1983-04-25

GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Thursday, April 21, consideration of the motion of Mr. Lalonde that this House approves in general the budgetary policy of the Government; and the amendment of Miss Carney (p. 24689).
[DOT]	(1110)
Hon. Flora MacDonald (Kingston and the Islands):: Mr. Speaker, you will remember that last autumn before unemployment reached the present unacceptable level of two million Canadians, the Prime Minister (Mr. Trudeau) treated us to a series of television homilies in which, above all else, he appealed to the Canadian people for trust. I have gone back over newspaper reports with such headlines as "Trudeau urges Canadians to show trust", "Lower prices through trust, Trudeau asks". That is from The Globe and Mail of October 21, 1982.
In his speech on October 20, 1982 he said:
1 dwell on the need for trust because what we have achieved so far is young and fragile. We must strengthen our trust in each other because trust is the only bond that will allow us to unite our efforts and combine our strengths to meet the challenge we face.
That is what the Prime Minister said six months ago-that we were to trust him and his colleagues to exercise the kind of leadership that would be necessary to overcome our economic ills; we were to work together; we were to have faith in him and to trust him. Here we are six months later, six tortuous months later, hundreds of thousands more Canadians are without jobs, the deficit has soared to astronomical levels and the Government brings down a supposed, cure-all budget. I will deal with some of the budget measures in a few minutes.
First of all, I want to draw attention to the Prime Minister's latest musings or, I could say diatribe, about the word "trust". What he has had to say is far from philosophical. In his press conference on April 22, just last Friday, again he dealt with trust between Canadians. Turning his back on his appeal of six months ago for trust among Canadians, he lectured, he berated them, because he does not think they can be trusted to spend their money as they should.
Look at the headlines that followed that oration by the Prime Minister. "Can't trust the public with tax cuts, the
Prime Minister said", as reported in the Montreal Gazette for April 23. "Canadian buyers can't be trusted to spend at home, Trudeau says" is highlighted in the Kingston Whig Standard of April 23. The Prime Minister says that the budget did not provide for sales tax breaks to consumers because they would not spend money at home; they could not be trusted to spend money unless on imports or perhaps on travelling abroad. He went on to say that he did not give a tax break to manufacturers because they could not be trusted to pass on the extra revenues to consumers. He did not want to see the Provinces getting any additional moneys because they could not be trusted to do anything but pocket the funds.
There we have the Prime Minister's current view of trust between Canadians and their Government. It is quite a different view from that which he expressed six months ago.
What does he say now? Canadians cannot be trusted to act in the best interests of the country. They would be liable to spend any additional money travelling abroad. This, sir, from the Prime Minister who, when he was travelling through Southeast Asia earlier this year, commented that he was not particularly concerned about the plight of Canadians because they would probably all be sunning themselves in southern climes or would be out on the ski hills having themselves a good time.
The Prime Minister's understanding of ordinary Canadians, indeed, sir, "passeth all understanding". He thinks that Canadians cannot be trusted, that given the chance they will goof off somewhere. The real problem with the Prime Minister is that he insists on applying his own personal standards to other Canadians. Nothing could more clearly underline how out of touch with reality he really is. How can he believe that two million unemployed Canadians would be out cavorting on the ski hills? How can he imagine that home owners, farmers and small-business people, who have gone through the agonies of loss of their homes, their businesses and their families' farms, would now be lolling on some beach somewhere in the knowledge that their financial problems are all a thing of the past?
The Prime Minister is out of touch and Hon. Members of the Government's benches are out of touch, and I say that to the Hon. Member for Ottawa Centre (Mr. Evans) if he believes what the Prime Minister said in his press conference of last Friday about having no trust in Canadians, about Canadians not being trusted to do the right thing by their

April 25, 1983
The Budget-Miss MacDonald
country. He had better find out what is actually happening with ordinary Canadians across this country. He had better find out that Canadians can be trusted. That is what 1 say to the Hon. Member for Ottawa Centre.


Mr. Fisher:: Talk about the budget.


