1983-05-05

GOVERNMENT ORDERS


Hon. Paul J. Cosgrove (Minister of State (Finance)) moved: that Bill C-151, an Act 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, in beginning my comments on Bill C-151,1 would like to draw to the attention of Hon. Members the remarks of the Minister of Finance (Mr. Lalonde) on October 27, 1982 when as the Minister of Finance he presented his comments on an economic plan in Parliament. I quote from his comments:
I have also made it clear by the estimates I have presented that further borrowing authority will be required before the end of this fiscal year. In the budget I intend to present early in 1983, I will review again the fiscal situation for the current fiscal year, set out estimates for 1983-84 and future fiscal years, and then seek additional borrowing authority as required.
[DOT]	(1110)
The Minister of Finance in his speech on supplementary borrowing authority of February 17, 1983 made reference as well to his intention to seek authority as is sought in Bill C-151 by these words:
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.
During debate on borrowing authority at the time the Minister made that speech, Members opposite insisted that they were not seeking to interfere with Government operations and they were not necessarily challenging the valuable social assistance programs that are supported by this borrowing authority. It was argued that they were willing to deal with borrowing authority if only they had adequate financial information. For example, on February 17, 1983 the Hon. Member for Vancouver Centre (Miss Carney) stated that her Party:
-would be much more willing to debate and pass this Bill if we knew what the money was needed for-
The Member for Mississauga South (Mr. Blenkarn), who is in the House today, also indicated, both in Committee and in
the House of Commons, that he would be willing to pass the legislation quickly if the Minister would give him a reasonable explanation of the economic position of the country with respect to the current fiscal year. He said that in the House on March 22 of this year.
The budget has been presented, Mr. Speaker. It does contain current and fiscal year projections. The budget contains the Government's economic forecast and its assumptions about the country's likely economic performance. We have, in effect, laid our cards on the table and provided the information which is the basis for the borrowing authority sought in Bill C-151. As Members opposite have indicated, they may quarrel with any or all aspects of the budget or its background information, but certainly they cannot argue that we have not presented, as comprehensively as we are able to, the basis for the request for speedy consideration of the Bill before the House, Mr. Speaker.
The Financial Administration Act stipulates that, except when Section 39 is used, statutory borrowing authority must be obtained from Parliament in order for the Government to increase its debt and to have additional authority for borrowing. Under Part IV Section 36 of the Act is the legislative basis for the request before us today. It reads:
No money shall be borrowed or security issued by or on behalf of Her Majesty without the authority of Parliament.
This refers to new money only, as under Section 38 of the Act there is a continuing authority to borrow funds to repay maturing debts. Consequently, in order for the Government to borrow money to meet its financial requirements, statutory borrowing authority must be obtained from Parliament. Section 39 does provide for the Governor in Council to authorize the borrowing of money when it appears that funds will not be sufficient to meet disbursements from the Consolidated Revenue Fund. This legislation is designed for short-term loans under limited terms to maturity not exceeding six months.
I have indicated the legislative basis of the legislation for which approval is sought today. I have indicated that the material which is the financial basis and foundation of that legislation is before us. We are now seeking speedy consideration of this legislation by the Opposition.
In so far as the budget is concerned, Hon. Members will know that it contains a large number of new initiatives to support and encourage economic recovery, to create jobs and to position the economy to take full advantage of the economic expansion phase that is developing in the world economies and reflected in the Canadian economy.

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The $4.8 billion program of private investment incentives and public spending is the main centrepiece of the budget strategy. We believe it will lead to the creation of good, rewarding jobs for Canadians right across Canada and that it will improve the economic basis on which our growth potential depends so much. Plans for federal capital projects worth half of that amount, that is $2.4 billion, are being finalized. As Hon. Members know, they will be put on a fast track in order to ensure that their contribution to the economic recovery comes quickly, within weeks.
Additional tax incentives through the business sector comprise the balance of the $2.4 billion, and this provision has received almost unanimously favourable comment across the country in the days since the budget. We believe this centrepiece, the $2.4 billion of accelerated and new funding, will contribute greatly to economic recovery.
The Special Recovery Program will go some distance in stimulating job creation in Canada, not only immediately under the capital works projects that we have set for the months and years ahead, but as well by virtue of the building blocks that the tax incentives, which are permanent changes to the Income Tax Act, will achieve.
The Government is doing more toward this end of creating jobs. The housing sector will benefit, and benefit greatly, from the measures in the budget and construction-related employment will continue to expand rapidly. The specific measures which will provide stimulus in this sector include modifications to the Registered Home Ownership Savings Plan, extension of the Canada Home Ownership Stimulation Plan and the Canadian Home Renovation Plan, as well as additional allocations for the Residential Rehabilitation Assistance Plan, for both Indian and social housing.
Furthermore, the Government is providing major additional support to employment through direct job creation measures. More funds have been allocated for the New Employment Expansion and Development Plan for local employment initiatives and for special youth job creation programs of several kinds, including the Summer Canada Program, Katimavik, the new defence Extended Youth Training and Employment Program and youth wage subsidy and internship programs. All of these allocations in the budget to which I have referred bring the total federal amount to be spent on direct job creation in 1983-84 to $1.5 billion, a figure which is impressive both on its own and in comparison to previous spending of the Government.
On the other hand, as indicated in the budget revenue growth is likely to remain relatively weak this year and the budgetary deficit is expected to be $31.3 billion. The net source of funds provided by non-budgetary transactions is projected to be somewhat larger for 1983-84 than it was in 1982-83, due in large part to the increase in Unemployment Insurance premiums that took effect on January 1, 1983. Thus estimated financial requirements, excluding foreign exchange transactions, are forecast to be $26.6 billion this fiscal year.
Passage of the present borrowing authority Bill, Bill C-151, of which we are speaking today, will ensure the Government is
in a position to implement the important measures in the budget and to meet the projected requirements for funds as identified in that plan for economic recovery.
The request for borrowing authority in 1983-84 is based on the financial requirements that I have mentioned, plus a reserve for contingencies. As we already have $14 billion in borrowing authority for the current fiscal year, we are seeking an additional $12.7 billion, to provide us with a total of $26.7 billion borrowing authority for the current year, an amount equivalent to the financial requirements, plus an amount for contingencies.
For purposes of clarity, Mr. Speaker, I would for the benefit of Hon. Members like to set out the history of the borrowing authority numbers in more detail. Part II of Bill C-143 passed last March provided interim borrowing authority of $14 billion for 1983-84. In addition, Part I of Bill C-143 conferred $5 billion of borrowing authority on the Government for use in the years 1982-83, of which an unused amount in excess of $2 billion was to expire on March 31, 1983. As it turned out-and I will provide the House with details later on-there was $2 billion of unused authority available to be carried forward into 1983-84.
Clause 2(1) of the Bill currently before the House seeks additional borrowing authority for fiscal 1983-84 of $14.7 billion. Clause 2(2) of Bill C-151 provides that any unused portion of this amount, to the extent that it exceeds $2 billion, will be cancelled on March 31, 1984. Thus passage of the current Bill, along with the borrowing authority provided in Bill C-143, will provide a total of $26.7 billion in new borrowing authority for 1983-84, plus a non-lapsing contigency of $4 billion.
There are two fundamental reasons, Mr. Speaker, for the non-lapsing contingency. They were the reasons, Mr. Speaker, which had prompted Parliament to put such a contingency in borrowing authorities previously, and they were borrowing authorities not only of this Government, but under the regime of Hon. Members opposite when they formed the Government as well. First, there is a need to have an amount in place to accommodate exchange market pressures and the effect they have on the level of official exchange reserves. Second, it is to enable the Government to continue with its regular debt program when the House is not in session.
In the foreign exchange market, when the Canadian dollar is firm the exchange fund account accumulates American dollars, and in order to finance this increase in official reserves, Canadian dollars must either be taken from cash balances or borrowed and charged against the borrowing authority.
On the other hand, when the dollar is weak the U.S. dollar reserves fall and these balances must be supplemented by drawing on the two standby credit facilities which the Government has with both the Canadian and international banks, or
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by other types of foreign borrowings. Any of these borrowings must be charged against the borrowing authority. This has been the practice of the Government for many years. It was the practice, as I said, which was carried on by Hon. Members opposite when they formed the Government.
Events which took place in May and June, 1982 are probably the best example to illustrate the type of situation which I have called upon just now. In that period the dollar was under pressure and nearly $3.5 billion of borrowing authority was used for foreign borrowing. And for all of 1982-83 foreign exchange operations added $1.5 billion to the financial requirements.
It is in case of any such repeated circumstances, Mr. Speaker, that we have asked for the contingency. As I say, such contingency has been granted by Parliament on all previous requests made heretofore. The request for a non-lapsing contingency amount, therefore, is not new.
I would like to turn, Mr. Speaker, to an explanation of how the borrowing authority situation stood at the end of 1982-83. Including the $5 billion borrowing authority provided by Bill C-143, the total amount of authority granted for 1982-83 was about $26.1 billion. Approximately $23.1 billion of this amount was used; $9.7 billion through the issue of Treasury bills, $4.9 billion through the issue of bonds, and $7.6 billion net Canada Saving Bonds sales. Foreign borrowing added a further $.9 billion to the use of borrowing authority. The foreign borrowing represented U.S. $750 million borrowed in the Eurobond market last June, and a partial redemption of Deutschemark maturity early last year. Thus there was approximately $3 billion unused of which $2 billion, as I indicated, was carried forward, and about $1 billion was cancelled on March 31, 1983.
I mentioned at the outset, Mr. Speaker, that Section 39 of the Financial Administration Act can be used in special circumstances. I would like to make reference to the actual amount of Treasury bills that were used by the Government under Section 39. Hon. Members will recall that in mid-February virtually all of the borrowing authority authorized for 1982-83 had been used. By early March it became apparent that Bill C-143 would not be passed for several weeks. In fact, we know that Royal Assent was not received until March 30.
Projected Financial requirements over the March to June period were extremely large, and in order to continue with a regular debt program that would satisfy these requirements it was decided to make use of the temporary powers granted by Section 39 of the Financial Administration Act. Permission was sought from Cabinet to use Section 39 to authorize a total of $2.3 billion of net new Treasury bill issues over the March 11-31 period. However, due to Canada Savings Bond redemptions occurring during that period which had the effect of increasing the authority, and since new authority was conferred in time to authorize the March 31 issue of Treasury bills, total usage of Section 39 amounted to approximately
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$1.4 billion. This amount was in any event charged to the new authority under Bill C-143.
I would like to refer to the final clause in Bill C-151, Mr. Speaker, which has recently been a standard clause. Clause 2.3 refers to the ability of the Government to borrow and repay loans in foreign currency and has been included in the last six Borrowing Authority Acts. Over the years Canada has borrowed and repaid funds in a number of currencies. In recent years, however, this Clause has been added to confirm Canada's right to borrow in foreign currencies.
Bill C-96, which received first reading in the House in March, 1982, proposes a number of amendments to the Financial Administration Act, including a general amendment clarifying the Government's ability to borrow and repay in foreign currencies. Once this amendment has been passed, there will no longer be any need to have the specific request included in the borrowing legislation, such as Bill C-151 before the House today.
In conclusion, Mr. Speaker, I began my comments by pointing out that the Minister of Finance had, in the fall of last year, in his first official statement to the House as Minister of Finance, indicated his intention to seek the authority we are today asking for. He again made reference to his intention to seek the authority once a fiscal and economic plan had been placed before Parliament and we have concluded debate on that budget. The vote recently concluded the initial debate on that exercise.
In the request of the Government for interim borrowing authority, we took the opportunity to remind Hon. Members that the last occasion prior to today when borrowing authority was requested was for borrowing authority pending the production of the budget and the financial material in the budget, although the Estimates had themselves been presented earlier. Therefore, today Bill C-151 is a follow-through of the Minister's intention signalled in October of last year to seek the support of Hon. Members to provide the wherewithal to carry out the economic program which is so important to this country at this time, especially those features of the Government's plan identified in the budget as the Special Recovery Program, at the same time maintaining the Government's support of its social net and safety provisions which have been and are so important to Canadians less fortunate than others who have, for example, needed the support of the Unemployment Insurance Fund. The request today is to continue the Government's new initiative in its economic plan and to continue its social commitment to Canadians who need that kind of support at this time.
The legislation, I understand, would go to committee for detailed examination. Hopefully, the consideration at second reading, the deliberation by committee, the return to the House and the proceeding with the legislation to ensure support for economic recovery, which has been well received

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by Canadians right across this country, would continue in a manner which illustrates the commitment of Parliament toward supporting the recovery which is very apparent.


Miss Carney:: Mr. Speaker, I would like to ask the Minister a question. In his remarks he referred to the fiscal requirement as being $26.6 billion.


The Acting Speaker (Mr. Blaker):: Order, please. The ten-minute period for questions, answers and comments applies to speeches which themselves are 20 minutes. The first three Hon. Members speaking on the Bill have access to a total of 40 minutes if they so wish.


Mr. Cullen:: Unanimous consent.


The Acting Speaker (Mr. Blaker):: The rule providing the ten-minute period for questions does not apply. However, I did hear the Hon. Member for Sarnia-Lambton (Mr. Cullen) note that if the House wished to give its unanimous consent to an exchange of questions and answers, that could be easily done. Is there uanimous consent to an exchange of questions and answers?


Some Hon. Members:: Agreed.


Pat Carney: Mr. Speaker, my point was that in his remarks the Minister mentioned that his fiscal requirement amounted to $26.6 billion. The budget papers state $26.7 billion. I would like to ask the Minister to clarify which is the correct figure.


Paul James Cosgrove: Mr. Speaker, I cannot, except to say that I suspect that was possibly-


Mr. Blenkarn:: That was part of the photo session.


Paul James Cosgrove: -a result of the amendments, the addendum which was filed by the Minister of Finance after his speech on the budget. However, I did agree and give unanimous consent to answer questions at this time. It is my hope that these questions in exchange may possibly speed the method by which we can solve some of these technical problems. I would certainly have that information available for the Hon. Member. I would conceivably shorten the time in which the legislation would be required in committee as well. Therefore I can undertake to give the specifics in so far as that discrepancy is concerned. I believe it relates to the additional $200 million added to the Special Recovery Fund for the Capital Works Projects.


The Acting Speaker (Mr. Blaker):: The Hon. Member for Vancouver Centre.


Pat Carney: Mr. Speaker, in opening debate on Bill C-151-


Donald Alex Blenkarn: May I ask a question? I rise on a point of order. I was about to ask a question, if the Minister would permit me. Your Honour is open to debate; is that correct?


The Acting Speaker (Mr. Blaker):: The Chair recognized the Hon. Member for Vancouver Centre for a further question, and if the Hon. Member for Mississauga South (Mr. Blenkarn) also wants to ask a question-


Donald Alex Blenkarn: I would like to ask a question, Mr. Speaker, if I could, yes.


The Acting Speaker (Mr. Blaker):: -there will be time to do so. I have already recognized the Hon. Member for Vancouver Centre, unless the one Hon. Member wishes to give way to the other.


Pat Carney: Mr. Speaker, I am willing to give way to my colleague, and then I would like to make my speech.


Donald Alex Blenkarn: I simply want clarification from the Minister. He started off this year, or March 31,1 gather, with $2 billion left in non-lapsing borrowing authority from Bill C-143 and $14 billion in borrowing authority for the current fiscal year available, for a total of $16 billion. He has now asked for $14.7 billion, totalling $30.7 billion. Is it the Minister's view that he really needs, as a contingency, $4 billion extra in non-lapsing borrowing authority just to be able to manage the Government?


Paul James Cosgrove: Yes, Mr. Speaker. I have indicated that the practice of the Government in preceding requests for borrowing authority in Bills has always been to ask for non-lapsing contingencies. It is the Government's best estimate that a prudent amount to be held for contingencies would be the additional $4 billion.
We requested that for two reasons which I made evident. The first is the need to protect the Government's flexibility in foreign exchange markets. I gave an example as to how the Government had to intervene last year to the extent of $1.9 billion in a rapidly fluctuating foreign exchange period. The Government has no assurance, but that situation might occur or might not occur again. The point is that the Government needs that flexibility to protect the orderly movement of the Canadian dollar.
Second, the Government is requesting the contingency because it does not want to be in the position in which it found itself in having to rely on Section 39, an extraordinary measure to which the Government had to resort for the first time this year. In order not to be put into that position, the Government has requested the $4 billion. We are motivated in requesting the $4 billion because it is our feeling that when we had to rely on Section 39, it did conceivably have some impact on the markets and on interest rates in Canada. When interest rates rose, we felt that could have reflected the tardiness involving the last interim borrowing authority process in the House. Therefore, it is our best guess that the $4 billion is a prudent request for contingency.


The Acting Speaker (Mr. Blaker):: Debate?


Donald Alex Blenkarn: I would like to ask one more question.
May 5, 1983


The Acting Speaker (Mr. Blaker):: The Hon. Member for Mississauga South may ask a further question.


Donald Alex Blenkarn: I was wondering if the Minister could advise why, in Bill C-143, the $2 billion carried over in the Bill never lapses; it carries on forever. In Bill C-151, the $2 billion carries on forever. Particularly when the evidence of the Minister of Finance before the Finance Committee was that $2 billion was more than enough for a contingency allowance, why is it all of a sudden necessary to have $4 billion in contingency carryover money?


Paul James Cosgrove: With respect, Mr. Speaker, I think that is really a repetition of the last question. In considering the first question asked, I realized that the forecasts were S26.7 billion. Mine was a reading mistake. The notes indicate $26.7 billion.


The Acting Speaker (Mr. Blaker):: Debate.


Pat Carney: Mr. Speaker, I thank the Minister for that clarification. In opening debate on Bill C-151, an Act to provide supplementary borrowing authority, I want to stress that this Government is either callous or careless. It is callous because it is asking Parliament to approve a Bill for $4 billion more than it needs according to its own fiscal requirements as set out in the budget. It is callous because that padded borrowing must be added to the increasing debt which must be paid for, in the final analysis, by our children.
It is careless because padding the deficit by that amount of money, $4 billion, indicates that the Government is indeed acknowledging that its sloppy and slipshod financial projections are continually changing. It is also careless because it is all too clear that by padding the borrowing Bill and padding the deficit forecast, the Government is providing itself with an election slush fund to be borrowed and spent before Canadian voters turf the Liberals out.
This Government has come before Parliament seven times this session to ask it for more borrowing authority. In the fiscal year 1982-83 alone, the Government came hat in hand to Parliament for authority to borrow more money on four separate occasions. Just a few weeks ago we approved the largest borrowing Bill in our parliamentary history, Bill C-143.
The Government still has $16 billion of that borrowing authority left. Since its financial projections as stated in the budget and confirmed by the Minister are for $26.7 billion in the current fiscal year, it requires only $10.7 billion for the balance of the year. Further, the Minister himself has told us that the Government requires $2 billion in cash balances. Yet as of this week he has almost $6 billion-plus on hand. In fact, when one subtracts the surplus $3 billion cash in hand from his financial requirements, the Government requires only $7.7 billion in additional borrowing authority to meet the fiscal proposals set out in the April budget.
We have already seen how a careless Finance Minister can add $200 million worth of debt to cover up his inadvertent
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budget leak. We now see how the same Minister can pad billions of dollars to the borrowing authority and to the public debt.
Further, by returning to Parliament so soon after his last borrowing Bill, the Minister is showing his contempt for Parliament. He wants this Bill approved now so that he can avoid parliamentary scrutiny of his spending plans for the balance of the fiscal year which will end close to an election. He wants to spend his borrowed funds without the inconvenience of explaining to Parliament and the country how he means to use them. He will use these borrowed funds to establish his election goody bag. That is a shameless abuse of the institution of Parliament and it is one reason why we oppose this Bill.
The Government must be accountable to Parliament and Parliament must be accountable to the people. The Government cannot account for the billions of dollars requested in this Bill which is surplus to its cash reserves, its existing borrowing powers and its spending plans as set out in the budget.
We must remember that this is the same Government that took four runs at estimating last year's deficit, tripling it in the process, before giving up and saying that it would come in "somewhere" between its third and fourth estimates. Who suffers? Not just Parliament or Canadians who are required to foot this Bill and who will be paying an additional $5.7 billion in tax increases over the next four years. The real victims of this Government's dishonest approach will be our youth, who will be paying for years to come. That will be their legacy from the Liberal Party.
Who are the winners and who will benefit, at least in the short term, from this Liberal largesse? The Government has a long history of paying off its supporters and rewarding its friends. The Government will pour as much of our money as it can into Liberal ridings before the next election in order to stem the Tory tidal wave. If last year was the year of the dog according to my Chinese friends, this year will be the year of the pork barrel. Let me give the House a few examples.
The centrepiece of the Special Recovery Program announced in the budget is the $2.2. billion capital projects fund. Control of this pork barrel will be in the hands of a special Cabinet committee. The same people who brought us Canadair, Consolidated Computer, Coalgate and the National Energy Program now have a lot more mad money.
Even though they are the cornerstone of the Government's job creation effort, the projects announced so far have contained few job estimates. Numbers that have been provided have proved to be inflated and grossly misleading. For example, the Government announced that it will be spending $147 million to purchase 20 Canadair CL-215 water bombers in order to develop a national firefighting fleet. In the original announcement, the Minister of Finance (Mr. Lalonde) said that 650 jobs per year would be created through this measure. In fact, the Government is committed to purchasing only four of these water bombers and has bought two of them for the Yukon where the fire season starts before the ice is out of the
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lake. That is another example of forward planning and fast tracking. The other 16 will be bought only if the Provinces agree to buy a matching 16 planes. Since the Provinces have never been eager to foot the extremely high cost of this plane, the purchase of all 36 planes is far from assured. Some Provinces have indicated that they are not interested since their terrain is not suited to this particular aircraft.
Even if orders are placed for the full complement of planes, Canadair has told us that the Government's job estimates are grossly inflated. In fact, no jobs would be generated this year at all. Canadair is actually laying off people this summer. By January, 1984, if all the planes go ahead, 155 jobs may be created. By May, 1984, assuming all of the planes go ahead, 300 jobs may be created. By December, 1984 that number will rise to 525 jobs, and it will not be until the peak of production in June, 1985 that there will be the 650 jobs associated with this project as suggested by the Minister.
Similarly, the Government announced it would be spending an additional $185 million on the coastguard and generate 20,000 jobs in the process. This job figure has turned out to be grossly exaggerated. A much more realistic estimate is that approximately 2,000 jobs may result some time in the future.
While little effort has been made to provide accurate job forecasts for these projects, elaborate attention has been paid to staging the announcement to garner maximum attention. Despite the program's claim that it will provide immediate economic and employment opportunities throughout Canada, it is clear that its major goal is maximum political development for the Liberal Party rather than maximum economic development for Canadians.
Similarly, the Minister responsible for regional and economic expansion announced a restructuring of the programs in his Department last week. The intention of the new Industrial and Regional Development Program he said, is to distribute federal financing assistance more effectively than before. I would be most interested in the Minister's definition of "effective", but I can guess that he means he has devised a better way to channel money into Liberal ridings. The Minister calls it targeting.
In deciding what region will receive federal money, the country is divided into its 260 census districts. A formula called a development index will be applied in order to determine the level of assistance. The index will be based on three factors: the rate of unemployment in the census district; the level of income per person in the district; and the fiscal capacity of the Province in which the district is located. That means the ability of that Province to raise money.
At first glance it all looks very objective. It does not take much analysis, however, to uncover some real difficulties with this approach. For example, the same size for determining the unemployment rate in each district, if it is based on the labour force statistics, will be too small to be reliable. Even if this measurement were accurate, it would not take account of overall employment. In other words, it would not consider how many people have dropped out of the labour force. The data will therefore be skewed away from areas with high seasonal
unemployment which are just the areas that can benefit the most from programs such as these.
A more accurate measure of unemployment might take account of the number of people registered at Manpower or collecting Unemployment Insurance Benefits. Furthermore, the index will draw on data dating back to 1976 in order to focus on areas with historical levels of high unemployment and low income. Unfortunately, this does not permit a quick response to changing circumstances. It will work against my own Province of British Columbia, for example, which has been very hard hit by the recent recession. By factoring in the fiscal capacity of Provinces, the program will discriminate against hard-hit areas of relatively well off Provinces, such as Alberta, British Columbia and Ontario. Theoretically, every riding would qualify for some federal money. In this way the Government may find it a lot easier to inject money into favoured ridings which would not have qualified under the earlier programs designed to alleviate regional disparity.
The Minister has not said precisely how the formula will work, but the Government's past track record, for example with ILAP and the Canadian Community Development Program, suggests it will be jigged to work in favour of Liberal ridings. We in the Opposition want to know if the formula will be legislated or whether it will be left to ministerial discretion. We can only hope that it will operate at least a little more objectively than the Special Employment Incentives Program which has just received an infusion of $150 million over two years in the recent budget. This money is to be spent on the following:
Localized, employment intensive projects under existing Government construction and other programs.
So far we have had Liberal Senators, such as Senator Olson and Senator Argue, announcing funding for swimming pools and community arenas. But there is no formal application process for this money, so we cannot tell on what basis these successful projects were selected. It certainly is a "special" employment initiatives program. We do not know what criteria these projects must meet to qualify. We do not know how many jobs they will generate. We do not know how many go to which Provinces, and we do not know what the cost per person-year of employment is for each job created. But we know who announces them-Liberal Senators.
What is important are the economic consequences of the Government's actions. We have just been through the worst recession in 50 years, a recession that has inflicted hardship on millions of Canadians. The Government says that its policies are designed to ensure recovery takes place and that it lasts. Sadly, its policies are liable to have the opposite effect.
The result of this Government's actions may be to choke off recovery just as it gets started. As we pointed out in our official response to the budget, the Government is making no attempt to restrain spending even though its expenditures jumped by 17 per cent last year. It is true that the Government promises to keep its spending in line with increases in GNP,
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but this means that the Government's share of the economy, which increased during the recession, will not decrease with recovery.
The Minister of Finance claims that there was nothing of substance in the official response to the budget. I would like to review exactly what I said because my comments are now being echoed by many other analysts. I pointed out that the Minister is making no attempt to restrain spending. Indeed, he plans to increase expenditures to help pay for his recovery program. I outlined the impact on social programs which are threatened by the runaway spending. Unless we can balance the books, there will be no money to pay for the social programs upon which Canadians depend. I also pointed out the divergence between the Government's fiscal and monetary policies. Sustained recovery will depend upon lower interest rates, but the increasing deficit threatens to crowd out the private sector incentives the budget is supposed to encourage as recovery takes hold. We cannot prevent interest rates from rising again in light of the Minister's deficit projection; the result will be a choking off of the recovery just as it gathers steam.
I also reviewed the budget's effects on various sectors of the economy. For example, I pointed out that it is not as favourable to business as it may at first appear. Certainly small business does not stand to gain very much, and that is a pity since approximately 32 per cent of new jobs in the country are created by that sector. Unfortunately, many small businesses were so weakened by the recession that they will not be able to take advantage of the investment incentives announced in the budget. Those incentives are not particularly useful to small businesses anyway; large businesses are more apt to use them. Of more use to small businesses would have been the adoption of the small business corporation which would have allowed them to increase their equity and improve their cash flow. This would have relieved the cash flow problems by allowing small businesses to take in partners who could write off losses against their income.
All businesses will be hurt by the tremendous tax increases which will be levied on consumers over the next four years. In fact, taxes will be increased by $5.7 billion by 1986. Increased spending by consumers is the principal need of small business. Unfortunately, consumption is liable to be reduced by the budget measures.
I reviewed many of the tax increases, including the elimination of the $100 standard deduction, the restructuring of the federal tax credit, the freezing of the children's exemption, the maintenance of the Canadian ownership charge, and the increase in the manufacturers' sales tax. The impact of many of these taxes will be regressive. Low and middle income Canadians will be the hardest hit.
We made all these points on the day after the budget was presented in the House. Now others are beginning to realize what the real impact of the budget will be. Thomas Maxwell, the Chief Economist of the Conference Board, has warned that the recovery is likely to stall by the end of next year. In a recent interview he said:
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Essentially what we see is enough momentum generated to keep us growing into 1984. The question is what happens towards the end of 1984 and into 1985. That I think is where our forecast and Lalonde's forecast start to part company. Because in our forecast, the economy sort of comes to a screeching halt in 1985 and 1986 as the very high interest rates combined with the tax increases associated with the later years of the budget start to put a constraint on growth.
Roger Keane of Midland Doherty said:
It is a mistake to view this as a pro-business budget; what it really has is all the attributes of a budget in which new public expenditures are brought down off the shelf.
I noticed today that Thomas D'Aquino who speaks for a group of businessmen is echoing our concern that business is being set up as the fall-guy in the budget, if they are unable to respond to the tax incentives it will provide the Government with a chance to intervene in the economy again.
I understand why people welcome the budget of the Minister of Finance compared with the three previous Liberal budgets. But this borrowing Bill only underlines the points I have been making about the economic mismanagement we have endured and will continue to endure under the Liberal Government.
Let us put this Bill into context. Over the past 15 years Government spending has ballooned by nearly 700 per cent. Just since the Liberal re-election in 1980, spending has increased 84 per cent on a national accounts basis. Government spending is now equal to 26 per cent of Canada's Gross National Product.
The Government argues that it must keep up its level of spending in order to combat the problem of unemployment in the country. But if one looks at historic levels of Government spending and their impact upon unemployment, it is clear that simply throwing more money at the problem solves nothing. For example, in 1970-71 the deficit stood at about $370 million and the unemployment rate ran at 5.7 per cent. In 1975-76 the deficit was $5.4 billion and the unemployment rate was close to 7 per cent. Today, with a projected deficit of over $31 billion, the unemployment rate tops 12 per cent. If we look at the projections of $25 billion per year budget deficits and unemployment rates of well over 10 per cent, we can see that running deficits does not help create employment and that there seems to be a distinct linkage between the size of the deficit and the increase in the unemployment rate. It is clear that this approach has not worked in the past and will not work in the future.
What do we need? We need to hold the Government accountable. The Government must explain its need for these additional funds. For it to be accountable, it must regain control of its expenditures. The Government cannot be permitted to inflate its borrowing authority in order to avoid returning to Parliament to explain how the money will be spent. We must oppose this Bill because it allows the Government to borrow far more money than it needs. The country cannot afford fiscal cushions for incompetent economic managers or election slush funds for desperate Liberals. We must keep in mind who will be paying the bill for this legislation.
At I said at the outset, it will be our children and grandchildren who will be saddled with the burden of excessive taxation

