come before this House and make a statement with respect to the Kirby report and those policy options which the Government is prepared to accept, so that that can be answered by the respective critics in the Opposition and there can be some discussion of it in the House of Commons? With respect, Madam Speaker, given the importance of this issue to Atlantic Canada, it seems a perfectly appropriate thing to suggest that the Minister do appear in front of this House and speak on motions.


Pierre De Bané: Madam Speaker, I am a little distressed because I have already accepted an appointment tomorrow in Vancouver, British Columbia, to meet with the Fishery Advisory Council to the Minister. I have also several appointments in Prince Rupert and other areas of B.C. tomorrow, Saturday and Sunday. As soon as I return I will be ready to meet with the Hon. Member.


John Allen Fraser: Madam Speaker, I understand the Minister's difficulties with respect to tomorrow. Naturally, coming from the West Coast I am not critical of those arrangements. But can the Minister tell the House whether he will be in the House for sure on Monday, and whether or not he is prepared to make a statement which would be answered by the Opposition critics?


Pierre De Bané: Madam Speaker, of course, I can give a commitment to the Hon. Member. The moment 1 return from B.C., it is my duty to be in the House to answer questions. I believe that my return is scheduled for later Monday night, so on Tuesday, of course, I will be here.


John Allen Fraser: Madam Speaker, can the Minister confirm that he will be making a statement in the House at the earliest possible time next week? I am not just talking about questions.


Pierre De Bané: No. On that question, Madam Speaker, that is under the authority of the Government House Leader. I thought the process I followed was the right one, and that is to have my Deputy Minister give an information briefing session this morning to all Members opposite interested in the matter, rather than my giving a press conference. Of course, if the Opposition would like to use one of their days to have a full debate, that will be welcome too.


John Allen Fraser: Madam Speaker, I appreciate, as did the other Hon. Members, the briefing given by the Deputy Minister. The Minister will not mind my saying that we would have appreciated the briefing perhaps as early as some of the leaks of documents had been distributed throughout the country.
Business of the House
But I must say, through you, Madam Speaker, that I believe it is appropriate, on a matter of this magnitude to Atlantic Canada, that the Minister make a statement in the House. I ask that he consult with his House Leader and be prepared to come back and make that statement early next week.


Yvon Pinard: Madam Speaker, all I can say is that the Minister of Fisheries and Oceans (Mr. De Bane) was in the House today during question period. If the matter was as important as all that, questions could have been put to the Minister, instead of having the Member for Yukon (Mr. Nielsen) indulge nasty remarks throughout question period.


Mr. Skelly:: Madam Speaker, some weeks ago the Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion released a report in the House which would see changes in Canada's shipbuilding policy. He indicated at that time that if the Opposition Parties were agreeable, the legislation could be moved quickly through the House. He chastised us to some degree, saying that we should co-operate, at that time my sense of the House was that both Opposition Parties would be willing to co-operate with speedy passage of that legislation.
With the new turn of events and the current situation in Newfoundland and developments offshore, we may lose a lot of the advantages available through the new policy if the Government does not move quickly. Could the Government House leader give us an indication whether the Minister was serious when he was asking for the co-operation of the House in putting that legislation forward, or were we just being treated to a kind of interim handing out of a report and then a long delay before action?


Yvon Pinard: I want to assure the Hon. Member that all Ministers are very serious.


Raymond John Skelly: It is unfortunate, Madam Speaker. I wonder if the House Leader might be in a position to deal with the substance of the shipbuilding policy because I do believe the Minister was serious when he put this forward. Certainly the Opposition Parties, indicated their co-operation, and were also serious in trying to put these people back to work and maybe put the industry in a little better position. As the Hon. Member knows, many shipyards are on the verge of closing in Vancouver and eastern Canada, with some very short-term work available and then nothing on the Order Paper.


Yvon Pinard: Madam Speaker, I just indicated that all Ministers are serious and then the Hon. Member said "it is unfortunate". I do not understand his point, except that I will be glad to discuss the matter with his House Leader. If he is serious, he will raise the matter with his own House Leader and when we have a meeting we will discuss it.


Raymond John Skelly: Madam Speaker, do I understand that the House leader has given an undertaking to consult with the


February 17, 1983
Privilege-Mr. Keeper
Minister to determine whether or not this House would be able to assist all Canadians in business in that particular field of endeavour? Was he making a commitment to check with the Minister of Industry, Trade and Commerce and report back to the House?


Yvon Pinard: Well, by reading Hansard tomorrow the Hon. Member will realize that he misunderstood a little bit.


Mr. Hawkes:: I have a question for the Government House Leader. On Monday of this week he would have heard the Prime Minister indicate on behalf of the Government that the Standing Committee on Health, Wealth and Social Affairs was free to examine the issue of single parents. This morning Government Members refused to come into the committee room. The House Leader will know there are only four Opposition members of the committee but it takes six to form a quorum in a standing committee, and if the Liberal members of the committee refuse to come into the room we cannot get started and deal with that kind of problem.
Can he assure the House that he will use his good offices to make sure that Liberal members come to committee meetings so that we can get started, or is he telling us that the Liberals intend to boycott the Standing Committee on Health, Welfare and Social Affairs in the future?


Yvon Pinard: No, Madam Speaker. On the contrary, I have encouraged all Hon. Members to make it possible to organize committees as early as possible. As a matter of fact, that organization process had begun last Tuesday, but due to the request of the Hon. Member's own Party we agreed to start all over again today because of insufficient notice in some instances.
The Hon. Member refers to the meeting of the Standing Committee on Health, Welfare and Social Affairs this morning. I do not know if there were one or two members sick or what reasons they had; I will inquire. But I want to assure him that it was not planned nor intended to delay the formation of any committee.


Frederick James (Jim) Hawkes: Madam Speaker, there were four Opposition members and one Liberal who came to the meeting. There were two Liberals outside the door for the better part of a half hour who refused to come into the room and form a quorum. It looked very much to the Opposition as if it were a deliberate strategy so that we could not get started. If they had not been physically present, I would accept that explanation. I guess I have brought to the House Leader's attention something he knew nothing about, but I think it is a very serious situation.


PRIVILEGE
Cyril Keeper: Madam Speaker, I have a question of privilege arising out of Question Period. I asked the Minister of Employment and Immigration (Mr. Axworthy) how much money there would be in each constituency and, when that information was going to be available, in light of the fact that the application deadline is on March 4. He indicated this information was available in advertisements in the newspapers.
That information is not available-


Madam Speaker:: Order, please. The Hon. Member may raise a question of privilege which follows the debate, but I am afraid the Hon. Member is now continuing the debate. That is not allowed under the guise of a question of privilege. If the Hon. Member wants supplementary information about the question he asked of the Hon. Minister, he can do that on another occasion, but he cannot use this particular time to debate that question.


Cyril Keeper: Madam Speaker, perhaps you can clarify the situation for me. What I am wondering is whether the Minister had breached my privileges by, maybe unintentionally, misleading the House in saying the information I was asking for was available in advertisements when in fact the information is not available anywhere.


Madam Speaker:: No, I can tell the Hon. Member that the Minister, in the circumstances described by the Hon. Member, has not breached his privileges. If the Hon. Member wants supplementary information or clarification, he can ask for it; but he cannot say he has a question of privilege.


POINT OF ORDER
Howard Edward Crosby: Madam Speaker, 1 have a point of order relating to remarks made in the House by the Minister of Fisheries and Oceans (Mr. De Bane). He has since left the House but with your leave I would like to record my concern.
The report to which the Minister of Fisheries and Oceans made reference in his remarks, the so-called Kirby report, which is actually the report of the committee inquiring into the Atlantic fishery, is a report that could be tabled in the House by the Minister. If he did, he could, pursuant to the new Standing Order 46(4), refer that report to a committee, in this case the Standing Committee on Fisheries and Forestry.
I would like to ask the Minister whether he intends at some future date, hopefully in the very near future, to table the so-called Kirby report in the House of Commons, and if he will at that time at least refer the report to the Standing Committee on Fisheries and Forestry, so that it can examine the contents of the report and give the public an opportunity to consider its provisions.

February 17, 1983


Yvon Pinard: Madam Speaker, I imagine the wording of the Standing Order you read to the House yesterday is still fresh in you mind. Clearly, the Minister is not required by an Act of Parliament to table this document, but he may do so voluntarily, according to the Standing Order. Whether he will or not is a matter for the Minister to decide. However, he has informed me that he is certainly not able to give a reply today.


Howard Edward Crosby: Madam Speaker, I realize we are dealing with legal interpretations at this point, but I would point out to the President of the Privy Council (Mr. Pinard) that I understand the inquiry, which became known as the Kirby Commission, was an internal inquiry pursuant to the Inquiries Act. That is a Statute of the Parliament of Canada, and a report made by that commission of inquiry is pursuant to an Act of the Parliament of Canada. Therefore, I do not know why it could not be regarded as such for the purposes of Standing Order 46(4).



ROUTINE PROCEEDINGS


Mr. Simon de Jong (Regina East):: Madam Speaker, I have a petition signed by 2,400 residents of the Uplands area in the City of Regina. The residents are petitioning Parliament in an attempt to prevent the Canadian National Railways from relocating its rail lines and marshaling yards to within two miles of existing or proposed residential subdivisions of the City of Regina. The residents are very concerned that the noise and air pollution from the proposed marshalling yards will destroy their residential community.
They hope that the Minister of Transport (Mr. Pepin) and the proper authorities will become aware of their very grave and very real concern.


Mr. Albert Cooper (Peace River):: Madam Speaker, I have the honour to present a petition on behalf of the constituents of Peace River which relates to pornography and particularly to pornography on Pay TV. They are very concerned about the effects this will have on the increase of pornography in the country.
The petition calls on Parliament to take whatever action is necessary to prevent the showing of pornography on Canadian TV.
Order Paper Questions QUESTIONS ON THE ORDER PAPER
(Questions answered orally are indicated by an asterisk.)


Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 3,340, 4,490 and 4,623.


Mr. Bosley: 1.	Is the price charged in the sale of wheat by Canada to the U.S.S.R. far below the price paid by Canadians for the same product and, if so, does this mean that Canadians are subsidizing the U.S.S.R. in the purchase?
2.	Does Canada loan money to the U.S.S.R. to facilitate any purchase and, if so (a) what rate of interest is charged (b) does the U.S.S.R. pay the interest on such loans and has repayment been made on the loans?
3.	To what extent does the sale of Russian products in Canada, such as cars and machinery, offset the amount of the loans owed to Canada or are Russian sales in Canada cash moneys earned?


David P. Smith: I am informed by the Canadian Wheat Board and the Export Development Corporation as follows:
1.	No. Within the floor and ceiling range of $5-$7 per bushel on wheat for human consumption in Canada, domestic and export prices are the same. Export prices in fact exceeded the ceiling in the November, 1980 through March, 1981 period.
2.	The Export Development Corporation does make financing available to the U.S.S.R. to facilitate the purchase of Canadian capital equipment and services.
(a)	As a matter of general policy the EDC does not disclose details of transactions such as that which is of the subject of the present request. As to the rate of interest, in view of the intense competition that prevails among countries in foreign trade, it is not in the public interest for the EDC to discuss its participation in export transactions or proposed export transactions. Such information would assist an exporter's competitors both foreign and domestic. Since information on bids, participation or negotiations is given by companies to EDC in confidence, the Corporation, to respect that confidence, refrains until the sale arrangements are final, from discussing a deal or even from indicating that it has been approached in a transaction. EDC makes public its participation in direct lending transactions when the financing agreement therefore is signed and, on request, in credits and foreign investment insurance cases where the exporter or investor consents to publication. If the exporter or investor has not given its consent the reply will so state. When EDC makes public its participation in direct lending transactions it does not, because of the intense competition above-mentioned, publish the rate of interest, for the reasons mentioned.
(b)	Yes.
See also question No. 2,481 answered July 7, 1981.
Note: All Soviet wheat purchases are for cash.
3.	Sales of Soviet goods in Canada are transacted on a cash basis.

February 17, 1983
Order Paper Questions CANADA DEVELOPMENT CORPORATION


Mr. Siddon: 1.	What amount did the Canada Development Corporation spend for advertising in the fiscal year (a) 1980-81 (b) 1981-82?
2.	What amount did the Corporation budget for advertising in the fiscal year 1982-83?
3.	What percentage of the Corporation's fiscal year 1982-83 advertising will be devoted to (a) newspapers and magazines (b) radio (c) television (d) trade show or convention exhibits (e) any other?
4.	Did the Corporation declare a deficit in the fiscal year (a) 1980-81 (b) 1981-82 and, if so, what was the extent of that deficit?


Mr. Jim Peterson (Parliamentary Secretary to Minister of State for Economic Development and Minister of State for Science and Technology):: The Canada Development Corporation is a corporation in which the Government of Canada, along with more than 35,000 other shareholders, holds an equity interest. The Corporation is neither a Crown corporation nor an agent of Her Majesty, and the Government does not have any official knowledge of the Corporation or its subsidiaries which is not publicly available from the corporate secretary.


Mr. Hawkes: 1.	Did the Minister of National Health and Welfare contact any provincial health ministers in November, 1982 regarding the Canada Health Act and, if so
(a)	on what date (b) which ministers did she contact (c) what form did the contact take?
2.	Did the Minister meet with any of the provincial health ministers in November, 1982 regarding the Act and, if so (a) which ministers did she meet
(b)	on which date or dates (c) in which cities?
3.	Does the Minister plan to meet with all the provincial health ministers before the Act is approved by Cabinet and (a) if so, on what date (b) if not, does she intend to present drafts of the legislation to the provincial health ministers?


Hon. Monique Begin (Minister of National Health and Welfare):: 1, 2 and 3. The Minister of National Health and Welfare is in contact with provincial health ministers on a regular, continuing basis. This question, however, relates to matters dealing with federal-provincial relations, and until negotiations are completed, it would be inappropriate to comment on this subject.


Madam Speaker:: The questions enumerated by the Parliamentary Secretary have been answered.


David P. Smith: Madam Speaker, would you be so kind as to call Starred Question No. 4,641.


Mr. McKenzie: 1.	Will the Government be launching a comprehensive environmental study to determine the effects on the water quality of Indian Bay and Shoal Lake in the event that the proposed 350 cottage lots on the northwest corner of Shoal Lake in Manitoba are developed and, if so (a) what will be the starting date (b) on what date will it be completed (c) will it determine the degree of risk of increased algae production, oil spills or other major forms of pollution (d) will it include an examination of the effects of using the sewage lagoon located across from Winnipeg's drinking water intake on the shore of Indian Bay?
2.	Will the government permit the use of motorboats for recreational purposes on Indian Bay?


Mr. Denis Ethier (Parliamentary Secretary to Minister of the Environment):: Madam Speaker, the answer is as follows.
1. Yes, the Government has begun a comprehensive examination of the cottage lot development proposed by Shoal Lake Indian Band 40. The Department of Indian Affairs and Northern Development requested that a formal public review of this proposal be undertaken by an Environmental Assessment Panel. The Minister of the Environment appointed a Panel in January, 1981 to undertake this task. The Panel issued guidelines for the preparation of an environmental impact statement to the Band in March, 1981. Since that time the Band and the City of Winnipeg have held discussions in an attempt to overcome concerns related to the proposed development. It was recently agreed, and the Minister of the Environment has just received confirmation from the Minister of Indian Affairs and Northern Development, that the Band and the City wish to continue with the environmental assessment review. He has therefore issued new instructions to the Panel to allow it to resume its review, (a) The Panel announced a resumption of the review February 9. (b) The completion date for the review is dependent on when the environmental impact statement is submitted to the Panel and on the quality of the information presented. A completion date therefore cannot be determined at present, (c) Yes, the review will primarily focus on the potential effects of the proposed development on water quality and will examine subjects listed in question 1 (c). (d) The review will not specifically examine the present waste disposal systems from the existing Indian community. It will, however, examine any sources of pollution to the lake. Environment Canada officials are presently advising the Department of Indian Affairs and Northern Development on this matter.
2. The federal Government has no jurisdiction with regard to the use of motor boats for recreational purposes on Indian Bay.