Flora Isabel MacDonald: I will certainly talk about measures in the budget because not only is the Prime Minister out of touch with reality, but so in many ways is his Minister of Finance (Mr. Lalonde). What they do not comprehend is that the people of Canada are no longer willing to buy their prescriptions. Even less are they willing to be made the butt of jokes and ridicule by the Prime Minister and his Minister of Finance. People have had too much suffering, too much uncertainty, too much frustration and of being stretched to the limits of their human and physical endurance by this Government now to be made the butt of sick jokes by the Prime Minister.
The treatment accorded the critical unemployment problem in Canada today by the budget of the Minister of Finance was also little more than a sick joke, although he did not use the same terminology as the Prime Minister. The Minister of Finance couched his approach to the issue in seemingly appropriate words. He said: "My dominant concern in preparing this budget has been to help the more than 1.5 million Canadians who want to work but cannot find jobs". That is his dominant concern. Did he really mean it or did he only say it?
I find it difficult, Mr. Speaker, if not impossible, to accept the words of the Minister of Finance as sincere when his budget provides for 182,000 more Canadians out of work this year than last, when it estimates that there will be more unemployed in 1985 than in 1982, and that there will still be a million-plus unemployed by 1987 and beyond. Either his "dominant" concern is really for the unemployed or it is not. His words say one thing but his budget says something entirely different.
This approach by the Minister of Finance, this "say one thing, mean another" phenomenon, touches many aspects of the budget. Taxpayers are promised a break but in the next few years they are going to have to pay additional taxes of $3,570 billion. The housing industry, through a number of measures, has been promised a building boom, all these measures which are going to bring about a building boom. I ask the Minister responsible for housing why, at the same time that this was done, did the Government propose to jack up the federal tax on construction materials? What help is that to the construction industry?


Douglas Glenn Fisher: What date does that tax begin?


Flora Isabel MacDonald: The Parliamentary Secretary to the Minister of Finance (Mr. Fisher) asks what date is the increase in building tax to begin. It begins in 1984, but what confidence does it instil in the construction industry when the Government threatens to impose higher taxes on it? Businessmen and investors are promised inflation indexing of capital gains, but they will be taxed year by year on those gains whether or not they have materialized. Small business is
promised help with its losses when the greatest concern they now have is with expansion and trying to rebuild profits.
Parents are promised an increased Child Tax Credit indexed to inflation, but the income threshold will be frozen, as will the $710 dependant child tax deduction. The progress of time and inflation will effectively and not too distantly eliminate both these benefits.
What, then, does the Minister really mean by the budget, so complex that it took almost two months of delay before he could bring it in and twice the normal length to explain? Yet as we have all seen, the deficit and spending program was adjusted upward by $200 million within a matter of a mere 24 hours.
We are told that the private sector is to be the cutting edge of both recovery and new employment. The Minister's predecessor deliberately threw two million people out of work in this country-deliberately threw them out of work-by the measures he introduced which crippled the private sector. Now this Minister of Finance hopes that with the timely application of a few band-aids, the private sector will not only walk again but carry everything else along with it.
Sir, if anyone or anything in our economy can work a miracle with such slender resources, I have no doubt it will be the private sector, those manufacturers and industries, large and small, that are the real producers of our national wealth. But at the same time as the Minister is giving the private sector this half-hearted boost, he continues to tell us there will be little or no change until the world economy changes. This, of course, is part of the ongoing Liberal litany that all our problems are the fault of someone else. Our difficulties are created elsewhere and so, too, will be our solutions. The Minister sits before the media, Mr. Speaker, and explains that British Columbia coal will not get moving again until Japanese steel picks up. That will not be until people in the United States start buying again.
The argument of interlocking economies would be more valid were all our trading partners to have an equally dismal economic record as Canada has. Then the Government might have something to base that claim on. It would be more compelling if Japan also had a 12.5 per cent rate of unemployment, which it does not; or West Germany with double-digit inflation these past several years, which it has not; or the U.S., even with its huge deficit spending, which is nowhere near equivalent to our own $31.3 billion deficit.
The truth is that we are not the helpless dependants of international welfare that the Minister of Finance would make us out to be. We do not need to wait for others, sir, to pull ourselves out of the economic mess that this Government has put us in. There is much we ourselves can do to raise this country out of the financial quagmire. But there is precious little that this budget will allow us to do along those lines.
Yes, I will agree that the budget has given the business communities some of the incentives and tools it needs to modernize, to invest in plant and machinery, to expand its
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research and development facilities, to get back on the road to productivity and world competitiveness. And, like the business community itself, we can applaud these long overdue measures in this direction. We have been urging them, sir, for many months now. But even at that, there is only so much a leaner and hungrier private sector can achieve until people start buying.
That, sir, has to be the basis of our economic recovery. Until businesses and manufacturers start increasing their inventory, until consumers start purchasing the end product, until that comes about there will be no significant reduction in unemployment in this country. Yet what encouragement is there for consumers in this budget to start that whole process moving? There is precious little, according to the Consumers Association of Canada. It gave this Budget a C minus, and I would say it was being generous in doing that.
The biggest purchase which most consumers will make during their lifetime is their own home. As I mentioned earlier, there are measures promising a boom in housing purchase and building. There is the topping up proposal for the RHOSPs, the Home Ownership Stimulation Plan, the Home Renovation Plan and the Residential Rehabilitation Assistance Plan. Obviously, those are supportive measures and they are to be applauded. I have said that before and I now say that to the Minister responsible for housing. However, I want to give him a piece of advice coming from home owners; these measures do not amount to a critical factor in trying to trigger a boom in home building or home buying. What the potential home purchaser and owner wants more than anything else is confidence, confidence that the roller coaster of interest rates will not return two, three or four years down the road.
If inflation is truly beaten as Hon. Members opposite claim, if we are on the road to recovery as the Minister believes, then a program guaranteeing mortgage deductibility on payments over a given rate of interest would have cost the Government nothing, if that is what they truly believe. However, it would do more toward encouraging home buying and, therefore, home building than any of the measures which the Minister of Finance has placed in his budget. I see that the Minister responsible for housing is shaking his head. Obviously, he is not speaking to the same prospective home buyers as I am. It is the question of interest rates which is uppermost in their minds. It is the major concern of those who have lost homes and those who are still paying high interest rates.
Of course, the budget does provide for some direct initiative for consumer spending in the withdrawal provisions for RHOSPs. However, perhaps the Minister responsible for housing can explain why the Minister of Finance did not stipulate in that measure that the provision would apply to goods, furniture and appliances made in Canada. Why did he not add that provision? Why not boost our own manufacturers? Why not put them before others? That would have immediately stimulated and triggered jobs here in Canada. Surely that is what the Minister of Finance said was his dominant concern in the budget. When he had the opportunity to do something about it, why did he not direct that one
The Budget-Mr. Roberts
measure to the whole question of job creation for Canadians in Canada?
Thomas Maxwell, the chief economist of the Conference Board of Canada, points out that firms will only begin to invest when they can see that consumers are beginning to spend. Without that spending by consumers, he concludes, there will simply be no durable recovery.
I can see that Your Honour is awaiting the conclusion of my remarks, but I would like to say that without that commitment by consumers, that encouragement of consumers to spend, there will be no real improvement in the tremendous unemployment situation that we face in the country today. The Government simply did not come to grips with that in the budget.