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unless we do something now. Unless we rein in Government expenditures, we will never as a nation achieve the level of prosperity we once enjoyed, nor will we have the capacity to adapt to the economic challenges of the 1980s. As I said, we may not even be able to afford the social programs to protect those who need it most. We will not be able to exploit our natural advantages in order to compete successfully in world markets. Our children will never enjoy the standard of living we have had. It is a grim outlook for the future-that is the real Liberal legacy.
It need not be this way. As our Party has stated, Canadians have the best chance right now to capitalize on our advantages, to be productive and competitive. The effects of the recession have been wrenching. However, those who survived are leaner, more efficient, more realistic. Excess capacity has been wrung out of the system. Faced with shrinking domestic markets, we have begun to look outward to promote our products in world markets to a greater extent. Many firms have reduced their oppressive debt loads and are ready to produce and be innovative again. Workers who have lost their jobs are beginning to think of retraining for new positions or starting their own businesses.
If we are to guarantee a recovery, we must be alert to new possibilities, aware of past mistakes and eager to adjust to changing circumstances. We must identify areas for improvement. For example, a survey conducted by the European Management Forum ranks 22 countries according to a range of factors, such as their productivity, industrial efficiency and human resources. It outlines Canada's advantages. We rank third in human resources, second with our natural resources and infrastructure, seventh in economic dynamism and sixth in competitiveness.
The survey also identifies an array of weaknesses. We are thirteenth in industrial efficiency; seventeenth in outward orientation or the will and ability to promote trade; sixteenth out of 22 in innovative forward orientation, which is the commitment to research and development and human resource development. We are in last place in employee productivity trends; and last again in export flexibility. Over-all we rank sixth. We should rank higher.
We must start working on these problems. We must improve our productivity and our competitiveness. We can no longer rely on our natural resource exports to ensure our prosperity and position in the world. We can no longer indulge in regional factionalism. We must use our regional diversity as a strength. We must develop an economic strategy that emphasizes the assets of each region, such as Canada's place on the Pacific Rim, and co-ordinate the actions of each level of Government to achieve this aim. We must address the problems of various economic sectors in the economy, such as energy and fisheries which have been ignored or abused by this Government. We must work to improve our management-labour relations.
These are just a few of the positive steps we should be taking. To ensure recovery, we must increase our markets. To increase our markets, we must increase consumer demand. We
can achieve increased demand by putting people back to work. To put people back to work, we must increase our export markets. To do that, we must be more competitive. To become more competitive, we must become more productive. To become more productive, we must expand our technological research and more aggressively apply it to industrial production.
To take these actions, we must change our attitudes and patterns of behaviour. It is an exciting challenge for us. A Government that demonstrates it is tackling these problems with determination, tenacity, co-operation and leadership will inspire confidence. That is what Canadians are looking for. That is what Conservatives can provide. That is why we will be proposing two amendments to this Bill at the appropriate time.
We believe the Government must account for all the money that is borrowed in its name. That is why we will be seeking to amend this Bill to include the financial requirements of Crown corporations. We believe the Government should seek authority to borrow only as much money as it needs. That is why we will be proposing an amendment to reduce the borrowing authority granted to half the amount that is currently being requested. We want to hold this Government to account. It must begin to control its expenditures. This Bill is a good place to start.


Mr. Vic Althouse (Humboldt-Lake Centre):: Mr. Speaker, the Bill before us today asks for an additional $14.7 billion in borrowing authority. The Minister kindly explained to the House that $4 billion will be for a contingency fund. As the House knows, this is in addition to the contingency fund and borrowing authority granted to the Government in February when Bill C-143 was introduced and eventually passed through this House. That Bill authorized the Government to borrow an additional $19 billion. A short two months later, we are being asked to grant authority to borrow an additional $14.7 billion.
There will be a great many questions the Government will have to answer. As I said, the Minister did explain the proposed use of $4 billion in contingency funds. He said in part it was to meet runs on the Canadian dollar. He referred to the occasion in the last couple of years when the Government found itself spending $9.1 billion in an effort to stabilize the Canadian dollar. He also pointed out the Government wanted to avoid having to trigger unusual methods of financing by using Section 39 because of the effects this sort of action has on the stock market and money markets, not only in this country but around the world.
Having just received a budget statement from this Government, we must now ask what the money will be used for. We can speculate. There will be some increases in costs. Unemployment is at a record high, and therefore funds being drawn out of the Unemployment Insurance Fund will continue to increase. Part of this borrowing authority will probably be used to cover the resulting deficit.
As people have more difficulty finding a job and as their Unemployment Insurance benefits run out, more and more of
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them are forced on to welfare in order that they and their families can subsist. The federal Government pays about half the welfare cost. Given the present economic conditions, some of this money will be used to offset these calls on the federal Treasury. As well, there will be continuing interest costs to cover the very high Government expenditures. While interest rates have dropped for the Government as well as for the rest of us, the volume of money being borrowed by Government continues to rise.
We note from the budget material that the usual revenues that offset the high cost of these federal programs will not be received to the same extent. Revenues from energy taxation will be down because of the reduced demand due to current economic conditions. The energy demand has dropped between 15 per cent and 18 per cent. Therefore, revenues from that source are down even though the Government attempted to maintain the oil compensation charge which it promised to drop at the beginning of this year.
Another area where normal Government revenues are expected to carry the show, so to speak, is in the area of personal income tax. As more and more people become unemployed, there will be less goods and services and less people paying income tax. The take from that source will be down as well. The take in corporate income taxes will likely drop because of economic conditions and because the budget further reduces the level at which corporations are taxed. In fact, I think one of the main thrusts of the budget is to create an impact upon the Government, causing it to come before us for additional borrowing authority.
There is now a continuation of the policy that both Liberal and Conservative Governments have embarked upon over the last 25 or 30 years. It is a continuation of the policy of increasing taxation for individuals and reducing taxation for corporate citizens. In the late 1950s, the revenue from income tax was approximately 50-50, half coming from corporations and half coming from private individuals. I should point out that in the early 1950s, close to 70 per cent of the revenue was from corporations and only 30 per cent was from individuals. By the end of the 1950s it had gone to a 50-50 basis. At the end of the 1970s approximately 30 per cent of income tax was paid by corporations and about 70 per cent by individuals.
Since we are talking about the difficulty the Government has keeping a large enough cash flow and since we are talking about raising funds, I would be remiss if I did not point out that there are a lot of deferred corporate taxes that have accumulated in this country. That deferred corporate tax is almost enough to cover the deficit that the Government has accumulated for the people of Canada.


Donald Alex Blenkarn: That is not so.


Victor Fredrich (Vic) Althouse: I believe it would cover about half of it; between $60 billion and $70 billion in deferred taxes versus the $130 billion to $140 billion accumulated deficit of the federal Government.
Using my own personal favourite corporate taxpayer, Canadian Pacific Limited, as an example of what this means,
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Canadian Pacific has deferred taxes in the neighbourhood of $1.6 billion. There are no Canadian studies which will indicate, and we do not know from Canadian experience, how much of these deferred taxes will ever find their way into the revenues of the Government. We do know that studies in the United States indicate that less than 5 per cent of deferred corporate taxes are ever collected and find their way into the revenues of the federal Government. For practical purposes, we can say that those deferred taxes are tax gifts to that particular sector of the economy. Discontinuing that sort of practice would leave the federal coffers in much better shape because there would be approximately half as much money paid out in interest to maintain the level of debt that must now be maintained.
I would like to make a few remarks concerning the way the budget has addressed the problems of the advantaged and the disadvantaged in our society. It is relevant to discuss this now at a time when there are something in the neighbourhood of 1.6 million to two million individuals in Canada who are unemployed and looking for jobs. These people have no work but they still have the daily costs incurred to maintain themselves with warmth and shelter and food and clothing. They are still trying to educate their children and provide some means of enabling the next generation to survive in Canadian society.
It is my belief that the budget failed miserably in addressing the rift that is growing between the advantaged and the disadvantaged in our society. I say this because it seems to me that the only tax breaks offered in the budget were tax breaks to upper income earners. As the budget is being analyzed more and more, I think the consensus now among most of the tax analysts is that individuals with incomes in the $60,000 and up income bracket have received a fairly substantial tax break from the budget.
The Globe and Mail, in an article on May 3, said it as succinctly as it could be said. The headline stated:
"Low, middle income earners losers: analysis of a regressive budget." I do not think the budget can be called anything other than regressive when uppper income earners who have the ability to pay a higher proportion of income tax are given a break while the lower and middle income earners are having some of the tax relief that was previously available to them gradually eroded.
As a case in point, I bring to the attention of the House the $200 tax relief that was introduced last year which is being reduced by $100 this year. Apparently, the budget papers tell us that that will be eroded by another $50 next year and will be phased out completely by about 1986. That tax break was previously offered to low and middle income earners in an attempt to increase total demand in the economy.
It is our Party's analysis that the only way this economy can get back in gear and back on the road is to introduce a tax policy that will allow middle and low income earners to increase their expenditures and their demand so that there will

May 5, 1983
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be a market created for goods and services, thereby putting more people back to work. This would create more investment as well and would make the preparations necessary to return to full employment in the society.
Another small provision in the budget that we see as being regressive is the changes to the child cost allowance. This must be put into perspective. The change purports to create an increase for families or individuals who are maintaining children, but the big question that has not been properly answered by anyone from the Government side that I am aware of is what happens to the availability of that money if one or both parents are suddenly left unemployed? The interpretation we seem to have at this time is that if one or both of the people raising children in a normal family are left without a job, there is then no reason to have child care costs as part of the family budget because one person will be at home. It has been forgotten that that unemployed person should not be at home but should be spending time looking for a new job. It appears to us from our interpretation of the budget that that child care allowance will no longer be made available to them.
Again, the budget is regressive. The people who need the tax break, the people who have lost their jobs and could benefit from an additional $1,000 tax break, will have that withdrawn. As well as being left unemployed, these people will take a further loss by losing a tax advantage that they thought they had at the beginning of the year.
To accentuate further the rift in the Government's attitude toward the advantaged and the disadvantaged, there is the Indexed Securities Investment Plan, the ISIP. We have here, according to the budget papers, an attempt by the Government to encourage investment. Indeed, it may encourage some kinds of investments. As I said earlier, the kind of income earner who is best able to take advantage of an ISIP will be someone with a fairly large income, probably in excess of $40,000 or $50,000 a year, because an ISIP must be set up somewhat like the old Registered Home Ownership Plan. A plan must be established through a trust company or an insurance company or some such agency. The assets that are put into such a plan can only be stock purchased on the regular open stock market. It seems to me that this is drawing a very curious line between small individual investors, people who run their own small businesses or farms, or people who may even be incorporated running a family corporation not offered on the stock market. This is setting up two levels of investors, consistent with Government policy, I guess. The Government seems to be hellbent on setting up two classes of people in this country, the very rich and the very poor.
As I read the program, the Government is setting up a two-tier attitude when it comes to taxing capital gains. Those people who set up an ISIP get some advantage. They get a good chunk of their capital gain written off. They can absorb the gain and transfer it into income at a later date, perhaps when they are ready to retire. But a small-businessman or a farmer is still tied to a V-day of 1971. A person setting up an ISIP gets a V-day of 1983. At the end of each year he can
review his portfolio and pay only 25 per cent of his capital gain. The rest is rolled over and he gets the advantage of it. There is an inflation index written into the ISIP which the small-businessman, the farmer or the holder of a small private corporation does not have the benefit of.
We see with this budget a total ignoring of the small people who are actually the fuel and main motor of the economy. The investor in common stocks, with all due respect to the Government, does not provide that much of an incentive. He or she is not providing a whole lot of expertise for the building and the growth of the economy. All they are doing is plunking some money on the line and hoping the people managing the affairs of that common stock company will, in fact, invest in something which will grow.
When I look at the investment choices of some of these large entities that are financed through common stock, it seems to me, from recent history at least, that the trend has not been to create new investment, to shoot off into new fields, with perhaps the possible exception of the computer and high-tech industry, but to amalgamate. For example, there was the Hudson's Bay Company and the Simpson's and Zellers operation of a few years ago. Very large operations, instead of using surplus funds to create new jobs and new enterprises, amalgamate existing enterprises and do away with some of the competition they had. At the same time they do away with an awful lot of jobs.
I think the new investment policy which the Government outlined in the budget does not make it at all clear where the investment should take place. The Government talked about 100 different programs around the country on budget night. We still hear Government Members using the number of programs but we are not seeing any announcements of where the investments will be and where these great projects are going to take place. It is a particularly good question to be asking, Mr. Speaker, because we note with interest that plant capacity in this country is running around 60 per cent or slightly lower.
Faced with that reality, what reason is there for an investor to rush out, build a new plant or wreck an old plant and build a new one? There may be some industries where that might happen. When it does happen, as it does occasionally in the high-tech industry, the plant created as a result requires fewer not more people, and it does not lead to an increase in employment. Touting this particular budget as a budget that will bring about recovery and employment through increased employment and creating demand is a dream and an illusion which the Minister of Finance (Mr. Lalonde) would have us believe. He has not presented any facts. There is no factual material accompanying those allegations to show us that what he says will happen will happen.
I would now like to speak about the use the federal Government is making of its moneys. It is pertinent because the Government is asking us for another $16.7 billion in borrowing authority. The last few moments of my time I will talk about the Government's program for railway redevelopment in this
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country. What the Government is proposing to do is throw $3 billion-something at the railways to do some double-tracking and to complete a tunnel needed in the mountains on the eastern slopes of the Rockies. The Government is alleging that this will solve a problem which it perceives concerning the movement of grain.
I will not spend a lot of time reminding the House that far less than 20 per cent of the total traffic on those rails is actually grain and that projections by the end of the 1990s would have that traffic as low as 10 per cent or 12 per cent. I simply want to talk about the manner in which the Government is proposing to spend the money. The Government is proposing to give that more than $3 billion to the railways with absolutely no strings attached. The Government is not proposing to take equity in the railways so the people of Canada can benefit if the railways are profitable and so Canadians can have some say in the decisions made at the board of directors level with respect to the Canadian Pacific side of the railway operation. The Government is not setting itself up for an eventual operation of that transportation system, which I think is legitimately a public utility kind of operation. It is the kind of operation that cries out, even under capitalistic economics and free enterprise thinking, to be an enterprise that is carried on for the public good and should be carried on for the benefit of the public.
The Government has instead decided to make the same mistakes that were made more than 100 years ago by providing funds to friends in the railway companies without taking back any equity. We think the funds would be better spent and better managed if the railways were required to increase their shareholding and capitalization, and Government funds go to pick up those increased shares. This would not result in an unexpected increase in the value of the shares currently held and it would have almost no effect on the profitability or nonprofitability of the earnings of the shareholders that now exist. It would allow the people of Canada to increase their control of what has traditionally been a privately controlled transportation conglomerate in this country.
By becoming more involved, we could eventually move to a situation where co-operation would exist between the two railways and avoid a great expenditure down the road for some of the double-tracking which is foreseen. This can be accomplished simply by co-operating rather than continuing the charade of competition. The Fraser Canyon, which is a very narrow access to Vancouver and the Lower Mainland of British Columbia, now has one railway operating on either side. If the two railways could ever be enticed into co-operating, one of those rails could be an outgoing line and the other could be an incoming line and capacity could be increased phenomenally-simply by co-operation. We are suggesting that if capital could go into the railways to increase their capacity, their equity capital, with control maintained on behalf of the people of Canada, and if eventually the Board could be controlled in the interests of the people of Canada, then that sort of co-operation would be greatly enhanced.
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We see the economic proposals, the budgeting and the fiscal propositions which have been proposed to us by Government in the last week and here today as being very lacking in forward planning. They do not seem to have a plan for getting us out of this recession. There does not seem to be a clear decision made to try to reduce unemployment and increase demand for low and middle income workers so that the economy can get itself out of this recession. We find that the further call on this House to increase the borrowing authority by another $14.7 billion, virtually on the heels of a borrowing authority of $19 billion, further accentuates what we see as the ineptitude of this Government.


Donald Alex Blenkarn: Mr. Speaker, this is the seventh time in this session of Parliament that I have risen on behalf of our Party to speak to a borrowing authority Bill. The first Bill, you will recall, sir, was Bill C-30, a Bill to authorize the Government to borrow $12 billion. That was immediately followed up the following year by Bill C-59, a Bill requesting another $14 billion. Then, starting the fiscal year 1982-83, there was Bill C- 111 for $6.6 billion; then Bill C-125, originally for $11 billion and then down to $7 billion. There was then Bill C-128 for $4 billion; Bill C-143 for $19 billion. Now we have Bill C-151 for $14.7 billion. It seems to me that we are spending a great deal of the time of this session of Parliament debating borrowing authority Bills to feed the insatiable appetite of this Government for money or debt.
May I remind you, sir, that on March 31, 1980, roughly when this session of Parliament was about to commence following the 1980 election, the total net debt of the people of Canada was $72.1 billion. That included not only our debt denominated in Canadian dollars, but our debt denominated in foreign currency borrowings. The total amount was $72.1 billion. As of the end of this fiscal year which has just passed, March 31, 1983, the net debt has been moved to $115.8 billion. If this Bill and the borrowing requirements which are contemplated in the budget go through, the net debt of the country will be $142.5 billion by March 31, 1984. I can say to you, sir, that we have doubled the national debt of Canada in the very short period of time since the last election.
There is no justification for that kind of spending, that kind of mismanagement. There is no justification whatsoever. It would be totally improper for any Member of Parliament who loved his country, who had some concern for his kids, who had some concern for his neighbour's children, and their children's children, not to insist that there be some accounting for a program of debt which seems to have no end. This debt will have to be paid. It will have to be paid by my children, by my children's children, and indeed by their children's children. It goes on and on and on! We cannot excuse ourselves by saying: "Well, we are just going into a little bit of debt this year because we have a lot of people out of work and we must do some things to stimulate the economy", because that has not been the case. For part of the session of this Parliament, times are said to have been relatively good, certainly very much more relatively good than they are today. Yet Bills were presented

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for $12 billion and for $14 billion, and so on and so on. Therefore it is not a question of just bad times. It is not a question of just tough times now and let's borrow a little and stimulate the economy and get things going again. It is a situation where we have been borrowing both in good times and in bad times.
In that sense I want to go now to the budget itself and take a look at the projections of this Government. If one wants to talk about building confidence in Canada, borrowing authority Bills of this nature do everything but build confidence, although the budget contemplates an increase in the Gross National Product this year of 2.3 per cent in real terms; next year over 5 per cent in real terms; the following year 4.4 per cent and continuing to 4.7 per cent in real terms. In other words, according to the budget Canada is about to enter into great boom times.
But then you must look at the borrowing and the deficit requirements. You find that forever, as far as you can see down the road, we are going to have deficits in excess of $25 billion and borrowings of between $25 billion and $30 billion. How can we possibly have confidence when in times which are supposed to be boom times, times when there is real growth in the economy, where the economy is growing faster, as projected by the budget, than at any time since the War, we have a situation where we will forever have deficits? The fact of the matter is that the budget and its projections are total garbage. They mean nothing. They will lead us to disaster, because as Government borrows it sucks up money from the system and prevents that money from being used by those who create wealth-because Government creates no wealth-and as it does that it drives interest rates up.
I point out to you, sir, that while interest rates may seem, in comparison to 1981 and 1982, to be down now, and likely to be down again when the Treasury bill auction takes place later today, real interest rates-and I am talking about the difference between what is the true inflation and what interest we are paying-are probably higher today than they have been at any time in the past three years.
If we look at the projected inflation rate, not the current inflation rate, and if we look at the projected increase in wholesale prices, we find that the real interest rate, the rate between what is deemed to be the inflation rate and the rate which the banking system charges at prime, today at 11 per cent, is between 8 per cent and 9 per cent. That is an enormous burden. We are only paying that rate of interest because Governments, particularly this one, are borrowing far more than they can legitimately take out of the economy. If the economy improves, as the Government suggests in this budget it will, then I can tell you, sir, that the improvement will not in fact take place because interest rates will go to the moon.
When we look at this Borrowing Authority Bill, we must look at what it does to business confidence and what it says about the financial affairs of the country and the creation of the enthusiasm and drive necessary to make the country work
better. The Government in its budget says it needs $26.7 billion to finance its requirements for the year. The Government says that as of the first of the fiscal year, April 1, it had borrowing capacity of $16 billion, so it would seem to need an additional capacity to borrow of only $10.7 billion. However, the Minister says: "I need a contingency. I am not satisfied with the gross amount of $26.7 billion; that does not give me any contingency." That is bare bones, he says.
Well, sir, that cannot be. The Minister talks about foreign exchange problems but he knows when he borrows in foreign markets that money is converted into Canadian dollars, so it does not matter whether he borrows abroad or in Canada. The fact is that the budget says he can get along on $26.7 billion, including contingencies. He says: "I need another $4 billion on top". That is less than three weeks after he produced the budget. And the people of Canada are supposed to have confidence in this Government's financial management, after it says on April 19 it needs $26.7 billion and on May 5 it says it needs $30.7 billion!


Paul James Cosgrove: That is not true. That is inaccurate.


Donald Alex Blenkarn: We must call this Government to account, Mr. Speaker. We cannot accept this Bill the way it is.
I want to talk for a moment about the Government's six and five program because, frankly, we have had enough of that program. I would refer you, sir, to the Main Estimates filed in the November, 1981 budget. That budget was supposed to look after the fiscal year 1982-83. At that time the Government said it was going to spend $76.3 billion. Well, what did it do? It in fact spent some $81 billion or $82 billion and then produced a budget for 1983-84 and a spending estimate for this year of $88.9 billion. Before the ink was dry, even before the Main Estimates have been passed and we had barely heard the President of the Treasury Board (Mr. Gray) say he could not possibly come to the House for supplementary estimates beyond $88.9 billion, his colleague, the Minister of Finance (Mr. Lalonde) says his new estimates for spending are $90.7 billion, an increase of 18.9 per cent from the estimates for the previous year. That is six and five? No, 18.9 per cent is what it is. So when this Minister says he needs $4 billion in contingency funds, we know that is not what it is. History indicates that it is already targeted for spending.


Paul James Cosgrove: That is not true.


Donald Alex Blenkarn: The April 19 budget has barely passed this House and he is targeting another $4 billion. It is nothing more than that. He comes here and says: "Gimme, gimme, gimme. I want no controls; I want to spend, I want to borrow".
Government is supposed to be the steward of the people's money, an honest steward, but this Government has failed in that stewardship. I say that seriously because there is no way we can allow a borrowing authority in excess of the alleged borrowing requirements.


Paul James Cosgrove: We want economic recovery right now.
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Donald Alex Blenkarn: The Minister squeaks about economic recovery. Let me tell him a few facts. If he looks at the Bank of Canada's statement of last week he will find that this Government had on hand $5.6 billion in deposits with chartered banks. Let me tell you how that works, Mr. Speaker; it is rather interesting. The Government is supposed to keep $100 million with the chartered banks to cover cheque clearing charges and not accept interest on that money. On anything over that amount on deposit the Government gets interest from the chartered banks at a rate roughly 10 per cent less than the going Treasury bill rate. So on today's market the Government gets 8 per cent on that money, but remember that the Government pays a little in excess of 9 per cent for its Treasury bills.
This Government has declared time and time again that it needs no more than $2 billion to facilitate its general activity. That is enough money in the bank to pay its bills and to look after all of its problems. This Government has $3.6 billion more on deposit than it could conceivably need, and that money costs the people of Canada at least $36 million a year, $3 million a month. That is supposed to be good stewardship. The fact of the matter is that the Government is not operating well. It is not running the financial affairs of the country well. From that point of view we must sit back and say: We will give you borrowing authority a piece at a time because we cannot allow you to have carte blanche.


Paul James Cosgrove: That is economic stagnation.


Donald Alex Blenkarn: It is the kind of Government which has no management ability. I say that seriously because its expenses are running away. It budgeted in November, 1981 to spend $76.3 billion; by April of 1983 it says it has to have $90.7 billion to run the country. The Government is running away with itself with that type of attitude. We are being asked to finance borrowing authority Bills, one after another. A Conservative Government today would not be coming to the House for borrowing authority. We would have on hand $16 billion in borrowing authority and we would know that with careful management, we would make it possible to operate the Government until October or November of this year.


Paul James Cosgrove: Under whose leadership?


Donald Alex Blenkarn: We would know that we would not have to be pounding Parliament for another $14.7 billion.


Paul James Cosgrove: Who would be the quarterback?


Donald Alex Blenkarn: We would do it that way. I say to Your Honour that we would operate the Government on a financially sound basis and would not be borrowing money when we had no money in the till. We would not be wasting money.
At this point the Government does not need this Bill. It will presumably need some borrowing authority for the balance of the fiscal year; it could probably easily get along on $8 billion. In order to expedite the proceedings of the House and its activity, we might be prepared to discuss an amendment to the Bill to reduce the borrowing authority to no more than the
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budgetary requirement of the Government. However, under no circumstances could we as a Party, or should we as a House of Commons, be prepared to accept the Bill before us.
The simple fact is that the budget had contingencies built into it. The borrowing requirements in the budget had contingencies built into them. To say that contingencies require an additional $4 billion is drivel, unrealistic, nonsense.


Paul James Cosgrove: And you are against economic recovery.


Donald Alex Blenkarn: The Minister says something about economic recovery, as though the only thing he will attempt to do is to recover himself by borrowing. I do not know how anyone becomes richer by going farther into debt. That is the program of the Government: put the country farther debt. I say that the Government must come to the country and to Parliament clean, and with a proposal which makes sense. To come to Parliament and request total borrowing authority of $30.7 billion, when even the Government's own exaggerated figures indicate that it can get along on $26.7 billion, is a travesty.


Mr. Fisher:: Mr. Speaker, it looks as though we are in for a classic debate on this matter. We have just heard a marvellous presentation of the usual blinkered Tory thinking. I would like to pursue the view of the Hon. Member to the effect that no one creates wealth by borrowing, which is a dumb statement. The Hon. Member knows that individuals create wealth by borrowing in the form of mortgages, that companies borrow in the form of bonds, and that Governments borrow as a form of stimulus to the economy when it is flat. I do not know why he drags out these cliches, because he knows fully well that the cliches are a little bit disreputable and he is a much more sophisticated economic thinker than that.
I would like to ask the Hon. Member a very straightforward question. He said that the Conservatives would borrow and would use the $16 billion authority through to October, and then would come back to the House for additional sums needed to carry them through the rest of the year. In October, how would he propose to ensure that people like him would not filibuster in the House in the manner his Party did last March, forcing the Government into the dumbest kind of borrowing that is possible-short-term notes, emergency borrowing, highly expensive borrowing? How would he ensure that his colleagues in the House would give us the co-operation we need to pass an additional Bill at that time without a lot of filibustering?