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


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


Some Hon. Members:: Agreed.
February 17, 1983



GOVERNMENT ORDERS

[Stage Direction]
[English\

[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that Bill C-143, to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Pat Carney: Mr. Speaker, before the recess 1 was describing how the Government is seeking to borrow an unprecedented amount of money to pay unspecified bills for programs not yet clearly identified. I explained how this huge borrowing represents a deferred tax on taxpayers in the future and how it constrains the action of the present and future Governments. 1 also detailed how the Government's record of forecasting has been wildly inaccurate and how in this Bill the Government fails to address the real problems in the economy, the deep, structural shifts which have closed our plants, our mills and our mines and which cloud the future of the unemployed in Canada, particularly the young.
I said we would be much more willing to debate and pass this Bill if we knew what the money was needed for, when it is needed and how reliable the Minister's information is and that we would be much more confident if the Government's performance over the last few years had been more credible.
I should like to continue by asking how the Government feels that it can properly and responsibly ask Parliament to approve this borrowing when it has refused to provide economic and fiscal projections beyond the current year in the last two budgets? How can the Minister seek this kind of spending authority when he refuses to answer any of our questions? Why should we approve this Bill when the Government is vague about the uses to which it will be put and when the Minister can give us no idea about the projected size of the deficit in the next fiscal year? What will next year's deficit be? The idea of picking a number between S20 billion and $30 billion is not the sort of game that Parliament should be asked to play.
Clearly, the Government is withholding information from Parliament. It claims it needs this additional money because revenues have fallen due to the recession and because of the additional cost of servicing the public debt, which, of course, represents interest charges on money borrowed in the past. But in fact, the Minister is cooking the books again in his statement to the House today. He attempts to justify his horrendously increasing deficit by arguing that substantial reductions in the deficit were achieved in three previous fiscal years.
This morning the Minister argued that the Government's financial requirements dropped from a level equivalent to 4.8 per cent of GNP in 1978-79 to only 2.5 per cent of GNP in 1981-82. He failed to note that, using his own figures, the Government's financial requirements for the current fiscal year of $26.1 billion will amount to 7.5 per cent of nominal
Borrowing Authority
GNP, an increase of 200 per cent on a year-over-year basis. That is cooking the books by anyone's definition, Mr. Speaker.
The Minister also ignores the fact that, in terms of revenue, we must expect that the worst is yet to come because of the time lag in collecting revenue. We would not expect the full impact of the decline in economic activity and Government revenues until later this year when companies and individuals file their tax returns and pay any taxes due on their activities during the past year.
So much for the Government's credibility. Let us look at its performance now. As I said earlier, we would be more willing to approve this Bill if the Government's performance in managing the economy were better. Unfortunately, its performance has been abysmal. It has shown no signs of moderating its expenditures, nor has its chronically high rate of spending been of benefit to the economy, as the two million unemployed will testify.
It is particularly ironic that this request for borrowing $19 billion comes on the eve of the anniversary of the Government's election in 1980. At that time the Prime Minister (Mr. Trudeau) said this:
We will hold the line on Government expenditure growth to under the rate of G.N.P.-
The deficit will be reduced in a phased and orderly fashion ... any new expenditure programs to meet the evolving needs and requirements of Canadians will be financed by reallocating existing expenditures or by increases in revenue.
In reality, since 1980 the Government has increased its spending at twice the rate of GNP, adjusted for inflation. Since 1980, the deficit has more than doubled. So much for the promises of the Prime Minister.
Since the Government took office in February, 1980, Government spending has increased by 66 per cent compared with an increase in the CPI of 38 per cent and compared to nominal GNP growth of 30 per cent. Clearly, the Prime Minister and the Government have been unable to come close to keeping his election promises.
As a matter of fact, it is interesting to look at the impact of Government spending and its relationship to the unemployment figures. In 1970-71 when the deficit was around $370 million, the unemployment rate was 5.7 per cent; in 1975-76 when the deficit was $5.4 billion, the unemployment rate was nearly 7 per cent. But today when the deficit is up to $26 billion, the unemployment rate is well over 12 per cent. The only conclusion is that the more the Government borrows, the higher the rate of unemployment.
This record is not confined to the present Minister of Finance and his unhappy predecessor; it has continued through the record of Finance Ministers of Liberal persuasion in the past. When John Turner was Finance Minister, inflation doubled from less than 5 per cent to more than 10 per cent. When Donald Macdonald was Finance Minister, unemployment rose from 7 per cent to 8 per cent and the deficit increased from nearly $5 billion to more than $8 billion. This kind of legacy, of course, has been outlined by the Auditor General in his reports.

February 17, 1983
Borrowing Authority
We must look at this record of deficits, and of irresponsible borrowing in light of the current situation when we have the twin evils of a recessionary economy aggravated by Government mismanagement. For Canada as a whole our real GNP fell by 1 per cent in the third quarter of 1982 which is the fifth consecutive quarter of decline. Real GNP has now fallen by 6.9 per cent since the second quarter of 1981. In the third quarter of 1982 manufacturing was operating at only 68 per cent of capacity, which is the lowest level since records were first kept in 1961. Canada needs 210,000 housing units each year to meet demand. In 1982 only 125,000 units were built.
According to the OECD, Canada's economic decline in 1982 was the worst of any of the 24 members of the OECD. According to the September 1982 issue of Euromoney, the over-all performance of the Canadian economy since 1974 ranks us fortieth in the world.
Over the past few years, our industrial productivity has been rising at the slowest rate of any major industrial nation. Of course, the impact on some of the Provinces, such as my home Province of British Columbia, has been very great. In B.C. the people are exhausting their unemployment insurance benefits at the rate of 9,000 per month. Welfare cases in the Province have jumped by more than 51 per cent since last year. Business bankruptcies in B.C. last year have more than doubled.
This is a dreary record created in part by a dishonest Government which augurs a dismal future for Canadians, who are paying the costs and will pay the costs for years to come. The Government's billowing debt threatens to throttle the fragile recovery which may emerge later this year.
The current Conference Board forecast shows a slow recovery from the recession starting this year with a modest growth in GNP, improving in 1984, but the unemployment rate is still expected to stay well above double-digit numbers. The cruellest impact of the Government's failure to develop the promise of Canada is evidenced by the rising numbers of Canadians who have lost their jobs.
When we look at alternative policies, Mr. Speaker, we have to look at the policies put forward by the NDP. I was amused this morning to note that the NDP finance critic noted his concern about the deficit. He said that he was deeply concerned about the size of the deficit. That is not what he has been saying. In a recent letter to The Globe and Mail, the finance critic for the NDP wrote:
in the reality of today, not all Government deficit is wrong ... clearly, the Government has a responsibility to borrow in order to stimulate the economy at a critical time such as now.
The NDP has also proposed economic policies which include emphasis on Government planning and increasing the corporate tax rate. In essence, the NDP is saying that more state planning is good for Canada. But this philosophy requires the Government to pick the winners and losers in the economic system. It is the same kind of thinking that spawned the National Energy Program and the 1981 MacEachen budget, which have proved to be such disasters.
We believe in the Conservative Party that these choices should be left to the marketplace. Our position is quite clear on this. We feel the only way to achieve a sustained and solid recovery is to restore stability to the Canadian economy. But stability can only emerge in a favourable climate or environment created within the framework of clearly defined Government policies. This environment must encourage the inflow of capital from other countries to augment Canada's own scarce capital resources and must encourage Canadians to conserve and expand our own capital base. Without such incentives, Canadians will not be able to create the job opportunities which are required before they can go back to work. Those who are lucky enough to be employed will not spend their hard-earned dollars on consumer purchases if they find themselves worried about their job situation. I am sorry that the Minister for Indian Affairs and Northern Development (Mr. Munro) finds that so amusing.
Similarly, we need to assist small businesses in particular to keep operating by helping them to husband their cash flow. Over and over again I am told by small-businessmen that they need such assistance as John Crosbie's Small Business Development Bond, which was a cash flow bond which enabled them to keep operating.
Over and over again I am told that small-businessmen need financial instruments to enable them to plan ahead, that they need simpler taxation measures.
Over and over again I am told by small-businessmen that the accounting costs of calculating tax advantages under the existing mish-mash of small business regulations and registration far exceeds any financial advantage to them.
For both large and small companies the need to improve their liquidity is very great, one of the biggest concerns in this country.
Over and over again 1 am told we need training programs that are not the inflexible training programs devised by this Government which limits the businessman's opportunity to use the people employed. We might consider specific incentives, such as a graduated capital gains tax or training incentives which account for management's time in training. Instead of positive, specific programs we have before us only borrowing Bills, the current one for $19 billion.
What is $19 billion? I would like to refer to this morning's The Globe and Mail. The editorial column has an assessment of what $19 billion is. Let me put it on the record:
What's $19 billion? This is how much it is. It is the size of the federal Government's entire budget in 1973-74: revenues were $19.3 billion that year, expenditures $20.04 billion. It is the size of the entire net debt of the country, the accumulated over all deficit since Confederation, as recently as 1974-75-
Indeed, the ever-increasing size of Liberal Government deficits since the midseventies has brought us to the point where, not our debt but the mere interest payments on our debt have become greater than total budgetary expenditures were when Pierre Trudeau came to power.
That is $19 billion, Mr. Speaker.


The Acting Speaker (Mr. Blaker):: The Chair is aware that the Hon. Member for Montreal-Mercier (Mrs. Hervieux-Payette) stands to be recognized. In the ordinary course of
February 17, 1983

events I would have to alternate between my left and my right, which means that I would recognize the Eton. Member for Montreal-Mercier. Elowever, the Leader of the Opposition (Mr. Nielsen) is here and also seeks the floor. 1 think in the circumstances the only way the Chair can proceed is to enquire of the House whether or not it may wish to extend its courtesy to the Leader of the Opposition. The Parliamentary Secretary to the Minister of Finance (Mr. Fisher).


Douglas Glenn Fisher: Mr. Speaker, I think the normal rules would be to allow the Hon. Member for Montreal-Mercier (Mrs. Hervieux-Payette) to speak. I know she has an important message that she wants to give to us and I would ask the House to listen to that Member now.


The Acting Speaker (Mr. Blaker):: There was implicit in my comments a search for unanimous consent. Obviously, there is not. Therefore, the Chair is obligated to recognize the Hon. Member for Mercier.


Mrs. Celine Hervieux-Payette (Montreal-Mercier):: Mr. Speaker, I would like to deal with a problem which is of major concern in my constituency, a problem which I have been facing for several weeks involving the whole question of unemployment in Canada as well as the bill now under consideration.
We know that a supplementary authority bill was introduced as a possible solution but, because of the economic slowdown and the resulting decrease in fiscal revenue and increase in unemployment insurance or welfare payments, the Liberal government is in my view acting as a responsible and more importantly as a reliable government by providing the people of Quebec with at least the basic necessities of life.
I would like to draw the attention of the House to a problem which was raised during the debate on Bill S-31 dealing specifically with investments by the Caisse de depot et placement du Quebec into companies involved in interprovincial transportation.
However, Mr. Speaker, I believe the principle which was applied to the Caisse de depot should be extended in practice. In my constituency, a building material plant owned by Domtar has just closed down and I disagree with this decision which put laid-off employees on unemployment insurance even though the plant still lead an operating capacity. Mr. Speaker, Domtar was acquired by the Caisse de depot, which now owns 46 percent of all shares in the company. Through the appointment of nine members on the board of directors and the chairmanship of Mr. Yves Pratte, a former constitutional advisor to the Quebec government the Caisse de depot has been able to gain full control of Domtar. Mr. Speaker, when a Quebec institution such as the Caisse de depot, whose responsibility it is to invest the pension funds of workers has its own staff on unemployment insurance, I believe there is ground for concern, and I want to thank the Minister of Finance (Mr. Lalonde) for getting the money he needs through this borrowing bill; however, I am still concerned by Domtar's decision.
Borrowing Authority
This company decided to close down its Quebec plant in the middle of its negotiations with its employees, after only 11 meetings. The workers had graciously accepted the 6 and 5 federal program and during the negotiations on the normative clauses, they were told they were now without a job. Mr. Speaker, 21 of these workers had served at least 30 years, a dozen had been working for the company for 20 years or more and twelve for over ten years, which means most of these workers now find themselves on unemployment insurance at 45, 50 or 55 years of age with little chance of finding another job because of the compounding effect of a bad economic situation and a dwindling labour market. Consequently, unskilled labourers or plant workers without specific technical training will have either to face a difficult retraining period to get back into the labour market or go on welfare when their unemployment insurance has run out. And in my view this is a palliative that seems to be the only way out at this point and that 1 cannot approve.
I am asking that corporation a question for the simple reason that their operations as a Quebec-based multinational company owned by Quebecers, through the Caisse de Depot, in other words the pension fund of those very workers, are being transferred to Ontario. This I consider an arbitrary decision, Mr. Speaker. Economic recovery is around the corner, interest rates are lower, construction is about to resume in Quebec, and this company manufactures gypsum boards that have always been of high quality, that have been part of the Eastern market. Those gypsum boards made in Montreal, in the riding of Mercier, were sold not only in Quebec, but also in the Maritimes and in New York state. Therefore, Mr. Speaker, the fact that we are compelled at this point to borrow in order to finance such a move by a company owned by Quebecers and financed by the Caisse de Depot, whose workers will have to live off unemployment benefits, and the fact that we are compelled to borrow while such high-handed decisions are being taken, cause me to rise and ask questions from a corporation which I regard as irresponsible.
If a Government such as ours is forced at this point in time to go out and get some money either by way of borrowing or through this country's consolidated revenue-although currently we are short of revenues due to the increased number of people that are drawing unemployment insurance benefits-1 feel they should be concerned with the lack of social awareness of some corporations. We have a federal work-sharing program that not only has helped most people to save their jobs but also is most compassionate by its very nature. Admittedly, Mr. Speaker, it must be financed through contributions obtained from the Unemployment Insurance Fund. It provides for two things: first, companies are allowed to keep their qualified workers, and second, those workers are assured of keeping their morale high and the work skills they have developed while waiting for an economic recovery.
Therefore, Mr. Speaker, I feel that everyone has to make a contribution, and private enterprise also must do its share. Under the current conditions, the private business sector is controlled by the Quebec government. The workers went to see