Mr. Deputy Speaker:: Are there Hon. Members rising to ask questions of the Hon. Member who has just spoken? If not, the Chair will recognize the Minister of the Environment (Mr. Roberts).


Hon. John Roberts (Minister of the Environment):: Madam Speaker, a few minutes ago my colleague, the Minister of State for Economic Development (Mr. Johnston), announced some of the details and fundamentals of the Special Recovery Projects Program which the Canadian Government is mounting as an important part of its response to the economic challenge to the country. That response is one of the major elements in the budget that was presented by my colleague, the Minister of Finance, which is a recovery budget. It is a budget which is designed to bring, and will bring, the country on track, to respond to our economic problems and particularly to create jobs in our economy. It is a recovery budget designed to create jobs both in the short term and in the longer term.
The rationale for that budget has been clearly expressed by a variety of Members in the House. It is a budget based on the belief that the strong motor force for creating jobs must be through the private sector's efforts. It is a budget designed to continue the efforts we have made in the past to create a stronger and more positive context for the private sector's activities.
There also is another important wing of our efforts, and that is through the federal Government's own activities to create jobs in the Canadian economy. We are not a Government imbued with a Reaganomic spirit which believes that only the private sector can create jobs and that the only responsibility of Government is to create an atmosphere in which the private sector can do so. We also believe as a Government that there are appropriate times for it to step in and directly assist in the creation of jobs within the Canadian economy.
The budget made it clear that it is important that the Government takes such steps now. While we may look forward to the impact of the very favourable changes which the Minister of Finance (Mr. Lalonde) has introduced to encourage the private sector and the investment intentions of the private