Donald Alex Blenkarn: Mr. Speaker, it is pretty self-evident that the Parliamentary Secretary is trying to cover up for ineptness. The fact is that Bill C-143 was presented in the House on February 17. At that time the Minister of Finance refused to answer any questions or give any projections whatsoever. The entire Opposition spoke vigorously on the Bill and eventually debate on the Bill had to be limited by time allocation. If the Minister of Finance had come forward with the figures as he was asked to do, the Bill would have gone through much faster. However, he deliberately refused to do so, and he also

May 5, 1983
Borrowing Authority
deliberately refused to allow one single financial speaker for the Government, which would have enable questions to be asked in the ten-minute question period, during the first eight hours of debate.
Second, the Minister refused to come, until he was dragged, kicking and screaming, to the Finance Committee. Every effort was made by the Parliamentary Secretary-


Paul James Cosgrove: After we used closure.


Donald Alex Blenkarn: -to stop the proceedings of the Committee. Eventually, kicking and screaming, the Minister produced some financial figures. At that point there would have been no problem. We were quite prepared to give the Minister the $5 billion he did not need last year. The fact is that he got along with $1 billion less than that. We were quite prepared, as we are prepared right now, despite the fact that we think this is an overspending Government, to talk about giving the Government the money which was approved in the budget.
However, that is not what he want. He wants more money than that which was approved in the budget. He wants $4 billion more. As if that were not bad enough, he wants it now, when he has no need to borrow more money until some time in October, or maybe November or December for that matter. If he handled the affairs of the country properly, he probably would not need any more than the $16 billion which has already been approved. However, assuming he does, why does he now demand $14.7 billion without any evidence of its being required in the budget?


Douglas Glenn Fisher: Mr. Speaker, I must be mistaken. It must be another colleague of mine from Mississauga South, not the particular one who rose in the House just now. I must be confused about my colleagues because I know that I sat in the Finance Committee with my colleague from Mississauga South and listened to the Minister of State for Finance (Mr. Cosgrove) on two separate occasions, and the Minister of Finance. We offered the participation of the Minister of Finance for as much time as he needed to answer questions. Some Hon. Member from Mississauga South, if it was not that one, was in the room when the Minister of Finance was there, from nine o'clock p.m. until two o'clock a.m. the next morning, and then for a second session lasting another hour and a half. I think, but I am not sure, that it was either him or his brother or some look-a-like who had plenty of opportunity last March to ask questions and did ask all kinds of questions. They were dumb questions but he asked them anyway.
I would now like to know the answer to my original question. How would the Hon. Member for Mississauga South or his spokesman, the other shadow member from Mississauga South, guarantee smooth passage of a borrowing Bill in October so that the Government would not have to go through the kind of dumb manoeuvring which he is forcing us into with this filibuster?


Some Hon. Members:: He doesn't know.


Donald Alex Blenkarn: It is very simple. All he has to do is to reduce the amount in his Bill and say: "I am coming to the House to ask for approval of what the House has already passed". The House has already passed the Government's budget. The budget calls for $26.7 billion in borrowing authority to meet its requirements. The Minister says that he has $16 billion. He therefore needs no more than $10.7 billion. It would be a very simple matter for the Minister to say: "The budget has been passed; now we would like the money set out in the budget". However, that is not what the Government requests. It requests something far more than that.


Paul James Cosgrove: Mr. Speaker, I do recognize the time-


The Acting Speaker (Mr. Blaker):: The Chair will recognize the Minister for a very brief question. As he can see, the time is now one o'clock.


Paul James Cosgrove: I realize that the time is one o'clock. Will the Hon. Member who has just spoken be available for questioning upon resumption of this business?


Donald Alex Blenkarn: Yes, sir.


The Acting Speaker (Mr. Blaker):: It being one o'clock, I do now leave the Chair until two o'clock this afternoon.
At 1.02 p.m. the House took recess.


[Stage Direction]
AFTER RECESS The House resumed at 2 p.m.


Mr. Jean-Guy Dubois (Lotbiniere):: Madam Speaker, yesterday, the Minister of Transport (Mr. Pepin) announced that he would soon be tabling new legislation to implement the Government's plan for improving the grain transportation system in Western Canada. In this connection, the Quebec caucus committee, which has ten members from various parts of Quebec and which I have the honour to chair, had made recommendations to the Minister of Transport not long ago to the effect that following the proposal made on February 1, the committee recommended to the Minister of Transport that the grain transportation subsidy be paid directly to small railway companies. We are of course very happy with the decision announced by the Minister of Transport yesterday, since we
May 5, 1983

have been working since September 1982 on preparing recommendations and meetings with agricultural organizations such as the Quebec Farm Producers' Union, the Cooperative federee des meuniers, and so on, and we have each followed up these meetings in our respective ridings.
Today, I think we can say that the Quebec caucus agrees with the proposal announced by the Minister of Transport and that this proposal is a satisfactory response to the aspirations of Members from rural areas and of the entire Quebec caucus, and I think the agricultural sector will benefit, not only in Quebec but also in the rest of Canada.



RAILWAYS


Mr. Blaine A. Thacker (Lethbridge-Foothills):: Madam Speaker, in 1897 the Crow rate, with an average cost of one-half cent per ton mile, to move grain by railway from the Prairies was established. Under the Crow rate, grain production prospered, billions of dollars in foreign exchange were earned, and the railways made money. Cow-calf producers, feed lot operators, meatpacking plants and secondary grain processors continued to flourish because the distortion did not affect the over-all natural advantage of western agriculture.
During the late 1960s and the 1970s, due to inflation brought on by the present Liberal Cabinet, the Crow rate became a major distortion between grain producers on one hand and the livestock industry and the secondary grain processing industry on the other. The over-all natural economic advantage was lost. In 1982 the Minister of Transport (Mr. Pepin) created the Gilson consultative process to negotiate a reasonable solution. Nine major farm organizations, the two national railways, and one group of processing companies spent thousands of hours negotiating an over-all compromise.
The Minister of Transport has since made major changes to the compromise whereby the major economic distortions are still in existence. The over-all balance and fairness have been lost. All of this happened without Members of the House ever seeing any legislation or being able to contribute our knowledge and experience.
Surely this whole process shows once again how incredibly incompetent the present Liberal Government is, whereby the nation must once again endure the worst of all possible solutions.



INCOME TAX


Mr. Gaston Gourde (Levis):: Madam Speaker, it is often said in the media, in this House and also in the National Assembly that Quebecers pay the highest taxes in Canada. I thought Canadians and Quebecers would be interested in some information on income tax levels in the various provinces. For instance, a taxpayer with a taxable income of $6,000 will pay $1,496 in income tax in Quebec, $1,119 in Ontario-$377 less-and $906 in Alberta-$590 less. With a taxable income of $25,000, our taxpayer will pay pay $9,229 in Quebec, but would pay $2,098 less in Ontario and $2,569 less in Alberta. I think that these figures speak for themselves, and that all the rhetoric of politicians who are "all talk and no action" is losing much of its impact on the people of Quebec.
Those are real reasons why investors are avoiding Quebec. These are factors over which the Government of Quebec has complete control, and therefore it cannot blame its neighbours or the Government in Ottawa. In fact, Mr. Parizeau will have a chance to remedy the situation next Tuesday when he brings down his budget.



PENITENTIARIES


Mr. David Kilgour (Edmonton-Strathcona):: Madam
Speaker, the Solicitor General (Mr. Kaplan) proposes to release earlier, for the first-time, offenders convicted for nonviolent offences. We all agree that the need is to get some prisoners out of jail, but only if they are genuinely rehabilitated and not likely to be a danger to the public. We need more qualitative release, not quantitative release. How do we accomplish that? We are obviously not accomplishing it presently.
Rehabilitation is essentially the responsibility of the individual, I believe. We cannot wave a magic wand and have automatic rehabilitation. Only an individual man or woman can rehabilitate himself or herself through their own voluntary change of mind and heart.
The Solicitor General and the Parole Board Chairman are reported as saying that there will be no change in the basic screening process for release. Surely, this is the real point, to determine where we can make a bold move to achieve both genuine rehabilitation and a reduction in the number of prisoners.
Why can we not change the existing process of screening to a meaningful process of qualifying, and put the onus and responsibility for qualifying on the individual prisoner?

May 5, 1983
We should not have to screen him or her. If prisoners want to get out, they should take the initiative and pass the test of satisfying the Parole Board that they have changed their lives enough to qualify for release. If there is a doubt about this, it should be resolved in favour of the community.
We shall only reduce crime effectively when we tackle the causes, not the symptoms of crime.



SCIENCE AND TECHNOLOGY


Mr. Simon de Jong (Regina East):: Madam Speaker, the Minister of Economic Development (Mr. Johnston) has me worried because he has told us all not to worry. The Minister calmly assures us that an additional two million workers thrown out of work by technology, in addition to the two million now without work or hope, will not be a tragedy. That has me worried.
The Minister says, "Do not worry, put your faith in the private enterprise system, the system will provide." That has me more worried.
When the mechanization of agriculture drove workers off the land, they adjusted by finding work in factories. When the automation of industry drove workers from the factories, they adjusted by finding work in offices and the service sector. Now, computers and micro electronics will drive workers off to nowhere. There is no place left to go.
It is true that we cannot and should not hold back the tidal wave of technology that is about to engulf us. We must join in on the micro electronic revolution, or be swept away. But we must join in on our own terms and in ways that will benefit ordinary people. The Minister's "technology at any costs" vision is blurred by panic.
There are other visions. Some of us, like the Catholic Bishops, see alternatives that would place the emphasis on socially useful forms of production, labour intensive industries, the use of appropriate forms of technologies.
Given such alternatives we would not only survive, we would even prosper as the new wave of technology washes over us. The Minister may think that he has all the answers. The worry is: has he even understood the question?



POLITICAL PARTIES


Mr. Thomas Siddon (Richmond-South Delta):: Madam Speaker, citizens of Canada who value the right of private ownership should be forewarned that Members of the New
Democratic Party are philosophically opposed to the constitutional entrenchment of the right to own and enjoy property. If this were not so, the NDP would not have obstructed the property rights amendment which was debated in the House last Friday. By denying unanimous consent on Friday, they purposely prevented Parliament from joining with the legislature of British Columbia in approving this important amendment to the Constitution.


Mr. Deans:: What happened to your press release?


Thomas Edward Siddon: The Leader of the NDP (Mr. Broadbent) and his Members have often said that it would be wrong to guarantee constitutionally the right to own property because this could prevent socialist governments from nationalizing industries or restricting the rights of private land owners.


Simon Leendert de Jong: What about your press release?


Thomas Edward Siddon: I am surprised they do not want to listen. NDP provincial Governments have a history of Crown intervention which has tended to liquidate or diminish the assets of property owners. For example, the present NDP policy on mining in B.C. advocates market intervention and social equity ownership.
The NDP in British Columbia and their federal cohorts have pretended to support property rights on one hand, while retaining a fierce philosophical opposition to such a clause in the Constitution. They offer to recognize the right of Canadians to own a farm or a home, but nothing else.


Madam Speaker:: Order.



PROVINCIAL BOUNDARIES


Mr. Bill Yurko (Edmonton East):: Madam Speaker, under the new Canadian Constitution, new Provinces can only be formed and provincial boundaries can only be extended with the approval of seven Provinces having 50 per cent of the Canadian population. Any Province can accept or veto any changes to its boundaries, under Section 43.
There exists no criteria for creating new Provinces or for changing the boundaries of any Province. Therefore, Parliament should appoint a Royal Commission at the earliest opportunity to recommend criteria for such changes. Indeed, criteria should be established for the granting of provincial status to the Yukon, the granting of semi-provincial status to the Mackenzie region, the possible establishment of new Provinces within the central region of Canada, and the possible extension of provincial boundaries north of the sixtieth parallel into the northern Territories. The creation of additional Provinces would enhance national unity and provide greater equity to the entrenched constitutional amending formula.
May 5, 1983



CANADA MORTGAGE AND HOUSING CORPORATION


Ian Deans: Madam Speaker, on July 20, 1982, the Minister of State for Economic Development (Mr. Johnston) said:
All price increases are limited to no more than 6 per cent in the 12-month period commencing June 28, 1982, and 5 per cent in the following 12-month period.
Also the Minister confirmed that the policy will apply to all prices established under federal jurisdiction, including Departments, agencies, Crown corporations and their wholly-owned subsidiaries. This was confirmed and reaffirmed by the Minister responsible for housing as being applicable to CMHC on Friday, July 30; on Monday, July 26; and on Friday, July 23.
In December, 1982, the residents at First Place in Hamilton received a letter indicating that "Canada Mortgage and Housing Corporation are requiring us to increase the apartments rents to closer to market value. On this occasion the increased rent will be 12 per cent". This preceded a letter of April 29, 1983, which put in place an increase that, combined with the increase announced in December, makes for a total increase of 21 per cent in less than 15 months.
I suggest that the Minister responsible for housing was either not telling the truth to the House, Canada Mortgage and Housing Corporation is not following the instructions of the Government, or both those two things were happening. I ask the Government to take action to correct-


Madam Speaker:: Order, please.



CANADIAN BROADCASTING CORPORATION


Mr. Hal Herbert (Vaudreuil):: Madam Speaker, in response to a statement that I made in the House on March 14 concerning the number of Canadians watching American television, specifically the Public Broadcasting Service, the President of the Canadian Broadcasting Corporation has drawn my attention to statistics which I want to convey to the House.
First, audience figures show that in Canadian metropolitan centres where PBS television can be received, it attracts only 2 per cent to 3 per cent of viewers. Also I am informed that the cost of operation of the United States public broadcasting system for the year 1981 was $767 million. That is broken down into a federal contribution of $200 million, state and local tax revenues of $272 million, and non tax-based revenues, such as foundations, auctions, and the general public, of $295 million, for a total $767 million.
I also referred to the percentage of Quebecers who watch English television. While it is true that approximately 51 per cent of Francophone Quebecers are reached by English television-that is, they watch English language TV at least
Oral Questions
once for a quarter of an hour in a given week-only 14 per cent of the total time spent watching television by Quebec Francophones was to English language stations and only 5.5 per cent of that time was to United States stations.
While the CBC expects to receive $820 million from Parliament in this fiscal year, the money will be used to provide programs and services for television networks in English and French, AM radio networks in English and French, and FM stereo services in English and French-


Madam Speaker:: Order.



ORAL QUESTION PERIOD

[Stage Direction]
[ Translation]

Hon. Roch La Salle (Joliette):: Madam Speaker, in the absence of the Minister of Finance and the Minister responsible for housing, I shall direct my question to the Right Hon. Prime Minister. The Prime Minister knows perfectly well that in his budget, the Minister of Finance had referred to a $3,000 subsidy to stimulate the construction industry, and he said the subsidy might last until the end of May. Yesterday, the Minister responsible for housing informed the House that practically all available funds had been spent and that Canadians applying before May 31 might be disappointed. In the circumstances, and considering the implications of the just society desired by the Prime Minister, can he give the House the assurance that all requests made before May 31 will be met as promised by the Government in the budget?


Paul James Cosgrove: Madam Speaker, I could respond to the Hon. Member by pointing out that, when the original CHOSP program was announced in June of last year, housing starts were at a very low level in comparison with years past. Hon. Members said right off the bat that the result of the program would be ineffective and that it would do nothing for housing.
That program has been very successful. It has been so successful that we have the problem which the Hon. Member raised and brought to our attention, that is, that many Canadians are aware of it and would like to take advantage of the $3,000 grants. The statement of the Minister of Finance in his budget was that indeed the program would be extended beyond the cut-off date, either to the time when the additional $30 million was used up, or to the end of this month.
Yesterday the Minister responsible for housing indicated in the House that there was a large demand, that the program was indeed successful, but that it was the success of the

May 5, 1983
Oral Questions
program that was causing the problem. Housing is now being generated at a very good rate. Housing starts for single families are three times the rate they were when the program was announced.
We think that the industry is very strong. We think that there is no need to continue that subsidy. Hon. Members who are asking the Government, for example, to cut back on its expenditures and to reduce its deficits, should recognize that that industry is now very strong.


Roch La Salle: Madam Speaker, I have a supplementary which is, of course, directed to the Minister of Finance, who said in his budget that the $3,000 subsidy might last until the end of May. I am not challenging the program's usefulness. 1 am very happy to see that an effort is being made in this area, but the fact remains that probably thousands of Canadians will be disappointed because they will not be able to benefit from the subsidy as offered by the Minister of Finance in his budget. The Minister will realize that the officials who are responsible for implementing the program will have a tremendous problem with applications they will not be able to honour because this budget is inadequate. Could the Minister of Finance, since his program is an excellent one, at least give Canadians the assurance that all applications made before May 31 by Canadians who wish to benefit from this program will be considered and that the Minister will provide the necessary funds to meet his commitments to the Canadian people as was his intention, I imagine, when he brought down his budget?


Mr. Lalonde:: Madam Speaker, the trouble for the Member for Joliette is that he cannot read. I said in the budget, and I quote:
-I am allocating $30 million more to the Canadian Home Ownership Stimulation Plan, which should be sufficient to extend this program until about the end of May.
That is what it says in the budget, and if my hon. colleague had bothered to listen instead of interrupting my budget speech on the evening of the budget, and if he had bothered to read it, he would have known what the Government's policy is. I have added another $30 million to this program, which has been very successful, as the Hon. Member is aware. The Minister responsible for housing is going to spend the entire $30 millon to meet requests for this subsidy. But in any case, this kind of program was supposed to end sometime, on April 30, and obviously, in April or on the 1st or 2nd or 3rd of May, some people may have been disappointed because they did not have access to these funds. Now, the situation is quite simple. Interest rates have now gone from 20 per cent to 10.75 per cent, for instance, for a first mortgage. Consumers are benefiting from a considerable drop in rates compared to what they were before, and it is now time to terminate a program that was introduced to help home buyers at a time when interest rates were up at around 20 per cent. Our monetary policy has succeeded in bringing interest rates down to levels that are
much lower than they were before. I hope that we shall be able to reduce interest rates even further, and meanwhile, the amount I was referring to, the $30 million, is there for all Canadians who apply, and their applications will be examined in the order in which they are received by the Canada Mortgage and Housing Corporation.


Roch La Salle: I would like to point out to the Minister that 1 have read the budget carefully, but I also know that thousands of Canadians now have a right to believe that they are entitled to a grant. The Minister of Finance seems to forget that the Minister responsible for housing said yesterday that nearly $30 million had already been spent or appropriated. In these circumstances, I think the Minister is under the obligation to be as honest as possible with the Canadian people and to tell them clearly that the program is now over instead of giving them to understand that they will be entitled to a grant to be negotiated, discussed or evaluated-


Madam Speaker:: Order, please! Speeches are being made on both sides. I would ask the Hon. Member to ask his question immediately and the Hon. Minister to reply as briefly as possible.


Roch La Salle: Thank you, Madam Speaker. My question is this. The Minister is well aware of the problems that this will cause. In the circumstances, if the Minister is unable-this is my question, Madam Speaker-if he is unable to pay out monies as promised, will he at least have the guts to tell Canadians what he can give them or not, as the case may be? That is my question.


Marc Lalonde: Madam Speaker, the last person in this House from whom I have no lessons to take in honesty and courage is the Hon. Member for Joliette. I therefore urge him to be a little more courteous and to hold back his insults. We are used to hearing them when he is seated, but it is unfortunate that we have to hear them even when he has the floor. I have nothing more to say to the Hon. Member, and again it is quite clear, than what I said in my budget. I have allocated an additional $30 million to help Canadians who want to purchase newly built homes. These $30 million will be spent for Canadians.


ASSURANCE SOUGHT THAT APPLICANTS WILL RECEIVE GRANTS
Mr. S. J. Korchinski (Mackenzie):: Madam Speaker, I have a question for the Minister of Finance. The last time the Government put up $100 million was in October last. At that time it did not stipulate that, if the fund ran out, the Government would no longer honour applications. Those who built homes took that into account when working out their total financing. They expected the Government would honour the commitment it made. Areas such as the Atlantic region did not
May 5, 1983

have enough money to carry the program through until the end of April. Will the Minister assure us that, despite the fact there is now a twist, there will be enought funds for those who expected to receive the $3,000 grant and who applied before the end of April, even though the Government is now twisting?


Marc Lalonde: Madam Speaker, I have no reason to believe that it will be imposible to honour the building applications which were received before the end of April. The Minister responsible for housing will be in the House very soon, and he was here yesterday. The Hon. Member could have asked him that question-


Roch La Salle: I did!


Marc Lalonde: He is the Minister responsible for that program, and I have no reason to believe that we will not be in a position to meet those objectives. What happened, according to the minister, is that many applications were sent in through contractors, applications for 50 or 100 houses at the same time. We are not convinced that in each case the foundations have already been completed. Inspectors will check whether those applications do meet the standards of the program, or whether on the contrary the circumstances are such that the contractors wanted to act fast and submit applications in advance because they expected that the program would end at the end of April, failing to take into account the additional $30 million. The Minister responsible for housing is keeping a close watch on the situation.


RAILWAYS
Hon. Edward Broadbent (Oshawa):: Madam Speaker, I have a question for the Minister of Transport. It concerns the changes that he announced yesterday, which were further to the earlier changes that he made in the Crow rate. Will the Minister confirm that, according to the proposals that he made yesterday, the average grain farmer in the Prairies by the end of this decade will spend about $6,000 more to ship his grain? It that is the case, will the Minister tell the House of Commons and the people of Canada why this additional burden should be placed upon our grain farmers?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, most people in the West agree that the Crow has become a liability. Only some reactionaries in the New Democratic Party have not accepted that. My hon. friend should read the statements made by the Saskatchewan Wheat Pool two years ago in which it said that should the Government comply with the following seven points, it would negotiate the Crow. That has been repeated ad nauseam by many organizations in the West. That implies that the farmers in the West are willing to pay more for a good service.
Oral Questions
Some months ago the Saskatchewan Wheat Pool was willing to agree to what is called the "Argue plan", under which the farmers would have paid double the Crow right from the beginning. They were willing to accept that. What other proof does my hon. friend need to understand that the western farmer is willing to pay more for a good service? My hon. friend is a cigar smoker. He should realize that the five-cent cigar no longer exists and, consequently, be willing to adjust.
Under yesterday's announcement and under the previous one, this will imply that the farmer will pay twice Crow in the next four years and, by end of the decade, mutatis mutandis, depending on volume shipped and on the interest rates, et cetera, they will pay five times Crow. The farmer accepts that as a general proposition because of the better system he will have in return.


John Edward Broadbent: If you will excuse the expression, Madam Speaker, the Minister already had to eat crow on this issue. If he goes to the Prairies in the next 48 hours, he will get what could be euphemistically described as an interesting response to his current proposal. He has admitted that the farmers will have to pay at least five times what they are now paying. Our calculation is that that is a Conservative estimate in terms of other increased charges.


AMOUNT TO BE PAID TO CANADIAN PACIFIC RAILWAY
John Edward Broadbent: Madam Speaker, my supplementary question concerns another aspect of the same proposal. In terms of using the taxpayers' money, the Government intends to give CPR, and I say give to CPR, approximately $500 million to be used for capital investment and improvement of the grain handling system. While acknowledging that capital infusion is necessary to modernize the grain handling system in the West, does the Minister not agree that the taxpayers of Canada, including unemployed workers who still pay taxes and are going to put up the $500 million a year, should in turn get shares in CPR for that investment?


Jean-Luc Pepin: Madam Speaker, the Prime Minister has just reminded me that I should have added in my previous answer that the five times Crow that the farmer would pay at the end of the decade, will then be less than 60 per cent of the true cost of transportation. That is an indication that transportation of grain will still be highly subsidized by the federal Government, the contribution being $900 million a year for the next decade and beyond. These are facts that should be taken into consideration.
On the subject of why the Government should not take shares in CP, I think that the simplest answer I can give is that this is not a gift made to CP. CP will have to carry grain in return for the money that they will receive. That should be clear. Now, should the Government invest money in both

May 5, 1983
Oral Questions
subsidizing and contributing to the transportation of grain in the West and besides that buy shares in CP, of course it would increase tremendously the contribution the federal Government would have to make. I might quote the NDP leader in Saskatchewan-


Madam Speaker:: Order, please.
[ Translation]
Order, please. I must ask the Minister of Transport to try to shorten his answers.


RATIONALE FOR PAYMENT TO CANADIAN PACIFIC RAILWAY
John Edward Broadbent: Madam Speaker, I have one final question for the Minister. If the Minister is turning to the gentleman on his left, the Prime Minister, for advice on Prairie issues, he is really in trouble.
Returning to the question of equity, Madam Speaker, acknowledging that we need money to modernize the grain handling system, acknowledging that some money must go to pay the additional costs that are above the freight rate, I ask the Minister who is responsible for the spending of taxpayers' money why we should give any money at all as a handout to the CPR, a company that made more than $120 million in profit last year, for capital investment, unless the people of Canada get a share proportionate to that capital investment in the CPR.


Jean-Luc Pepin: Madam Speaker, I turn to the man on my left side with pleasure, because a few years ago the man on my left side indicated that the future of the West needed double tracking.


An Hon. Member:: Double talking.


Jean-Luc Pepin: At that time, like today, some people smiled, others laughed. Today that statement has become conventional wisdom. Today this is really what is happening in the West, and my hon. friend on my left should be proud of the prediction he made at that time.


Some Hon. Members:: Hear, hear!


Jean-Luc Pepin: About the general announcement I made yesterday, indeed I had to eat crow. I recognize that and I am humble about it. The fact is that perceptions existed in the West and in the East that could not be countered. I have been told by Madam Speaker to be concise, but I think that we now have a balanced set of propositions which will be widely accepted both in the East and the West, and that is the important fact in this matter. We are going to move.


FINANCE
Pat Carney: Madam Speaker, my question is directed to the Minister of Finance who is gracing the House with his presence today, one of the few days he has since he brought in his budget. The Minister should be aware of the fact that there is a growing realization that his 1983-84 budget deficit does not add up, that in fact it has been inflated by about $1.5 billion, possibly to provide a hidden slush fund or an election goody bag. Can the Minister tell the House whether he presented the estimates of expenditures and revenues as prepared by his departmental officials, or did he exercise his ministerial discretion to change them?


Marc Lalonde: Madam Speaker, I was so shocked by the hon. lady's first disgraceful remark that I would ask her to repeat the question. I missed the latter part of it.


Pat Carney: Madam Speaker, I will repeat the question. I pointed out that there is a growing realization that in the Minister's budget deficit figure for the current fiscal year the numbers do not add up, and that there is speculation that it has been inflated by about $1.5 billion, possibly to provide a hidden slush fund or an election goody bag. Can the Minister tell the House whether he presented the estimates of revenues and expenditures as prepared by his departmental officials, or did he exercise his ministerial discretion to change them?


Marc Lalonde: Madam Speaker, I would like first of all to remind the hon. lady that I was in the House yesterday and I do not know where she was. She was not here. Second, out of 58 days before the budget, I missed attending the House on five days. I put this as a challenge to her to match. I know that she has not been here that often.


Some Hon. Members:: Hear, hear!


Marc Lalonde: That being said, obviously the budget is the responsibility of the Minister of Finance. It would be rather strange if I were to start commenting on actions taking place inside my Department between officials or between officials and the Minister. But I have no compunction, no hesitation and no problem at all in telling the Hon. Member that she does not have to worry a bit. The figures are those that were provided by my Department. I questioned them, I analyzed them with my officials, but they are the figures provided by the Department of Finance and they stand on their own. She does not have to worry.


Pat Carney: Madam Speaker, we will be glad to table in the House the record of the Minister's participation in the House since he presented his budget.
May 5, 1983


GOVERNMENT EXPENDITURE PLANS
Pat Carney: Madam Speaker, we know that the Minister of Finance can add $200 million to the public debt in order to cover up his budget leak, and that he is proposing to add $4 billion to his borrowing requirements in the Bill now before the House. Has the Minister of Finance revealed all of his spending plans for the current fiscal year in his budget, or is he going to spring some expensive new programs on unsuspecting Canadians in the future?


Marc Lalonde: Madam Speaker, I am glad to report, from extensive discussion I have had with Canadians since the budget, that they have received the budget extremely well and they are rather shocked by the kind of petty politics that the Conservatives are engaging in.