February 17, 1983
Borrowing Authority
Mr. Parizeau, who simply told them he was not getting involved. He only gets involved when it suits him. Apparently, the matter lies on Mr. Biron's and Mr. Landry's desks, and finally on the desks of all Quebec ministers and former ministers. They are unable to deal with the matter of a company with 90 employees. Some may say that 90 employees drawing unemployment benefits is not a major problem. But we must remember that decisions like those are made and repeated many times, and especially by companies such as this one who should be aware of their social responsibilities.
Mr. Speaker, in Quebec in 1976, the unemployment rate was less than 10 per cent. It has now gone up to 15 per cent or more, and we have an incredible number of people on the welfare rolls. Through its programs, the Federal Government is helping many Quebec families but it cannot be said that any substantial assistance has been received from the provincial authorities. In the process of taking controlling interest in corporations such as Domtar, the provincial authorities are forgetting that the workers concerned have in fact worked most of their lives. After a while, their productivity goes down, and they are no longer as young as they were. As a result of collective agreements and seniority and the number of weeks of leave to which they are entitled, they have become to expensive to "keep up", and so they are treated like obsolete equipment that can be simply got rid of, and put on unemployment insurance.
Mr. Speaker, I think that even if our Government is discharging its responsibilities through the kind of borrowing measures the House is considering today, it is not up to the Federal Government alone to bear this burden. On the other hand, I think that this borrowing measure will help us to uphold the principles supported by a Liberal Government, namely, the universality of programs such as Family Allowances and Old Age Security. Mr. Speaker, anyone who is familiar with the financial administration of the Federal Government will realize that these programs require very substantial funds. I feel, however, that in a recession, at a time of great financial difficulty, we must not forget those people who would otherwise become the victims of the situation as has happened in the United States, as a result of the conservative policies of the Reagan Government, which decided to resolve its economic problems by cutting social programs.
Furthermore, I think that a responsible government, like the Liberal Government, understands where its responsibilities lie and has the requisite compassion for these people who are having to face such difficult times. Mr. Speaker, as Canadians, we have no choice but to draw from our national wealth. Economic recovery is imminent. Mr. Speaker, at the present time, we have both the capability and the need to borrow. I believe that people who will be receiving money from the Federal Government which is now experiencing a drop in revenue and of course, an increase in payments, I believe that
these people will now be able to bridge the gap between economic recovery and the present recession.
Furthermore, Mr. Speaker, to get back to the situation in my riding, at Domtar, I urgently request the officials of that company and the federal authorities to drop their adjustment committee and to use programs such as the time-sharing agreement. There is still time to get this plant operating again. There is still time to manufacture gypsum board in Montreal, because, and the Minister's statistics are eloquent, construction is starting up again across Canada, and especially in Quebec. I must say that my riding is particularly well-suited to providing the kind of residential construction we all need.
Mr. Speaker, I have a riding that is developing steadily, with a growing population. We have land available and all the programs and infrastructures necessary to get ahead. We have the demand, and then we have a company that is simply shutting down.
Mr. Speaker, I am merely repeating what the workers have told me, workers I represent in the House of Commons. I am therefore asking the company and the Government of Quebec to act responsibly as the Federal Government has done, in these difficult times, and to enable these workers to keep their jobs.
Mr. Speaker, finally, I would like to point out that we must realize that the situation is very serious. Certainly, we are borrowing funds to help a group of people who need help, but in Quebec, the situation is almost hopeless as far as the Charter of Rights is concerned. The Province of Quebec is now going through difficult and sad times, and I simply want to appeal to the solidarity of the people of Montreal-Mercier and of all Quebecers. It is not a problem between English- and French-speaking Canadians, it is not a problem between the rich and the poor, it is not a question of knowing who will get what from the Federal or the Provincial Government. No, it is a problem of solidarity, of mutual respect, and of our common future.
Mr. Speaker, the Bill before us today reflects the seriousness of the situation, and I hope that my colleagues opposite will understand that a fair share of that money is earmarked for Quebec and that they should support the Bill. It is true that Quebec's unemployment rate is unprecedented. I suggest that now is the time for the Opposition parties to show solidarity and support the Bill so that Quebecers will continue to have faith in Canada.
Mr. Speaker, I have been defending that position in the House of Commons ever since I became a Member. Our financial capacity and credibility may have been jeopardized by an irresponsible Government in Quebec, but at least we in Ottawa can be proud to have a Minister of Finance who hails from Quebec, a Minister of Finance who is sensitive, who can take his responsibilities and who will channel enough funds through unemployment insurance and other social programs to enable Quebecers to get over this difficult crisis.
February 17, 1983

Mr. Speaker, I have heard just about every remark on the relevance or irrelevance of this borrowing Bill, and in my opinion it is simply a matter of decency and sharing. If we really want Quebecers to feel at home in Canada, we must realize that it is in difficult times that we need the help of others. Mr. Speaker, the best way for us in the House to show that we can take our responsibilities is to support the Minister of Finance and this new Bill.


Donald Alex Blenkarn: I thank the Hon. Member for a very detailed and full statement on the borrowing Bill. I was wondering if she, as a key spokeswoman for the Government, could give us the estimated public debt charges for the year 1982-83, since she has a full understanding and felt it was important to make her presentation and so prevent the Leader of the Opposition (Mr. Nielsen) from speaking.


Céline Hervieux-Payette: Mr. Speaker, I think we have the right to speak in this House, and I just-


Some Hon. Members:: Hear, hear!


Céline Hervieux-Payette: -I just exercised my right to speak. We are going through great suffering. We had plant closures, such as those of Texaco, BP, Domtar and many others in my riding. I think I am entitled to raise these matters as much as is the Leader of the Opposition. In regard to knowing what is the deficit in this country, there is a conservative country just beyond our border where the borrowing authority will be well over $200 billion.


Mr. Kempling:: What does that have to do with this place?


Céline Hervieux-Payette: There is a conservative philosophy in that country and it will have to borrow much more than this country.


Some Hon. Members:: Oh, oh!


William James Kempling: What a red herring.


Donald Alex Blenkarn: Since the Hon. Member is not quite familiar with the expenses, I was wondering if, in view of six and five, she could justify an over-all increase in Government expenses at 9.6 per cent, and whether she could tell us where the Government of Quebec might borrow the money since the Government will now crowd out everyone, including private borrowers from the marketplace.


Douglas Glenn Fisher: With record saving rates?


Céline Hervieux-Payette: Yes, Mr. Speaker, I am quite aware of the amount of borrowing being carried out by our Government and the issue concerning whether or not we have the capacity to borrow that amount of money. In fact, I think that if we consider the actual interest rate of the Bank of Canada, it is usually a sign of whether the Government is borrowing too much or too little. The actual interest rate has been going down for four months, and 1 just think that it is a
Borrowing Authority
sign that the capacity of the Canadian Government to borrow on the market is certainly there.


William James Kempling: In anticipation that you are going to ask for $19 billion.


Céline Hervieux-Payette: Today I have not seen any signs of the interest rate going up because the Government tabled the Bill requesting more money.


Some Hon. Members:: Hear, hear!


William James Kempling: Scattered applause.


Marcel Joseph Aimé Lambert: Madam Speaker,
I find myself a little bit surprised, like my colleague, the Hon. Member for Mississauga South (Mr. Blenkarn), that the Parliamentary Secretary to the Minister of Finance (Mr. Fisher) would be so unconscious-


William James Kempling: Uncouth.


Marcel Joseph Aimé Lambert: -of standard rules of behaviour in the House. Regardless of the merits of the case put forward involving a constituency problem by the Hon. Member for Montreal-Mercier (Mrs. Hervieux-Payette), and there is no question that they were well stated, yet the Leader of the Opposition (Mr. Nielsen) has priority, as does the Prime Minister (Mr. Trudeau). The Parliamentary Secretary, with a little bit more experience, will learn some of the unwritten rules of the House.
As far as the Hon. Member for Montreal-Mercier (Mrs. Hervieux-Payette) is concerned, she made a plea for the people of Domtar. I say to her-

-I will tell her bluntly that as a result of the National Energy Program and the budget of November 12, 1981, one petroleum industry in my city which had 2,500 people on its payroll was also forced to close shop. The Hon. Member made a plea for a few hundred employees, but I think it would have been preferable if she had taken up the cause of many other workers. They were the economic strength of the country, but they have been choked like a bunch of chickens because of a deliberate program of the Federal Government, a program regarding our national energy launched by the present Minister of Finance (Mr. Lalonde). Therefore, she will not arouse much sympathy in that respect.

In so far as Bill C-143 is concerned, which involves the borrowing of some $19 billion, it is in essence, an omnibus Bill, and is totally superflous. We are asked to authorize a further $5 billion to cover the period to the midsummer. Then $14 billion will be required for some indeterminate period in the balance of the fiscal year 1983-84. Never should we have been asked for this in light of the performance of the Minister of Finance this morning. He did not give us one iota of information on the financial conditions which had been promised by

February 17, 1983
Borrowing Authority
the former Minister of Finance. Although he was the most incompetent Minister of Finance we have seen come down the pike in a quarter century, the present Deputy Prime Minister (Mr. MacEachen) at least recognized the traditions and obligations of any Minister of Finance who, seeking borrowing authority, gives a full projection of Government revenues, Government requirements for cash and the estimate of the spending program of the Government. But we have not received that.
I have a copy of the Minister's notes for his 45 minute intervention this morning. It was 45 minutes, yes, because there was a lot of political riff-raff in it. But there was no hard information with regard to why we should have this fantastic borrowing program, where the requirement to pay interest on a public debt of now $140 billion or more is the biggest single item in any of the Estimates of any Ministry. Years ago National Defence was the biggest spender of all Departments, followed by National Health and Welfare. National Health and Welfare was responsible for Old Age Security, Family Allowances, hospital and diagnostic services and Medicare, but even that great program of social services is now overtaken by the cost of servicing the public debt. As my colleague, the Hon. Member for Mississauga South indicated, when we considered the saving ability of the Canadian public-and, much was made of the fact that most of this borrowing would be done in Canada, and therefore there would be savings to Canadian taxpayers, individuals as well as corporations-it absorbs more than the ability to save on the basis of the level of economic activity. Therefore, according to both the Bill and the Minister's statements, the Government may have to go outside of the country to raise some of these funds. So you borrow to pay interest on your debt. That is the shortest and the straightest line to bankruptcy. If any private individual or any corporate entity in this country had to go out on a regular basis to borrow money, and I do not mean $100 or $1,000 but rather hundreds of millions of dollars, does anyone here realize that we have here a request to borrow $19 thousand million? For how long, and what is a million dollars? What is a million dollars?
If a man who had a million dollars said to his wife, "I will give you a million dollars on the condition that you spend $1,000 a day, and when you have spent the one million dollars you can come back", how long would she be gone? She would be gone two years and nine months. That is what a million dollars is. If you want to translate it into simple one plus one terms, if you take it in one dollar bills, I would suggest to you that you would have a 38 storey building made up of a perpendicular stack of one dollar bills. We are now asking for $19 thousand million, so you would have 19,000 38-storey buildings. North America does not have that many.
But that is what we are dealing with when we get $19 billion. But that is not what is going to be required for the deficit. Canada is going to have to absorb the shock for something around $26 billion, an increase of a further 33.33 per cent.
Canada is in this mess primarily because there has been fiscal and monetary incompetence, rotten incompetence in this Ministry for the past several years. We saw a relatively healthy Canadian economy zapped, absolutely cut to the bone in 1980 by the introduction of the National Energy Program and, secondly, that nefarious budget of November 12, 1981, followed by incompetence again multiplied by the June 28 performance, I believe it was, or June 24 of 1982.
Then they decided they were going to change the pilot. We were asked by the Minister this morning to pass rather rapidly Bill C-139. My colleague, the Hon. Member for Mississauga South talked about the absolute hammer blows that the Canadian economy is suffering as a result of those remaining budgetary proposals. Some have been wiped out, those that were causing the Government more concern from the voters than had any actual worth in the program, but the Government is gathering unto itself in its centralizing policies more and more. There is the elimination of the IAACs, income averaging annuity contracts, into forward averaging where the money has to be paid to the Crown and then claimed back; and is not paid into an RRSP or into an annuity contract, which is available to private industry for investment. No, it goes to the Government, that much, and how far it goes, how far it goes!
Then there is the 12.5 per cent tax on small business dividends. The former Parliamentary Secretary will have his opportunity to speak. He may mumble in his beard or through his mustache all he wants but I will be pleased to hear him. I want him, before he speaks, to read an article signed this morning by Dominique Clift, as it appears on page 5 or page 7 of The Globe and Mail, as to the state of the economy. I know he reads The Globe and Mail. He can read, Dominique Clift, a well known writer, and he will see the similarity between the state of the nation, fiscal and otherwise, in the Province of Quebec and what is also present in the Government of Canada, that great centralizing welfare state that has been gradually added on-Big Brother knows better! These are the people who are the chief architects. They are quite candid about it. The NEP was part of it as well as the tax system.
This past summer we had officials from the Department who went through the philosophy of the proposals. It was strictly the scrapings off the Carter Report which had either been picked up off the floor or some dusty shelf and reintroduced. The then Minister of Finance did not know what he was bringing in and could not have cared less. However, the effect on the country has been remarkable. The damage has been done.
Some things remain, such as the taxation of earnings on insurance policies. This causes the policyholder to pay the tax every three years on something he or she will never see. It will be the beneficiaries who benefit. Why does the state claim the right to tax those earnings? The state simply says it has a right to tax all earnings in this country. It will allow individuals so much for living expenses, a certain amount for charity, capital gains, child care allowances or travel allowances. It then has
February 17, 1983

the blessed gall to say those are tax expenditures, that the Government is spending that money. If the Government is spending that money, it means it had a right to all the earnings in the first place.
That is the type of philosophy that is prevalent in this administration in so far as the tax system is concerned. Of course, it applies to the NDP as well.
We are told that under the handicap of Bill C-139, businessmen will be hit left, right and front centre by further and further taxes. For those who are out for development, the soft costs will be gone as an expense. All sorts of things that are normal are gone.
I can see the tax Department now. A commission salesman of automobiles is deemed to have to stay in the showroom to sell automobiles. If he dares use his car to go to see customers, to demonstrate to them or help them out, he is denied a claim for expenses for that automobile.


Mr. Mazankowski:: You will never sell a car that way.


Marcel Joseph Aimé Lambert: The theory that applies in both Finance and National Revenue is crazy. We are now trying to fight that.


Donald Frank Mazankowski: These guys buy it.


Marcel Joseph Aimé Lambert: Of course they do. They are a bunch of sheep when it comes to income tax. They do not understand it. Probably the Hon. Member for Ottawa Centre (Mr. Evans) has a little more knowledge than some of the others. To be fair, he is not bad.


John Leslie Evans: There is one on each side.


Marcel Joseph Aimé Lambert: What he knows, averaged out among the rest of the caucus, would not measure a thimbleful). This is one of the most cruel things imposed on the Canadian people, the income tax Bills. The majority of Members are unknowing, uncritical and simply stand up and say, "Aye, ready" on any and all occasions when it comes to something they do not understand.
In 1981 the then Minister of Finance did not understand. We will see whether this Minister understands or whether he has a more facile way of slipping in the knife between the ribs of the Canadian public as he takes their money. Possibly he has more gall. We will see whether he has as much sense after today's disclosure, and I guess more openings later on.
In closing, I object to this Bill, particularly in that it is an omnibus Bill. I would accept the first part, but not the second part. Part II is for the next fiscal year. That should only be done after the disclosures of a full budget and the Estimates. I urge my colleagues-I cannot urge many Members opposite because very few are listening-that they give this Bill a very much more critical look and vote against it.


The Acting Speaker (Mr. Blaker):: Questions, answers, comments. Before recognizing the next Member for the
Royal Assent
purpose of entering the debate, may I deal with some other matters.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Blaker):: Order. 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-North Delta (Mr. Friesen)-National Revenue-Garnisheeing of small business accounts (b) Government policy; the Hon. Member for Saskatoon West (Mr. Hnatyshyn)-The Administration-Position of present Ministers (b) Request that Prime Minister take action (c) Request for committee investigation; the Hon. Member for Humboldt-Lake Centre (Mr. Althouse)-Grain-Timing of change in Crowsnest Pass freight rate-effect on exports (b) Request that Minister table studies.


MESSAGE FROM THE SENATE
The Acting Speaker (Mr. Blaker):: I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill C-132, an Act to amend the Family Allowances Act, 1973, without amendment.