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sector, it is clear that major private sector investment will only be more active as we move toward the end of 1983 and well into 1984. There is a need to create jobs and strengthen productive capacity now, in preparation for the renewed private sector efforts which we believe will take place as a result of the positive suggestions in the budget.
That is the rationale underlying the Special Recovery Projects Program we have brought forward. It is to find and move forward projects which the federal Government can undertake to create jobs in the very short term which leave lasting benefits of strengthening the productive infrastructure and capacity of our country.
When the Minister of Finance presented the budget last week, he outlined two central recovery goals. The first goal is to ensure that the recent stirrings of growth start to pervade the whole economy of Canada as quickly as possible; the second is to make sure that the recovery is strong and durable in order to create good, permanent, satisfying and well-paying jobs for Canadians.
The Special Recovery Projects Program is the cornerstone of the foundation which the federal Government is laying to meet these two goals. This Special Recovery Projects Program is the largest Special Capital Investment Program ever undertaken by the Government of Canada. It will create jobs now, both in the communities where facilities will be built and in the centres where orders will be placed for goods and services. It will assist in several currently weak sectors, including construction, shipbuilding, fisheries and forest products. I hope I will have time to expand considerably on the forest sector which, of course, given my responsibility to the Canadian forest service, is one area of particular interest to me and I believe to many Members in the House.
The Special Capital Investment Program will put key infrastructures into place to improve the productivity of Canadian industry and meet the competitive challenges that will arise during world wide recovery.
At the outset I should say something about the economic environment in which this federal recovery investment is taking place. Total capital spending in all sectors of the Canadian economy, public and private, is expected to decline at the present time by more than 3 per cent in 1983. Even more significant is the expected decline of 8.2 per cent in investment in the private sector. That decline follows a decline of over 5 per cent in capital investment last year.
Through accelerating planned federal spending we will make up some of this investment short-fall and contribute substantially to national economic recovery. By bringing forward our investment projects we will improve the pace of recovery within the country.
Of the $2.4 billion directed to the special projects over the next four years, $1.7 billion will constitute a new injection of funds. In 1983-84 we are adding $600 million to our already forecast expenditures for construction and for the purchase of goods and services, which is an increase of approximately 35 per cent. In 1984-85 we will add $700 million to the forecast
expenditures for an augmentation of about 33 per cent. In 1985-86 the additional expenditures will amount to approximately $400 million, which is an increase of about 22 per cent over our forecast of expenditures.
This program will put in place the financing of over 100 capital projects. I should stress how these projects have been selected. They are not make-work projects in the sense of being directed only to the creation of jobs. We believe that they will create jobs quickly in the Canadian economy, but, they are jobs which are also designed to enhance the productive capacity of the country. These are projects which departments have considered necessary over the coming decade for the development of the infrastructure. What we are simply doing is bringing them forward to make sure that they are paced properly within the perspective of economic recovery.
During the early stages of budget planning the Government asked departments to review their capital spending plans for future years and identify those projects which were useful, constructive and could be brought forward for early implementation. These projects were tested against a variety of key selection criteria. We were looking for initiatives that could be started within six months. The projects were screened according to the contribution they could make to investment and growth in key sectors and regions.
One of our important efforts in relation to these projects is to try to cut through some of the bureaucratic red tape that so often seems to surround Government decision-making. We have established a special Cabinet committee to accelerate the process of decision-making. Tendering and contracting times are being shortened and we will be working closely with key groups in the private sector to get their support for fasttracking projects, not only at the selection and approval stages but throughout implementation.
The Special Recovery Projects Board, comprising a variety of senior civil servants, has been established to work with all the departments that are involved in this program in order to monitor its progress and expedite the process wherever possible.
In effect, 100 capital projects are being brought forward. The $1.5 billion of expenditures which would have taken place later in the decade is being brought forward to create jobs now in a way which will enhance the productive capacity of our country and speed its recovery. Special efforts are being made to provide quick administrative implementation measures to ensure this happens quickly. Two of these 100 major projects were announced today. My colleague the Minister of Supply and Services (Mr. Blais) announced the addition of $630 million in expenditure over the next four years to upgrade the quality of the Canadian Coast Guard, which is obviously a key need in our society, one which will have considerable technological and spin-off benefits.
I announced today that the federal Government is prepared to spend up to $147 million over the next four years under the capital program to strengthen in conjunction with the Provinces the capacity of Canada to fight forest fires across the
April 25, 1983

country through the purchase of up to 20 CL-215 fire bombers from Canadair.


Mr. McDermid:: Bail that company out one way or the other.