Some Hon. Members:: Hear, hear!


Marc Lalonde: What shocks Canadians even more is the emptiness of the comments made by the Opposition concerning the budget. I am happy to report that this has been the reaction across the country. I would invite my hon. colleague to take a few days off to check this out for herself. She might change her line of questioning on this particular subject.
I want to tell the Hon. Member that the figures provided in the budget are the estimates as developed by my Department and approved by myself. As far as the planned expenditures of the Government are concerned, they are contained in the Estimates tabled by the President of the Treasury Board and they will be contained in Supplementary Estimates that the President of the Treasury Board will introduce in Parliament, which occurs several times every year. The Hon. Member may not have been in the House for very long, but surely she knows that.


RAILWAYS
Mr. Arnold Malone (Crowfoot):: Madam Speaker, my question is directed to the Minister of Transport. I want to share with him my disappointment in both his change of principles in his press announcement yesterday and in the method by which he is now making announcements which relate to the Crow rate. After two years of playing cat and mouse on unclear postulations across the Prairies, causing a debate between interested groups, why is it that the Minister would choose to report four times to the media, to people who can report but who cannot represent, rather than to the House of Commons? Why is it that he is continuing to avoid the Parliament of Canada where people can represent and reflect on an issue of major importance, and instead takes his information to people who can only report? Because of what he said yesterday, he is now making amendments in the media rather than in Parliament.
Oral Questions


Jean-Luc Pepin: Madam Speaker, the decision was made by the Cabinet yesterday and I announced it immediately because I wanted the rest of Canada to share in this information.
With respect to having changed my mind on this subject, as I said yesterday, there was opposition from East and West. The opposition in the West, simply capsuled, is an opposition from those who thought that this would bring about too rapid a change in western habits with respect to transportation. This is why we decided to make the payments to the railways. Now, other people in the West were saying that the farmers' exposure was too great. Yes, indeed, now the situation is a bearable one, but who knows about the future? That is why we brought about the principle of a safety net. My hon. friend may not agree with that.
With respect to those the Member supports, the livestock people, yes, indeed, they will have a better transportation system. They will benefit from it. The end result of the Bill will be a reduction in the cost of feed grain in the West and consequently the livestock people will benefit, not to the same extent that they would have from the previous program, but they will benefit from the program that I announced yesterday.


Arnold John Malone: Madam Speaker, we should remind the Minister of Transport that the Parliament of Canada is also in Canada and it can be used. When the Minister talks about having a program where there is some conflict East and West, surely he realizes that in order to have good programs in the East you do not have to have bad programs in the West. That is not the nature of this country, and surely we can get good agricultural programs for Canada without having to do it for just one section of the country.


Some Hon. Members:: Hear, hear!


REPRESENTATIONS HEARD BY MINISTER
Arnold John Malone: Madam Speaker, 1 have another question for the Minister of Transport. Bearing in mind that numerous groups of persons and organizations, such as Canadian commodity groups, livestock groups and processors, have been told by the Minister to remain silent on this issue because he would look after them, which allowed for representations from only one side of this perspective, why is it, after having done that, while forcing the other side to be quiet, he can bring in a view that represents an imbalance in this country and, therefore, defy the history, the conventions of our federation, and put in process favouritism at the price of the economy of western Canada?


Madam Speaker:: Order.


Jean-Luc Pepin: Madam Speaker, there is one thing nobody can accuse me of, and that is of not having consulted with different parties on that subject both in the West and the East. I have been at it for the last two

May 5, 1983
Oral Questions
and a half years. Some Members know how much time I have spent both in the East and in the West on this item.
With respect to Parliament, we will have the Bill here in the House next week. We will have first reading, and second reading very few days after. My hon. friend will speak on the subject. Everybody who wants to, will speak on the subject. Then we will go to a committee and for the best part of a month we will receive representations and debate all aspects of it. I think this will satisfy the demands of democracy.


Mr. Hnatyshyn:: With what are you threatening us? The best of a month?


NEGOTIATION OF VARIABLE RATES
Victor Fredrich (Vic) Althouse: Madam Speaker, my question is for the Minister of Transport. Yesterday when the Minister of Transport announced that he was making some slight modifications to his original plan to change the Crow rate, he changed his method of payment to the railroads. At the same time at his press conference the Minister stated that the Government would include a process whereby shippers could apply to the CTC to negotiate variable rates. Since the Minister has said that he wants to win the approval of farm groups in the West, particularly the Pools, with these changes, how does he justify the inclusion of variable rates as part of his proposal?


Jean-Luc Pepin: Madam Speaker, if one reads the debates that have been going on for a number of years, particularly the last three, and particularly on the subject of variable rates, one would realize that opposition to variable rates is not total. The WAC, for example, said that some form of variable rates is acceptable. In the legislation that Hon. Members will see on Monday this will be taken into account. There will be a procedure, a fairly long one, under which the CTC will receive cases for variable rates from shippers and railways. This will be thoroughly examined by the CTC and decisions will be made. That is not contrary to a mood that exists in the West. There are some variable rates that are highly desirable, for example, weekend rates and offseason rates, and the Bill will reflect that view.


JUSTIFICATION FOR MINISTER'S PROPOSALS
Victor Fredrich (Vic) Althouse: Madam Speaker, I am a little puzzled by the economics that are being used here by the minister and his Department. He talks about saving money by implementing weekend rates, yet he proposes to charge more money on that amount of grain that moves above the 31 million tonne cap. It seems to me the cost should be very much lower after that.


Some Hon. Members:: Question.


Victor Fredrich (Vic) Althouse: Instead, the Minister has proposed the farmers pay the whole charge. How does the Minister justify it, or is it justified according to some of these studies and
projections that he had done some time ago that produced results that said wheat at the farm would bring $7.40 in 1983? Are these the kinds of figures and background the Minister has to justify these kinds of proposals?


Jean-Luc Pepin: Madam Speaker, I think we had better leave that for the debate which will come next week. The establishment of a relationship between the safety net and the 31.1 million tonne cap is all rather complicated, and Madam Speaker has already told me that I take too long with my answers.


Some Hon. Members:: Oh, oh!


CANADA COUNCIL
Mr. Claude Tessier (Megantic-Compton-Stanstead):: In the
absence of the Hon. Minister of Communications, who is responsible for the Canada Council, Madam Speaker, I will direct my question to his Parliamentary Secretary. First, I wonder, as many other Hon. Members do, if an elected representative should comment on some of the most bizarre and grotesque initiatives which the Canada Council has taken and which represent an outright waste of money. As a matter of fact, Madam Speaker, I have previously blamed the Minister's staff-


Madam Speaker:: Order, please! The Hon. Member should ask his question immediately. There is no need for such a long preamble.


Claude Tessier: Thank you, Madam Speaker.
Well, I come immediately to my question. In view of the dreadful incident which occurred last weekend when a number of artists set fire to a car with living rats inside it, could the Minister indicate to the House whether this was a mistake on the part of the Canada Council and whether mistakes such as this should warrant the dismissal of the official involved or at least the blacklisting of such artists who are laughing at the taxpayers, institutions and Government of Canada?


Mr. Jack Burghardt (Parliamentary Secretary to Minister of Communications):: Madam Speaker, as this House knows, the Canada Council operates on an arm's length policy from the Department of Communications and the Minister. Certainly the Council does dispense a number of funds across the country to various professional groups, individual artists, writers, and to anyone in the arts and culture field. Because the Hon. Member has raised this matter I will certainly bring it to the attention of the Minister who, I know, will discuss it with Canada Council officials.
May 5, 1983


RAILWAYS
Mr. Bert Hargrave (Medicine Hat):: Madam Speaker, I have a question for the Minister of Transport. It deals with the Minister's 180 degree turnaround with respect to paying the Crow benefit to the railways and not to the grain producers. The Minister must surely be aware of the consequences of this about face, especially in Alberta where it is already indicated that the total dollar damage to the livestock industry due to increased distortions will be in the order of $230 million a year, including an addition to the input cost of feed grain of about $25 a ton in the livestock feeding industry. In the light of the solid support of the Gilson Committee and to the Minister personally by the Western Commodity Coalition, what is the Minister going to do about this reversal of his own policy that is a total disaster to the total livestock industry in the West, and is not a balanced solution?


Jean-Luc Pepin: Madam Speaker, I think you will understand me if I ask where all that support was in recent months.


Mr. Mayer:: Table the Bill.


Jean-Luc Pepin: Some Hon. Members feel very strongly now.


Mr. Nielsen:: Show us the Bill.


Jean-Luc Pepin: I do not remember any one of them making that kind of statement some months ago, at least here in the House.
My answer to my hon. friend is the same as the one I have already given. First, the livestock people will benefit, like everybody else in the West, from the tremendous improvement of the railway transport system that will result from the initiative we are taking now. Second, they will benefit also from the reduction of the cost of feed grain in the West and of which everybody is aware. It will not be as great as it would have been under the previous 50-50 method of distribution, but it will be quite substantial at the same time. This is the name of the game. I have to balance the interest of all parties in this matter. My hon. friend should know and must know, because it was visible that the West was divided on these matters. There is no way I could accommodate both sides 100 per cent, and the Hon. Member knows that too.


Herbert Thomas (Bert) Hargrave: Madam Speaker, it is a little difficult to talk about balance when we never see the legislation.


APPLICATION OF STATUTORY RATES TO SPECIALTY CROPS AND PRODUCTS
Herbert Thomas (Bert) Hargrave: Madam Speaker, my supplementary question is directed to the same Minister. In light of the Minister's own statement in his Transport Canada pamphlet that:
The Crow rate discourages crop diversification, agricultural processing, and livestock production.
Oral Questions
And the Minister's further statement that:
The agricultural distortions caused by the Crow have grown greater and are now actually taking away the West's natural advantages in such areas as diversified crop production, secondary processing, and livestock production.
-that is a quote from the Minister's own pamphlet-does the Minister intend to include "livestock" in yesterday's announcement that:
Some additional crops and their products will be included under the new statutory rates.
And this question, of course, the Minister will know is directly on behalf of the 20 separate associations that make up the Western Commodity Coalition.


Madam Speaker:: Order.


Jean-Luc Pepin: Madam Speaker, I am surprised that my old friend says that the policy was not known. I made a full statement on February 1 where it was completely spelled out. There was even a leak of the Bill, so if that was a secret, it was a secret to only a very few people.


Mr. Trudeau:: And those are the people over there.


Jean-Luc Pepin: However, on the subject of the addition of specialty crops, yes, indeed, this is part of yesterday's announcement-that the Government is going to introduce in the Bill, under the statutory tariff rates, some specialty crops and some products. I will come to the committee with an amendment to the Bill on that subject which will at least accommodate a percentage of the number of people who have been antagonized by the announcement I made yesterday.


SCIENCE AND TECHNOLOGY
Mr. Cyril Keeper (Winnipeg-St. James):: Madam Speaker, my question is directed to the Minister of State for Economic Development. Yesterday I challenged him to an open debate with regard to technological change and job loss. It would be an open debate where all facts would be on the table. The Minister replied by saying, "I am not aware of a study, per se." I have since learned that the paper from his Department with regard to technological change is dated January 26, 1983. I wonder, in light of this specific information, whether the Minister, in the interest of democratic debate, with all the facts on the table, would be willing to table that document in this House. Or is he going to pursue the approach of giving selective facts to the public in order to manipulate public opinion? Will he take as his model for political action, Thomas Jefferson, rather than Dr. Goebbels?


Some Hon. Members:: Oh, oh!


Hon. Donald J. Johnston (Minister of State for Economic Development and Minister of State for Science and Technology):: Madam Speaker, I think the statement made by the Hon.

May 5, 1983
Oral Questions
Member is rather unfair. He knows that at the end of yesterday's Question Period I rose and explained the knowledge which I had of the document. I would not characterize it as a "study". It is a document which was designed to promote discussion.
The simple fact is, Madam Speaker, that the document of January, to which the Hon. Member makes reference, was converted by me into a Cabinet document and circulated to my Cabinet colleagues to promote discussion of the very kind, in fact, which is now happening, which I believe is a good thing, so that people would really appreciate the opportunities which lie ahead in terms of technological changes and, of course, also the difficulties we must confront as a society, along with our neighbours in the United States, West Europe and also Japan. That debate is an important debate. On the other hand, I have sent a Cabinet document to my colleagues.
Surely the Hon. Member is not expecting me to release a Cabinet document, which is currently, in fact, in front of my colleagues. However, I recognize the importance of the debate, and what I would like to do is contemplate what specific information I have which is not in the public domain already. The information contained in that report, frankly, Madam Speaker, is information garnered from the experts, from the press, from economists, and from reading scientific journals. There is nothing extraordinary about it what-


Madam Speaker:: Order. Order, please.


Cyril Keeper: Madam Speaker, I do not wish to be unfair to the Minister, but I do feel that in all fairness he should make all of the facts available to the public.


PUBLIC SERVICE
Cyril Keeper: Madam Speaker, my supplementary question is directed to the Minister responsible for the Public Service Commission, the Secretary of State, if I could have his attention. Yesterday the annual report of the Public Service Commission was released. It is clear that the impact of the six and five program has been to increase the wage gap between male and female Public Service employees by some 12 per cent. Yet the Chairman of the Public Service Commission said that public servants are happy with six and five. I would like to assure the Minister that, certainly, the women in the Public Service are not happy with this increase in the wage gap. Is the Minister prepared to recognize the inequity of this six and five legislation as it applies to women? Will he take some action in order to reduce the wage gap rather than increase it?


Hon. Serge Joyal (Secretary of State):: Madam Speaker, the Hon. Member should understand that the purpose of the
six and five program was to create conditions which would make it possible for our economy to recover, thereby eliminating the wage gap between male and female employees. If we had failed to implement this program to fight against inflation, we would only have postponed the realization of this objective. The rate of inflation is gradually decreasing now, so there is no doubt that the objectives we have set and debated on several occasions in the House remain those of the Government, and that we will make additional progress within the next few months and years consistent with the economic recovery which the Minister of Finance has forecast in his budget.


NORTHERN AFFAIRS
Hon. John A. Fraser (Vancouver South):: Madam Speaker, my question is directed to the Minister of Indian Affairs and Northern Development. Before I ask the question I just want to say that I wish my friend from the New Democratic Party, the Hon. Member for Winnipeg-St. James, would not refer to anyone in this House as a Nazi.


Some Hon. Members:: Hear, hear!


John Allen Fraser: My question to the Minister refers to the situation at Stokes Point where Gulf has applied to develop a port. The Minister will know that that particular area has been withdrawn from development. He will also know that his colleague, the Minister of the Environment, is very much opposed to this going ahead, at least until the environmental assessment process is completed with respect to the total development of lands along the Beaufort Sea. Can the Minister advise this House whether he has been able to make any decision before issuing a land-use permit? I must point out to the Minister that if he goes ahead, he will be-and I am sure not intentionally-sabotaging the process which is in place.


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: Madam Speaker, I am very glad the Hon. Member brought up this point. In the last few minutes I had an opportunity to talk about that very matter, plus another important matter, with the Minister of Finance from the Northwest Territories, Mr. Tom Butters. He is in the Speaker's Gallery now, Madam Speaker. I am very pleased to have him here as a guest.


Some Hon. Members:: Hear, hear!


John Carr Munro: Madam Speaker, incidentally, if I may, with the indulgence of the Hon. Member, and I am sure I have that indulgence, I should like to say that Mr. Butters was down asking me to convey a message to the Prime Minister that the famous town of Inuvik is having its 25th anniversary in mid-July and would wish us to recognize that.
May 5, 1983

To answer the question specifically, Madam Speaker, yes, it is a controversial area. Yes, the environmental people, including my colleague, are concerned with respect to the decision which will be taken at Stokes Point, as is the Northwest Territorial Government, the Dene, and the Yukon Government, although their disposition is to be in favour of it, that is, the Yukon Government, which Party in power is the same as that of the Hon. Member, incidentally. I want to point out, however, that it is a very controversial question.
I am not making a decision until I have had an ample opportunity to talk to COPE, and the other native interests, and I can only tell the Hon. Member, Madam Speaker, that it will probably be at least three or four weeks before a decision is made, if I am going to talk to all those native interests.


CONSEQUENCES OF DECISION
John Allen Fraser: I would like to thank the Hon. Minister for his answer and I join with him in welcoming the distinguished visitor who is here today.
It may or may not be a good thing to have a so-called temporary port at a cost of $60 million at Stokes Point. I am not addressing the question of whether it is or is not a good thing. I am addressing a very serious question which involves the credibility of a Government which has reserved lands. The danger here, it seems to me-and I ask the Minister to comment on it-is that if one Department makes a decision as to land use there, then those who are charged with the responsibility of determining the total issue of land use within that environmental area, the Beaufort Sea, will have, to really a considerable degree, the rug pulled out from under them. I would ask the Minister if, in this regard, he has had further consultations with his colleague, the Minister of the Environment, and whether he and his colleague have had discussions on this issue which I agree is difficult, with the Prime Minister.


John Carr Munro: Madam Speaker, before a final decision is made I will undoubtedly have further discussions with the Prime Minister. At the moment, though, it is within the mandate of the Northern Development Department and my own responsibility as a Minister of the Government to examine this issue and ascertain the merits on both sides before discussing it with the Prime Minister and Cabinet. That is the process I am involved in now, and I realize it is a very important one.
Incidentally, Madam Speaker, by the tone of the Hon. Member's question, while he says he has not made a decision, it certainly sounds as if he has-a decision against the proposal. I do not see how you can read the preface to his question any other way. If I am right, I cannot help but wonder if that is the position of his entire Party, including the Hon. Member for the Northwest Territories.
Business of the House POINT OF ORDER


MR. BAKER (NEPEAN-CARLETON)-PRACTICE RESPECTING SUPPLEMENTARY QUESTIONS
Hon. Walter Baker (Nepean-Carleton):: Madam Speaker, a few moments ago in Question Period a question was asked by the Hon. Member for Winnipeg-St. James (Mr. Keeper) of the Minister of State for Science and Technology (Mr. Johnston) concerning a document which we heard was turned into a Cabinet document and circulated as a discussion paper dealing with science and technology.
What purported to be a supplementary question from the same Member was then directed to the Secretary of State (Mr. Joyal) on another matter entirely, having to do with the Public Service Commission and the very important matter of the employment of women. By no stretch of the imagination could that second question be supplementary to the first question, Madam Speaker. Quite frankly, both questions are important but one is not supplementary to the other and I worry about this practice continuing.


Some Hon. Members:: Hear, hear!


Madam Speaker:: Well, if it is any consolation to the Hon. Member for Nepean-Carleton (Mr. Baker), I can tell him this is not the first time it has happened in the House. Even when Members ask two questions on a specific matter, they shout at me "supplementary", so they can catch my eye, I guess. I have been fooled into recognizing them on something that was not at all supplementary. I guess we have grown into the practice that Members are entitled to two questions, and they call the second one a supplementary. If Members are agreeable, I will be strict and expect-


Some Hon. Members:: Hear, hear!


Madam Speaker:: -the questions to be really supplementary. But I must say that this is going to cause a lot of problems to many Members because there are a lot of questions which are not supplementary. Some Members do not even listen to the answer but go to the second question which they have written down. So I am willing to be stricter on this.


Some Hon. Members:: Hear, hear!


Madam Speaker:: The Hon. Member for Nepean-Carleton (Mr. Baker) I suppose will have rendered a great service to the House by his point of order.


BUSINESS OF THE HOUSE
Mr. Lewis:: Madam Speaker, I would like to ask the Government House Leader if he could give us some idea as to the business for tomorrow and the rest of next week.
At this point I would reiterate the offer of my Party on Tuesday to send the property rights resolution to committee

May 5, 1983
Business of the House
after one day's debate tomorrow. We offer to the Government what is usually an Opposition Day for discussion of this matter, with no confidence vote. The resolution could go to committee for discussion and give people an opportunity to be heard, be reported back to the House by June 7 and the matter dealt with at report stage and third reading with one day's debate by June 30.
Through you, Madam Speaker, it was my understanding that the NDP caucus wished an opportunity to discuss this matter. They had a caucus meeting yesterday and hopefully we can proceed on that basis now.
[ Translation]


Mr. Pinard:: Madam Speaker, as I indicated previously, tomorrow, will be an Opposition day, as will Monday, May 9. On Tuesday, we shall resume debate on Bill C-151, an Act to provide supplementary borrowing authority for the Government. I hope that by the end of the day on Tuesday, we shall be able to refer this Bill to committee. Wednesday is a day designated for Private Members' Business, and as I already indicated to the Parliamentary House Leaders at our meeting, next Thursday may be designated as an Opposition day, but that remains to be confirmed. At the beginning of next week, I will be able to confirm what the business of the House will be for next Thursday.

In relation to the point raised by the Hon. Member, the reference of property rights to committee, we had a discussion on the floor of the House on this matter not so long ago. The Leader of the Opposition (Mr. Nielsen) was involved. It was obvious then, and it is still the situation, that we agreed to the proposal and I have here the proper House order. We are ready to accept it by unanimous consent if we have that consent from the Tory Party and the NDP.


Philip Derek Lewis: Agreed.


Ian Deans: Madam Speaker, we did indeed discuss this matter in some detail and at some great length. As we stated earlier, we are very much in favour of including the right of Canadians to own their own homes and farms, and those and other similar rights should be contained within the Constitution.


Erik Nielsen: But!


Ian Deans: However, there are some questions I would like to pose to both of my colleagues in order that we can clearly understand the implications. I wonder if one or both of them would care to inform the House how-


Madam Speaker:: My impression was that the negotiations had been terminated. I want to remind Hon. Members that these matters are best negotiated outside the House. I thought the Hon. Member was rising to say whether or not he was giving consent to the proposal of the Hon. President of the
Privy Council (Mr. Pinard). It is only in those terms that I can accept his intervention. I cannot really accept that negotiations take place on the floor.


Erik Nielsen: Do the NDP consent or not?


Ian Deans: Madam Speaker, I will of course be prepared to indicate how we intend to deal with it in a moment. However, I want to answer the question being asked, which is whether we are prepared to accept the proposal as outlined some days ago by both the Government and the Official Opposition as it applies to the inclusion of certain words in the Constitution.
I want to put to the House quite clearly that in answering that question there are some serious problems. How do those words impinge upon such things as landlord-tenant relations?


Erik Nielsen: Do you consent?


Ian Deans: On rent control?


Madam Speaker:: Order. I think those questions present such complicated answers that this is really not the place to discuss them.


Ramon John Hnatyshyn: It is an NDP red herring.


Madam Speaker:: I do not want to intervene but I feel Members probably need another meeting in order to set this right.


Yvon Pinard: Madam Speaker, with respect, I think I have the answers in the text of the motion. I will put the motion on the record and if the Hon. Member agrees, he will say yes; if he disagrees, he will say no.
Therefore I move, seconded by the Hon. Member for Simcoe North (Mr. Lewis):
That, not withstanding the provisions of any Permanent or Provisional Standing Order, the following motion be placed on the Order Paper as a Government Order in the name of Minister of the Crown:
"That whereas the Constitution Act, 1982 provides that an amendment to the Constitution of Canada may be made by proclamation issued by the Governor General under the Great Seal of Canada where so authorized by resolutions of the Senate and House of Commons and resolutions of the legislative assemblies as provided for in section 38 thereof:
Now therefore the House of Commons resolves that His Excellency the Governor General be authorized to issue a proclamation under the Great Seal of Canada amending the Constitution of Canada as follows:


PROCLAMATION AMENDING THE CONSTITUTION OF CANADA
[Stage Direction]
1.	Section 7 of the Constitution Act, 1982 is repealed and the following substituted therefor:
7. Everyone has the right to life, liberty, security of the person and enjoyment of property, and the right not to be deprived thereof except in accordance with the principle of fundamental justice.
2.	The said Act is further amended by adding thereto the following section:
60.1 A reference to the Constitution Acts, 1867 to 1982 shall be deemed to include a reference to the Constitution Amendment Proclamation, 1983 (property rights).
3.	This Proclamation may be cited as the Constitution Amendment Proclamation, 1983 (property rights)."
[Stage Direction]
May 5, 1983
[Stage Direction]
B.	That one day allotted according to Standing Order 62 for the period ending June 30, 1983 shall be allotted to consideration of the said motion, provided that the motion shall be that described in section A of this Order;
C.	That at the conclusion of the sitting on the day that the said motion is called for consideration pursuant to this Order the motion shall be deemed to have been referred to the Standing Committee on Justice and Legal Affairs;
D.	That the Committee shall report thereon no later than June 7, 1983;
E.	That the said report shall be disposed of in not more than one sitting day, no later than June 30, 1983;
F.	Provided that all motions made in consequence of this Order including those in consequence of any Committee report pursuant to this Order shall be proposed only by a Minister of the Crown.
That is the motion which I wished to put on the record.
Some Hon. Members:: Hear, hear!


Madam Speaker:: Is there unanimous consent?


Ramon John Hnatyshyn: Nothing could be simpler.


Ian Deans: Madam Speaker, as you have said yourself, it is much too complex to be dealt with in one day, and we cannot give unanimous consent.


Some Hon. Members:: Oh, oh!


Madam Speaker:: Therefore if I understand the proposal of the President of the Privy Council (Mr. Pinard), it is to the effect that the motion, in the terms outline by him, be presented by a Minister of the Crown. There is no unanimous consent.


Philip Derek Lewis: I rise on a point of order, Madam Speaker. I think that in all fairness the record should show that there is no unanimous consent because it was refused by the NDP.


Madam Speaker:: The record will show that there is no unanimous consent.


Ian Deans: Madam Speaker, grandstanding notwithstanding, it was refused because sufficient debate is not being allowed by the Tories and the Liberals.


Madam Speaker:: Order.


Philip Derek Lewis: I rise on a point of order, Madam Speaker.


Ian Deans: Let's push on with it. Deny people their rights! Go ahead!


Erik Nielsen: You did it for 18 months.


Philip Derek Lewis: Madam Speaker, I suggest that the shoe fits kind of tightly down that way.
I would like to ask the Government House Leader if he perhaps inadvertently omitted to tell the House exactly when the Minister of Transport (Mr. Pepin) would table the legislation of the Crow rate.


Yvon Pinard: Madam Speaker, I did not make such an error.


Erik Nielsen: We are asking.


Mr. McGrath:: Madam Speaker, I raise this as a point of order because it relates to Private Members' Business. Perhaps
Electoral Boundaries Readjustment Act
the Parliamentary Secretary to the Government House Leader could deal with it. Would he consider giving more notice as to what Private Members' Business we are to deal with on Wednesdays so that more Members would be involved, because they would then have sufficient notice to prepare themselves? As it stands right now, not enough notice is given for Private Members' Business. As a consequence, there is not enough participation. I think if more notice was given, the Parliamentary Secretary would find that there would be much more meaningful participation.


Mr. Smith:: Madam Speaker, I would like to assure the Hon. Member that this point was raised on his behalf and that of other Members by his House Leader at the House Leaders' meeting yesterday. It is a legitimate point. It is one which we try to deal with in a fair manner.
The problem is that those Hon. Members whose names are written down frequently, for a variety of legitimate reasons, are not ready to proceed. I can assure the Hon. Member that while it is inconvenient to the Members in question, it is also inconvenient to the various Parliamentary Secretaries who must be prepared to debate those motions on equally short notice. However, the Hon. Member's point is well taken, and we are doing what we can to provide additional notice.


Ian Deans: Madam Speaker, I would like to return to House business, if I may, and ask the Government House Leader if he can tell us whether he has been able to reach an agreement with the Conservative Party to debate Canagrex or Bill C-653.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: In one day, fellas!


PETITION
Madam Speaker:: I have the honour to inform the House that the petition presented by the Hon. Member for Yorkton-Melville (Mr. Nystrom) on Wednesday, May 4, 1983, meets the requirements of the Standing Orders as to form.


ELECTORAL BOUNDARIES READJUSTMENT ACT
Madam Speaker:: It is my duty to inform the House that an objection signed by the Hon. Members for Peterborough, Caribou-Chilcotin, Lanark-Renfrew-Carleton, Prince George-

May 5, 1983
Tabling of Documents
Peace River, Red Deer, Richmond-South Delta, North Van-couver-Burnaby, Calgary South, Lethbridge-Foothills and Assiniboia has been filed with me pursuant to Section 20 of the Electoral Boundaries Readjustment Act, Chapter E-2, R.S.C. 1970, to the report of the Electoral Boundaries Commission for the province of Alberta.
If the House agrees, I would suggest that we follow past practice and print the text of the objections as an appendix to today's Votes and Proceedings. Is that agreed?