THE ROYAL ASSENT

The Acting Speaker (Mr. Blaker):: I have the honour to inform the House that a communication has been received as follows:
Government House Ottawa
17 February, 1983
Madam,
I have the honour to inform you that the Honourable Julien Chouinard, Puisne Judge of the Supreme Court of Canada, in his capacity as Deputy Governor General, will proceed to the Senate Chamber today, the 17th day of February, 1983, at 5.45 p.m., for the purpose of giving Royal Assent to a Bill.
1 have the honour to be Madam,
Your obedient servant,
Esmond Butler,
Secretary to the Governor General

February 17, 1983
Borrowing Authority



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that Bill C-143, to provide supplementary borrowing authority, be read the second time and be referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mrs. Ursula Appolloni (York South-Weston):: Mr. Speaker, I hope the Hon. Member for Edmonton West (Mr. Lambert) did not imply that if one were not an income tax expert, one would automatically be a second-class Parliamentarian. I submit that if we are to be truly representative of the Canadian people, it is not necessary to be an income tax expert. I would say that it is very necessary to understand people, to understand their needs and aspirations and, more than anything, to have what is regularly known as a certain amount of common sense. Unfortunately, it is not as common as its name would imply. One would wish at times we had more of it, even in this august Chamber.
Dealing with the borrowing authority Bill, the first point to be made is that the need for the Bill should not come as a surprise to anybody. 1 do not think I have heard anyone say that they are surprised. Perhaps they were alarmed or overwhelmed, and many other words could be used depending on which side of the House you speak from. They may have been alarmed at the amount.
I believe the first point to be made is that no one was really surprised that the Government needed to borrow money to tide it over to the end of this fiscal year. Why? Let us look at it in a common sense way which, as I have already said, is unfortunately not common enough. We have to look first at the global situation. Everyone who has read a newspaper, watched TV or listened to a radio has witnessed a recession, the magnitude of which we have not seen since the early 1930s, and it has been global. We have witnessed high unemployment, record levels of unemployment, in all the industrialized countries. We have witnessed tremendous uncertainty among OPEC countries. We still have that uncertainty with us. Perhaps another week or so will give us a better picture of how we are going to project our own budget for the coming year. We cannot be immune to these situations which occur in other countries. They do affect us. At home we have had two drastically high unemployment periods, which means not only human suffering and misery but, more practically, record levels of payment out of the Unemployment Insurance Fund.
There are those of us, and I count myself among them, who thank God that we have an unemployment insurance plan which gives a safety net to those people who, through no fault of their own, lose their jobs. We do have an Unemployment Insurance Fund but it has been depleted. Many of our constituents have even depleted what benefits they were getting from the Unemployment Insurance Fund and have had to go
on municipal welfare or, worse still, provincial welfare, because that means a longer term. Obviously, the coffers have been depleted because fewer people have been working, because the oil prices have not risen as one year ago it seemed they would rise. The Government receives less revenue. High interest rates, which are coming down now, were also added to the national debt. We had to pay more money to service the national debt. But these things are improving, Mr. Speaker. The global situation now is much healthier than it was even a few short weeks ago. We now have rapidly falling interest rates, as a result of which the Government's debt will be more easily borne by Canadian taxpayers. Hopefully, interest rates will continue to go down. The economic indices are good. Things are going to improve.
However, let me say again, no thoughtful Canadian should be surprised at this stage that the Minister of Finance (Mr. Lalonde) needs more money to tide him over to the end of the fiscal year. No one should be surprised at that, nor can anyone blame him. However, once we have reached the end of the fiscal year, the Minister has already spoken about interim financing toward June. What is he going to do with that money? That is what I would like to direct my remarks to, Mr. Speaker. It is the main theme of my presentation today in the House. What is the Minister going to do with that money? How is it that he cannot wait until later, after the budget, to get money in order to put forward his programs? I submit, Mr. Speaker, that the very fact that the budget has not been brought down, nor will it be for another few weeks, at least, explains in part why the Minister must have the authority to borrow money now and not when it is too late. Let me explain. We have read in today's press that the budget will probably be brought down sometime in April. No one knows the exact date, not even the Minister of Finance himself. In that budget the Minister will announce specific projects. We in this Chamber know how long legislation takes, how long debate takes. We should be the first to understand the lead time which will be necessary in order for these programs to be implemented.
Let me focus my remarks on my particular wishes for the programs of the future. I refer to the youth constituency, Mr. Speaker, because irrespective of the upturn in the economy which will come, irrespective of the tremendous growth which will come, we have to be realistic and understand that when employers start re-hiring, they will re-hire the skilled and trained workers. The youth component will be very, very low on the totem pole. The youth are the ones who will be hired last and, unfortunately, will be the first fired. 1 do not believe, being realistic, that the private sector will turn its attention in the immediate future to the youth of this country. The Government must look after the youth component. They are our future. The Government will need money now before it can even start formulating the programs for our youth. What kind of programs am I suggesting? First of all, I believe that in discussing youth needs we should be very careful, Mr. Speaker, not to generalize. We women would be very upset if people
February 17, 1983

generalized about our aspirations and needs. The men would also resent any kind of generalization. We cannot generalize about youth. There are various categories with various needs, just as with the adult constituency.
In order to make our approach simpler, I believe we, as legislators, and, hopefully, the public, should have at least three broad categories for youth who this summer, just a few weeks from now, will desperately need our hlep. In the first category, very broadly, are the youth who have finished their formal education. They have left school. They have a certain amount of formal education but not very much practical experience. They will need full-time jobs. The proposal which grew from this side of the Flouse, Mr. Speaker, refers primarily to that category. It is not, and I repeat, it is not a panacea for all the ills of Canadian youth, for all the needs of Canadian youth, but it is at least a firm proposal by which a certain number of Canadian youth, who so wish, will be absorbed for a short period of time into the Armed Forces. That is a full-time job.
The second category of youth, I would submit, is the university students who will be coming out of school, perhaps, as soon as May, just a few months from now. Many of these young people have stayed in university longer than they originally planned to do at the beginning. Perhaps some of them would have been happy with just a simple BA, but now because of the economic situation they have fears that they will not get a job, and those fears are well founded. They cannot get a job now in our society as it is. Therefore, they have chosen to stay in university, perhaps at some financial sacrifice to themselves and to their families. I am sure society as a whole will benefit from this in the long run because the future generation will be more educated than the preceding one. However, we must help those university students to continue to pay for their tuition by finding them summer jobs. As I said before, I doubt very much that the private sector can supply jobs in the numbers needed for these students. But I hope any jobs we do find them will be jobs that will help them in their career aspirations, not just make-work jobs, but jobs which would give them on-the-job experience they will need when they eventually go into the private sector and ask for work.
1 would suggest, therefore, that perhaps the universities, the laboratories, could be given extra grants in order to hire the students who need summer jobs and, therefore, give them the practical expertise during the summer which they are learning in theory during the winter months. It is only a suggestion, I do not know if it will be accepted.
The other category is the high school students. Here again we now know that enrolment last year was much higher all over the country than it has been for many years. Why? Again, the kids decided to stay at school rather than go on unemployment insurance or face a job market where there were no jobs for them. Here again there was a financial
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sacrifice particularly on the part of those students' families. We have to help them. These students, in their hundreds, will be coming into the summer job market, perhaps in the middle or at end of June. What is going to happen to them? I suggest, Mr. Speaker, that it would be unwise, to say the least, perhaps irresponsible, on the part of Government to even place advertisements, such as it did in today's newspapers, offering them summer jobs if the Government itself is not sure it would have the means of providing for the payment of those programs. I suggest that is the kind of thing the Minister of Finance meant this morning when he said that our job was to provide for the needs of those who need help most.
In my submission, we have to be prepared in the coming months to face the tremendous number of young people who are going to be turning not to the private sector but to all of us in this Chamber and begging for help. I do not think they need to beg. We should not make them do so. We should be preparing them now and saying "Look, there is hope".
Of course, Mr. Speaker, it is embarrassing for any Government to have to ask permission to borrow money. But do you not think it would be morally reprehensible if we were not to ask for that money to spend it on worth-while programs such as those I just mentioned? I believe, Mr. Speaker, that our first duty is to the people of Canada, to help them when they need help most, when there is no one else to do it for them. Therefore, I would say yes, we are facing a deficit. No one is very comfortable about it, but we are using the money for worth-while purposes, and I think that Canada's youth will thank us for it in the end.


The Acting Speaker (Mr. Blaker):: It was my intention to recognize next the Hon. Member for Comox-Powell River (Mr. Skelly), but as the House will have noted, I had to ask him to consult with the Chair for a moment. In the meantime I will remind Hon. Members that there is a period for questions, answers and comments.


Arnold John Malone: Mr. Speaker, I would like to ask the Hon. Member for York South-Weston (Mrs. Appolloni) whether the Government is intending to spend $19 billion on young people as the result of this borrowing request?


Ursula Appolloni: Mr. Speaker, I hope the Hon. Member was joking. I really do. I have asked that the Government be humane, not irresponsible. I have already pointed to the various needs the Government is facing to replenish the depleted unemployment insurance coffers and service the debt. I have not for one instant mentioned or even thought that all the money the Government needs now has to go to youth. However, I would hope very much that a large section does.


Arnold John Malone: Mr. Speaker, we need not be told about the question of irresponsibility of the Government. The Canadian people already know that. I want to ask the Hon. Member for York South-Weston how much money will be spent on youth?


Ursula Appolloni: The rules of the House forbid us to impute motives to any member who is speaking and I would just hope

February 17, 1983
22956_____________________________________
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en passant that by his questions the Hon. Member for Crowfoot (Mr. Malone) is not implying that he does not give a damn what happens to Canadian youth. However, when he asks me specifically how much money will be spent on youth I have to answer in all honesty and seriousness that I am not the Minister of Finance, nor am I privy to his calculations. Obviously, I do not know. However, I do know that our present Minister of Employment and Immigration (Mr. Axworthy) does his damnedest to help Canadian youth, and he will get every darn penny he can to help them.


Raymond John Skelly: Mr. Speaker, there are two questions I would like to put to the previous speaker concerning youth employment. I agree that it is a very serious problem. However, I am concerned that the Government would not identify maximum benefits to youth employment, and I wonder if she might comment on this. For example, consider reforestation. The basic degradation of the forest resource industry in Canada is a desperate problem and seems to be one of the factors which has driven forest companies out of Canada. Disease-kill, fire-kill, and over-logging, especially in high-grade areas, has meant a loss of much of our forest base.
Would it not pay the country to use the youth, of which there is an enormous capable force available, to get heavily involved in reforestation programs, salmon enhancement programs and rehabilitation of Indian communities rather than putting them into the Armed Forces? Has she given any consideration to what would be a double pay-off for the dollars spent where, first, it would employ youth and, second, it would make a permanent contribution to the resource base and future of this country?


Ursula Appolloni: Mr. Speaker, I thank the Hon. Member for that question. In fact, I have followed that line of reasoning myself, particularly as far as reforestation is concerned, with the Minister of Employment and Immigration. Many of the particular proposals to which the Hon. Member referred would have, shall we say, a short life expectancy in as much as they would be seasonal. Now, I did point out that the proposal to put the young people in the Armed Forces is not a panacea, nor is it the answer to all the problems concerning youth unemployment. It is aimed primarily at those who have already been accepted into the Armed Forces, those who wanted to join and have been accepted. But that would be for a full-time job.
Now, what 1 think the Hon. Member is getting at, and I agree with him, is that reforestation can be done, particularly under such programs as the Community Development Program. For instance, if in the Hon. Member's constituency there is an area which needs reforestation, I cannot see why the Hon. Member himself would not communicate with the Minister, as I have done regarding my own constituency, and say that we need a particular program and we need to employ youth. I also happen to know that the Minister of Employment and Immigration has spent something like $100 million in 1982 for youth employment alone, and he has already asked for more. This is in reply again to the Hon. Member, who is not interested in youth but just likes to ask silly questions, even though he did ask how much is of this money going to go for
youth. I can tell you it is going to be more than it was last year.


Gilbert Parent: Mr. Speaker, the devotion of the Hon. Member for York South-Weston (Mrs. Appolloni) to youth employment is well known in our caucus. In her remarks she alluded to two programs which I would like to hear a little more about. One is the program which had to do with youth helping older people in her particular riding, and the second was the proposal put forward in discussions with U.S. Congressmen. She alluded to these in her talk and I would like more information, as I am sure most Hon. Members would. So if she can address herself to those two programs, I would be most appreciative.


Ursula Appolloni: Mr. Speaker, I thank the Hon. Member. There are several programs now in place in individual ridings. We have not hidden the models. As a matter of fact, on several occasions I have invited my colleagues who are interested in youth proposals to get in touch with me, and we would give them the model.
In my riding, under the Community Development Program, we managed to hire nine people, of whom six were youngsters, usually high school drop-outs, and the three others were unemployed skilled workers-a carpenter, a painter and a general handyman. They taught their skills to the six youths. Once the kids learned the skills we sent them out into the community to help low-income people. In a year and a half we trained 21 kids up to apprenticeship standard. Two of them have started their own business and are now employing others, several have been employed by other people in the private sector and some have gone for further training. The beauty of this is, that at the same time, 87 homes of low-income people, usually senior citizens, were renovated. They only had to bear the cost of materials, not labour. This can be done in any riding with the same characteristics as mine.
The other program was a high school drop-out program, to encourage the individual kids to return to school. As far as the conservation program is concerned, I would invite all Hon. Members who are interested in youth to get in touch with the Kennedy Memorial Institute in Boston, which has adopted some of our programs.


Arnold John Malone: Mr. Speaker, what we have established from the remarks of the lion. Member for York South-Weston (Mrs. Appolloni) is that she is willing to borrow $19 billion. She lists subject areas which no Member of any political Party would doubt are good areas in which to spend money, but she does not have any idea how much money is required.
I want to ask the Hon. Member if she could name one bank that would give a loan of at least $1,000 to a company or person if that bank did not know what the money was to be used for.


Ursula Appolloni: Mr. Speaker, if 1 were to give a factual and detailed answer to that question, the Minister of Finance
February 17, 1983

would indeed deserve to lose his job because he would have broken Cabinet secrecy. I have been careful to say from the beginning that I am not privy to his calculations. All I can do as a responsible MP is to put forward suggestions, not to sit and beef constantly about unemployment, but to give him some concrete suggestions about how to get over the problem. I wish, and I am sure the people of Canada wish, that certain Members of this Chamber would spend less time on partisan jibes but would do their homework and help their constituents. Perhaps if we all did that there would be less unemployment and less need to borrow in the first place.


Raymond John Skelly: Mr. Speaker, I should like to propose the following amendment to the Bill before us:
That the motion be amended by deleting all the words after the word "that", and substituting therefore the following words:
-Bill C-143, an Act to provide supplementary borrowing authority, be not now read a second time, but that the subject matter thereof, particularly the subject matter of the clauses pertaining to borrowing authority for the fiscal year ending March 31, 1984, be referred to the Standing Committee on Finance, Trade and Economic Affairs which is instructed to consider the impact of the subject matter of the said clauses on unemployment in Canada.


The Acting Speaker (Mr. Blaker):: The Chair would like to express its gratitude to the Elon. Member for Comox-Powell River (Mr. Skelly) who was so kind as to advise the Table officers and myself before putting that amendment. That has given us time to examine the precedents and rulings relevant to this case.
I should like to refer the Hon. Member to Erskine May's Parliamentary Practice, Nineteenth Edition, at p. 517 where the following passage appears:
In the case of bills referred to standing or select committees, an instruction can be moved as soon as the bill has been committed, or subsequently.
The Hon. Member for Comox-Powell River will recognize the difficulty, which is that the amendment he proposes adds certain instructions to the Committee. According to our precedents, those instructions cannot be given to a committee until such time as second reading stage has been completed.
Again I thank the Hon. Member for taking the trouble to consult with the Table officers and the Chair. In order to facilitate his consideration of an amendment, perhaps I could be of assistance, although it is obviously up to the Hon. Member to decide what he wants to do. 1 could suggest to him that if he were to simply drop the last phrase beginning with the word "which is instructed to consider" et cetera, then the amendment could be found to be in order.


Raymond John Skelly: Certainly, Mr. Speaker, the intent of the advance notice was to determine whether the phrase at the end of the amendment was acceptable. I am more than willing to delete that particular phrase so that the amendment would end with the words "-to the Standing Committee on Finance, Trade and Economic Affairs".


The Acting Speaker (Mr. Blaker):: In that case I will put the motion to the House in that fashion. It is moved by Mr. Skelly and seconded by Mr. Young (Beaches):
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That the motion be amended by deleting all the words after the word "that", and substituting therefore the following words:
-Bill C-143, an Act to provide supplementary borrowing authority, be not now read a second time but that the subject matter thereof, particularly the subject matter of the clauses pertaining to borrowing authority for the Fiscal year ending March 31, 1984, be referred to the Standing Committee on Finance, Trade and Economic Affairs.
The proposed amendment is found to be in order and is open for debate.