John (Moody) Roberts: I am sorry that the Hon. Member opposite does not seem to understand the importance of this step and the importance of the forest industry in Canada. I would like to stress that this important step takes place within the context of the general forest strategy which the Government brought forward and implemented. It is an example of how the Special Recovery Capital Projects Program can help strengthen some of these industries in Canada which are the foundation industries of this country. We can help strengthen the resource sector, help it through some of its current difficulties and respond to the long-term opportunities it provides to our country.
Approximately 18 months ago the federal Government brought forward its forest sector strategy paper. It outlined the key areas where there is a need for action on the part of the provincial Governments, the private sector and the federal Government. We isolated those areas in the forest industry structure where there is a special need for Government assistance, a need to upgrade human resources in the forest sector and a need to strengthen the marketing systems for it.
There is an essential need to focus on the problem of reforestation and provide programs which will lead Canadian industry to transform itself from an industry that is simply exploiting a given resource to one which treats the forest as it properly should be treated, as a renewable resource. We need policies to put into place the reforestation which the forest industry so badly needs. The fourth key area of action which we saw that had to be met was the need to fight disease and fires throughout Canada.
The federal Government has acted in each of those specific, crucial areas of the industry. On the human resources side it brought forward an initiative of over $15 million for the next three years to assist through block grants to forest faculties across the country, and through a human resources program that is awarding 20 Canadian forestry scholarships this year and up to 50 by 1985-86. We brought forward a program under the federal internship program to employ 300 forestry students over the summer. We increased contract research to universities. Overall, there is a $15 million program to strengthen the human resources side and meet the human resources needs of the industry.
We have entered into arrangements with the provincial Governments in relation to reforestation. The federal Government has committed $130 million in expenditure by the year 1985-86. We are now in the process of signing with each of the provincial Governments a reforestation accord. One has been signed with the Province of Nova Scotia, we are ready to sign one with the Province of Prince Edward Island and I expect that in the next two years we will sign agreements with each of the provincial Governments, agreements which attach criteria
The Budget-Mr. Roberts
designed to ensure that, through federal-provincial co-operation, we tackle the needs of reforestation in this country. We have signed research agreements with over half of the Provinces and expect to sign such an agreement with each of the ten Provinces by the end of this year. In this fiscal year we expanded our commitment to research by over $5 million.
One of the important areas where action still needs to be taken is in relation to the control of disease and in relation to the control of fire. The Special Recovery Capital Projects Program and the purchase of fire bombers which I have announced today will be supplemented by further announcements in the next few weeks. We will be using the over-all Special Recovery Projects Program to support the forest strategy. It will be used to bring federal forest research facilities up to the standards needed to carry out the federal share of responsibility in the forestry sector. We are going to ensure that the facilities are adequate to develop the skills required in the modern forest industry. It will be used to protect our Canadian forestry resource. We have acted in the past through our support for the establishment of the Canadian Inter-Agency Fire Centre in Winnipeg, a very much needed step to improve co-operation and co-ordination between the Provinces and the federal Government.
I want to give Members some idea of the importance of combatting fire in Canada each year and the reason why this purchase of water bombers is such an essential step for us to take at this time. The forest area lost to fire in Canada each year regularly exceeds the area harvested. Over the last five years there have been some extreme fire seasons. During that period, forest fires have burned on the average of three and a half times more forest land than was harvested. Clearly, losses of that magnitude cannot be borne.
To put it every more graphically, in a record fire season like 1980 forest fires burned an area in Canada equivalent to a six-kilometre-wide strip from coast to coast, a six-kilometre strip right across the country. That is the size of forest area that we lost in one year to fire alone. It is a bit difficult to determine the exact economic impact of that. Obviously it is substantial. Estimates place the loss of such dimensions as something in the order of $350 million. Average annual fire losses are in the order of $53 million per year.
Action is required, action which involves both the federal and provincial Government, to improve our capacity both to suppress and to combat fires. That is why I announced today that we are prepared to spend $147 million over the next four years to purchase up to 20 CL-215 water bombers from Canadair in Montreal to combat the menace of forest fires.
Four of these aircraft will be for use in the Yukon and Northwest Territories and 16 will be available for a national fleet of water bombers to be operated by the Provinces. These aircraft are to be obtained under the terms of a federal-provincial co-operative supply agreement which the Government is considering as a request from the Canadian Council of Resource and Environment Ministers on behalf of the Provinces.