Some Hon. Members:: Agreed.


Ramon John Hnatyshyn: Madam Speaker, in that presentation you mentioned the constituency of Assiniboia. Was that Winnipeg-Assiniboine or Assiniboia?


Madam Speaker:: I said "Assiniboia". "Winnipeg" did not precede it.


Mr. Neil:: On a point of order, with regard to the redistribution, there has not been a report from Saskatchewan as yet. At least, it has never been announced.


Erik Nielsen: It's the wrong riding.


Madam Speaker:: Hon. Members will recall that yesterday the report was filed, and these are the objections which have come in today.


Philip Derek Lewis: Nova Scotia signed yesterday.


Madam Speaker:: Hon. Members are probably surprised because they did not sign it, but I have the signatures in my hand.


Mr. Lambert:: They are not for the Province of Alberta.


Madam Speaker:: Any ten Members may sign, not necessarily Members from Alberta. I guess that is why the Hon. Member is surprised to see these objections, but they are duly signed. I have in my hand ten signatures of Members of Parliament, not necessarily all from Alberta.



ROUTINE PROCEEDINGS


Hon.   J.-J. Blais@Minister of Supply and Services: Madam Speaker, on Tuesday, May 3 during Question Period, and again yesterday, I was asked by Members of the Opposition to table all correspondence and contract documents with respect to a $17,000 contract between my Department, on behalf of the Department of Energy, Mines and Resources, and the West German company Voeg. As I indicated at that time, some aspects of these documents are of a commercially
confidential nature because they involve a marketable development in high technology.
In an effort to bring forward as much information as possible, I have had officials, including law officials of the Crown, examine all the pertinent information affecting the Department of Supply and Services. I am now advised that the documents can be made public.
In addition, I am advised by my officials that they have spoken with officials of the West German company who have indicated that they have no objection to the contract being tabled. Hon. Members will find a copy of the contract between the Department of Supply and Services and Voeg, as well as all the correspondence exchanged between officials of the Department of Supply and Services and Voeg. Your Honour will note that the material includes an exchange of correspondence between these two parties dated March 18 of 1983 involving a collateral agreement to the contract imposing upon the Department of Supply and Services and the Department of Energy, Mines and Resources non-disclosure obligations relating to the contractors' processes.
This collateral agreement, called a "secrecy agreement", is also being tabled today.


Ramon John Hnatyshyn: Apologize!


PRIVACY
David P. Smith: Madam Speaker, on behalf of the Minister of Justice (Mr. MacGuigan) I am pleased to lay on the Table of the House a copy in both official languages of the Annual Report of the Privacy Commissioner, 1982. I ask that the Report be referred to the Standing Committee on Justice and Legal Affairs.


PETITION
Mr. Lome Greenaway (Cariboo-Chilcotin):: Madam Speaker, it is my duty to present a petition signed by 234 concerned citizens of Cariboo-Chilcotin riding in British Columbia. The purpose of the petition is to protest the broadcasting of pornographic material on the First Choice Pay-Television station as well as the possibility of such material being carried by other Pay-TV outlets.
The nature of the petition is to urge the Government to review the licences of Pay-Television operators who broadcast pornographic material, with a view to revoking the licences of
May 5, 1983

those carriers that would persist in presenting such unsuitable and exploitive material.
The petitioners hope that in your examination of the petition you will find the petition in order and that you will exercise the discretionary powers vested in the office of Speaker of the House to allow discussion and referral to the appropriate committee at the earliest possible time.

[ Translation]


GOVERNMENT ORGANIZATION ACT, 1983 MEASURE TO ESTABLISH
Yvon Pinard: for leave to table Bill C-152, an Act respecting the Organization of the Government of Canada and matters related or incidental thereto.


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

Yvon Pinard: for leave to table Bill C-153, an Act to amend the Financial Administration Act (Crown Corporations).


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

Hon. Ed Lumley (Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion) moved: for leave to introduce Bill C-154, to amend the Regional Development Incentives Act (No. 2).


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

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
David P. Smith: Madam Speaker, the following questions will be answered today: Nos. 4,676 and 4,739.
Order Paper Questions


Mr. MacKay: 1.	Since 1977, how many employees of (a) the Government (b) Crown corporations and agencies (i) applied to the authorities of the Czechoslovak Socialist Republic for "regularization" of their legal relationship to that state in accordance with the decree of the Government of the Czechoslovak Socialist Republic of March 16, 1977 (ii) were consequently released from Czechoslovak citizenship (iii) were issued Czechoslovak passports (iv) travelled to the C.S.S.R. on Czechoslovak passports?
2.	What were the names of such employees and what positions did they occupy in the Public Service?
3.	Is it the policy of the Government to employ former citizens of Czechoslovakia who, according to the decree of the Government of the C.S.S.R. of March 16, 1977, while in Canada, renewed their allegiance to that State by signing a statement binding them "to behave and conduct themselves as citizens of the Czechoslovak Socialist Republic" or who were released from Czechoslovak citizenship by virtue of not having acted "in a way hostile to the Czechoslovak Socialist Republic or in a way damaging the interests of the Czechoslovak Socialist Republic"?
4.	Is it the policy of the Government to extend Canadian citizenship and/or Canadian residence to persons who claim to be refugees from the Czechoslovak Socialist Republic and who, subsequent to their landing in Canada, renewed their allegiance to the Czechoslovak Socialist Republic?


David P. Smith: I am informed by the Department of External Affairs, the Employment and Immigration Commis-sion/Department and the Public Service Commission as follows:
1.	This information is not available. Under the terms of Article 36 of the Vienna Convention on Consular Relations, to which both Canada and Czechoslovakia are party, Czechoslovak consular officials are free to communicate with and have consular access to individuals who are still deemed to be citizens of Czechoslovakia on matters which fall directly under their consular jurisdiction. This implies that in so doing, Czechoslovak consular officials are under no obligation to notify the Canadian Government of their legitimate contacts with Canadian-Czechoslovak dual nationals. At the same time, Canadian-Czechoslovak dual nationals are not obliged to notify the Canadian Government of their contacts with Czechoslovak consular officials. Therefore, unless the information is volunteered, which it usually is not, it is not possible for the Canadian Govenrment to compile data on those Canadian-Czechoslovak dual nationals who wish to comply with the Czechoslovak regulation.
Furthermore, all Canadian citizens and residents are free to leave Canada at will, and no person is required to inform the Government of his destination on leaving the country. No data on the movements of departing persons are maintained. It is therefore not possible to know accurately how many persons of Czechoslovak or other origin visited Czechoslovakia in any given period. This is equally true for all Canadians, regardless of employer.

May 5, 1983
Order Paper Questions
2.	For the reasons noted in Part 1 above, this information is not available.
3.	The Public Service Commission which is charged with the administration of the Public Service Employment Act does not have a policy which deals with the employment of former citizens of Czechoslovakia nor those of any other country. Former citizens of other countries, once having obtained Canadian citizenship, are entitled to compete for Government jobs on an equal basis with other Canadians. Should they not have obtained Canadian citizenship but be resident in Canada as landed immigrants they would still be able to compete for employment in the federal Public Service. The success of gaining such employment would be dependent on the application of certain provisions of the Public Service Employment Act. Thus in open competitions the Public Service Commission may restrict the selection to Canadian citizens when it is aware that there is a sufficient number of qualified Canadian applicants. A further provision of the Public Service Employment Act requires the Commission, when establishing an eligible list in open competitions, to list veterans and Canadian citizens ahead of non-citizens. In view of these provisions it is more difficult for landed immigrants who are non-citizens than for citizens to obtain federal Public Service employment.
There is no requirement for dual nationals to notify the Commission of the fact before seeking employment in the Public Service of Canada.
4.	In so far as the Immigration Act is concerned: Citizens and/or residents of Czechoslovakia may be accepted as refugees if they fall within the definition of "Convention Refugees" or those of the "Self-Exiled Persons Class".
Canada does not remove residence privileges status from Czechoslovak immigrants who come to Canada as refugees and who, once in Canada, renew their allegiance to the Czechoslovak Socialist Republic. As a signatory state to the 1951 Convention and the 1967 Protocol relating to the Status of Refugees, Canada ascribes to the Regulations laid down by the UN High Commissioner for Refugees on the acquisition or reacquisition of national protection by an individual. These Regulations state inter alia that:
If the refugee does not act voluntarily, he will not cease to be a refugee. If he is instructed by an authority, eg. of his country of residence, to perform against his will an act that could be interpreted as re-availment of the protection of the country of his nationality, such as applying to his consulate for a national passport, he will not cease to be a refugee simply because he obeys such an instruction. He may also be constrained, by circumstances beyond his control, to have recourse to a measure of protection from his country of nationality.
In so far as the Citizenship Act is concerned: Under the provisions of the Citizenship Act which became effective on February 15, 1977, naturalization as a citizen is a matter of qualified right subject to the requirements of the Act. Among these requirements are that the applicant making application therefor is: (1) 18 years of age or more, (b) has been admitted to Canada for permanent residence (as a landed immigrant by the Immigration authorities) and has since such admission, resided in Canada for at least three out of the four years immediately prior to date of application, (c) must not be under
order of deportation, and (d) must be free of the prohibitions to the grant of citizenship which pertain to criminal activity and security offences.
Persons of Czech nationality whether or not they have maintained and/or affirmed their allegiance to Czechoslovakia have been and will be granted Canadian citizenship in like manner to any other adult who makes application and satisfies all of the requirements to become a citizen.
In addition, under the terms of the 1977 Citizenship Act there are no statutory provisions for automatic loss of citizenship upon becoming a citizen of another country outside of Canada as had existed in the former Act (1947) and prior legislation. This change in law has increased the numbers and will continue to increase the numbers of dual national Canadians residing both inside and outside Canada. Those persons residing outside of Canada in their country of second nationality (example Czechoslovakia) or visiting there, especially those travelling on the passport of the second nationality, are considered to be subject to all of the laws of that country and may, for real or imagined infractions of the law, be prevented from leaving and in some cases may be imprisoned.


Mr. McKinnon: Is the Department of National Defence engaging Dr. N. Tracy of Fredericton, New Brunswick at a cost of $17,200 to do a study on "Real or potential challenges to Canadian sovereignty in the Arctic" and, if so, for what reason when less than a year ago it received a study done under contract at a cost of $11,600 on "Canada's Northern Security" by Nils Orvik?


Hon. J. Gilles Lamontagne (Minister of National Defence):: Yes. The Department of National Defence has engaged Dr. N. Tracy of Fredericton, N.B. to do a study on "Real or Potential Challenges to Canadian Sovereignty in the Arctic", at a cost of $17,200. This study as well as last year's study by Professor Nils Orvik are part of a larger DND project on Arctic strategic studies. Dr. Tracy's study is to examine the challenges to Canadian sovereignty and the role of the Canadian Armed Forces to meet these challenges. Professor Orvik's study was geographically more limited, namely the Eastern Arctic and he applied a broader concept of security forcusing on questions such as transportation, non-renewable resources, the native peoples and Canada's relation with Greenland.


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


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


Mr. MacKay:: Madam Speaker, I am moved to say to the Parliamentary Secretary today that in the past I have heard most complaints about some of the delays with respect to Order Paper Questions being answered. Lately I have been
May 5, 1983

getting some detailed answers and I want to take this opportunity to say something that I have seldom heard in the House, which is to thank my colleague for the answers that have been provided.


Madam Speaker:: I am tempted to ask the Parliamentary Secretary if he has heard this interjection!
Shall the remaining questions be allowed to stand?


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Cosgrove that Bill C-151, an Act to provide supplementary borrowing authority, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
The Acting Speaker (Mr. Blaker):: When the House rose at one o'clock the House was in the ten-minute period granted for questions and comments following the speech by the Hon. Member for Mississauga South (Mr. Blenkarn). Accordingly, the Chair will look to those who may wish to complete those remarks.


Paul James Cosgrove: Mr. Speaker, as you know, it is not very often that Ministers have an opportunity to ask questions in the House of Commons; the procedure is usually the opposite. Under the new rules and operations of the House, a Member is given an opportunity to answer questions following his speech, and therefore there is the opportunity for all Hon. Members to ask questions after a presentation. I had asked the Hon. Member for Mississauga South (Mr. Blenkarn), who had spoken this morning on the legislation requesting additional borrowing authority, if he would answer a question and he indicated that he would.
The thrust of the Hon. Member's comments was essentially a review of the budget, which he argued was the basis for the request for additional borrowing authority. It was the basis, for example, for the Government's plan for economic recovery.
While the Hon. Member referred to the budget and those programs for recovery, he also flagged the issue of the deficit and expressed a concern for the deficit. The Minister of Finance (Mr. Lalonde) was equally concerned with the deficit and proposed two methods of addressing the increase in deficit to provide stimulus for economic recovery: by demonstrating a Government commitment to keep Government expenditures at trend growth for GNP; second, by introducing a plan to increase taxes at a time when the economy is projected to be stronger.
Borrowing Authority
What further specific measures did the Hon. Member have in mind other than reducing Government expenditures or increasing revenues in certain ways so as to reflect his concern about the deficit?


Donald Alex Blenkarn: Mr. Speaker, I intended and hoped to have the time to get into that very issue in my remarks. The Minister will realize that for over a year and a half we have suggested the appointment of a special committee of the House to have over-all supervisory budgetary control. That committee would inquire into and priorize Government expenditures in order to make sure that they would fit within the framework of how the Government and the House would deem these expenditures be spent. There are a number of expenditures that are made, all deemed to be necessary, but there is a need to priorize those expenditures.
We can only have in our household that which we can afford. While there are many things we would like, as Members of Parliament we eventually have to come to grips with what we can afford. We need the social nets that exist in health and welfare and we need to look after those least able to help themselves.
But, do we really need the PIP Program at this point? Do we really need the CHIP Program at this point? Do we really need to spend as much as we do on entertaining ourselves? Do we need the advocacy advertising at this point? Are there not many expenditures which may be desirable and great but not really needed at all at a time when we have economic dislocation and revenues cannot even come close to meeting budgetary demands? Do we not need to priorize our efforts and consider if it is really worth the interest cost to borrow the money to do that which may or may not be necessary?


Paul James Cosgrove: My final question would be in two parts. In the Hon. Member's desire to cut down on expenditures, is he saying that he believes it is necessary to create another committee of Parliament with all the expenditures associated with committee structure in order to investigate these questions? Does not the existing committee structure, such as the committee of which he will be a member that is to question me on Monday next on the expenditures of the Department of Insurance, seem adequate for that kind of investigation?


Donald Alex Blenkarn: Mr. Speaker, under no circumstances are they. They tend to be line department committees. For example, people who are interested in environmental matters want money spent on environmental matters and people who are interested in communications want money spent in that particular area. People who are interested in energy want money spent on energy-related matters. We tend to have spending committees as opposed to committees with control on the over-all spending of Government. This concept is not only ours. The Minister knows that it has been advocated before. It would not be additional overhead or expense for the committee system. It is a change in direction of the committee system to

May 5, 1983
Borrowing Authority
ensure that Parliament comes to grips with real budgeting. Parliament must come to grips with this matter. We cannot continue forever budgeting larger and larger amounts.
The Minister talked about keeping within the trend lines of the GNP. The Minister knows that last year the budgetary expenditure forecast was for $76.3 billion. It turned out to be $82 billion. Its program for this coming year will now be $90.7 billion. The fact is that that is an increase in one year over the next year's program of 18.9 per cent. To no way do we come close to that in terms of the GNP. Indeed, we had a declining GNP last year. The fact of the matter is that we have to tailor our wants to our pocketbooks, to our means.


Some Hon. Members:: Hear, hear!
[ Translation]


Mr. Raymond Savard (Verdun-Saint Paul):: Mr. Speaker, I am very pleased with this opportunity to speak today to Bill C-151 and to the budget, which, I am convinced, will give Canadians the assurance that our economy is on the right track. I want to congratulate the Minister of Finance (Mr. Lalonde), who before he brought down his budget, held a series of thorough and intensive consultations with the private sector, governments and various organizations. The budget will provide the necessary means for helping those who want to work but cannot find jobs. I am referring to young people and to older workers. What I really admire in this budget is that the Government wants to provide help for Canadians who need it most. This $4.8 billion recovery budget will, of course, help create jobs, especially in the private sector. I may add that more than $250 million in additional funds will be spent on expanding existing programs relating to housing, more specifically, the purchase, renovation and improvement of homes.
Mr. Speaker, in Verdun-Saint Paul, this program, in which the Canadian Government has invested a little over $2 million, has helped build about 100 co-operative housing units, the result being that many of my constituents now own their own homes and tenants living in units that have been renovated. That is why I am particularly pleased that the Minister agreed to increase the number of units to be built this year to 25,000, that is, new social housing units for low- and middle-income Canadians. This program was also instrumental in carrying out another very important building project in my riding, and I am of course referring to the senior citizens' home, on which more than $4 million has been spent by the Canadian Government, so that senior citizens will be able to move in by next July. As a result, 100 senior citizens on low incomes will be able to enjoy a comfortable and happy life.
While I am on the subject of housing, Mr. Speaker, I shall, if I may, express my appreciation to the Minister of Public Works (Mr. LeBlanc) for some programs that are very important to the people of Verdun-Saint Paul, and I am referring to
the Canadian Home Ownership Stimulation Plan and the Canadian Home Renovation Plan. About 100 of my constituents took advantage of these programs during 1982. From comments I have heard, I expect we shall be receiving many more requests in the coming year.
And what about the important changes in the Registered Home Ownership Savings Plan? In my view, this program will encourage many of my constituents to spend their savings on the purchase of a new home, furnishings and household appliances. It will also enable small contractors to start construction projects and, as a result, provide job opportunities for thousands of Canadians.
Mr. Speaker, as far as job creation is concerned, especially for young people, I am proud of the fact that the Minister of Employment and Immigration (Mr. Axworthy) has put at the disposal of Verdun-Saint Paul residents an information centre designed especially for young people. This centre will enable our youth to acquire vocational training and make it easier for them to make the transition to the labour market. Within three months, this centre has already enabled 150 graduates to find a regular job, which is very promising for the future of our young people. On the other hand, now that our economic woes are behind us as long as the Quebec Government does not make an effort to cooperate with its Canadian partners and as long as it insists on its independence priority, unfortunately very few businessmen will be willing to invest in Quebec.
The best proof of this was given by the Minister of Finance when he spoke before the Montreal Chamber of Commerce and was asked the following questions: Which Government is to blame for excessive taxes in Quebec? Who caused the headquarters of several companies to close down in Montreal? Which Government continues to promote uncertainty concerning the political future of Quebec? Members of this House will not learn anything new if I say that the Quebec Government alone is to blame. I believe that very few people remain blind to this fact and still say that the Quebec Government is not to blame. The only Government that does its best to create jobs and support industry in Quebec, to keep corporate headquarters in Montreal, to support major businesses and help to finance industrial modernization is the Canadian Government. If the Quebec Government persists in trying to separate the province from the rest of Canada, Quebecers will unfortunately be poorer in every respect, that is economically, socially and culturally. The only way for us to have a better future is for the Quebec Government to cooperate more seriously with the Federal Government.
I would like to call the attention of the House to the area of job creation. While the Canadian Government takes initiatives to create jobs, the provincial Government ignores young job seekers who, once again, are unable to benefit from federal assistance. For instance, last December, when the federal-provincial agreement was signed to implement the NEED
May 5, 1983

program and create thousands of jobs in various municipalities, the Quebec Government again reversed its decision and refused to sign the agreement at the last moment.
How can Canada prosper, Mr. Speaker, when the leaders of the Quebec Government are constantly trying to obstruct Federal initiatives and make the people of Quebec believe that Ottawa is responsible for our present economic problems?
Mr. Speaker, if this budget is to have any impact on the jobless, the private sector will have to take advantage of the programs implemented by the Canadian Government. I realize that the private sector has been under extreme pressures these last few years. That is why the Minister of Finance has provided special assistance for Canadian businesses. To this end, the budget contains measures which will allow businesses, especially small- and medium-size businesses, with much more limited resources, to get back in the saddle and reduce the indebtedness incurred by many of them. These businesses will then be able to use the money now required to finance their debt for more productive activities which will be more likely to create jobs. The $300 million provided to help businesses will allow them to bring their investments forward. Needless to say that, as investments increase in the private sector, as they must to guarantee a lasting long-term economic recovery, Government borrowings will decrease. Moreover, if the Government and the private sector use their resources to make our products more competitive, we shall be able to retain and increase our share of the market. Businesses must be encouraged to buy more of their supplies in Canada by promoting innovation and an increased productivity as well as new, larger and more modern production facilities. These are very important measures for putting the economy back on its rails, in a long-lasting effort to give Canadians permanent, meaningful and well-paid jobs.
It should be remembered, Mr. Speaker, that businesses in the Province of Quebec are at a serious disadvantage as against their competitors in other provinces, because of the shamefully high cost of energy in the Province of Quebec. Last week indeed, Mr. Parizeau's tax on gasoline accounted for 52 per cent of the price of a litre of gasoline in the greater Montreal area.
Mr. Speaker, 1 would also like to mention that I am interested in social issues as they relate to the constituency of Verdun-Saint-Paul, which has a rapidly ageing population. Without going into details, the Canadian Government has been successful in maintaining its social programs. I want to assure our senior citizens that, as far as I am concerned, I will go on making representations to the Minister of National Health and Welfare (Miss Begin) requesting further extensions to the existing social programs, in order that these people may still enjoy the same degree of protection.
Borrowing Authority
I also wish to congratulate the Minister of Finance (Mr. Lalonde) for his sensitivity to our people's expectations. This budget proposes changes in the child benefit system that will maintain the principle of universality, and programs aimed at low and middle-income families. Consequently, the budget will help single-parent families, mostly headed by mothers who usually make only 58 per cent of the salaries of men.
The child care expense deduction will be increased to $2,000 per child and to $8,000 per family, thus doubling the present deduction. This will certainly help low and middle-income families. Of course, the Child Tax Credit, which increased by $50 this year to help families, will be maintained and, in addition, when mothers claim their child tax credit, they will be entitled to a non-taxable amount of $343 for each child. I am also pleased that the $26,330 ceiling will remain unchanged and this child tax credit will still be paid in part to people whose income does not exceed $40,000. Again, I am fully satisfied that most families in need will be protected.

It is my sincere belief, Mr. Speaker, that all the measures introduced in the budget will serve the interests of all Canadians and give them confidence in the future.

To conclude, this is a budget to invest in, to work for and to build on. Through our efforts we can ensure that Canada moves not just from recession to recovery, but to lasting prosperity. The choice is ours.

Mr. Speaker, I would like to conclude on a humorous note. Since I first came here, I have been listening day after day to Opposition Members attacking the Government. Well, whatever they may say or do, people on this side are more efficient than the ones across the aisle.


Mr. Dawson:: Mr. Speaker, we on this side already know all about the humour of our Deputy Whip, the Hon. Member for Verdun-Saint Paul (Mr. Savard). We are glad to see that he can share it with all his colleagues.
There are two things I would like to say. First, after the remarks of the Hon. Member who will be celebrating his sixth anniversary as Member for Verdun-Saint Paul in a few days, 1 can understand why the people of his riding have expressed their confidence in him three times.
I saw that the Hon. Member for Verdun-Saint Paul was concerned about the needs of his community as well as those of the residents of the riding of Verdun-Saint Paul and of the Montreal region. He spoke about senior citizens and about people in various categories. I would like to know whether the Hon. Member has anything to say about the budget and its ultimate effects on job creation for young people. The past performance of the Government with respect to job creation

May 5, 1983
Borrowing Authority
programs for young people is outstanding indeed, but if he can I would like him to give the House some figures on the way the Federal Government has been spending money to create jobs, particularly for young people in his riding of Verdun-Saint Paul.


Pierre Raymond Savard: In answer to my colleague from Louis-Hebert, Mr. Speaker, I would say that the feeling is mutual. I must congratulate him also and tell him that it is for those reasons that he is a Member of the House. He too will be celebrating his sixth anniversary on May 24.
As to the question he has just asked about the contribution of the Federal Government to youth programs which have already been implemented for 1983-84, I would say to him that the Federal Government has paid $3,899 billion to the provinces for post-secondary education. Funds of $170 million have been earmarked for student summer employment, and an additional $170 million under student loans program to cover interests and defaults. That is very important for young people who have completed their studies. Some $589 million will be spent for training programs, $390 million for job creation programs and $126 million for employment services. I hope my colleague will find my answer satisfactory.


Jean-Guy Dubois: Mr. Speaker, in his remarks my colleague from Verdun-Saint Paul (Mr. Savard) referred to the beneficial effects of the budget. He also spoke about the elderly and the young, something which is clearly more interesting to the Hon. Member for Louis-Hebert (Mr. Dawson) who is very young and yet very old at the same time since he has been a Member of the House for six years, just like the Hon. Member for Verdun-Saint Paul. I would like the Hon. Member for Verdun-Saint Paul to give us more information. In his speech, he mentioned special funds and special projects amounting to $2.4 billion. There are various considerations from an administrative stand point. The amount of $1.71 billion has been mentioned. Does the Hon. Member know exactly how those funds will be distributed, either throughout the province, or in Quebec City, or in Montreal, or in Verdun, and does he know of special cases in his own riding? He said something about the Province of Quebec where there is conflict in the implementation of certain programs which might help his riding and his electors.


Pierre Raymond Savard: Mr. Speaker, to reply once again to my colleague's remarks concerning my speech, I would like to point out to him that since the tabling of the budget, several of those projects have been announced. They represent approximately 45 p. 100 of all expenditures under the Special Recovery Projects for the next four years. I would like to mention to him that those moneys will be spread over the next four years. In effect, $147 million will be allocated during that period to the purchase of 20 CL-215 water bombers to be built by Canadair in Montreal. Furthermore, $630 million, of which $185 million represent new expenditures, will go during the next four years toward the modernization of the Canadian coast guard fleet.
In addition, $67.5 million will serve to speed the procurement of highly sophisticated communication equipment by the Department of National Defence. Furthermore, $51.8 million will be allocated to the construction of a new federal building in Halifax. So far as Montreal is concerned, $40 million-I am all the more pleased with that project that I announced it last week-will be devoted to the Vieux Port in Montreal, of which $14.8 million will be spent for infrastructures and site development, $11.1 million will go toward the construction of new buildings and renovation projects and $14 million toward the development of parks and walkways. In addition, $23.8 million have been allocated to the Harbour Front project in Toronto; $36 million will be devoted to the new harbour in Sept-Iles, precisely in the constituency of my dear friend. Furthermore, $34 million will be used to build a deep water harbour in the Chicoutimi area; $15 million will be allocated to the construction of new harbours in Chatham and Newcastle, in New-Brunswick. In addition, $11.6 million will be spent in the Welland Canal region; $8 million will help to develop a portion of the improved lands of the port of Hamilton, $7 million will be spent toward the building of a new terminal and $2 million will be used to modernize the airport in St-John.
Therefore, as one can see, we have a very good budget which shows that the government is taking initiatives to help create jobs and achieve great things.


Jean-Guy Dubois: Mr. Speaker, I thank my colleague for his explanations. I have another question concerning the Canadian Home Renovation Plan. What is happening in the region of the Hon. Member himself with regard to home renovation and the $3,000 grants which were to be available until the end of April and for which the deadline has now been extended to the end of May? As far as he knows, has this program brought about any particular improvement in the housing situation in his area, the Montreal area? Can he tell the House whether his constituents were enthusiastic about the extension of this program?


Pierre Raymond Savard: Mr. Speaker, I can tell the Hon. Member that, in my opinion, these $3,000 grants have greatly benefited my area and the city of Montreal. I can tell him that construction is already underway, and I believe that all contractors and builders who made applications under this program are very happy to see that it will be so useful, especially in the Montreal area and in my constituency. We now have some vacancies but not that many, and I believe that before the program comes to an end, over 100 units will have been built.


Jean-Guy Dubois: Mr. Speaker, I have another question for my colleague. I know that he is also an alderman for the city of Verdun. Does the RRAP or Residential Rehabilitation Assistance Program apply in the city of Verdun? In addition, does he know whether many districts in Verdun have been designated
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for this program? Ele said earlier that there are a number of older people in his constituency. Of course, there are also many Verdun residents who work in Montreal. It is perhaps more of a dormitory city or a place for retired people. I am not saying that it is not a beautiful city, but I would like to know whether representations have been made to the Verdun-Saint-Paul city council or whether my colleague has made any representations to the Minister of finance (Mr. Lalonde) under the RRAP Program.