Raymond John Skelly: Mr. Speaker, presentation of the Bill before us which seeks authority to borrow a substantial amount of money, is a very common procedure in the House of Commons. It is almost a knee-jerk reaction in which we find the House being presented with a blank cheque. Sometimes the Government makes certain gestures toward the provision of information about the need for borrowing. In each case that we have been faced with, the amounts are larger and larger while the information is scarcer and scarcer each time the Bill comes before us.
I recall that when the last Bill was before us we engaged in a very intensive debate about the matter. At that time the other Party with whom we share the Opposition benches informed the Canadian people that they had won a great victory by not signing the blank cheque right away. Eventually, however, they did sign half the cheque, and after a couple of days of debate they signed the last half of the cheque.
What we have now is a situation where debate in the House of Commons winds up being largely a matter of knee-jerk reaction. Many Members of the House believe that this is a very substantial amount of money to be borrowed and that certainly, prior to giving support in principle at second reading stage, it would be better if we were to refer the question of borrowing to the Standing Committee on Finance, Trade and Economic Affairs. I hope that this amendment will be accepted by the majority of Members in the House.
There have been allusions to the causes of the economic dilemma that faces us today. I think it is fairly clear why the Government has to borrow. We are in a very severe recession in which Government revenues have definitely dropped, Government programs have been strained to the nth degree in an attempt to support individuals in difficult times. These programs have not been doing a great job in supporting those individuals, given the unemployment figures, bankruptcy figures, the erosion of the social institutions mentioned by the previous speaker such as the university community and technical schools which are all faced with very severe cutbacks in teaching staff, increase in pupil-teacher ratios, class size and lack of material.
Let me just digress for a moment. I would point out that a Dean of an Engineering Faculty to whom I was speaking, responsible at the time for instruction of post-graduate students in electrical engineering, told me that recently his class sizes had risen to the point where he found it very difficult to teach. He was in a fairly lucky position with tenure and a fairly reasonable salary. He found himself well above the other

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members of the faculty, especially the new ones, in terms of security and salary. At the time the university was increasing class sizes dramatically. The university was refusing to provide appropriate equipment to keep its post-graduate students on the leading edge of technology which would enable them to leave as competent, trained engineers. The junior faculty was being siphoned off quickly into industry where the benefits and salaries were much higher and where the opportunities to improve and develop their professional capacity was much greater. Largely through federal Government and provincial Governments' restraint activities the university faculties were being gutted. Once we have caused harm to the students it will have a life-long effect on those individuals. If we gut our universities now it will be a decade or more before they can recover.
The motion before us this afternoon proposes that we take a serious look at the implications of this borrowing Bill. Maybe we can determine some of the directions in which we should be moving to spend that money when we determine what amount of money is appropriate. There is an enormous failure on the part of the Government today. There is enormous incompetence on the part of the Government today. No one argues that we have not been drawn into a deep world-wide recession, from which Canada cannot be excluded. But unfortunately the negative, social and economic impacts on this country have been compounded by an incompetent Liberal Government.
Let me outline one example of the complete incompetence of this Government as it relates to the National Energy Program. In 1980, during the election, the subject of energy and the cost of energy was widely talked about. We heard how we were going to develop security of supply and how we were going to be protected from high price energy. These were made the topics of the election campaign. Certain commitments were made by this Liberal Government on those topics. Basically, Government revenues were to be enhanced, the price of fuel was going to be controlled and ultimately the megaprojects would be the economic salvation of this country. All of that was embodied in what was called the National Energy Program in 1980. We heard the present Minister of Finance (Mr. Lalonde), who was then the Minister of Energy, making firm commitments in the House of Commons about the benefits that Canadians would receive. We heard that the megaprojects would put us back to work. The NEP would be the engine which fuelled the economy, supported other businesses, created employment and took away regional disparity. The promises went on and on. The National Energy Program was also to be the salvation of what had been in the past incompetent Liberal Governments. These Liberal Governments wound up with enormous deficits and eroded the strength of Government programs. Ultimately, the National Energy Program was to be an enormous cash grab by the federal Government shared with the Provinces and the producing companies, which would solve all our economic problems. The revenue figure used by the Government was $65 billion. It is very difficult to get one's head around that amount of money. It certainly pales the deficit.
We also talked about the possibility of Atlantic Canada becoming financially secure, energy self-sufficient and spinning off the results of industrial and economic development into the twenty-first century. We were told that all this would create opportunities in areas of the country that traditionally had great difficulties.
It was not too long after that that Bill C-48, the legislative vehicle that implemented the National Energy policy, was rammed through this House by closure. It was rammed through committee. It was a very difficult and complicated piece of legislation. The Minister told us, "We do not want to spell out the details. We want you, legislators, to give me, the Minister of Energy, discretionary power," and the amount of discretion in that Bill was enormous. We saw the Government ram that legislation through the House. It put the National Energy Program into place. It was hardly implemented when its collapse became evident to most people.
Ultimately, we wound up in 1982 with what was called the National Energy Program Update. It became obvious that the original projections, the megaprojects, had collapsed. That engine to fire the economy to assist us in recovery from recession, collapsed because of the incompetence of the Government.
The Government had made a quick snatch at revenue in the amount of $65 billion. But in the 1982 Energy Update it changed its projections. The projections became an amount between $25 billion and $30 billion. The Government wound up again confounded with problems of assistance to regional developments because of the collapse of particular projects or the delaying of them.
Again, we come to face what we have today, a request to borrow $19 billion. One of the reasons we are faced with this borrowing, the particular depth of recession and the harm caused by it, is the incompetence of the Government. What is that incompetence? The Government took a terrible risk. It risked the industrial and economic future of this country in one economic sector. The Government threw the dice on one particular sector, that of energy. The Government made a snatch at a goose it thought was going to lay a golden egg. But eventually it found there was nothing there. Instead, the Government placed Canadians and the whole economy of our nation in the hands of OPEC, a cartel which was controlling the world supply of oil and its price. Unfortunately for the Government of Canada, the OPEC cartel collapsed. OPEC was not a platform upon which this Government could build a sound economy in Canada. But that is very traditional with the Liberals. Liberal Governments in this country have looked for the economic salvation of Canada in the export of raw, unprocessed natural resources. At one time it was coal and unprocessed base metals that were being shipped to the Japanese, and other world markets. In the future it looks as though we may be shipping unprocessed forest products to the United States. The same will be true of the export of raw energy resources, natural gas and oil. We talked about 900 years of natural gas and 900 years of oil around a decade ago. Suddenly that wheel turned back and Canada has a shortage of supply. But now we are being told again that we have a very heavy surplus. Believe
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me, Mr. Speaker, we have been put through this exercise one too many times.
It is interesting to note that the National Energy Program collapsed. This was the industrial sell-out for raw materials in Canada. The Update has collapsed. The most recent events in the collapse of the National Energy Program Update were seen in the total collapse of the megaprojects. There are no jobs to be created in that area nor any stimulus for Canadian business.
We look to the collapse of the Canada-Newfoundland Energy Agreement. We can take no comfort in the fact that the Appeal Court of Newfoundland has ruled in favour of the the federal Government of Canada. At some point in time officials of this federal Government will have to sit down with officials of the Province of Newfoundland, play fair ball and bargain in good faith. Unless this Government is prepared to give the Government of Newfoundland a fair and even partnership in the development of that resource, we will see the same kinds of economic problems emerge. Fairness was preached about so much in the National Energy Program. That fairness will be put off for decades. The Government of Newfoundland simply asks for an opportunity to manage that resource in such a way that a portion of the $100 billion projected from Hibernia will stay in Newfoundland. But the only way that can occur is if the people of Newfoundland have some say in the management, the development and the opportunity to pace that development so that industries in Newfoundland and Atlantic Canada are to share in the benefits of resource development.
History is very clear. What happened to the majority of jobs created by the North Sea oil? They wound up in the United States. The collapse of the megaprojects is one thing. It is time the federal Government came back to the table with Newfoundland, put aside the matter of who owns the resource and looked at how we as Canadians will share the benefits, thus providing an opportunity for the people of Newfoundland and Atlantic Canada to pull themselves out of economic dilemmas they have faced for so much of their history. It could also provide an industrial and an economic base that will support them after the oil is gone.
We look at the collapse of revenue. The National Energy Program Update dealt with certain recovery measures that were meant to get the federal Government into an acceptable revenue position. Perhaps we could look here for some of the funds for programs for young people that the previous speaker spoke of, as well as for some programs for the unemployed that would help get some economic initiatives rekindled.
Unfortunately, that Update to the National Energy Program has collapsed again. We have seen the price of energy on the international market fall to the point where oil will likely replace natural gas. The Government is trying to sell enormous volumes of natural gas. The National Energy Board provided for the sale of enormous volumes of natural gas into the United
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States. In order to stick to the Government's promise to keep the domestic price of gas at 65 per cent of the equivalent price of oil, the Government has dropped $300 million in revenue. From this type of poor planning we have seen a drop in projected revenues from $65 billion to $30 billion on the first update. We have seen a drop of $300 million in natural gas earnings alone. There has been a tremendous loss in projected revenues ever since the National Energy Program Update in 1982. This brings us back to the collapse of the energy projects and the collapse of the Canada-Newfoundland energy agreement. Now we have the collapse of the revenue projections.
We talked a great deal about fairness throughout both of those phoney energy policy reports. There were errors in Government judgment in regard to the economic and industrial recovery for Canada.
As recently as last Thursday, the Minister of Energy, Mines and Resources (Mr. Chretien) stated in Vancouver that one of the Government's main commitments was to build pipelines to allow the people of Atlantic Canada to capitalize on natural gas as an alternative energy source to oil and to allow the people of Vancouver Island to have natural gas as an alternative. There are no developed alternatives to oil on Vancouver Island at present. There was a commitment of $150 million to build that pipeline and pay the conversion costs on Vancouver Island. Last Thursday, the Minister of Energy, Mines and Resources appeared to have scrapped that plan. I and many Canadians would appreciate it, in a spirit of fair play, hearing from Minister in the House for the sake of the people of Vancouver Island whether that gas pipeline is to go ahead. He indicated that it would not because a review of the costs proved them to be exorbitant.
The National Energy Board came out with a proposal about a week and a half ago to increase the export of natural gas primarily to the United States market. It represents an enormous increase in volume. I believe the rationale behind that decision is unacceptable. There are certainly problems with it. But the federal Government has left itself open to blackmail from the industry which tells the Government to either sell the gas or they will shut down. On the other hand, the Americans are pushing us by saying they will not take our gas unless the Government drives down the prices, substantially. We are faced with the prospect of Canadians paying billions in incentives to drill for gas. The companies pay about six cents, and the Canadian taxpayer pays about 94 cents on the dollar for the risk of exploring for that new and expensive oil and gas. Yet the Government is prepared to sell enormous volumes of cheaper gas to the American market which cannot even absorb that volume. Canadians will find themselves further behind the eight-ball as a result of paying these enormous incentive grants, while the Government's revenues from energy are greatly reduced on sales of a very valuable resource which the Government is prepared to give to the United States at sale prices.
Let us consider the economic logic of this plan in which the Americans end up with cheap energy to produce cheaper goods
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that will compete with our high priced goods in a very competitive world market. The economic logic behind the cheap gas export fails completely. The failed logic of the National Energy Program has caused the Government to push cheap supplies of energy into the United States that will displace our manufacturers and our goods on the world market.
Probably the most amazing aspect of the National Energy Board decisions was the Dome Petroleum proposal to sell liquefied natural gas to the Japanese. This is an incredible situation in which a Canadian Board and the Canadian Government would allow a company like Dome to feed natural gas into the Japanese market. The Japanese market which is going soft. The Japanese are cutting back on orders of coal and natural gas. The formula by which Dome is to sell that gas to the Japanese is based on the U.S. prices. If the Government caves in to the demands of the United States to lower the price of our export gas sales, then our gas to the Japanese could easily go down. The price is already so low that when one takes into account the cost of delivering the gas from Prince Rupert, the liquefication, the transfer to Japan, and the regasification the return to Canadians will make the exercise uneconomical. In reality, we may discover that Dome will have to be bailed out from another misguided project.
There are serious concerns, even concerns expressed by the National Energy Board. I think it is time for the Cabinet to step in and put a stop to these illogical projects. We must develop a much more sound approach to the management of our economy and the development of energy as a rational, integrated part of industrial and economic development in Canada. Instead, the Government's approach has simply been to try to snatch at a goose that they thought was laying a golden egg.
These problems originally began when the Government's National Energy Program of 1980 failed miserably to develop an economic strategy for Canada. That program was patterned after the same miserable failures of past Liberal Governments' proposals to export our unprocessed resources. This is what the Liberal Government has traditionally depended upon. It has failed to develop an effective and broadly based industrial strategy with a firm foundation that is developed by Canadians and will provide employment opportunities.
The Minister of Energy, Mines and Resources should come to the House and give us a new update to the National Energy Program. Furthermore, when we come to deal with the budget of the former Minister of Energy, Mines and Resources, perhaps we will find some direction which will show that the Government has finally become aware of the real problems that confront this country and its economy. The Government should go back to square one, develop an industrial strategy that will put Canadians back to work, and that will not suffer from the ups and downs of an OPEC-managed world energy market.


John Carnell Crosbie: Mr. Speaker, this is a most unusual piece of legislation that we are now discussing. The only reason that the Government of Canada is even able to contemplate this kind of barehanded effrontery, this raid on the Treasury of the people of Canada, is for reasons
that we can see here when we look around us today. In this House of Commons Chamber we do not have one reporter in the gallery. Apparently they do not care about what is to be said about an attempt by the Government to borrow $19 billion, which is the largest amount for which any Government ever attempted to get borrowing authority. They do not seem to care that only $5 billion of that money is for the fiscal year we are in now and that $14 billion is a barefaced grab without any adequate explanation of what it will be needed for next year.
We see on the benches opposite us that Members are so concerned and worried that we have a total representation here of nine, half of whom are Cabinet Ministers. Of course, they are the ones who organized and initiated this grab. They are the ones who are responsible for what we see before us.
What is this all about? We have an admission, again by the Government, the Department of Finance and the Minister, that they are totally and utterly incompetent. On November 12, 1981, just 15 months ago, we were told that the deficit for this year, which ends at the end of March, would be $10.5 billion. That was to be our deficit. All the economists in the Government gave this as their best estimate for this year.
We are now just 15 months past the date of that estimate and the deficit, we are now told, is $27.2 billion. That is two and one-half times what we were told 15 months ago.
The predecessor to the present Minister came to the House on June 28, 1982, just eight months ago, and revised his figure. He said the deficit would be $19.6 billion for this year. That estimate was only eight months ago and he was wrong by $7.6 billion, so far, as compared with the estimate made eight months ago. The present Minister of Finance came to the House on October 27, just four months ago, and told us the deficit would be $23.6 billion. Four months later he is just as uninformed or as deliberately dishonest as his predecessor when he gives us his estimate of a $27.2 billion deficit in the year ending on March 31.
The same Minister has made equally inaccurate statements concerning borrowing requirements, what are called the financial requirements, most of which the Government must borrow. Fifteen months ago, the Government said it would be $6.6 billion. Eight months ago, it changed that to $17.1 billion. Then, four months ago, it changed it to $22.2 billion, and today it is telling the House that the financial requirements this year amount to $26.1 billion. That is four times what it estimated just 15 months ago.
In the whole history of Canada, such incompetence or monumental dishonesty has never been exhibited by the people who are responsible for guarding the funds of Canada. However, there are hundreds and thousands of economists. Are we to believe that this is the best kind of job they could have done over the last 15 months? This Minister has no credibility, none. He is just as bad if not worse than his predecessor.
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What has the Government said about those deficits during all this course of time? On November 12, 1981, the former Minister of Finance, who is now the Deputy Prime Minister (Mr. MacEachen), said that the deficit for the fiscal year 1981-82 would be lower than the $9.8 billion he projected a year before. In fact, the deficit last year turned out to be $13.6 billion. Fie was $3.8 billion wrong when he gave the estimate on November 12, 1981, for the fiscal year which was to end four months later. Such incompetence is unbelievable.
Then the former Minister, in regard to the Government's policy, said, "I believe we must reduce our deficit and our borrowing requirements substantially". That is what this prevaricator said was the policy of the Government on November 12, 1981. He said, "We must reduce our deficit and our borrowing requirements substantially", but instead of that, the deficit has tripled and the borrowing requirements have quadrupled. Despite that statement of policy, the Government is either completely and utterly dishonest or completely and utterly incompetent. Never in the history of this country has such incompetence been seen-


Donald Alex Blenkarn: Or both.


John Carnell Crosbie: -or dishonesty, or both, been seen. Then we heard his statement of June 28, 1982. Listen to this, Mr. Speaker, in light of the background I have given. He said:
The Government cannot responsibly add to the deficit. It has to reallocate resources. The action plan will therefore be carried out within the framework of current monetary and fiscal policy.
He said that at a time when he estimated the deficit to be $19.6 billion, and it has now risen $7.6 billion. He said, "The Government cannot responsibly add to the deficit", but it has added $7.6 billion to it now. The Government is condemned by its own words, put in writing and printed just eight months ago.
He said:
My purpose tonight is to offer Canadians a way to end the recession and to speed our progress toward recovery through immediate action.
What a joke! Tell that to the 1,600,000 Canadians who are now unemployed. 1 want to compare that with the statement of the present Minister of Finance (Mr. Lalonde) today, that creature who refused to demonstrate any sense of moral responsibility by resigning because of the patronage deal into which he entered with Mr. Gillespie, as we found out in the last several days. Concerning the fiscal year 1983-84, which begins in one and a half months, or six weeks, he said:
-it is too early at this stage to forecast what the financial requirements will be.
This Minister cannot forecast, a month and a half before the fiscal year starts, what the deficit might be, yet he comes into the House and blindly asks us to approve a $14 billion increase in borrowing authority. Can it be creditable, that he would attempt that? He can only attempt it because there is no interest. No one cares. No one gives a damn about our financial position. No one understands what a deficit is. No one appears to worry, and the press are off, of course, chasing rainbows or moths or some other diversion, and are not following the course of debate in the House. We in the House might
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as well be eliminated, done away with, come in here and go through the Question Period for one hour a day and close down the rest of the nonsense that we are in the process of going through now.


Arnold John Malone: That is because Trudeau killed Parliament.


John Carnell Crosbie: I showed Hon. Members what his predecessor said in June, and today the Minister of Finance said this, and I quote from page 11:
The Government of Canada remains committed to its longer term goal of systematic restraint of its expenditures as a proportion of the GNP-
Do Hon. Members know what the Government is up to now? It is now spending 26 per cent of the Gross National Product.
Let me say to you Canadians out there who create the goods and the services and the wealth, that they are taking and spending 26 per cent on you. That is what they are up to, yet they have the gall to tell you that their goal is systematic restraint of its expenditures as a proportion of the GNP.
The Minister went on to say, "We remain committed to the systematic reduction of the deficit as well".
What a tissue of lies. The Government is not dedicated to the systematic reduction of the deficit. It is not committed to any reduction of the deficit. It has risen from $10.5 billion 15 months ago to $27.2 billion today.
What is one of the main reasons we have been in this mess over the last several years when we know that there has been a recession and depression? The fact is that we had nothing behind us. The Government had trapped itself, had its hands tied, because for all of the previous years it had prepared deficits. So at a time when Canada really needed deficit financing, these fools, these charlatans, these scoundrels, had spent away our substance. So the deficits could no longer be stimulated.
I have in my hand a table which shows what our deficits have been for the last 10 or 12 years. Beginning with 1972-73, when the great genius, John Turner, was Minister of Finance, there was a deficit of $999 million. Every year the deficit became worse, until the end of March, 1982, when it was $13.6 billion. Over those ten years, when things were relatively not too bad in Canada, the Government incurred $77 billion in deficits. Therefore, when we came to the part of the financial cycle where deficit financing was needed, the Government had already wrecked our system. It could no longer stimulate. Now that we are up to $27 billion, we are receiving no stimulation from that $27 billion. The Government is even suggesting that the deficit might be higher than that next year. In terms of the United States, which is ten times larger than our country, it would amount to a deficit of $270 odd billion. Those are the kind of straits we are in.
Anyone interested in the deficit discussion should read the book by Michael Walker of the Fraser Institute on balancing the budget. First, I refer to page 18, which states:
The consequences of Government deficits, therefore, depend on how the Government chooses to finance the shortfall. If it creates an excessive money

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supply, it will promote inflation. If it opts for the alternative of issuing debt (borrowing), it will raise interest rates above the level they would otherwise have achieved and, in the process, crowd out private expenditures. The consequences of the latter effect are likely to be deep and long lasting. The reason is because of the nature of private and public expenditures.
The only way the Government can finance these fantastic deficits is by having an excessive money supply which we all know leads to inflation, by issuing its own bonds or by borrowing, and this will drive up interest rates and crowd out the private sector which should be encouraged today. Our only hope lies in the private sector.
What is the Government doing? It is asking us to authorize the borrowing of $19 billion. On page 20 it states:
When a Government issues a bond, it merely defers taxes or the printing of money. In the end, the deficit must be paid for either by taxing or money creation.
Now let me tell you Canadians who are listening to me out there, there is $19 billion, but the Government wants us to authorize today-


The Acting Speaker (Mr. Corbin):: Order, please. The Elon. Member should address his remarks to the Chair, please.


John Carnell Crosbie: Mr. Speaker, I do not mind addressing my remarks to you, but frankly, I am not talking to you. I am talking to the Canadian people.


The Acting Speaker (Mr. Corbin):: Order. Standing Orders provide that Hon. Members who are recognized for the purpose of making a speech must address their remarks to the Chair.


John Carnell Crosbie: You had better believe it, Mr. Speaker. That is what I am doing, directing my remarks to you, but I hope the people of Canada are listening because I do not expect you or anyone else from the Government side to really pay any attention.


The Acting Speaker (Mr. Corbin):: Order. Would the Hon. Member resume his seat, please. The Chair has called the Hon. Member for St. John's West to order. Surely the Hon. Member should not comment on that ruling, which is substantiated by Standing Orders of the House of Commons.


John Carnell Crosbie: Quite right, Mr. Speaker. When the Government asks us to authorize the borrowing of $19 billion it is asking us to authorize the Government to issue bonds. All we are doing is to defer $19 billion in taxes because the Canadian people will have to pay back this $19 billion through the Government. The Government can only pay it back in the future by taxing the public for $19 billion. So what we are doing now is to defer taxing the Canadian people today and taking $19 billion from them today, which we are going to put off on them or on their children for five years or ten years' time. That is all we are doing. We are deferring taxes, or we are printing money. If the Government does it by printing money then we are into an inflationary spiral that will never end which is going to finish this country, and its productive
resources. This deficit can only be paid for by taxing or creating money.
Then the Government goes on to say this:
For this reason it is most useful to regard Government deficits simply as deferred taxes.
The Government deficit is simply a deferred tax. It has to be paid back. The deficit of $27.2 billion that this Government has so far this year has to be paid back by the Canadians who are out there in this great country, and we hope some of them are watching this debate. The taxpayers have to pay it back or their children have to pay it back, plus interest. The situation today is that one of every four dollars that this Government spends is now being spent on interest payments, not for anything productive but for the debts that they have incurred in the last 10 or 12 years. One of every three dollars of the revenue they are taking in, your taxes and mine, is going out in interest payments. One of three of the revenue dollars is for interest payments and one of four of expenditure dollars is for interest payments. The difference is made up by their borrowing. Does no one care? Do they not see where this leads to? This may get the Government through another year or two, or four or five years, but this country is going to hell in a hand basket and it is a Liberal hand basket, and they are getting us there much faster than anybody ever thought would have been possible just a few years ago.
This Minister of Finance a few months ago said-and this shows how good a forecaster he is-that unemployment would decline and reach a level slightly above 11 per cent of the labour force by the end of the year. In fact, the rate was 12.8 per cent. We have 1,598,000 people out of work. When he brings his budget in, Mr. Speaker, we cannot believe a word he says. We cannot put any credence in the estimates he gives. The record of the last three years is unbelievable. The Government has abandoned any strategy of deficit management, it has lost control of the spending and its revenue, it cannot predict from month to month what the deficit might be, it cannot give us any kind of a reliable or meaningful forecast, and it now asks us to give it a blank cheque for another borrowing of $19 billion.
The Minister is stalling on his budget. He was going to have a budget in January, then in February and then in March, and now he is not going to have it until April. He says it is because we will not approve his tax Bills that are in the House. It is not for that reason. It is because he does not know what to do. He has no strategy, the Government has no strategy. It does not know what to do to bring about an economic recovery. There is a slight one coming, but not because of this Government. We had got down as far as we could go. He does not know how to reduce unemployment, except perhaps for some frashy little scheme, a temporary job creation on which he might spend a billion or two.
He is drifting, waiting for someone to help him. This Minister of Finance is the great anti-American who brought in the National Energy Program and who is so much against the Americans, this big, tough guy who does not care about the United States of America. He is going to show them where to
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get off in his energy policy. Why, he is waiting for the United States of America to save him. The only thing that can save him is Ronald Reagan. The only thing that could save the economy here in Canada is a big expansion and economic recovery in the United States led by Ronald Reagan. That is how tough he is, and that is the sagacity that this Cabinet Minister has.
Mr. Speaker, I for one am going to vote against this Bill. It is an atrocity to bring this before the House of Commons. 1 was struck today by two points made in an editorial in the Globe and Mail. They say that the amount that the Government is now asking us to give them borrowing authority for, SI9 billion, is the size of the entire budget of the Government of Canada in 1973-74. The Government of Canada only spent a total of $19.3 billion nine years ago. Today they want from us authorization to borrow in one fell swoop more than they spent in the whole period of 1973-74. They want us to give them the right to borrow $19 billion now, which was the entire net debt of this country from Confederation to 1974-75. From Sir John A. MacDonald to the great Trudeau, we only had a debt of $19.2 billion, and now the great Trudeau wants us to authorize the Government to borrow more than we had in the total net debt of this country from 1867 to 1973-74.
It is no wonder that we are going to balk at that. It is no wonder that we are going to do everything we can to defeat this. There is no salvation for Canada in greater and greater deficits, none. That is the way to totally bankrupt this country and take away any chance we have of recovery. We have another two years before this bunch of poltroons and cowards calls an election. They still have time, unfortunately, to wreck our economy completely, and the road to greater deficit is the road to ruination for this country. The deficit is already far, far larger than anyone ever thought that we could handle.
So the Government who does not know how big its deficit is going to be next year, according to the Minister, who does not know what they are going to have to borrow next year but just wants us to give him a simple $14 billion authorization that might carry him over until the early summer, he says.
Now, Mr. Speaker, the Government has lost all credibility-


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


John Carnell Crosbie: My time is coming to an end. We are going to oppose this Bill which is the worst Bill, filled with nothing but-


Mr. Flis:: You have no respect for the Speaker.


John Carnell Crosbie: I have no respect for the Government or anyone who sits with it, who have put forward the most rotten-


The Acting Speaker (Mr. Corbin):: Order, order. Questions and comments. Debate. The Hon. Member for Vegreville.


Donald Frank Mazankowski: Mr. Speaker, it is always a pleasure-
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John Carnell Crosbie: Come on, stand up and ask a question.


An Hon. Member:: Is he running for the leadership or not?


John Carnell Crosbie: You poor devils are wishing you had the chance, that is all.


Douglas Glenn Fisher: We should all switch and join the ranks of the-


John Carnell Crosbie: There is not enough room for you in this Party. We are not taking any rotten apples over here.


Donald Frank Mazankowski: Mr. Speaker, as I said, it is always a pleasure to follow my good colleague, the Hon. Member for St. John's West (Mr. Crosbie). I think it is quite clear that had the economic and financial levers been under his control this country would be in a lot better shape today, there is no question about that.


Some Hon. Members:: Hear, hear!


Paul James Cosgrove: Thank God for the voters.


Donald Frank Mazankowski: Mr. Speaker, the Bill that we are dealing with here, Bill C-143, represents a clear example of this Government's failure to manage in a competent and effective fashion. There is no question about that. My friend, the Minister of Communications (Mr. Fox) smiles and snickers. He does not mind the imposition of a $19 billion tax load on the poor people of Canada. There is no question, their whole approach to this is unbelievable and the consequences are unbearable.
It is the largest borrowing Bill in the history of Canada. Nineteen billion dollars equals, as my colleague indicated, the total amount of federal Government spending in the year 1973-74. When I came to this House in 1968, the total Government spending at that time was something in the order of $12 billion. Today, in the next fiscal year, it is going to be something in the order of $88 billion. When you look at this $19 billion borrowing for a period of six months, it is $3 billion a month, over $100 million a day. When we look at that, we see the Government is spending in excess of $10 million an hour. If we look at it in terms of the 1979-80 period, Government spending has increased by 66 per cent since then. The Government is sinking into a muskeg, something we have a bit of in the northern part of our Province. That is where a good portion of our oil and minerals are found. It is in a quagmire of muskeg and will never bail itself out. It shows no leadership. It asks Canadians to practise restraint.


Paul James Cosgrove: Look who is talking about leadership.


Donald Frank Mazankowski: There is certainly no leadership over there and certainly no morality, judging by the performance of the front bench opposite today and on previous occasions. People expect moral and honest leadership from a Government, not the kind of sleazy leadership we are getting from that Minister and other Ministers. They ask the old age

February 17, 1983

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pensioners and families with small children to exercise restraint while they spend money as if it were going out of style.
What is alarming is not only that the Government has been overcome with a deficit psychology but that it has convinced many of its Liberal friends in the business community that there is nothing wrong with the perpetuation of continuing high deficits.
Their good friend, lan Sinclair, the former chairman of CP, was put to work on the six and five program. It is interesting to note that he advocates an increase in the deficit, spending our way out of our difficulties. I find that alarming. If we really face the consequences of the kind of deficit we are dealing with today, we would have to increase taxes by roughly 40 per cent in order to balance the budget. That is impossible. It is irresponsible for a Government which has continually escalated a deficit.
My colleague, the Hon. Member for St. John's West went through the itemized performance. Since 1968 we have had one balanced budget. In the year 1969-70, there was a $493 million surplus. Since that time we have had escalations of deficit financing, to the point where our gross debt is now in the order of $135 billion to $140 billion and interest costs alone are $17 billion annually. What a tremendous imposition that is upon the productive capacity of this nation.
In order to finance the deficit we either have to borrow or print more money. We are selling out Canada and putting an imposition on future generations. The young people of this country will be faced with the burden of servicing the debt and, hopefully, paying it off some day. Quite frankly, we are spending beyond our means, and have been doing so for some time.
Massive Government borrowing on the scale of $19 billion has very serious consequences in terms of our whole economic environment. It will threaten the recovery and has the potential of fueling inflationary expectations, which can cause interest rates to rise again. There is a clear possibility that we could repeat the cycle of 1981-82 which was an economic disaster.
We face the prospect of crowding out the private sector. The Government now takes 60 per cent of the long-term capital needs generated in this country. That has the effect of crowding out the private sector which we hope will be the main engine of economic recovery. The Government will need to borrow in order to create the economic activity and jobs that we need.
In 1982 the federal Government accounted for 61 per cent of the net of new security issues. If that is not crowding out the private sector, I do not know what is. We seem to be compounding the errors of the seventies. We are on the road to repeating the trends we followed in the seventies. If we analyze the last ten years and look at some of the structural defects and our failure to recognize and deal with them, we see that we failed to read the signals of low productivity. We failed to encourage modernization, re-tooling, individual equity investment, improved labour relations, improved skilled trades and
co-ordinating the skilled trades with job demands. We fail to encourage new and successful ventures.


Lloyd Axworthy: That's nonsense.