Pierre Raymond Savard: Mr. Speaker, I can honestly tell my colleague that the RRAP has been very helpful in Verdun. When it was implemented, we divided the city into four districts and I was very proud to announce this program because, when it came into effect, I was Parliamentary Secretary to the Minister of Public Works. I must say that, since the RRAP come into effect in Verdun, it has helped many homeowners and has been very beneficial to all my constituents. I must tell my colleague that the RRAP is still going strong. I have made many representations in this regard and at the moment, two of the four phases have been completed and we shall start on the third one very soon. I believe that people throughout Canada will benefit from this program.


Mr. John Thomson (Calgary South):: Mr. Speaker, I am pleased that my colleague from Verdun finds himself in a position to be very proud of what the budget has been able to accomplish for his constituents. It occurred to me that about ten years from now I would like to ask the young children of Verdun, who are perhaps six and seven years old right now, how they feel about paying back the $240 billion debt that the country will have by the year 1987.
Many issues are addressed by the federal Government and the House but I think one of the most serious issues that all of us really fail to address is what I consider to be the politically immoral loading of the deficit on our children year after year. It is as if I were to say, "I am going to buy a car that I cannot afford and I am going to ask my children to pay for it."
The scale of the deficits that have been incurred over the last 15 years and that will be incurred in the next four years as projected in the budget are politically immoral. They are politically irresponsible. We are on a treadmill. The more we borrow, the more unemployment we create. That sounds funny, does it not? We have a big job creation program here that has been put forward by the Government and we borrow money to create jobs, but that is an improper use of capital. The more we do that year after year, the more unemployment we are creating. But this seems to be perfectly acceptable. The NDP Party likes that kind of economics. The Liberal Government has seemed to like that kind of economics for the last 15 years. It borrows, inflates and creates more joblessness.
A fierce debate is raging in the United States today over the magnitude of their deficit. The deficit for a country of 250 million people with a trillion dollar economy is projected to be $150 billion. Here we are in Canada, one tenth the size, with a $30 billion deficit. They are having a raging debate over $150
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billion, and we just blithely go on. The Canadian Government does not seem to be very concerned about a $30 billion deficit which, in terms of United States figures, would be $300 billion, twice the size of that of the United States. The Minister in the front bench smiles and the Parliamentary Secretary smiles. What is $30 billion here or there? Gentlemen, the loading of this debt on our future generation is politically immoral. You are depriving future generations of their opportunity, and we are an accomplice to what is going on.
Surely to goodness everybody in the House can see that to increase the deficit continually is to deprive Canadians of jobs and inflate our economy continually. It cannot be done any other way. There is no magic formula. You know that as well as I know that. Yet we do it. We are politically immoral. This institution is deceiving the people of Canada.
Apart from the political immorality of the continuing succession of deficits, the other thing that upsets me is that the Government opposite does not seem to care very much. Members of the Government continually say, "We cannot do anything about Government spending because we will deprive people of the very essential needs of life. We cannot cut our social welfare programs, we cannot cut out income support programs."
Well, gentlemen, maybe there are many social programs and income support programs that should not be cut, but as a member of the Public Acounts Committee where I sit at least twice a week, I can tell you that there are horror stories after horror stories found in the report of the Auditor General. The Members opposite know that. The Minister of State for Finance (Mr. Cosgrove) has said that we have an adequate committee system to investigate Government expenditures and he surely would not suggest anything to improve that. Well, there is not a Member in the House who would not suggest something to improve the committee system, something to put some teeth into the committee system so that we could do something about these horror stories through the committees. All we do is to bring in witnesses day after day to ask them questions. This goes on year after year. Ninety four million dollars was spent on Consolidated Computer; $1 billion on Canadair and $560 million on Via Rail. There is no end to it. The waste and the extravagance are insufferable. We should be ashamed of ourselves as parliamentarians for the waste and extravagance that goes on at the hands of this Government. Every single Member of this House knows it. Yet we allow it to go on, nobody seems to care, least of all the Ministers on the front benches. We do not have the means or the political will to come to grips with the inefficiency and the waste.
In the last few days we have been reviewing one small part of the Government's operations in DREE. We have been reviewing just four clauses. You can compare this needless waste of money against the human tragedy of people losing their homes and their jobs, yet the Government-in fact

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nobody, gets very upset about it. Listen to this example: DREE makes a payment of $2.7 milion to a company and four days later the bank forecloses. That costs Canadian taxpayers $2.7 million. Nobody wastes money like that, but that is part of the scheme of things. Nobody gets particularly upset. There is another small matter here of $57 million. That amount was paid to Devco, the Cape Breton Development Corporation. It requested and was paid amounts totalling $57 million, more than the company expended for the acquisition of capital assets. Was that not a waste of money? It is not accurate to call it a misappropriation of money except that $57 million went to the Cape Breton Development Corporation that it should not have had that year and the money's still sitting there unspent. The accounting policies of the Government are an abomination. We are accountable for it, all of us as Members of Parliament. We should be ashamed of ourselves.
Let me come now to Petro-Canada. Many people think I have a thing about Petro-Canada. Yes, I have. Petro-Canada has cost Canadians innumerable jobs and the Government does not seem to understand that. Future generations of Canadians have invested the sum of $7.7 billion in Petro-Canada. Do you know what they have to show for that? Petro-Canada made $10 million last year. I do not know what the mathematics are, but it is surely a lot less than a 1 per cent return. Surely it does not take a genius to understand that is a gross misuse of capital. This is capital that we need in this country if we are to generate jobs to be competitive. If we keep spending $7 billion on Petro-Canada, $2.5 billion on Canadair, another $500 million on de Havilland and $1.5 billion to bail out Dome, where is all the capital to come from to generate the jobs that will be required? Our young people will be forced to pay this massive debt that we have loaded on their backs but they will not even have the jobs to earn the money to pay the debt. Surely it does not take an economics degree to know what to do. We have so many economists today and I do not know what they have done for the Government over there, certainly we desperately need capital formation in Canada if we are to be competitive in the new world.
The Minister of Finance (Mr. Lalonde) and the Minister of Industry, Trade and Commerce (Mr. Lumley) talk about the need for us to be more productive and competitive. How do you get to be more productive and more competitive if you do not employ capital? We need huge amounts of capital. But what do we do in this country? The Government designs programs to drive out capital. In 1981 alone the National Energy Program drove out $10 billion in capital.
Unless we are prepared to come to grips with the deficit issue and make a clear determination to bring down deficits, the financial markets in Canada will remain unconvinced that we mean business. Interest rates will stay high as long as the financial markets do not have confidence in this Government. You cannot expect economic recovery to occur because you pump $2.4 billion into temporary programs, Mr. Speaker. That is a sham and it is a deceit. You have to persuade the private sector to help.
The Minister of Finance talked in glowing terms about how he wanted to co-operate. Suddenly a new age dawned on the Liberal Party. The Liberals will spur economic activity by encouraging the private sector.


Douglas Glenn Fisher: Quite right.


John William Thomson: For 15 years the Liberals have strangled the private sector.


Douglas Glenn Fisher: That is wrong.


John William Thomson: That is why the private sector is in the position in which it finds itself today, because it does not have any confidence in this Government. It does not have the necessary confidence to go out and invest. It is not only because of high interest rates that people are not willing to invest, it is because if they do, they know the Government is very likely to change the rules in midstream. The Government is a master at retroactivity and fine tuning. The Government believes in a system of grants, subsidies and bail-outs.
In most places in the world today, in western Europe, Japan and the progressive free world economies, even in the United States, Governments are beginning to understand that they cannot spend more than they take in. Governments all over the world are trying to come to grips with their problems of inflation and unemployment by reducing deficits. But Canada cannot face up to that. Canada is going in exactly the opposite direction.
Let me come back to Crown corporations for a moment. There are more than 300 of these corporations, including subsidiaries. I do not know how much was invested in these 300 corporations last year. I suspect it is something in the order of $50 billion or perhaps $100 billion. Last year they took in revenues of $31.9 billion and their expenses were $33.6 billion. That is $100 billion which is losing money. It is losing money because this Government does not want to allow the private sector to function. It says it does, but really it does not, because it does not trust the private sector. This is the fundamental cause of why we are not developing as a country. There is no feeling of trust between Government and business in this country. Government has frustrated business, Mr. Speaker, over the last 15 years and we have been paying a very heavy price for it, and our children are going to pay a heck of a price for it.


The Acting Speaker (Mr. Blaker):: Questions, answers, comments? Debate.


Charles James Mayer: Mr. Speaker, it is interesting to note that after the very thoughtful and well put together speech made by the Hon. Member for Calgary South (Mr. Thomson), there should not be one Government Member or anyone on the opposite side rising to ask about some of what I consider to be ringing condemnations of the way the Government is spending money. That is what this Bill is all about.


Paul James Cosgrove: It was inaccurate.
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Charles James Mayer: If it was inaccurate, it would have been interesting to see the Minister rise and point out the inaccuracies. He had his opportunity and I would have thought that, if he was responsible in his job, particularly as the Minister of State for Finance, he would have pointed out some of those inaccuracies. However, as I said, it is interesting that no one had the courage to rise and point out any inaccuracies, if there were any. This Bill is certainly about money and about the way the Government is spending money. As the Hon. Member for Calgary South pointed out, for a $7 billion investment in PetroCan, the Government earned $10 million. That would be ' the same' as an individual citizen of the country investing $7,000 and getting $10 back, or investing $700 and getting $1 back. If those figures are accurate, that certainly is not a good way to be spending taxpayers' money.
This is a borrowing Bill and the Opposition is not suggesting by any means that the Government should not borrow money. Those of us in the Opposition realize, I believe, that the Government does have some legitimate reasons for needing to borrow money. It is certainly accepted that the Government should go to the market to borrow money. However, any concerned person, any concerned taxpayer of the country, must ask, when he is faced with the staggering amount of money which this Government is spending whether it is being spent properly. That is the concern, certainly, which I have, as well as all Members of the Opposition. One billion dollars represents $40 from each individual in the country. This year the Government is going to be running a deficit of $30 billion. That means that on behalf of each citizen in the country it will be borrowing $1,200. If you apply that to a family of four, it means that very close to $5,000 is being borrowed on behalf of that family. Therefore, if we in the Opposition are to be responsible in doing our job in representing those people who pay the taxes, and who are eventually going to have to bail out the Government, I believe we have to stand up and ask some legitimate questions as to how the Government is spending that money.
It goes back, Mr. Speaker, even further than budgets. In the Thirty-second Parliament, we are still in the first session. I fail to understand how any operation, whether it be a firm, a household, a farm or a business, can operate by running everything together. A farm, a business or a household operates on a period of time, a monthly basis, an annual basis or some such period of time. It seems to me that when this Government was elected in 1980, had it set out to have a Throne Speech each year, had it set out to have a budget each year, had it done some planning and presented Estimates on that basis, we would have had a much more sensible and sane way of spending and collecting money. What has happened though, is that in this one session of Parliament we have had seven separate borrowing Bills. In fact, it is almost like a rerun, a record which is stuck. This Government is continually asking the Parliament of Canada to approve more borrowings. As the Hon. Member for Calgary South pointed out, if some of this money is being used-which it is-for Government
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subsidies and Government bail-outs, then there is a legitimate question to be asked.
When the Hon. Member for Mississauga South (Mr. Blenkarn) was speaking this morning, the Minister of State for Finance (Mr. Cosgrove) made the comment, "If the Government does not borrow money, we are going to have economic stagnation". Surely, he does not think that the only kind of economic activity in this country which is going to produce any wealth is one which is funded by the Government? There are other ways to run a deficit than collecting more money than you spend, which is exactly the kind of deficit this Government is riinning. There are other ways to run a deficit. One is to simply give incentives to private industry in the form of a forgoing of taxes over a period of time, whatever the Government thinks is appropriate. That would mean that you do not collect tax dollars, and in some ways that is a very real alternative to what the Government is doing. Rather than have tax dollars collected up front, and money borrowed up front and then given back to the private sector, maybe it should not collect the money in the first place but instead try to create some incentive. I feel that that would be a better way to run a deficit. That would increase the number of people working in this country and would in turn increase the amount of wealth which we create. That is another way we can look at in terms of how we can get ourselves out of the economic stagnation we are in, rather than simply having mass Government spending and mass Government borrowing and mass transfers of money from one sector to another. It does not take an economist, as the Hon. Member for Calgary South pointed out, to understand that. It is basic, simple common sense.
I heard an amusing description the other day, Mr. Speaker. I heard it said that Christopher Columbus was the first modern-day economist. It may be an old story but it is certainly ne^w to (^ne. When he started out to sail, he did not know where he was going. When he got to America, which turned out to be the new world, or was defined as the new world, he did not know where he was. When he got home, he did not know where he had been. And the reason he is a modern-day economist is that he did it all on Government money. That, in some ways, is the kind of fiscal policy which this Government has. There is no plan, it seems to me, other than to run up massive deficits.
If one looks at some of the accumulated deficits which we now have, I consider it almost scary. The national debt on a per capita basis in approaching $5,000. The amount of interest we are going to pay this year as an individual taxpayer to service that debt is $705. Relating that to an average family of four, it means that that family pays close to $3,000 in taxes which goes to service past Government debt. That does not finance any new schools. It does not allow for any additional transfer payments to Provinces. It does not fund any new programs. It simply goes to pay interest on past Government borrowings.
It seems to me that we all want to get ourselves out of this situation. We are not simply standing up to criticize the Government. If you listen closely to what most Hon. Members
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say when they rise to speak you will hear them offer suggestions. In order to get ourselves out of this problem, the percentage of involvement by Government in the economy must be less. By doing that Canadians can be encouraged and become more productive. Surely, we must start looking at some other programs. That is one of the concerns I have as I listen to what is almost like a broken record as the Government comes back and asks for more and more money.
When a Government gets as large as this Government is, it becomes more and more important that it be run properly. When the expenditures of the Government amounted to 10 per cent of the Gross National Product, as it took that much away from the average citizen in the form of taxes, and the Government made a mistake, you could live with that or you could get around it. However, now the Government alone accounts for approximately 25 per cent of the total generation of wealth in this country, because the Government takes that away from us in the form of taxes and either redistributes it or uses it itself to spend on Crown Corporations. When mistakes are made and the Government is involved in the economy to that extent, it becomes a major problem. When you add that to what is going on in the provincial Governments, the average taxpayer in this country probably pays close to half of his total earnings to one level of Government or another in the form of taxes. It then becomes very, very important that those tax dollars are spent properly. If they are not, you simply create very large problems. It goes back to plain and simple common sense.
Last summer, Mr. Speaker, many of us were prepared to have a special committee of the House sit and look at specific Departments to see where we could save money. There have been many suggestions made as to how money could be saved on advertising. The Government has spent something like $1 million on advertising some of the proposed Crow rate changes, and I do not think that is money well spent. We would have been a lot better served had the Government introduced legislation a long time ago. We would have had a chance to examine it, debate it and focus on the issues in the House, rather than have the Government running off outside the House making statements and spending taxpayers' dollars advertising how great these proposed changes would be for the agricultural community.
We have made suggestions and they may sound as if they were minor. When you are talking about a total budget of $80 billion, a million dollars does not sound like very much. But the point is that if you start looking for savings and come up with some useful suggestions and the Government could adopt them, then there is some incentive to save. Perhaps through saving $1 million here and $1 million there we can make a dent in the total spending. Those are some of the things which concern me as a Member of this House and also concern my constituents.
We also have very great concern over the amount of money the Government is collecting in the form of fuel taxes. I come from an agricultural riding where it is very important that we be as competitive as we possibly can with other producers around the world. When you look south of the border, you find
that the American farmer is paying something like 40 cents or 50 cents a gallon less than the Canadian farmer. That makes it very tough for the Canadian farmer to compete because we both have to sell to the same customers around the world. If the Government chose to reduce taxes in that area, it would show some benefits. I have suggested repeatedly in the House, and I will say again because I see the Minister of State for Finance (Mr. Cosgrove) here and I hope he listens to me, that in Manitoba's case the federal Government collects a 7 cent a gallon tax on fuels used for the production of food on farms and then refunds it under certain conditions. I have had correspondence with at least one Minister concerning the administrative saving to the Government if it did not collect that 7 cent a gallon tax in the first place. That seems to me to make sense, yet the Government chooses not to pay much attention.
In closing, Mr. Speaker, I would like to reiterate that I have some concern-not because we do not want to see the Government borrow, we all realize the Government has to borrow money-that the Government borrow and spend the money responsibly. When we get to the level of borrowing we now have, we had better make sure that not very many mistakes are made because at that level of expenditure mistakes cause severe problems throughout the economy. The Parliamentary Secretary to the Minister of Finance (Mr. Fisher) is here and I hear him talking about wanting to fuel the private sector for recovery. One of the things we had better be careful about is that the Government does not borrow so much money that it crowds out the private sector. We all know that Canada's wage earners, Canadians in general, are great savers, but when the Government puts too much pressure on capital markets so that interest rates end up going up, that hurts the private sector, and the people who generate the real wealth in this country, the individual producers, have a tough time competing. Again, it is counterproductive.
Having outlined those few concerns I have over this Bill, Mr. Speaker, I now conclude my remarks.


Paul James Cosgrove: Mr. Speaker, in rising to speak the Hon. Member invited questions from Members of the Government, so I would like to ascertain the position of the Official Opposition on a couple of areas of spending. For example, the Hon. Member has indicated his concern over deficits and Government spending. Yet we have seen today in Question Period the Hon. Member for Joliette (Mr. LaSalle) and the Hon. Member for Mackenzie (Mr. Korchinski) complaining that the Government is terminating expenditures relating to the $3,000 grant to home buyers.


Mr. McKenzie:: They said there would be enough money until the end of May.


Paul James Cosgrove: I am confused. Who is speaking for the Party? Are the two Members I mentioned expressing the wishes of the Party? Is the Hon. Member? Then there is the issue of the Special Recovery Capital Projects announced in
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the budget, which we urge as a way of generating private sector involvement in construction through the expenditure of $2.4 billion to buy services in the private sector and put projects in place. We have on the one hand the Hon. Member for Vancouver Centre (Miss Carney) saying that program is a myth and on the other we have the Hon. Member for Pembina (Mr. Elzinga), the President of the Conservative Party, asking whether there are funds for his constituency in that program.
Now, who is speaking for the Conservative Party, the Hon. Member who is the President of the Party, the Hon. Member who is the financial critic, the Hon. Member who just finished speaking, or the Hon. Member for Joliette and the Hon. Member for Mackenzie who have both asked for additional expenditures?


Charles James Mayer: Mr. Speaker, at the beginning of my remarks, I pointed out that the Hon. Member for Calgary South (Mr. Thomson) had made I thought, some very ringing condemnations of Government policy. I would have liked to have seen the Hon. Minister, if he had some concerns over that speech, ask the Hon. Member some questions.
In regard to the two questions he asked me, it was my understanding that there was going to be enough money in that home ownership grant fund so that people could apply until the end of May. Personally, I thought it was a good program. Now, if the Minister wants to be fair and reflect upon what I said, I did not say that the Government should not borrow money. I said the Government should borrow money to be used prudently. It seems to me that if you tell a Canadian that he can apply for funding under a certain program and there are enough funds until the end of May, and we then find that there are areas across the country where a person has applied and cannot get funding, that is an inconsistency in the Government's program. We should do everything we can to see that it is cleared up. There is no contradiction in that. What I said was that I want to see the Government spend money prudently and responsibly.
Referring to the $2.4 billion for the Special Recovery Projects, again I do not see anything indigenous to that Program that is bad. I am not familiar with some of the specifics, but I suspect that there are certain areas which will not be of much advantage to my riding. Surely Members of Parliament cannot be criticized for rising in the House of Commons to inquire of the Minister responsible what kind of programs are available to their constituents so that they can advise them on how to take advantage of some of the Government's programs.


Paul James Cosgrove: Then I would ask the Hon. Member, Mr. Speaker, whether he is taking the position that the Special Recovery Program, which is the centrepiece of the budget and is created to assist private sector job creation, may be a good program, because he says that he is not familiar with specifics in his own riding. However, if he offers the observation that it may be that it is doing some good, does he not detect a contradiction in that observation or agreement with what the last Hon. Member who spoke, his colleague, said in that those
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expenditures, although perhaps contributing toward the deficit, are at the same time an investment in Canada's future and a benefit to future Canadians, something that is of concern to the Hon. Member who last spoke? Is there not that trade-off, that moneys well spent on infrastructure and public works in Canada become of benefit to Canadians in the future and they should therefore share in that public expenditure?


Charles James Mayer: Mr. Speaker, I would agree with the Minister, but the problem which I see, and the problem to which the Hon. Member for Calgary South referred, is that surely inducements should be offered to Canadians to become productive, other than grants and subsidies. I have heard grants and subsidies described as taking a quart of blood from one arm and transferring it to the other through a transfusion process and spilling half of it on the way over. If we are to consider generating some incentive in the private sector, why should taxes be so high in the first place? Some of the additional money should be left with the private citizen. He will not go into his basement and burn it at night. He will recirculate it by buying a television set or taking a holiday in Canada. He will spend it as well as the Government and, I would argue, in most cases better. The Government, wherever possible, should leave the money with the citizens who generate it and encourage people to invest and individuals to be productive rather than take it all away in the form of taxation which, to my mind, discourages production and makes the country less productive.
If we consider what has happened when these big deficits have been running in conjunction with a very high rate of taxation, we find that we have actually had negative growth in the last few years. If we are to have a bigger tax base, we must encourage production.
Those are some of my concerns over the Government's exclusive focus. I am not saying that I am totally or at least partially condemning the Government for using grants, but what I am saying is that it is time the Government started considering other ways of encouraging some incentives and production in the private sector.


Paul James Cosgrove: I would like to ask the Hon. Member one final question, Mr. Speaker. The Special Recovery Program, the $4.8 billion Program, is specifically created to provide a tax incentive to industry for research and development, export financing and resource development. One half, or $2.4 billion of the budget which will result from changes to the income tax provisions, is specifically designed to give investment incentives to Canadians, for example in share purchase options from small Canadian firms. I would like to know whether the Hon. Member is saying that at least that part of the budget is well directed toward helping Canadians, if it is not in the category of grants.


Charles James Mayer: Mr. Speaker, some of the incentives are excellent, to the extent that they will be real incentives and Canadians will take advantage of them to purchase shares and stocks in Canadian companies. Canada's record of investing in the

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private sector is rather dismal when compared to that of the United States. In fact, on a per capita basis-and I think the figures are still accurate-Canadians are willing to invest more in the United States than they are in their own country. I suggest that it goes back to at least one of the problems to which the Hon. Member for Calgary South referred, involving the uncertain business climate which the Government has created through everything it has done on a retroactive basis.
The Minister made reference to the provision in the budget for R and D. I do not have the budget document in front of me, but I think I can almost quote it. At the end of the section on R and D, it essentially states that Canada's tax provisions for R and D compare very favourably with those in other countries around the world. Essentially, the Government will not do anything. Again, I do not have the text in front of me and I am sorry that I do not. I would be glad to obtain it, send it over to the minister when I conclude my remarks. However, if I remember correctly, in its budget document the Government did not do anything to stimulate research and development in this country.


Paul James Cosgrove: One-hundred and eighty million dollars.


Mr. Les Benjamin (Regina West):: Mr. Speaker, I want to speak on the borrowing Bill because of some of the events which have been occurring in recent months and years and as late as yesterday, and which will be occurring over the next number of weeks and months. I want to relate borrowings by the Government for transportation purposes to the developments which have been taking place and which will continue.
I am not an economist nor a chartered accountant, however, it has always been my understanding that when Governments borrowed, they borrowed for specific purposes. I notice that the borrowing authority Bill does not tell us where the money is going in terms of specific and individual items. However, there is no doubt that much of those borrowings will go toward covering what could be called subsidies or direct grants. Much of it will also be devoted to capital investment purposes.
It has always been my understanding that Government revenues and expenditures incurred through borrowing used for such purposes as subsidies and grants to pay for things which bring no return and from which it is not possible to recover the moneys, are called dead weight debts. Those borrowings must be repaid out of future tax revenues of the Government. However, borrowings which are used for capital investment, whether it be airports, railways, seaways or seaports, can and should be called self-liquidating debts, in the sense that if money is provided for those purposes as repayable loans, they become self-liquidating debts. Or, if they are provided as a capital investment by the taxpayer, who originally borrowed the money through the Government, then surely the Government has a responsibility on behalf of the taxpayer to ensure that there is a return on the capital investment.
Does Your Honour know of anyone who would put up funds for capital investment without taking equity ownership, debentures, or bonds from which there was a return of interest and dividends? I do not know of any self-respecting investor or so-called free enterpriser who would hand out his own money or anyone else's without receiving some opportunity for return
on the investment, or at least being eligible for a return on the investment if it proved to be a successful one.
I am sure we could study many other areas of the economy, but we should consider the history in this country of borrowing funds for transportation purposes which were turned over to entrepreneurs for capital investments from which the people of Canada received little or no return. I suggest that it makes good, sound business sense that if one borrows money to invest in capital improvements, the money is used to get a return on that investment.
Since 1881, and probably before then for canals and small railways in central Canada, the people of Canada have provided capital investment for privately owned railroads as well as for land, forest, mineral rights and cash grants. They have provided funds for capital investment but did not own it.
We provided funds to take over bankrupt capital investments, such as in the formation of the Canadian National Railways. We took over five bankrupt railways, and while the banks and the bondholders got their money back, the taxpayers of Canada paid those debts and interest charges for the next 40 years approximately.
Incidentally, Canadian National was not formed because the Government of the day believed in a Crown corporation or publicly owned railway, but to bail out the bankrupt railways of Grand Trunk, Grand Trunk Northern, Grand Trunk Pacific, Canadian Northern and others. In the 1950s, 1960s and 1970s, those debts were transferred from Canadian National to the Government of Canada. In recent years there has been the odd year when Canadian National has paid a dividend to the single shareholder, the Government of Canada, because it was relieved of all these old debts and some recent ones and was able to show operating profits out of which it could pay a dividend and some income taxes. At least there was a beginning to some returns being made on that investment. I believe that is good beginning, but in recent years we have continued to hand money over for capital improvements or subsidies for which we have received no return.
In fact, some money was borrowed for these branch line subsidies. Not only did the railways expect the money for those branch line subsidies but they expected a return on those subsidies. In other words they expect a return for them on the taxpayers' money for the branch line subsidy.
The theory behind that subsidy, which included maintenance and depreciation, was that the railways would repair the branch lines. However, they did not do so, but kept the money. The Government introduced an additional program called branch line rehabilitation. A few hundred million dollars have gone into that program. The railways expect to get a 21 per cent return on that capital investment which the people of Canada gave them. That return is on the taxpayers' money, not the railroads'. They expect to get another 20 per cent for what is euphemistically called overhead.
May 5, 1983

A bureaucrat who appeared in front of the Transport Committee told me that overhead was the cost of money. I am aware that interest rates are high but I did not know that money cost 20 per cent these days. Overhead not only includes the cost of money, it includes the president's salary, the cost of the water that goes into his whiskey, the management costs and so on. The felony is now compounded by the request for money which is to be borrowed under this Bill. The Minister of Transport (Mr. Pepin) has indicated that he wants to give $725 million a year to the two major railroads to cover their alleged losses on transporting grain and to cover the federal Government's contribution to capital improvements. The Minister does not say what the subsidy will be for their so-called losses from hauling grain and how much it will be for capital investment. In other words, the $725 million a year provided under this borrowing Bill and the money provided under future borrowing Bills will be sent to the railroads in the form of a cheque to be spent as they please. I know that the Minister talks about guarantees of railway performance, but he has already had for Some years all the authority he needs under the National Transportation Act, the Railway Act and the Canadian Pacific Railway Act to require that performance under the law. Additional so-called guarantees are superfluous at best.
No private enterprise, bank, or lending institution would provide investment capital without getting some kind of assurance of return on that investment. How much longer will successive Liberal and Tory Governments put up funds for capital investment on behalf of the people of Canada and include in those public funds what amounts to almost a 40 per cent profit? While I am not against a reasonable profit, I challenge anyone to tell me that a 40 per cent profit is reasonable. No self-respecting free enterpriser would suggest that. He would probably say it was exorbitant.
We have an alternative use for the money that has been proposed by the Minister of Transport (Mr. Pepin). We suggest that out of that $930 million per year, $380 million would go directly to the railroads to pay the real shortfall between the statutory grain rates and their actual out-ofpocket costs. We would not add 21 per cent return on investment on those subsidies for the benefit of the railways, or 20 per cent more for so-called overhead. They would be reimbursed for the actual out-of-pocket costs which include maintenance, depreciation, wages and salaries and fuel. The remaining $550 million is for capital investment. Assuming that it is divided equally between CN and CP, the Government's equity ownership on behalf of the people of Canada and Canadian National automatically increases by that amount, which I believe is a $ 1,000 per equity ownership share.
Of the money that is being turned over to Canadian Pacific for capital investment purposes, which is being borrowed on behalf of the people of Canada, not one nickel or return is available to the people of Canada on that investment. Surely that is some kind of economic stupidity. Surely it makes sound economic business sense to take equity ownership in return for whatever we give to each railway. Any interest or dividends that are paid year after year would come back as a return on that investment to the Government for the people of Canada.
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That type of practice should be expected of any operation, whether private or public. In approximately 50 years' time the return on that investment makes that debt not a Government expense or a total dead weight on the people of Canada but an investment which self liquidates. In fact, there may even be an odd occasion when a profit is made on the investment as well as an annual return. I do not understand how any so-called private enterprise Government-and they have been doing it in the country for 117 years-can fail to at least blush when it continues to borrow money for capital investment purposes for which there is not even an opportunity for a return on the investment.
I am just an innocent stubble-jumping prairie boy. I do not pretend to know the ins and outs of high finance, economics and so forth, but I still cannot get it through my head what kind of economic sense there is in what the Government is trying to promote. What kind of rationale is there in borrowing money to give to someone else for a capital expenditure and receiving no return on the investment? I do not understand it.
If these birds over here or the ones over there had done that with their own money, they would all be on welfare. They rise and complain about the big deficit, the poor taxpayer and the national debt, but who has been borrowing money since 1867? Who has been handing out billions of dollars in the last 117 years for capital projects, both publicly and privately-owned, with no provision for a return on those investments? Who has been doing that?
It was not any socialist. It was the Grits and Tories, the great free enterprisers or protectors of property! Whose property? The taxpayers of Canada borrow the money. It was given to someone else for capital improvements, which meant property. Do the taxpayers of Canada have any interest in or return on the property? No, the property belongs to somebody else. What about the property rights of taxpayers for the funds they borrowed and gave to Canadian Pacific for capital investment on which they will receive no return? They have no say in the expenditure of those moneys. They have no shares, no dividends or no interest. What kind of economic stupidity is that? What kind of a con game is that on the taxpayers of Canada, and also in this instance on the grain producers of western Canada?
For the same amount of money the Minister of Transport proposes to expend, we would increase equity ownership in Canadian National. We would also start taking common share equity voting stock ownership in Canadian Pacific Limited in order to have some dividends and interest in return for the investment. Surely that is the proper way to expend the borrowings any Government of any political stripe has to make frequently, in fact every fiscal year.
Concerning the matter of capital investment to improve our rail systems in western Canada, although everything in and east of Manitoba, had been left out, the Minister said that for

May 5, 1983
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anything over 31.5 million tonnes a year the farmers will pay all the freight costs. When he was asked yesterday whether he would lift the ceiling, he said that if farmers shipped 41.5 million tonnes, it would cost the federal Government $1 billion more. He said that he could not do that, that he could not lift the ceiling. But, he is prepared to allow it to cost grain producers by 1991 $1 billion a year more. He borrows this money, on which there is no return, to hand it out, and then passes the cost back to grain producers and taxpayers generally. I hope we will have some answers. We want to know why this insane economic spending has been going on and for what purpose the borrowings will be used.