Donald Frank Mazankowski: It is not nonsense. You need only pick up a newspaper to see that the jobs going begging are for skilled trades. This Minister and his predecessor did not address that issue. What he says is balderdash and he knows it.
Over the last ten years we failed to recognize the winners and to support new ventures. Rather, we have been propping up the losers. Through successive Government intervention we have either killed the enterprise spirit or lulled it into a false sense of security. In the course of that, the private sector was discouraged. We relied upon borrowing and spending our way out of our difficulties. The results were high deficits, debased currency, high interest rates, outflow of investment dollars and shattered confidence. We now have an economy that rates 24 out of the 24 OECD countries.
When we look at the trends that are developing in terms of the amounts that all Goverments are taking as a percentage of the GNP, it is frightening. Well in excess of 50 per cent of all goods and services produced in this country is now being expended on some level of Government. When that happens, we not only lose our economic freedom, but our political freedom is threatened as well.
Looking at the reality of the situation, we must address some of the problems facing us today. We must cut back on Government spending. We cannot reduce social assistance programs under the current crisis. Naturally, we cannot reduce the transfer payments. There are some serious structural problems in the economy. We know that we cannot reduce the deficit overnight, but we must be determined. We must develop a psychology of working toward reducing the deficit.
There are many ways in which the extravagance and excessive spending of this Government could be reduced. Let us look at this Government's record in terms of how it treats its friends, such as newly appointed Senator Pitfield. We learned the horrendous revelations of the former Minister of Energy in the sweetheart deal arranged for him. With a $25,000 investment, he has the potential of picking up a $750,000 profit, a $30,000 a year salary, plus $600 a day. That is a real sweetheart deal.
We now have the ridiculous Royal commission, which will cost Canadian taxpayers $5,000 a day, of which the chairman will receive up to $925 per day, plus expenses. It is heartening to note that even some Liberal backbenchers find this difficult to smallow. Then we have the 200 per cent increase for CMHC directors, all good, card-carrying Liberals, no question about that. The Government is spending on advertising something in the order of $230 million. While everyone else has been asked to abide by the Government's six and five guidelines, the administrative costs in Government are soaring; 17 per cent over-all between 1981-82 and 1982-83. The administrative costs of the Department of Employment and Immigration increased by 40 per cent, Health and Welfare by 32 per cent, Transport by 20 per cent, and the Department of

February 17, 1983

Supply and Services by 15 per cent. And with respect to the scores of advisory boards, Mr. Speaker, it is rather interesting to look at these boards which have been appointed by this Government with 9, 10, 12 members, some of whom never meet, and some of whom meet once in a while. They are all on some sort of an honorarium-another political pork barrel.
These are some examples of the waste and extravagance and pork barrelling which could be reduced. The Government could then lead and demonstrate by example rather than by its double standard in suggesting to the old age pensioners and the families with small children to bear the brunt of the restraint program.
On the economic side, as well, Mr. Speaker, I believe there are a number of things which have to be done, and have to be done soon. This Government is possessed with its massive intervention in the economic welfare of the country. I believe that we in this country must make a commitment toward a more market-oriented economy. I believe this would do more to restore confidence in the economic domain than anything that has occurred over the last two years. It is the reality of the world, particularly in our new industrialized nations, that we will have to recognize that the free market forces are going to have a greater play in the future.
Second, we should make it very clear to Canadians, and to people throughout the world, that we in Canada are ready and open for business, by removing the obstacles and restraints to investments, both from domestic and foreign sources. There is no question that this country needs capital to create jobs. We should become a haven for investment, rather than a country which is hostile to it. Third, as I said in my speech on the tax Bill the other day, we must simplify our complex, costly and counterproductive tax system. It is regressive. I have not found anyone in Canada who believes we have a good tax system, and if people do not believe we have a good tax system, it should be changed. If it is not changed, the whole integrity of the system can break down. We have regulation piled upon regulation, which does nothing more than frustrate business and individuals. There is clearly an opportunity to engage in a massive regulatory housecleaning. That has to be done in concert with the Provinces, of course. We have the study by the Economic Council of Canada which introduced some 66 recommendations, 25 of which were directed at the transportation industry, but nothing has really been done in that area. I believe we have to face the facts, Mr. Speaker, that surely we have disproven and discredited that utopian ideal that we can plan and regulate everything to perfection. Let us get on with the job. Let us unleash the entrepreneurial spirit in this country. The enterprising spirit, Mr. Speaker, will be the main engine of growth in this country.
Fourth, I am sure that we can remove duplication and reduce the level of Government take, in concert, again, with the Provinces. The former Auditor General of Canada said that he could identify some $5 million-worth of savings just in the area of reducing duplication. That could be done over a three-year period in concert with the two levels of Government. And when you look at the implications of that, you find
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it would not only save money, but I believe would avoid a lot of frustration and free up the system.
Fifth, rather than picking the winners and the losers through grants and subsidies-and I see the Minister of Industry, Trade and Commerce (Mr. Lumley) here. He is a very powerful Cabinet Minister. He can decide which industry goes and which fails, and in what region. He has that power. I hope he uses it with some discretion-surely we should be looking at programs which would allow for the kind of incentive which would allow industries to develop across the board, which would be rewarded for innovation, for advanced technology, for R and D. One-half per cent increase in the level of research and development in this country would produce some 400,000 jobs and would have a tremendous impact upon the industrial heartland of Ontario, in particular. It is the industrial, manufacturing heartland which is really hurting in terms of jobs. There are clearly ways, therefore, in which that can be overcome, through a tax system which would provide tax shelters, incentives, such as the Canadian Stock Ownership Plan, which we introduced, or the Registered Shareholder's Investment Plan.
Sixth, and I have talked about this many times in the House, we have failed to turn our energy advantage in this country into an economic advantage. The National Energy Program has been a disaster. There can be no question about that. It has been proven time and time again. We must move toward oil self-sufficiency as quickly as possible, and we all know that that problem is not as urgent as it was a little earlier. In connection with the energy industry, we have to do something about the petrochemical industry. We have some $6 billion worth of projects on hold in Western Canada. We have a petrochemical industry in Eastern Canada which is probably weeks away from collapsing. That is part and parcel of the whole energy program which must be addressed.
Seventh, we must improve our labour-management relations, and as I said earlier, synchronize and coordinate our skills to mesh more directly with job demands.
Eighth, we must remove those impediments which discourage the enterprising spirit of Canadians. We must encourage individual initiative. We must encourage individual ownership. We must provide incentives to build. We must restore the profit motive. We must revitalize the productive sector and encourage growth and development based upon our natural strength.
Finally, Mr. Speaker, what we must do once again is to renew our commitment towards an economic and political union in this country. Through the National Energy Program and through the constitutional debate, there has been some deep division and disharmony which has been generated throughout this country. We must get Governments working together rather than against each other and against the private sector. We must do this for the common good. We must create a climate where we are building through co-operation rather than frustrating and destroying through confrontation. This

February 17, 1983
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country has tremendous potential, Mr. Speaker. It can once again be a proud and vibrant nation. But we must harness the creative and entrepreneurial spirit of our people. I submit to you, Sir, that the key to building this country and setting it on its proper course, is to allow people to be set free, allow them to be free to grow and to build in a climate where Government serves the people rather than people serving the Government.


John Leslie Evans: Mr. Speaker, I was very interested in the words of my hon. friend, as I always am. I find his words carry rationality with them. Flowever, in a good part of his speech, the framework of his speech seemed to be that the free market system should be allowed to move forward under its own driving force, with which I have a great deal of sympathy. There were some parts in his speech, however, which, 1 believe, tended to contradict that, and I wondered if he would like to comment on two particular aspects. First, with respect to the energy industry, the words used were, "We have to coordinate the energy industry to make sure that the petrochemical industry and the oil industry are all coordinated and running well together." Is the word "we" in reference to Government and, if so, does that not say there is some kind of central planning of the entire petrochemical and petroleum industry? The next statement was that we have to co-ordinate and manage the manpower skills and needs of the country. Is he not saying that we, the Government, have to determine which skills are important and which needs are going to be met? If so, does that not fly in the face of the whole free market philosophy he puts forward?


Donald Frank Mazankowski: I thank the Hon. Member for his question. If I used the word "co-ordinate" or "manage" I left the wrong impression, because the fact of the matter is that before the National Energy Program we had a healthy oil and petrochemical industry in this country. Since the NEP, we have neither. What I am saying is that the effect of the NEP not only destroyed the oil industry as we know it, but it is also playing havoc with the petrochemical industry. What is really happening is the heavy up-front taxes-well, I will wait until the Member is prompted by the Minister of Industry, Trade and Commerce who should have this problem resolved by now rather than sitting on it.
The fact of the matter is that because of the heavy up-front taxes on the feedstock of petrochemicals, we now find ourselves in a situation where we are non-competitive in world markets.
As to manpower policies, the federal Government is the main author of economic policy and immigration policy, so it is in a better position to determine what the needs are, what the skills are, and the number of people coming to major centres like Toronto or Montreal. So I am suggesting it has a better opportunity to provide leadership and direction than any other level of Government. It is the author of economic policy, of immigration policy. Well, I may be treading in the provincial domain, but I think there has to be better co-operation and coordination in matching the skills with the demands.


John Leslie Evans: Mr. Speaker, with regard to the oil and petrochemical industry, what role would the Hon. member say is played by the fact that in the free market system oil prices have fallen rather than risen, and what impact has that had on the oil industry? Is it all the fact of the NEP, or indeed has the free market mechanism itself undermined the viability of the oil industry and the petrochemical industry not only here, Mr. Speaker, but in the United States and in the oil-producing, under-developed countries? Has the free market not done a great deal of damage to the industry the Hon. Member has been referring to?


Donald Frank Mazankowski: Mr. Speaker, certainly not. As a matter of fact, the oil consuming countries played into the hands of the OPEC countries because, rather than facing the prospect of accepting high prices for energy, countries like Canada chose to cushion the effect of the high energy costs. What we did is simply to perpetuate the high prices. Since the United States has deregulated and since there has been conservation and cutbacks in consumption, plus new supplies coming on, the OPEC cartel is crumbling. As a result, it is the marketplace which is really forcing the price of oil down. All we have done, by trying to protect our consumers by putting a very heavy burden on the Treasury, is to protect high prices, and the author of those high prices was OPEC.


Lloyd Axworthy: Mr. Speaker, I would just like to take the opportunity to pose to the Hon. Member some questions. I was surprised during the course of his speech that he demonstrated a singular lack of information or knowledge about what has already taken place. Let me pose these questions partly in a rhetorical way because I am surprised at someone who poses as being so knowledgeable about so many things and yet has so many gaps in his information.
For example, is the Hon. Member aware in his demand for more co-ordination on the manpower side that there is already in place a new system called COPS, which is based on full provincial, business and labour co-operation to designate national occupations based on information from all sources, and that the model has already been developed, a conference held and the system going into place?
I would expect that when the Member speaks he should at least try to base his conclusions on some information, although I know it is the habit of Hon. Members on the other side not to get confused by the facts.
When the Hon. Member makes a ringing call for additional manpower programs, is he aware that his own caucus voted last year for a new National Training Act which has pumped an additional 20 per cent into manpower training programs this year alone. Does he know that just this past month we have put something like $2.5 billion into New Brunswick for a Cadcam system, and other money into the Province of Ontario for Ryerson and 14 other community colleges? Does he know we have put money into the Holland College on Prince Edward Island, and $14 million into the Province of British Columbia, including the riding of the Hon. Member for Vancouver
February 17, 1983

Centre (Miss Carney) to provide for new computer technology? In one year's time we have been able to shift the level of high skill training from 25 per cent to 30 per cent in one year under that new National Training Act.
It seemed to me, Mr. Speaker, that it would be interesting to know if the Hon. Member, in making these claims, is simply repeating the words written for him by some Tory caucus speechwriter who is basing his information upon obviously obsolescent and irrelevant material. Or would he like to have the opportunity, which I would be glad to offer him, to have a full briefing on the way in which we have placed manpower policy at the centre of our industrial restructuring, and how we are miles ahead of anything the Tory caucus Research Bureau has ever dreamed of?


Donald Frank Mazankowski: Mr. Speaker, it is no wonder this country is in sad shape. The fact of the matter is that this guy over here spots a problem, throws some money at it and walks away. That is the problem. Really, we have more damn programs than we need.


Some Hon. Members:: Hear, hear!


Donald Frank Mazankowski: His alphabetical litany is screwed up as much as the mind of the Minister. You are as stupid as you look.


An Hon. Member:: Oh, oh!


Douglas Glenn Fisher: Madam Speaker, I would like to ask the Hon. Member who just spoke to give us some idea of how he defines sweetheart deals. I would like to ask him, in light of his own experience with the Grange inquiry, what standards did he use to appoint the counsel and assistant counsel to that Commission? What political Parties did they belong to and how much money did they earn?


Donald Frank Mazankowski: Well, in the case of the Grange Commission, as in the case of the Dubin Commission, and I think both Commissions did tremendous service to the country, and indeed to the transportation sector, I simply followed the guidelines put in place by the former Liberal administration.


Douglas Glenn Fisher: Madam Speaker, then I wonder whether the Hon. Member for Vegreville (Mr. Mazankowski) would confirm that the standards used by the prior Liberal Government were acceptable to him, and were high enough in their moral standards so that he would lend his name to them.



THE ROYAL ASSENT

[Stage Direction]
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Adjournment Debate
Madam Speaker, the Honourable Deputy to the Governor General desires the immediate attendance of this honourable House in the Chamber of the honourable the Senate.
Accordingly, the Speaker with the House went up to the Senate Chamber.
And being returned:
Madam Speaker:: I have the honour to inform the House that when the House did attend His Honour the Deputy to His Excellency the Governor General in the Senate Chamber, His Honour was pleased to give in Her Majesty's name the Royal Assent to the following bill:
Bill C-132, An Act to amend the Family Allowances Act, 1973-Chapter 139.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Benno Friesen (Surrey-White Rock-North Delta):: Mr. Speaker, ten days ago I rose in my place to address a question to the Minister of Agriculture (Mr. Whelan). I asked him why he would not make a recommendation to the Minister of Finance (Mr. Lalonde) to impose a surtax on American potatoes, coming into the market in the lower Fraser Valley and the Greater Vancouver area. From his reply I deduced that there has been a trade-off made between the Canadian and American Governments. The Minister of Agriculture replied that we have problems in trade with the United States. I assume as a result of the problems we have with the United States that the Minister of Agriculture, maybe together with the Minister of Finance, has decided the Canadian producer in Eastern Canada cannot be put in jeopardy with the American market. Therefore, the Government is now willing to sacrifice the potato growers in the Fraser Valley of British Columbia and will let them be destroyed in order to save the eastern potato producer.
The potato product coming in from the United States is of high quality. It is produced, on an economic scale at a ratio of probably ten to one. The land costs are far below Canadian land costs and taxes are lower. Above all, labour costs are substantially lower. As a result the Canadian producer cannot produce a product competitive with the U.S. product. This means the American producer can now import and market potatoes in Canada at probably 50 per cent of the cost of

February 17, 1983
Adjournment Debate
Canadian production. Therefore, the Canadian potato farmer in the Lower Fraser Valley will not be able to exist.
I suggested to the Minister of Agriculture-that great friend of the farmer, the best Minister of Agriculture the world has ever seen-that as a result farmers will lose their farms, or they will have to divide their land and sell it to light industry in order to make a living. In other words, if farmers do not make a living from their product, they will have to go out of business.
Somehow the Minister of Agriculture does not appreciate the domino effect, the cause and effect relationship of his policies on farmers in the Fraser Valley. If farmers cannot make expenses, and if they have to go out of business-they have to make a living somehow-this means they will have their farms rezoned. But the Minister of Agriculture says zoning is a provincial problem, that is not a problem of the Minister of Agriculture. The clueless Minister of Agriculture does not see that relationship. Sooner or later these farmers will have to rezone their farms in order to gain some capital, and then invest it in some way.
The net result will be that those corporate farms in the State of Washington will capture the entire Canadian market, because there will be no Canadian suppliers. If the Minister of Agriculture is at all interested in the consumer, he ought to work for the protection of the farmer in Canada so that the consumer will not be victimized by the one sole source of supply, which will be the State of Washington. If he cares at all for the Canadian consumer, he will do everything in his power to preserve the Canadian farmer.
Under present policies he has made this trade-off and is willing to sacrifice the farmer in the Fraser Valley to preserve the farmer in eastern Canada. I do not fault him for trying to preserve the eastern farmer, but in a matter of years he will find that there are no Canadian farms in the Fraser Valley. It will all be industrial land. We will be at the mercy of the corporate farms in the United States. At that point they will be able to charge whatever price they want. They will be able to scalp the Canadian consumer because there will be no other source of supply.
I put it to you, Mr. Speaker, that this Minister of Agriculture is sacrificing, first the farmer and then the consumer, and we will pay for it in the future.


Mr. Garnet M. Bloomfield (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, the situation is somewhat unusual in that there has been some confusion with regard to this question and the question the Hon. Member for Surrey-White Rock-North Delta (Mr. Friesen) asked on Tuesday, February 15. This evening, I am answering the question asked last Tuesday evening, dealing with a revenue problem.
The collection policy of the Department of National Revenue, Taxation, is best described as patient but firm, becoming
increasingly more firm if the taxpayer concerned attempts to escape responsibility.
When the moneys owing are income taxes, the taxpayer is first sent an assessment notice which says that by law the taxes owing must be paid within 30 days. If the payment is not made, a reminder in the form of a resquest for payment is mailed to the taxpayer. If this second notice is not heeded, a third one is sent to inform the taxpayer that legal action may result if payment or satisfactory arrangements are not made within 15 days.
Finally, when the taxpayer has been approached three times, the Department proceeds to apply the collection powers that Parliament has given it. These are the powers of garnishee of wages or other forms of remuneration, the garnishee of bank deposits or the seizure and sale of assets. These measures may seem harsh, but the citizen who does not pay his taxes is acting contrary to the interests of fellow citizens who have paid theirs.
If the amounts owing are source deductions, the matter is even more serious. These source deductions are trust funds. The employer is withholding amounts to pay the employee's income tax, his Canada Pension Plan contributions and his unemployment insurance premiums. This is the employee's money and not the employer's, and if it were not required by law to be withheld and remitted to the Government the employer would have had to pay it to the employee.
Therefore, when the Department detects by audit or other means that an employer has failed to remit source deductions, it demands immediate payment. By that time, he would be in arrears by at least 30 days. The payroll auditor would request the money and caution the employer that failure to pay may result in legal action. I would be very surprised if any employer did not already know this.
That legal action is once again garnishment, applied, where appropriate, to accounts receivable of the business. The Department would have some knowledge of the customers of the business and would file notice with one or more of these customers that amounts they would otherwise pay to the business in default of source deductions must be paid to the Department. Of course, the garnishee notice states the amount that the business is deficient and the customer is required to divert all payments up to that amount to the Department.
I cannot see why the Hon. Member is critical of these actions. The businessman has taken trust funds and funds that were not his and has not remitted them as the law requires. The Department takes action to recover these funds in the way Parliament has provided. It is as simple as that.


THE ADMINISTRATION-POSITION OF PRESENT MINISTERS. (B) REQUEST THAT PRIME MINISTER TAKE ACTION. (C) REQUEST FOR COMMITTEE INVESTIGATION
Ramon John Hnatyshyn: Mr. Speaker, in the matter of Alastair Gillespie today, we witnessed in the House one of the most incredible performances ever made by a Prime Minister of our country. We are a parliamentary democracy which is based on the British tradition.
February 17, 1983

The pinnacle of our system is responsible Government. A Minister, upon joining the Government, becomes responsible for the actions within his Department, and the actions of an agency of that Department, which is under his control. If he errs in judgment in a serious way, if a major mistake is made in his Department or if one of his agencies transgresses the rules, the Minister must assume full responsibility. This, above all, is important in cases involving morality. Concerning questions of basic honesty and honourable dealings, the correct and proper course must not only be taken, but it must also be seen to have been taken.
The post-employment guidelines set forth by the Prime Minister (Mr. Trudeau) clearly stipulate as follows:
In any official dealings with the former office holders, Ministers must ensure that they do not provide grounds or the appearance of grounds for allegations of improper influence, privilege of access or preferential treatment.
Former Ministers must not:
-act for or on behalf of any person or commercial corporation in connection with a transaction to which the Government of Canada is a party and in which they had a personal and substantial involvement during the last two years of their participation in the ministry within two years of leaving office.
Neither can they lobby for or on behalf of any person or corporation within that Department for which they were responsible.
What are the facts here? We know that the former Minister of Energy, Mines and Resources, Alastair Gillespie, entered into a memorandum of understanding with two Crown corporations, Petro-Canada and the Cape Breton Development Corporation, 16 months after leaving his ministry. These were the financing arrangements to set up the Scotia Coals Synfuels Project. We have seen television footage of Mr. Gillespie and the Deputy Prime Minister (Mr. MacEachen) announcing this project in Nova Scotia in April of 1981, six months after the signing of this particular memorandum of understanding. The press conference had national exposure and was arranged by the Press Secretary and other officials of the Department of Energy, Mines and Resources.
These events were grossly improper and constitute a massive breach of the conflict of interest guidelines. Mr. Gillespie should not have been dealing with the Department of Energy, Mines and Resources or any Crown corporation on an energy-related matter, according to the guidelines.
What is equally serious is that the current Minister of Finance (Mr. Lalonde), who was then Minister of Energy, Mines and Resources, should not have had dealings with Mr. Gillespie, at least until after June, 1981, again according to the guidelines set down by the Prime Minister.
The Prime Minister tries to protect his Minister by saying that his Minister had no personal knowledge of the arrangement until September of 1981, when the final agreement was signed between the Government of Canada and Mr. Gillespie. However, that simply cannot be accurate. Even more important, it is not of great relevance, in my submission.
Adjournment Debate
It is clear that the Minister's Department and agencies were involved in this highly suspect arrangement for some time. The Deputy Prime Minister, the second highest elected official in the country, knew all about it, attended a press conference and must have been fully aware of the conflicts which were involved.
When a system of Cabinet and Ministerial responsibility is so grossly infringed, it is incumbent on a Minister to tender his resignation. Let us face it, Mr. Speaker, Alastair Gillespie had dickered on this deal for a long time before September, 1981, or even June of that year.


David P. Smith: Says who?


Ramon John Hnatyshyn: It was the subject of a memorandum of understanding and a press conference with the Deputy Prime Minister. When the Prime Minister suggested that the Minister of Energy, Mines and Resources did not even have knowledge of the matter, who was he trying to kid?
Moreover, where is the success of our system? How can he be so ignorant of the traditions upon which this institution and our democratic system are based? What of the Deputy Prime Minister? He, too, must bear responsibility here. He is second only to the Prime Minister. His face was depicted all over the television screens along with Alastair Gillespie, at least two months before Mr. Gillespie was supposed to have any dealings whatsoever with his former Department. In the words of the Prime Minister, "There is no way that Mr. Gillespie was laundered by April of 1981".
This is not a mistake. This is not an innocent omission. This was a deliberate flaunting of the guidelines conceived and set forth by the present Prime Minister. There could be no more blatant a case of public immorality. Not only has a political friend been given a special sweetheart deal, but he has also received that deal in the face of the Prime Minister's own explicit directives.
I now call upon the Prime Minister to accept his responsibilities. His Ministers have been caught contravening the conflict of interest guidelines.
If American legislators were guilty of misconduct in Abscam, as was clearly demonstrated on videotape, so was the Deputy Prime Minister caught on television announcing this particular project some time before the expiry of two years from the time Mr. Gillespie left the ministry.
If Lord Carrington in the United Kingdom was responsible, even though he had no knowledge of the items which led to the invasion of the Falklands, he as a matter of principle and honour under the parliamentary system felt obligated to tender his resignation, because something had happened in a department over which he had responsibility.
The admission of responsibility is fundamental. The Prime Minister must act immediately, swiftly, and ask for the resignation of the Minister of Finance.

February 17, 1983
Adjournment Debate


David P. Smith: Mr. Speaker, since this matter was first raised in this House yesterday by the Hon. Leader of the Opposition (Mr. Nielsen) we have had a series of allegations of conflict of interest, preferential treatment, etc., raised against members of this Government, as well as a previous Minister of the Crown.
The Hon. Minister of Finance (Mr. Lalonde) has been accused of violating the conflict of interest guidelines during the period when he was Minister of Energy, Mines and Resources. The Hon. Alastair Gillespie has been accused of violating the post-employment guidelines applied to former holders of public office. We have yet to be told what guidelines have been contravened by the Ministers of the Government of the Province of Nova Scotia, a Tory Government, I might add, as a result of that Province's participation in the agreement which has generated this tempest, which is certainly a tempest in a teapot.
I think at this time it is appropriate to review the genesis and purpose of these conflict of interest and post-employment guidelines. The first comprehensive sets of guidelines for Ministers in these areas were established by Liberal Governments under this Prime Minister, in 1973 in the case of conflict of interest guidelines, and in 1978 in the case of postemployment guidelines. The most recent guidelines were introduced by the Prime Minister in 1980.
These guidelines were established to protect the interests of the public, and the reputations of individual Ministers and office holders. In this debate, Members of the Opposition have attacked the reputations of present and past Members of the Government, with vague innuendoes that the public interest has not been well served.
I will quote the relevant section of the conflict of interest guidelines applied to Ministers:
(1)	Current and former holders of public office must ensure by their actions that the objectivity and impartiality of Government service are not cast in doubt and that the people of Canada are given no cause to believe that preferential treatment is being or will be unduly accorded to any person or organization.
(2)	Current and former holders of public office must ensure by their actions that there is no reasonable ground for belief that it is possible to have privileged access to Government personnel or services.
(3)	Current and former holders of public office must exercise care in the management of their private affairs so as not to benefit, or to appear to benefit, from the use or communication of confidential information acquired in the course of their official duties.
The Minister of Finance cannot in any way be said to have contravened the guidelines and to have given "preferential treatment" to any person or organization. His only contact with Mr. Gillespie would have been on September 25, 1981 when he signed, on behalf of Her Majesty in right of Canada, a tripartite agreement between the Government of Nova Scotia, the Scotia Coal Synfuels Project, a consortium consisting of Petro-Canada, Cape Breton Development Corp., and Nova Scotia Resources Ltd., which is provincial Crown corporation, and Mr. Gillespie and his partners, and Her Majesty in Right of Canada.


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


David P. Smith: Time? Thank you, Mr. Speaker.


Ramon John Hnatyshyn: Send me the rest of that speech. You have not answered anything.


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


GRAIN-TIMING OF CHANGE OF CROWSNEST PASS FREIGHT RATE-EFFECT ON EXPORTS. (B) REQUEST THAT MINISTER TABLE STUDIES
Mr. Vic Althouse (Humboldt-Lake Centre):: Mr. Speaker, on February 10 I rose in the House to ask questions of the Minister of Transport (Mr. Pepin), who speaks for the Government on matters relating to grain exports and the Canadian Wheat Board since the Senator in charge is not in this House, and of the Minister of Agriculture (Mr. Whelan). I asked them both to comment on the policy moves the Government was making with regard to abandoning the Crow rate.
In my question to the Minister of Transport I tried to establish the fact that all competing countries were increasing subsidies to enable their producers to export, while at the same time we were reducing one of the few subsidies that exist for the export of grain for this country.
I then turned to the Minister of Agriculture, who has been arguing that both the East and West will benefit from the disruption of the Crow rate. I asked a very straight forward question. I asked where, in his analysis, the increased production that will occur in the East and West will take place, how it will take place, where it could be sold and, more important, at what price. I asked the Minister to table the studies that must have been made in these areas of economic research.
The Minister replied, in typical ministerial fashion, as follows:
If there are and if these are working documents that have not been made public they will be because I think that even a blind economist on a galloping horse could see that what we are saying is true.
I have no doubt that what the studies say is true, as far as it goes. It is what they do not say that is of most importance to agriculturalists and farmers in this country. They do not state the assumptions upon which the studies were based and the direction in which the research was told to move.
We know the assumptions behind some of the studies as we go through the results. For example, we know that farmers in both the East and the West are very upset with the proposals put forward and the studies that have been made public. The Minister of Transport has been quoted numerous times in the press as saying "In the East they are talking about the survival of agriculture. In the West they are talking about the survival of agriculture."
Farmers are upset because they understand the elements of agriculture more than the researchers who have been doing the work for the Ministers of Transport and Agriculture. They understand the kind of disruption to themselves, their families and communities that follow certain actions in the name of development. They understand that some of those actions in
February 17, 1983

the name of development, or progress, or whatever buzz words the planners happen to use, will be found to be obsolete, inefficient or redundant. That is the reason farmers in the East and West are worried about the survival of agriculture. They are worried about the survival of agriculture and their place in it.
The assumptions that have been made of the livestock feeding program are in accordance with those we have been told were made for the studies done by the federal Government. They showed that livestock production in Eastern Canada will continue to increase in size, and that livestock production in Western Canada will do the same. Not much time was spent on determining where that increased production would be sold.
The studies did raise some possibilties. They indicated it may be sold as a result of the increased domestic demand which may occur after the economy turns around and people can afford to eat more meat. That demand may increase because of a possible increase in population. The increased production may be exported to the United States and Japan, depending on the economies of those countries, their ability to be self sufficient and the degree of protectionism.
Those are all very nebulous factors in these studies. The only hard evidence presented is that the market in Eastern Canada, on the U.S. East Coast, the Eastern Seaboard, are as close to our producers as they are to the producers in the mid-Western United States. They point out that producers in Western Canada are as close to the California market as are the producers in the mid-Western United States.
The studies ignore, however, the question of political interference in crossing those political borders. They ignore the effective demand, because they had to make assumptions on whether those economies are going to pick up. In fact, they ignore reality. They ignore the fact that we have to compete in international markets in grain. We are geographically trapped in a region where transportation over land for up to 700 miles has to take place, compared to our competitors, who are only 100 miles to 150 miles to water transport. They ignore these realities.
Farmers are not waiting, Mr. Speaker, for a blind economist on a galloping horse to see the answers. They are simply looking for some clear-eyed politician to honestly say what sort of future is being planned for farmers of this country. They want a clear assessment of what is going to happen to them under the Government's transportation and agricultural policy. They did not get that in the documents which have been made
Adjournment Debate
public. They did not get that in the replies which we received on February 8.


Jesse Philip Flis: Madam Speaker, in his question of February 10, and in his remarks tonight, the Hon. Member objects to the Government's plans to reform the Crowsnest Pass freight rate on the grounds that this is the only program which allows Canadian grain farmers to remain competitive. He refers to concerns voiced by the Minister of State responsible for the Wheat Board about export grain subsidies in other countries. The key is Canada's ability to compete. In his closing remarks, the Hon. Member said the answer ignored the fact that we have to compete on the world market. I believe that is exactly what we are addressing. Our Canadian producers have to compete on the world market.
The Hon. Member, in fairness to his constituents, should look up the definition of "competitive". What is competition? Competition is not being just price competitive. In order for the Canadian producer, the Canadian farmer, to be competitive, he must, first of all, guarantee a quality product. The producer must guarantee delivery of the amount he contracted for, and he must guarantee delivery on time. In combination with all of this his or her price has to be competitive.
But even if we subsidize the farmer 100 per cent of the cost of producing transportation, if the farmer cannot meet the other terms of being competitive, that is, if he or she does not give a quality product, does not deliver the amount contracted for, does not deliver on time, then that farmer is not competitive.
Therefore, I believe, Mr. Speaker, we have to finally take a good look at what we mean by encouraging our farmers to be competitive. That is what the Western transportation initiative is all about, a better transportation system. The Government has allocated a great deal of money, almost $4 billion over four years, to this initiative, in spite of a large deficit. The Government believes it is not unreasonable to ask farmers to share in future cost increases. I spoke to farmers in the Hon. Member's constituency because I was born and raised there, and these farmers agree. When you speak to them on an individual basis, they agree they have to be realistic, they have to pay more for transportation costs. But, they say, guarantee us an efficient transportation system.


The Acting Speaker (Mr. Corbin):: Order. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m.
At 6.35 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, February 18, 1983