Mr. Flis:: Mr. Speaker, I have only two questions for the Hon. Member. First, I would like to have an honest answer from him as to whether or not he read all the budget papers which were tabled on budget night.


Some Hon. Members:: Have you?


Jesse Philip Flis: I keep hearing from the Hon. Member that the budget does not tell us where the money is going, so I would like an honest answer to that question. Yes, I have read the budget papers, in answer to the gentlemen opposite who yelled out the question.
Second, if the Hon. Member went into a restaurant and purchased a meal for $6, would he want equity in that restaurant? I am sick and tired of hearing the same argument we have heard twenty times over in the last week. What the NDP is comparing with equity when the Government is subsidizing something is similar to going to a restaurant and purchasing a meal for $6 and wanting a $5 equity in the restaurant. That meal may cost $1, but the other $5 goes to paying the taxes, heating, lighting and wages of the waiters and waitresses. I am asking the Hon. Member whether he would want a $5 equity in the restaurant for a $6 meal? Those are the only two questions 1 have.


Leslie Gordon Benjamin: Mr. Speaker, in response to the Hon. Member's first question, I have not read all the budget papers.


Jesse Philip Flis: I appreciate your honesty.


Leslie Gordon Benjamin: I would be surprised if anyone, apart from the Hon. Member, has done so. All I was saying is that it would be nice if there were a breakdown in this little three-paragraph Bill as to where the $14.7 billion will go. That is all.
On the matter of going into a restaurant and buying a $6 meal, and whether I would want a $5 share in the ownership of the restaurant, let me indicate to the Hon. Member that he misses my point entirely. I think all other Hon. Members understood what I said, but perhaps he did not. I said that out of the money the Minister of Transport proposes to expend, $380 million is in direct subsidy for the so-called shortfall in hauling grain. That is for operating costs. It is like the cost of producing the meal in the restaurant to which the Hon. Member referred.


Victor Fredrich (Vic) Althouse: That is for the meal.


Leslie Gordon Benjamin: Right, that is for the meal. If I were buying that $6 meal in a restaurant and the owner said that he wanted $10 for the meal, $4 of which was to help fix the building, I would want $4 worth of common shares in the restaurant for the capital investment portion of that price. Similarly, in this instance $380 million is a direct subsidy for operating costs or out-of-pocket expenses. There is no equity involved in that. The other $550 million in capital investment would be like the additional $4 on the restaurant meal. Surely it is only reasonable and makes good sense to say that we should have equity shares for capital expenditures. I thought the Hon. Member understood that. I thought it was a normal investment and spending procedure of any individual, financial institution or certainly of Governments. That is all I was saying.


The Acting Speaker (Mr. Corbin):: Order, please. We will return to questions in a moment.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Corbin):: 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 St. John's East (Mr. McGrath)- Fisheries-Negotiations on restructuring East Coast industry, (b) Newfoundland proposal; the Hon. Member for Cariboo-Chilcotin (Mr. Greenaway)-Income Tax-Auditing of farmers' income-Request for moratorium, (b) Request for limitation on assessment of back taxes; the Hon. Member for Edmonton South (Mr. Roche)-Nuclear Armaments-U.S. and U.S.S.R. offers to reduce nuclear arsenals, (b) Proposal to hold summit meeting.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Cosgrove that Bill C-151, An Act to provide supplementary borrowing authority be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
May 5, 1983
Cyril Keeper: Mr. Speaker, I would like to make a comment with regard to this whole question of equity. The Hon. Member opposite indicated that if you went to a restaurant to have a meal, a New Democrat would ask for $5 equity. The problem with that statement is that it shows that Liberal Member has no conception of the difference between day-to-day operating expenses and investment. The whole point of asking for equity in a company has to do with investment. If the Party opposite knew the difference between investment and day-today operating expenses, perhaps the economy of this country would be in better shape.


A. Daniel McKenzie: Mr. Speaker, Bill C-151, An Act to provide supplementary borrowing authority, seeks to borrow an additional $14.7 billion. Of this amount, $2 billion may be carried over into future years. The Government is thus seeking a cushion of $2 billion for this year plus $2 billion to be used either this year or in future years. It is more than a cushion. It sounds as if they were looking for the whole chesterfield.
The Government has come to Parliament seven times in this session to seek more borrowing authority. We have had Bills C-30, C-59, C-lll, C-125, C-128, C-143 and C-151. This clearly indicates that the Government has not paid any attention to the Auditor General's statement that the Government has no control over expenditures. The Auditor General went to great lengths on the problem of the borrowings by the 300 or 400 Crown corporations that we have. There is absolutely no accountability from Crown corporations. I will go into that in a little more detail in a moment.
The Government's projected financial requirements between 1983-1984 and 1986-87 total $93 billion. Parliament is in for a steady stream of large borrowing Bills over the next few years. It clearly indicates that the Liberal Party's solution to any problem is to spend more and borrow more.
Financial requirements are only part of the picture. Many Crown corporations are able to raise debt in the financial markets without seeking borrowing authority from Parliament. That is something we in the Conservative Party oppose. When we were in Government, we took steps to bring in some control. Unfortunately this was dropped when the Liberals were returned to office.
I now want to deal with the federal Government's financing in perspective. There will be Government project spending of $100.1 billion on a national accounts basis and a deficit of $31.3 billion on a public accounts basis. The gross national debt last March was about $160 billion. Interest on the debt will cost Canadian taxpayers $17.6 billion this year. On a per capita basis, Government spending this year will amount to $4,000 per man, woman and child in Canada. This compares to only $500 per capita in 1967-68.
The cost of interest on public debt this year will equal $700 per capita and $1,800 per taxpayer. That is a tremendous load on the Canadian public. One tax dollar in three is used to service the debt.
In the Fall of 1979, Treasury Board found that it was faced with cost over-runs on major capital projects totalling $1.1
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billion. Placed in perspective, these over-runs could finance the construction of 18 CN towers or 66 new fighter aircraft. This has been going on for years. There are cost over-runs on practically every project in which the Government gets involved. No cost benefit analysis is conducted and there are no proper controls on these projects.
Including operating deficits and capital expenditures, Mirabel airport to date has cost the taxpayers more than $700 million. This was to build an airport that was way ahead of its time, was not required and was aptly named a white elephant. That sum of money is the equivalent of giving 800,000 people a free round-trip ticket from Saint John's Newfoundland to Vancouver, British Columbia.
The federal Government has an information and advertising budget of $245 million. It does not need any such budget. Most of this advertising is an absolute waste. In 1981, the federal Government spent $13.1 million on food, booze and entertainment. That is the equivalent of more than one million bottles of liquor. Since this Prime Minister (Mr. Trudeau) came into office in 1968 he has been repeating the same thing every couple of years. They are empty, meaningless statements. I will quote what he has said in the past.
The Liberal Government has a history of paying lip service to restraint. In August, 1969, in announcing the first Liberal restraint program, the Prime Minister told Canadians that, "We would be on the road to financial disaster if nothing was done to bring spending under control". Why does he not do something about it? This Government should do something about that. In June, 1975, in announcing the second Liberal restraint program, the then Finance Minister told Canadians, "The Government proposes to set an example of restraint ... by imposing strict control over its activities and programs".
In spite of periodic references to restraint, Government spending has climbed by 554 per cent on a public accounts basis since 1968. Any commitment on the part of the Liberal Government to restraint, based on past evidence, is nothing more than insincere posturing.
We in Manitoba get the double whammy. We have the same problem with the NDP Government there. Because of the NDP budget deficit and uncontrolled spending, the Manitoba financial rating has dropped. Manitoba's financial position has deteriorated significantly over the last two years, a major New York ratings house suggested yesterday as it lowered the Province's credit rating. The Province has budgeted for an equally large deficit this year. Government spending will increase by almost 10 per cent this year after adjusting for inflation. The credit rating has been downgraded because of excessive spending and excessive borrowing. Manitoba, under an NDP Government, has one of the largest debts in Canada. In 1969 we had a balanced budget. The Conservative Government was defeated in 1969 and the NDP took over. Prior to 1969 there were proper financial controls. Once the NDP got in, uncontrolled spending began. That is why Manitoba is in this mess today.

May 5, 1983
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Over the past 15 years, Government spending has risen in an unprecedented way. On a national accounts basis where data is comparable over time, spending has climbed from $12.6 billion in 1968-69 to an estimated $100.2 billion in 1983-84, an increase of 693 per cent. On the more commonly used public accounts basis, spending has increased from $12.3 billion in 1968-69 to $89.8 billion, an increase of 554 per cent. That is astronomical and insane. A significant portion of the increase has happened since re-election of the Liberals in Feburary, 1980. Relative to fiscal 1979-80, spending has risen by 78 per cent on a public accounts basis or 84 per cent on a national accounts basis. Spending this year will go up by 12 per cent. Why will spending go up by 12 per cent? It should not be going up at all. Spending on a national accounts basis is now equal to 26 per cent of Canada's Gross National Product. This compares to 21 per cent only four years ago. In 1982, borrowing by the federal Government accounted for 51 per cent of all net new security issues placed in Canada. Borrowing of that magnitude must clearly have an effect on the supply and demand for money and thus on the interest rates that must be borne by the private sector. The horror stories go on, Mr. Speaker.
The investment community does not trust a Government that continues to live so far beyond its means. It does not want to hold a currency that continues to be debased by excessive Government borrowing. As a consequence, the dollar has fallen, driving up the cost of living in Canada. Interest rates remain quite high as the Government attempts to support the dollar. Job-creating capital investment has gone elsewhere. A classic example of that was the National Energy Program which almost destroyed the Canadian oil industry, lost some 60,000 jobs in Canada and drove oil rigs out of the country. jThe Government stijl does not get the message. The mqd spending goes on. The mad borrowing continues. It does not learn from its past errors and mistakes. It just carries on with the same ridiculous procedure.
I mentioned earlier that there is no proper accounting by Crown corporations. They are simply handed money and, as the Auditor General says, they take the money and run. I want to read the following passage from the Auditor General's Report of 1982:
It may be helpful in visualizing the scale of the problem to think of the whole group as an enormous iceberg floating lazily in the foggy Atlantic; silent, majestic, awesome. The public tends to see only the upper portions ... the giants like CNR, Petro-Can, CBC ... The great bulk of the iceberg below the surface is less spectacular, less likely to attract public interest, less likely to receive the attention of Parliament, yet costly to taxpayers.
Of course, the Auditor General's Reports have read the same every year for many, many years. It is unfortunate that more attention is not paid to their recommendations.
Dealing with entrenchment of state control, the creation of the multi-billion dollar holding company, the Canada Development Investment Corporation-not to be confused with Canada Deposit Insurance Corporation-belies any serious commitment the Liberals may profess to have regarding greater accountability for Crown corporations. The CDIC was
created in May, 1982, by Order in Council. Six months and 17 Orders in Council later, the CDIC has emerged as a huge holding company for Government corporate interests with no accountability to Parliament and a wide open mandate to intervene anywhere in the Canadian economy. One of the first things the present Prime Minister did when he took office in 1968 was to remove parliamentary control over Government expenditures. Any politician who plays games that do away with proper accountability or control over the public purse is a very irresponsible individual.
The new corporation has been granted a $500,000 interest-free loan from the Consolidated Revenue Fund, and the Minister responsible, Senator Austin, claims that he can commandeer the profits from Teleglobe, which now go to the CRF, and use them as a source of operating funds for the CDIC. That is a great accounting procedure, Mr. Speaker.
Canadair has hit the headlines recently. It will be looking to Parliament for about $2.5 billion to bail it out. In December of 1976,1 told the Liberal Government that it should-
-quit hiding behind the cloak of secrecy-
-and make a complete revelation of all details with regard to Canadair, the Government-owned aircraft manufacturing company, including the $50 million loan guaranteed by the Government. I was concerned than about the $50 million. That has gone up to the $2.5 billion that they are looking for now. Back in 1976,1 pointed out that:
-Canadair has to sell 500 aircraft just to recover the investment let alone cost of money over the intervening period . .. The Gulfstream Two which is the obvious competitor to this aircraft has established a strong position in the market but sales are well below the 200 level.
In light of those figures, I pointed out:
Where is the Canadair Ltd. going to find the market for 500 aircraft?
, That) question ljst still relevant tqday. Are we to continue to prop up Canadair? When they come to us looking for this $2.5 billion, we will have to Find out if they have a market or if they have sales for 500 aircraft. They will probably have to sell 1,000 aircraft to break even now. But at that time, the Minister, who is the present Energy Minister (Mr. Chretien) and was the Minister of Industry, Trade and Commerce at that time, always gave us great assurances that there would be no problem with Canadair, and he ridiculed me and my colleagues for even bothering to raise the question. We warned them in 1976 that they were on a disaster course, but they laughed at us. Now the laugh is on the Canadian taxpayer.
Canadian people are quite concerned about a recent speech made by the Secretary of State (Mr. Joyal) in which he points out that he is going to turn Canada into a French state. In his speech he points out that the cost will be no object. No one is to question the cost of turning Canada into a French state. He goes into a fair amount of detail in his speech but we do not know how much it will cost, we do not know what effect it will have on English-speaking Canadians, and we should be entitled to have a White Paper or a Green Paper or some kind of an explanation from the Government on how much it intends to spend on turning Canada into a French state.
May 5, 1983

The Minister in his speech talks about the need for more French universities across the country. I do not know how many more are needed, what the cost will be, where the money will come from, where they will be located. Our universities at present are all suffering from the current economic conditions. They can hardly keep going. But this Minister says that he will build more universities across the country. It would be very interesting to know if any cost benefit analysis has been done in regard to turning Canada into a French state.
Another cause of considerable concern across the country is the fantastic cost of the language training programs to date. About $4 billion has been spent on language training. The majority of Canadians will go along with a reasonable amount of language training at a reasonable expenditure, but $4 billion just for language training is only a very small part of the total cost of making Canada a fully bilingual country.
The double standards used by the Liberal Government in its language training program is of concern to us. Certain people, friends of the Government, will be sent to the south of France for language training. Other individuals from the Government are sent to Toronto for language training and have apartments rented for them. One recent case was brought to light where an individual was sent to Toronto to learn the French language. The Government rented her an apartment for $845 a month, gave her an expense account of $600 a month, plus her salary while she was in Toronto for 11 months. I have other contacts here in Ottawa, Mr. Speaker, individuals who have had difficulties learning the French language. The Government will not give them language training in the Government schools and they will have to go to night school and pay for their own language training.
I could go on and on about the fantastic costs of the Metric Commission and their extravagant expenditures and how their budget has risen 100 per cent this year to a grand total of over $25 million. I would suggest that the Government should start reading the Auditor General's report, never mind coming back here every couple of months to borrow billions and billions of dollars more.


The Acting Speaker (Mr. Corbin):: Are there any questions, comments? Debate. The Hon. Member for Carleton-Charlotte (Mr. McCain).


Mr. Fred McCain (Carleton-Charlotte):: Mr. Speaker, I regret very much that I am compelled to make the remarks I am about to make. I have to say as a Member of Parliament of Canada that I have been betrayed. It cannot be described in any less forceful term than that.
When I first became a Member of the House of Commons in the Fall of 1972 I was concerned about the fact that we were embarked upon a bilingual program. I wanted to know what was to be the impact upon my constituency in particular and upon Canadians in general. I was asked to attend a meeting with the then Member for Moncton, the then Member for Saint John, the then Member for Fundy-Royal and the then Member and still Member for York-Sunbury (Mr. Borrowing Authority
Howie). We met with Mr. Spicer who was then the gentleman in charge of the bilingual program for this nation. We asked several questions. First, how was it determined that a particular position in the Public Service would be classified as bilingual? It was not exactly a fair question at that time and Mr. Spcier could not directly answer it. I then asked whether he could tell me that unilingual communities would be categorized as those requiring bilingual employees in the federal service. The answer was an unqualified no. My next question was, if there was a competition for a particular job within the Public Service of Canada, will language prohibit the employment of any person applying for public work? The answer was: no, because there would be language training provided. If the applicant were approved and if additional language training were required it would be available to the gentleman or the lady who applied for the job before employment. Another question asked was: would language have anything to do with advancement in the service of those already employed? The answer was, no. The policy of the Government was that if there is to be advancement and if bilingualism were a requirement for advancement, then language training shall be available.
It was not very long until the government welshed on the first statement that language training would, in fact, be available for an applicant who had the merits to take the job for which he had applied. The first step and the qualification of Mr. Spicer's statement was that the individual would have to take an aptitude test. If the person failed to pass that aptitude test there would be no language training. Regardless of merit, if the individual did not have the aptitude for bilingualism, he or she shall not get an appointment. That was a very serious move away from the formula outlined by Mr. Spicer.
The next step now in place is that you must be bilingual to apply for some jobs and you will not get one if you are not. The language resolution of 1973 followed that. Again, we were assured the guidelines that had been outlined to us by Mr. Spicer would, in fact, remain in place under that resolution. That, of course, had been practised up to that point in time to a degree that I was quite satisfied the resolution did not infringe upon any statements made to me as a new Member of Parliament by Mr. Spicer. I was the idiot who then betrayed myself and my constituents. I voted for that resolution, and for that I apologize to Canadians, whether they live in St. Andre or St. Stephen, Fredericton or Edmundston. I do not care what their principal language is, people are entitled to opportunity for public employment. They should in no circumstances be denied employment regardless of their native or mother tongue. That is an injustice to any person young or old who applies for a job in a professedly bilingual country.
When it comes to advancement, I do not have time in the 20 minutes allocated to me to enumerate the denials of language training for those who applied. I do not have time to list the extravagances of some of those who did get language training and the cost incurred, but I am concerned that in the Town of St. Stephen there are now three National Revenue postings

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which may or may not have been filled and which are declared bilingual. Only one is available to a unilingual individual. I am ashamed that I voted for that resolution. One of the applicants for those National Revenue jobs went to see the RCMP. He assumed he was talking to a personnel officer and he was told by that officer that if he was not bilingual he should not bother to apply. I challenge anyone here in his House or anyone who reads my statement to say that I am against a bilingual program in this nation of Canada. But I say that bilingualism has to be for all Canadians. Employment has to be open to all Canadians whether they come from St. Andre or St. Stephen. That makes no difference to me, but the language training has to be there and the merit system has to be in place. People in this nation have a right, which I thought was extended and explained in 1973, to apply and expect to be accepted for employment regardless of language qualifications.
When this is carried to the extreme, we see instances of people who are already in the employ of the Government of Canada, most of whom are over 50 years of age and some of whom are over 60 years of age, employed by the Department of Transport for security purposes in the City of Fredericton at the city airport who are advised they shall be released from their job four months down the road because they are not bilingual. That is why I feel I was betrayed and they are betrayed by this Government.
There is no example in the annals of this nation of more obvious betrayal. Why is it that there are now several research positions in the field of agriculture left vacant? Have they been declared bilingual? I could not care less what the mother tongue of an individual is so long as he can study the research projects and come up with the merits that qualify him for employment. I could not care less. But he has to be good, and it should not be language that should categorize him.
I appeal to this Government to come back to the promise it made, first through a very highly respected gentleman, Mr. Spicer, and second through a resolution that was passed by this House, one for which I voted, and for that I apologize to all Canadians, not just those in my constituency. That promise was with regard to the pattern of bilingualism intended, and that is the pattern which I can support. I cannot support the automatic disqualification for linguistic capability on its own. I cannot support the lack of opportunity for advancement for linguistic reasons alone. Train the people and advance the people if the merit is there. That is the system we must have.
It was rather interesting to listen to the last speaker from the New Democratic Party. If a fellow were going to finance this country on the basis that he proposed, you would have to get the Canada goose to lay golden eggs. It sounded to me as though he had about as much economic sense as a computerized, vocalized teddy bear.
There are a lot of items on which I would like to expand with respect to the borrowing Bill, with respect to the. budget and with respect to Canadians as a whole. Amongst those things I am going to ask a question or give notice of a question to which I hope we will get an answer in this debate, the budget debate, or in some form. The proposed changes in the Crow rate structure which pertain primarily, superficially at
May 5, 1983
least, to the West, also have economic impact on the East. We never did get an explanation of the impact on the East. We never did get an evaluation of the increment in cost which would accrue to the feeders in eastern Canada, and particularly to the feeders east of Montreal and including all of the Atlantic Provinces. There is an impact and I want to know if there is any intention on the part of this Government to recognize that increment in cost which will be passed on by the change in the Crow rate as it relates to eastern Canadian poultry, hog and beef operations. We are entitled to that answer in a definitive cost study basis, Mr. Speaker. Let us have it because we cannot assess it since we do not even have the legislation or the firm proposition. Maybe the press has, but this House does not.
We are prepared in this House for a request to vote for a borrowing Bill, the consequences of which are shameful in this nation, as far as I am concerned, but it does pose some questions. You and I, Mr. Speaker, happen to be representing constituencies which need some money. We need some money from this make-work salvage operation which is coming up in the potato industry, and we need it very badly. One could extend that further if one went farther down the river westward into Quebec from my home, eastward into Nova Scotia. We need some money in the apple industry. The apple industry is facing the results of what I consider to be an error, although I am not overly critical of this. It is the root stock evaluation for climatic purposes. The apple industry in eastern Canada planted a root they never should have planted, and grafted onto trees which were supposed to bring profit, and which have not turned out to be. I submit to you, Mr. Speaker, that that root should have been evaluated in the climatic conditions in which it was planted. It never was evaluated. It was released for production. It was sold and it was multiplied in this country. Unfortunately, we now have some apple growers who have lost up to 50 per cent of their total orchard as a result of replanting with a root stock which would not stand the climatic conditions of our country.
The Minister of Agriculture (Mr. Whelan) said, "Well, if anyone would declare it a disaster, we would do something about it. If the Provinces would put up a little money, we would do something about it". However, Mr. Speaker, that has been a historical federal responsibility, and anyone who suggests that it is not a disaster when crop damage as high as 50 per cent takes place in any aspect of agricultural operations is wrong. That, Sir, is disastrous.
However, the real disaster at the moment is in the potato industry. It has always been cyclical ever since that crop was first planted in a commercial way in Atlantic Canada or, for that matter, in any other part of Canada. Its returns have been so variable that some people have said that you might just as well shake dice as plant potatoes. And to some degree that is correct, with all the variables which exist. But this time we got hit with both barrels. We got hit by weather which caused the crop, first, not to store well and, second, even if it stored, to be
May 5, 1983

graded so that it became virtually unmarketable. The return in your constituency, Mr. Speaker, and mine, dropped down to as low as 15 per cent or 20 per cent of the cost of production of the crop.
There are several steps which the federal Government should take. I propose that it should move now. I would ask the help of any sympathetic Hon. Members on the Government side of the House to encourage Government to act now. The cropping season is just around the corner. The steps which the federal Government should take are, first, to put some of this make-work money, some of this pump-priming money, into the Farm Credit Corporation to be lent at reasonable rates to those farmers who need assistance; second, to defer the payment of the money which has been lent for the storable crops program. That would enable some farmers to plant a new crop. Third, and this is the last step which I would recommend, the Government should sit down with the provincial Governments and in fact come up with a program which is supportive of both the apple industry and the potato industry. But it must do it now because now is the time to plant. This is the week of decision, and if that decision is not reached, if there is not cooperation between federal Government, provincial Government, farm organization and banks-and they are all ready to talk-if that decision is not reached by next week, Mr. Speaker, you and I know that there will be people who should have help who cannot plant another crop.
I appeal to the people of responsibility, Mr. Speaker: you have less than a week to make that decision! I am not talking entirely about young farmers who have over-financed or overborrowed. I am talking about farmers of every age in the business, from farmers with less than ten years of experience to farmers with more than 40 years of being self-supporting in the agricultural field and producing that crop. They are all dependent upon the degree of damage from mother nature, in storage, excessive moisture and distortion of the tubers. Every category of farmer in this instance is in very, very serious trouble. I cannot over-emphasize the need and the urgency of an immediate decision.
There is another place for some pump-priming money. Some of that could be put into make-work projects in the coastal region of my constituency. I have submitted on an annual basis, except for this year-it seemed to be an exercise in futility; the list must still be on file and nothing has been done about it-a list of port improvements, small craft harbour improvements. I have submitted up to 30 names, some of which have never even been inspected by the Department of Public Works. It is not their fault. There was no use inspecting them because the Department of Fisheries did not give them any money, and this is the time when money could and should be spent either for a dual purpose or for a single purpose, whatever the case may be. It would be for a dual purpose in the Town of St. Andrews, where a proper harbour facility for fishing and tourism would add a great deal to the economy of that community. The same could be said for St. George. It could be spent in the Sand Point wharf where it was promised
Borrowing Authority
three years ago that if the tuna packing plant in that community would triple its capabilities, the Government of Canada would in fact extend the wharf to accommodate the necessary ships to bring products in and take other New Brunswick products out. That has not come through yet, Mr. Speaker, and that wharf is cluttered up. We are losing business. Canadian workers could be at work but now they are going to East Port, Winter Port and other ports along the main coast. We are losing business because the Government has not kept its word. And it is not just the tuna packing plant. There are products being shipped from the Atlantic coast of this continent which will not go through Saint John or Chatham or Rimouski, but would in fact go through Sand Point Port in Champlain Industrial Park in Charlotte County.
There is a place where some of that money could be put, and not only will it make work but it will make continuing work and bring on-going revenue to those communities. I could read the list of small craft harbours ad infinitum. Dipper Harbour, they are: Chocolate Cove, Whale Cove, Seal Cove, Ingalls Head. These harbours have been neglected. Let us put some of this money to work to make work where it will have lasting and productive value. These are the things, I believe, Mr. Speaker, which we have to consider. That would be a constructive allocation of make-work money.
There are other projects in the Province of New Brunswick which deserve attention as well, many others, but the ones referred to are the ones which would be revenue-producing and work-producing for the long term. Money could also be spent on tourist development throughout the whole Province of New Brunswick. The provincial parks could be improved, which would increase their attractiveness. That is a place where money could be put. Some of the highways could be improved, country highways, in order to attract tourists to this Province, to make it an all-season operation.
I must, Mr. Speaker, say to this House, to my constituents and to Canadians, that I have been betrayed in the bilingual program. I supported it. I have to ask that it revert to what it was. Canadians have been betrayed and their resources mismanaged. When I go home on Mother's Day and look at our family, my children and grandchildren, I tell you that I will not be going with the pride with which I would have gone 20 years ago. They had a future then in a country of which the then campaigning Prime Minister could say "this land is strong". Well, Mr. Speaker, this Government sure sapped its strength.


Mr. Andre Maltais (Parliamentary Secretary to Minister of Industry, Trade and Commerce and Minister of Regional Economic Expansion):: Mr. Speaker, I am very pleased to be taking part in the debate today, especially after listening to the comments of the Member for Carleton-Charlotte (Mr. McCain) which of course concerned the entire question of borrowing authority for the Canadian Government. I think the Member for Carleton-Charlotte had some very interesting

May 5, 1983
Borrowing Authority
things to say about the importance of carrying out certain projects in his riding, where funds could be put to good and practical use, because basically, I think he shares the concerns of Members on both sides of the House, who are anxious to ensure that the money the Canadian Government gets from private or corporate citizens or by borrowing will generate jobs and stimulate the economy. However, I disagree when the Hon. Member says that we do not have the same pride we had fifteen years ago, because there is less of a future for young people. I think it is true that the situation is a difficult one today, but I think it is wrong to conclude that there is less future in this country than there was fifteen years ago, because if we look at this country's potential and compare it with other industrialized countries, it is clear that Canada's position is still very strong, although a great deal more effort must be put into building and modernizing our infrastructures.
I think the Member for Carleton-Charlotte-whom I know very well since we travelled together when I was vice-chairman of the Transport Committee-and you yourself, Mr. Speaker, as an Eastern Canadian, are both aware of what it means to lack infrastructures of every kind in our ridings, especially in our part of the country.
I think the Bill we are considering today, Mr. Speaker, namely Bill C-151, an Act to provide borrowing authority so that the Government may, according to the wording of the Bill, invest such sums of money as may be required for public works and general purposes, mean a great deal to us. All this may not be as important to Members from urban areas, because they are used to living, I should perhaps not say in luxury but in relative comfort; many good roads, industry nearby and a highly diversified economy. If we look at the extra-peripheral regions, however, there is an incredible lack of infrastructures. I myself am from an area that is not necessarily remote but nevertheless suffers from the problems of regional disparity and has done so for quite some time. At first, 1 was opposed to a Government deficit. Like all Canadians, we would prefer a budget in which revenue and expenditures are balanced. That is not the case, unfortunately. Because of the present recession and the problems in industry, the Government's revenue has been much lower than was predicted by the experts and by the Government itself, so that while funds must be spent on social benefits for Canadians, Government revenue has dropped considerably. If the Government had ignored what had to be done in this country, perhaps we could have had a balanced budget, but this would have been at a high cost to the extra-peripheral regions and Canadian workers.
I am thinking of the Gaspe, which is just across from my riding. Mr. Speaker, it is high time the Canadian Government announced substantial measures to improve infrastructures in that region. A lot has been done in the Gaspe over the last fifteen years, but this region will never be able to operate on an equal footing with the rest of Canada if we do not give it the necessary capital facilities so that it will not only be able to
compete with other parts of Canada but also with other countries. This is important, and I know what I am talking about, Mr. Speaker.
Similarly, I think a person has to know the Atlantic Region to realize that Newfoundland, Nova Scotia, New Brunswick and Prince Edward Island have far fewer infrastructures than they do out West, and I am referring to the Pacific Region. A person has to have seen both to understand the significance of the funds being sought by the Government today for investing in those regions. If it were just a matter of spending money on facilities that are already more than adequate, I would object.
Earlier, however, the Member for Carleton-Charlotte was very specific when he mentioned the particular needs of his riding. I think the same applies to most ridings in the Atlantic Region.
All Members from Eastern Canada have very specific needs as far as infrastructures are concerned. As long as we do not have proper infrastructures in that part of the country, we shall never be on an equal footing with the rest of Canada.
That is the important thing. To be able, with a budget like the one we have now and the supplementary funds that must be ratified, to invest in capital projects. And I have often heard some of my fellow Canadians criticizing the Government because according to them, it was putting the country into debt. But although it is true, I think people should realize that in doing so, we are rescheduling projects which would otherwise have been carried out five, ten or fifteen years later.
However, the projects that will be financed in 1983-84 will serve future generations. These infrastructures will last ten, fifteen, twenty, twenty-five or forty years. It stands to reason therefore that the cost be spread over one, two or three generations.
Last week the Minister of Transport of Canada (Mr. Pepin) came to my riding to announce that Ports Canada will finally build new infrastructures in the Bay of Sept-Iles. People have been waiting for those facilities for years, but the work was supposed to be spread over 15 years. Thanks to the combined efforts of various intermediary groups in the area, and thanks as well to the unrelenting work of people responsible for regional communities, the Minister of Finance and the Minister of Transport gave their approval to this harbour project.
We have already asked the local people to get involved and make sure that private businesses will be able to open their doors in the Sept-Iles area so that the facilities in the port of Sept-Iles will be more productive. After the announcement was made last Thursday, Mr. Speaker, we could see that the outlook was changing already. Contrary to the comments the Hon. Member made earlier to the effect that the people-the young, the elderly, heads of families and retired people alike- were desperate, they now have regained confidence. They are glad that they will finally be able to find work and, as a result of the mining problems we have experienced, we must diversify
May 5, 1983

our regional economy. It must be done. And very soon the Government will have to open up a transportation link between Quebec City and Port-Cartier, which has been closed since 1979.
If I wanted to be irresponsible, Mr. Speaker, I would say that it was closed down when the Progressive Conservative Party was in office. However, that Party did not have anything to do with it, such was the economic situation. Since 1979, Quebec and the Government of Canada have appointed very responsible people to look into the possibility of reopening the plant at Port-Cartier. That is when we will need funds to guarantee a sound recovery, not as owners of the plant-in that respect, I think I am voicing concerns similar to those of the Progressive Conservative Members-not to become owners, but to act as partners in the reopening of that plant.
Indeed, we had done our share in 1974 through the allocation of funds for the Port-Cartier plant to make sure that the area would have a truly diversified economy. The funds for which we are seeking the approval of the House will be used for that kind of operations. I still remember when I was Deputy Chairman of the Committee on Transport; we had toured the Atlantic region and I recall the dilapidated condition of wharves and fishing facilities. I remember that some wharves had been abandoned altogether although fishermen did need them to do their job. The funds will therefore be used to carry out various projects in those ridings and those areas.
Mr. Speaker, the budget was not introduced only to benefit the party in office; it is aimed at all Canadians and all ridings. I think that the role of the Opposition is to make sure that everybody gets his share and that the real needs are met. That is the important thing to say at this stage. I would suggest that all Members on both sides of the House are aware of the importance of this budget for young people.
To criticize the legislation introduced in the House is easy but what really matters is to know what are the needs this budget is going to meet, and these needs can only be met if the money necessary to carry out these projects is made available to us. What surprises me is the fact that over the past two years, Hon. Members both on the government and opposition sides have repeatedly urged the Government to take positive action in an effort to get the economy moving again.
Yet, Mr. Speaker, the Government is acting responsibly. Not only does it provide $2.5 billion for direct job creation, but it urges the private sector to get involved by providing it with some $4.5 billion in incentives and tax breaks of all sorts.
I think it is most important to let Hon. Members and all the other Canadians know that this is a concerted effort by both the private and public sectors to balance the forces, because the Government has no money. What the Government has is the taxpayers' money. That is all the Government has, and it can only rely on human and natural resources, and seek a
Borrowing Authority
perfect balance between these two resources to develop the country. That is all it can do. As a Government, we cannot create the economy, but we can and should create favourable conditions to a buoyant economy. That is what a Government must do. And that is exactly what the budget introduced by the Minister of Finance is trying to achieve. Because there are no miracles, Mr. Speaker, only concerted efforts in the right direction.
Already Hon. Members opposite are blaming the Government for the borrowing powers it is seeking. Had we not borrowed money or introduced legislation which was bound to increase the deficit, would we have had the tools to break the economic deadlock? I believe the answer is a very definite no, Mr. Speaker.
When you read the comments made by various economic experts, you very soon realize that the budget does meet current needs. Of course, there may be some reservations here and there. We could have allowed a little more here, a little less there, but all in all we struck a balance. And this is what the Government should be striving for, in the interest of all Canadians. On the lower North Shore of the St. Lawrence River, Mr. Speaker, there lies an area with some 400 miles of coastline where there are no roads, absolutely none, although 6,000 or 7,000 people do live there, in 15 isolated villages, French-speaking, English-speaking, and native people. Those people are looking forward to a reorganization of both Regionair and Quebecair. I think the Minister of Transport should be urged to act soon. For instance, Mr. Speaker, those people have to pay $700 for a round trip ticket from Blanc-Sablon to Montreal, and that is not first class. There are many stopovers, although this is the same country and the same Province. That is not normal. Special steps will have to be taken, at the Canadian taxpayer's expense, so those people can travel from Blanc-Sablon to Montreal at a more reasonable cost. Right now, it is cheaper for a Montrealer to go to Paris than for someone in Blanc-Sablon to go to Montreal. Those people have a right to live, and they have made tremendous efforts to provide Canadians with fish, and game.
But, when we speak in this House, we have a feeling we are speaking only to Torontonians, Montrealers, Vancouverites. This country is not just ten provincial capitals and one federal capital, Mr. Speaker. It consists of a vast land with a potential that is waiting to be tapped and in need of infrastructures. This has often been neglected in the past, for all sorts of reasons. But past neglect is no reason for staying on the same course. Quite the opposite! As a Member of Parliament, I wish we only had balanced budgets. But in the face of unbelievable shortcomings that exist in various parts of the country, whether it is the East, the Centre, the West or the North, I feel we really should invest with a view to the future, and get the money needed to have the required infrastructures.
Our young people are asking for two things, Mr. Speaker, two very specific things: a sound training, and infrastructures

May 5, 1983
Borrowing Authority
that will enable them to put their training to practical use, to develop this country. This is what our young people are asking for. And older people too. We know all about layoffs in the various mining operations across the land. This involves not only Shefferville, Gagnon, Fermont, Port-Cartier and Sept-lles, but many other communities. When we see people put on early retirement at age 50, 55 or 58, it is a real tragedy. A person who receives a $10,000 severance pay is not necessarily happy. The only way to be happy is often to have a job that you like, a job that makes you proud to support your family, to be responsible for them, to be a responsible citizen. That is what people need.
I remember how frantically the officials from the Department of Finance wanted to check the outflow of money in order to try and lower the deficit. However, when one is elected to sit in this House, one realizes the real needs of people and one has to say no to public officials' demands in order to be really responsible and allocate funds in an attempt to put people back to work and help industrialize this country. That is what we really need. We sometime hear the question: How is it that the government does not plan ahead for such expenditures? I remind Hon. Members that when the IOC mining company shuts down its operations in Shefferville, the Canadian government-that is to say each of us-will pay $4,500 per household to relocate the people of Shefferville anywhere else in Canada, even though they cannot find a job, because people cannot stay up there, they cannot stay in a remote place 385 miles North of Sept-Iles, where there is no road, when a return plane ticket between Shefferville and Montreal costs in excess of $350. So it is up to the Canadian government, to the public administration, to take on the responsibility of enabling people to relocate elsewhere in order to look for a brighter future. The mining company will pay $1,500 and the Quebec government will also put up $1,500. Yet, this was not anticipated in the government budget. And these people from Shefferville, who were paying a lot of taxes, are quite justified to expect the government to help them find better prospects elsewhere.
So for all these reasons, I suggest the bill we introduced is necessary, and in conclusion, because my time is expired, I would ask Hon. Members on all sides of this House to show extreme care in distributing the funds in all parts of this country, to ensure that each and every constituency will have its share to invest in the future of our country, among young as well as older Canadians, so that every Canadian can regain hope not only in the future of this country, but in themselves, because the great crisis we are presently going through is in great part a crisis of self-confidence. So I will simply say in concluding my remarks, Mr. Speaker, that I hope we will gain the support of all parties so that this bill can be passed as soon as possible and that tomorrow, we will be confident that, the country is back on track and heading toward prosperity and a more diversified economy.



PROCEEDINGS ON ADJOURNMENT MOTION

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

James Aloysius McGrath: Mr. Speaker, on May 2 I put a question to the Minister of State for Economic Development (Mr. Johnston) who is now in charge of the Cabinet committee which is charged with the responsibility of restructuring the Atlantic Provinces' fishing industry and the troubled companies in that industry. I wanted the Minister to tell the House when the negotiations leading up to a decision on restructuring would be completed and when a decision would be made and reported to the House.
Of course, I got no satisfaction from the Minister. That is why I am taking this opportunity to bring it to the attention of the House. This is a very serious matter.
On March 28, a conference was held in St. John's with all the principal players involved in the Newfoundland fishing industry. A resolution was unanimously adopted and forwarded to the Minister of State for Economic Development. I will read it into the record:
BE IT RESOLVED:
That all fish plants involved in the deepsea fishery be kept open, and BE IT FURTHER RESOLVED:
That the federal and provincial Governments make a commitment to exercise their separate jurisdictions in the harvesting and processing sectors to ensure the continued operation of all deepsea ports, and BE IT FURTHER RESOLVED:
That rather than a simple bail-out of the corporate interests both Governments commit themselves, jointly or separately, to the public ownership-in whole or in part-of those deepsea companies unable to operate without public assistance, and


BE IT FURTHER RESOLVED.
[Stage Direction]
That the immediate acquisition of these companies, either jointly or separately, by both Governments is absolutely necessary to accomplish a meaningful restructuring of the Fishing industry, and BE IT FURTHER RESOLVED:
That the option of the separation of the fleet and community ownership of processing plants be examined as potential objectives in a new, restructured deepsea fishing industry.
That resolution was unanimously adopted at this conference and was signed by Members of Parliament, including the Parliamentary Secretary to the Minister of Fisheries and Oceans, the Hon. Member for Humber-Port au Port-St. Barbe (Mr. Tobin), the Minister of Fisheries of Newfoundland, the Minister of Environment of Newfoundland, the President of the Newfoundland Fish Food and Allied Workers Union, the President of the Newfoundland Federation of Labour and the mayors of all the towns affected by down plants. To date there has been no response from the Government to that resolution.
May 5, 1983
[Stage Direction]
We are dealing with a situation in which there are still seven plants in Newfoundland not operating. Thousands of inshore fishermen have no place to sell their fish and trawler fleets are tied up. This situation exists a full six months after the Kirby Task Force Report during which time negotiations on restructuring were supposed to be taking place.
The Canadian Salt Fish Corporation is still without a president, even though the Government accepted Kirby's recommendation for an expanded role for the corporation which would see it involved in processing and marketing fish in the northern communities of Newfoundland and Labrador.
The Fisheries Council of Canada has just completed its annual meeting in St. John's, yet there is still no word from the Government on restructuring, in spite of an ongoing negotiation, we are told at least, by the Government Cabinet Committee and Kirby.
What we are seeing here is the Newfoundland fishing industry being relegated to a secondary role to that of Nova Scotia which, if the Cabinet committee has its way on restructuring, will see a newly integrated giant Nova Scotia corporation as the principal player in harvesting, processing and marketing of fish in the Atlantic Provinces.
My question is, where is the Minister of Fisheries and Oceans for Canada (Mr. De Bane) while life and death decisions are being made affecting Newfoundland communities, fishermen, plant workers, trawler men and their families? I am talking about thousands of people. His role has been usurped by one of the super Ministers of the Cabinet, the Minister of State for Economic Development, a gentleman who obviously takes his advice from the Deputy Prime Minister (Mr. MacEachen) who is an active Member of that committee and happens to be the Hon. Member for Cape Breton-Highlands-Canso. Of course, there is not doubt as to where the interests of that hon. gentleman lie.
I say to the House that our patience is running out. There is unanimity in Newfoundland as to what should be taking place, yet the Government in the interests of protecting certain corporate interests insists upon dragging its feet. The innocent pawns in all this are Newfoundland fishermen-14,000 inshore fishermen, thousands of plant workers who are without jobs, trawlermen and their families. They are the innocent pawns in this super corporate power chess game which is taking place.
I say to the Government that our patience is not infinite. Time is running out. I call upon the Parliamentary Secretary to the Minister of Fisheries and Oceans, who signed his name to the resolution which represented a reasonable compromised solution that would address the problems of the Newfoundland fishing industry, of the downed plants and of the communities that see their livelihood taken away, to rise in his place and tell us when we can expect a decision by the Government. At the very least he should tell us when we can expect a reply to the resolution which was forwarded to the Government on March
Adjournment Debate
29. To this date there has not even been the courtesy of an acknowledgement.
Mr. Jean Lapierre (Parliamentary Secretary to Deputy Prime Minister and Secretary of State for External Affairs):: Mr. Speaker, the Minister responsible for economic and regional development, as chairman of the ad hoc Committee of Ministers on Atlantic Fisheries Restructuring, has the over-all responsibility for the ongoing negotiations on restructuring. We know that the Hon. Member is impatient; so are we. On March 31 the Government gave Michael Kirby broad instructions to begin negotiations leading to a reorganization and refinancing of the troubled deep sea fishing industry in Canada. Mr. Kirby is representing the Government in those negotiations. These ongoing negotiations with the banks, the companies and the Provinces concerned are presently at a very delicate stage. I know the Hon. Member would not want those negotiations to break off because of some indiscretion or an attempt to make political points.
All Hon. Members will understand that we are dealing with matters of utmost financial sensitivity and that any details relating to the Government's negotiating position cannot be laid before the House at this time. The Hon. Member will know exactly what we have done whenever the negotiations are concluded. However, I am confident that these negotiations are proceeding on an urgent basis-and the Hon. Member has shown the urgency of the case-and will lead to the revitalization of the Atlantic fishing industry, including the provision of more stable employment and incomes for thousands of fishermen and plant workers who depend upon the fishery.


INCOME TAX-AUDITING OF FARMERS' INCOME-REQUEST FOR MORATORIUM. (B) REQUEST FOR LIMITATION ON ASSESSMENT OF BACK TAXES
Lorne Everett Greenaway: Mr. Speaker, the subject I want to raise this evening concerns Section 31 of the Income Tax Act. I think Hon. Members on both sides of the House who have farmers in their constituencies realize the problems that are caused by the interpretation of Section 31. Most of us, especially myself, are having problems because the Department of National Revenue is very actively engaged in auditing farmers across the country under the provisions of that Section.
What has happened is that because of tough times, high interest rates and high costs, many farmers have been required to work off their farms to make supplementary income to keep up with their payments and literally to keep from losing their farms. To add insult to injury, the Department has picked this particular time to audit farmers and to reclassify them under Section 31.
Section 31 has roughly three classes of farmers having regard to writing off losses against income. There are bona fide farmers who farm full time. They are allowed to write off as much loss as they have. The second category of farmers includes those with supplementary income. They are allowed to write off $5,000 per year. Then there is the so-called hobby

May 5, 1983
Adjournment Debate
farmer classification. We are not interested in protecting hobby farmers.
What is happening is that because people have had to work off their farms in order to make supplementary income, they are being categorized as hobby farmers. This causes an awful lot of difficulty. People are finding that their losses are being disallowed and that they are now being hammered with as much as four years in back taxes, plus interest and penalties. In many cases they are literally being forced to either sell their farms, stock, equipment or whatever they can to try to pay their tax bills.
Literally hundreds of farmers in my riding, have been audited. Let me read a paragraph from a letter I received today from the Quesnel and District Chamber of Commerce. Quesnel is a community in my riding of about 10,000. The letter is addressed to the Minister of Finance (Mr. Lalonde). The first paragraph points out the problem. I quote the last paragraph:
The farmers in our community are afraid to commit present financial resources to such things as fertilizer and seed badly needed at this time of the year while under the threat of possible income tax reassessments for prior years.
In my question on April 26,1 asked whether, because of the ambiguity of Section 31 and the reclassification of many of these farmers, he would call a moratorium on tax audits until Section 31 could be amended to reflect these problems. This problem has been with us since 1951 when the section was brought in. I did not get an answer to the question. My second question was:
Would the Minister agree to that, to assess back taxes only for the current year if people are going to be reassessed under Section 31.
There is a precedent for that. This problem arose in 1972. The then Minister of National Revenue, now President of the Treasury Board (Mr. Gray), wrote to the former Member for Mission-Port Moody. I quote from that letter:
If, following the review, it is concluded that the departmental policy has been correctly applied to a taxpayer, I have asked that this allowance of losses be limited to the most current of the years under review. This basis of assessment will be continued in all subsequent applications of the departmental policy relating to losses claimed by part-time farmers so that only the loss for the one year is disallowed.
Under the circumstances, that precedent should hold. The least we can do for farmers faced with this terrible problem is allow their losses for the current year.


Mr. Garnet M. Bloomfield (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, the Hon. Member has raised a number of questions on the subject of audits conducted by National Revenue concerning claims for farm losses. The Minister has answered all those questions. For the benefit of the Hon. Member let me explain the interpretation and application of the law with respect to this matter.
Section 31 of the Income Tax Act sets a limit, under certain conditions, to the amount of losses from a farming business that a taxpayer may deduct from other sources of income in completing a tax return. The word "business" here is of crucial
importance. The taxpayer must be in the business of farming in order to claim business losses, a reasonable requirement.
The Hon. Member has asked for a moratorium on tax audits because he says the section is ambiguous. Although the section is somewhat complex, the Department has the benefit of many court decisions, including one by the Supreme Court of Canada to which it can refer for interpretation and application of the law.
The Hon. Member has also commented on the qualification of the auditors performing the audit. In this regard I would like to say that the Department's auditors have the know-how to determine the profit or loss of an enterprise. For example, if an enterprise incurs thousands of dollars of expenses in a year and in the same year makes only a few hundred dollars in sales and does this for three or four years in a row, and it can be seen to be making no progress toward a profitable position and the entrepreneur is really living on money earned in another full-time job, the question must arise as to whether the enterprise is a business at all. This would be true whether we are talking about agriculture or any other type of business.
The Member suggested that the reassessment of taxes should only be for one year. The Department recognizes that it can take more than one year to get a person established on a farm. I am sure the Hon. Member would understand that in many cases it takes a few years to assess the viability of an enterprise. Therefore, in these circumstance^ it is normal, depending on the facts of each case, that the Department may review and assess, where applicable, for more than one year.


NUCLEAR ARMAMENTS-U.S. AND U.S.S.R. OFFERS TO REDUCE NUCLEAR ARSENALS. (B) PROPOSAL TO HOLD SUMMIT MEETING
Mr. Douglas Roche (Edmonton South):: Mr. Speaker, when I questioned the Prime Minister (Mr. Trudeau) yesterday on the nuclear arms negotiations issue I tried to make the point that Canada should play a stronger role for peace in the world by pressing both the Soviet Union and the United States to make progress in Geneva. By pressing, I mean that Canada should be formulating its own recommendations to both super powers for mutual, balanced and verifiable reduction in nuclear arms, and that these recommendations would be based on objective account of the precise amount of nuclear weaponry that the Warsaw Pact and NATO possess.
At one level the nuclear arms question is terribly complex, yet it is possible to ask clear questions to which clear answer should be given. Here are some of the questions a growing number of Canadians, including Parliamentarians in this House, are asking. Exactly how many warheads does each side have? Why are the two sets of nuclear negotiations, strategic and intermediate, not joined into one over-all negotiation so that the question of nuclear parity can be established? Why does the Security Council of the United Nations not play a major role in the negotiations?
I submit that there is an important role for Canada to play in pressing forward in this manner. Nuclear negotiations are
May 5, 1983

not a matter in the exclusive domain of the two super powers. All humanity is today held hostage by the arms race.
It is the growing recognition that the nuclear arms race must be halted that led two important bodies in the United States to take action this week. The U.S. House of Representatives, by a margin of 278 to 149, passed a resolution calling for a mutual and verifiable nuclear weapons freeze. This vote has not only given the nuclear freeze movement credibility, but renewed momentum. The congressmen did not take this action lightly. They debated the resolution a total of 45 hours, with several amendments being made. Consider the debating time on that crucial issue compared with what the Canadian Parliament gives this issue in debating time-practically zero.
The Roman Catholic Bishops of the United States, by a vote of 238 to nine, ratified a broad-ranging pastoral letter that denounces nuclear war and calls for the end of nuclear weapons. The Bishops, in calling for this immediate halt, have taken a forceful and historic position in church thinking and put their collective finger on the nub of the issue by saying, and 1 quote from The New York Times of May 4, 1983:
"The nuclear age is an era of moral as well as physical danger," ... "We are the first generation since Genesis with the power to virtually destroy God's creation. We cannot remain silent in the face of such danger."
No one can accuse the American congressmen or Bishops of being soft on communism or of being dupes of the peace movement which is growing rapidly around the world. Both the House of Representatives and the church in the same week have urgently signalled that negotiations must be successful if mankind is to survive.
A clear, solid path to common security is found in the Palme Report signed by representatives of the Soviet Union, the United States and several other countries including the Third World. This report called for a zone in central Europe to be cleared of battlefield nuclear weapons. My colleague, the Member for Victoria (Mr. McKinnon), pointed out in a lengthy analysis of the Palme Report that the report:
-came up with recommendations that are practical and feasible. There is a way out of this mess and I think that the Palme Commission has shown us that way.
Let the Prime Minister and the Canadian Government become more vigorous in pressing for the detailed recommendations of the Palme Report, in pressing the Security Council to play a role in unified negotiations and, finally in pressing for a summit meeting of the two leaders, Messrs. Reagan and Andropov, who hold the future of humanity in their hands.


Jean-C. Lapierre: Adjournment Debate
My hon. colleague has suggested one way of resolving the nuclear escalation and if we were to follow his arguments and manage to get together the partners who, for instance ... He says that some clear and specific questions should be asked in order to get clear and specific answers. I would therefore ask him to consider the discussions that were held on this issue during the past years and to realize that when we refer to equal and equivalent nuclear forces as between Americans and Russians, various interpretations are given. Moreover, this issue is so confused that it would be difficult for us as good Canadians or as citizens of the world to simply ask the Russians and Americans to draw up an inventory of their weapons and those of other countries. I think that one is rather naive and fails to realize what is going on when one asks that sort of questions.
On the other hand, for the past few years, the Canadian Government has been strongly promoting the resumption of negotiations, especially as regards the Geneva talks.
We have also noted the many contacts made by the Secretary of State for External Affairs (Mr. MacEachen) and by the Prime Minister (Mr. Trudeau) himself when the Hon. Member refers to the possibility of a summit meeting, as the Prime Minister has confirmed yesterday that during his meetings with President Reagan and Vice-President Bush he urged the American authorities to agree to meet their Russian counterparts at a summit conference. Moreover, we should make sure that if such a summit meeting were held, it would be well prepared in order to give concrete results. An agenda for a summit meeting of that sort should not be forced upon us, and I think that Canadians generally agree that it is essential that such a meeting be convened. In addition, the Prime Minister and the Government are making serious efforts to get that kind of activities under way. However, we hope that there could be a summit meeting similar to the one which was held in 1972, that is when the Salt I Agreement was signed. We hope that perhaps in the future another similar exercise could be carried out with the complete agreement of the entire world which is anxiously waiting for a respite in the nuclear arms race.


The Acting Speaker (Mr. Corbin):: 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 6.23 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, May 6, 1983