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Under the terms of such an agreement, the federal Government will purchase one aircraft for each one purchased by the Provinces. Apart from the four which we will buy for the Yukon and Northwest Territories, it will be a matching program. Each CL-215 will cost about $6 million. Consultations are under way with the Provinces to finalize their arrangements for participation in the water bomber purchase program.
The Canadian CL-215 is the only aircraft specifically designed as a water-scooping fire bomber and it is the only modern fire bomber in production. This aircraft is a Canadian concept and it is a major achievement of the Canadian aerospace industry. It has a proven track record and it has earned an excellent reputation both in Canada and overseas.
The water bombers purchased by the federal Government will constitute a national fleet to meet peak fire season needs when provincial firefighting resources are fully committed. That is when the failure to have enough "flying fire trucks" results in hundreds of millions of dollars worth of timber losses, such as in the 1980 fire season when forest losses were estimated to be over $350 million.
The aircraft will be assigned to individual Provinces to operate and they will be responsible for all operating costs. Allocation of these aircraft for firefighting duty during peak forest fire periods will be co-ordinated by the Canadian InterAgency Forest Fire Centre in Winnipeg. The Department of Transport will own the national fleet of aircraft on behalf of the federal Government. The Provinces and Territories will operate the national fleet as part of their present fire bomber fleets.
Besides keeping a technologically important production line in operation, the water bomber purchase will enable the federal and provincial Governments to command a large enough production run to allow for both continued and for economic production. As a result, Canadair will have a viable production schedule that will benefit the company, the forest industry and the labour forces of both the aerospace and forestry sectors.
If I still have a moment, I would like to spell out in a little more detail some of the job implications of such an effort. Of course, I cannot give a specific commitment on job creation in relation to the program because it will depend upon the cooperation of the Provinces and the finalization of our agreements with them. It will depend to some extent as well on whether the international orders which we expect will follow through from this program. We believe there will be an international market for at least 20 of these CL-215s. If one takes into account the four that we are purchasing, the 16 which we are prepared to purchase if matched by the Provinces, the 16 which the Provinces purchase to meet that commitment and another 20 which we expect to sell internationally, we are talking about potential sales of 56 CL-215s over the next four-year period. That will create jobs for Canadair in Montreal. It will also create jobs elsewhere such as Fort Erie, Sault Ste. Marie, Winnipeg and Vancouver. There is that additional spin-off effect. Repair, overhaul and maintenance is expected to create more jobs as well.
In total, we believe this program could create 1,200 direct jobs and 265 sub-contract jobs. If the orders go out for all 56 planes as we expect, it will provide something like 9,000 person-years of work over the first stage of the program.
Mr. Speaker, I have dwelt on this one example because it is of particular concern to me as the Minister responsible for forests, but I hope it illustrates how, through the Special Recovery Projects Program, we can at the same time bring forward projects and start them now. This will have the effect of enhancing the productivity of our country, of realizing its potential, and of creating jobs in the immediate short term. That is what the program is about. That is what it is designed to do. Mr. Speaker, that is what it will do.


John Horton McDermid: Mr. Speaker, I have a couple of questions for the Minister. First, can he assure the taxpayers in the country that the amount paid Canadair for these water bombers will be the market value of those water bombers and not inflated prices such as it appears the Canadian Government has paid for the Canadair jets? It paid a higher price for the same jet that the private sector would pay a much less amount for. Can the Minister assure us that we will be paying the fair market price and not a price that is inflated because it is being purchased by the Government?


John (Moody) Roberts: Mr. Speaker, I can assure the hon. gentleman that negotiations for the purchase of these planes will be carried on by the Minister of Supply and Services, a tendering and negotiation process which is exactly and explicitly on a commercial basis. I would remind him as well that-


John Horton McDermid: Tendering.


John (Moody) Roberts: Tendering and negotiation process on a commercial basis, as Supply and Services always does. If the Hon. Member would stop talking for a minute and listen, I would point out to him that the federal Government will be purchasing four of these planes. The others will be purchased through programs with the Provinces so that the Provinces will be undertaking negotiations with Canadair. Twenty of them we expect to be bought on the international market and negotiations will take place internationally by those purchasers. So the bulk of these planes will be purchased by provincial Governments with our co-operation. The Hon. Member is talking about a process of negotiation with Canadair carried on through ordinary competitive arrangements and on a commercial basis by Supply and Services and by provincial Governments.


John Horton McDermid: I have two quick questions for the Minister. Has he any guarantees from any of the Provinces that they will participate in this program? Second, the Ontario Government traded in their Canadair jet for two water bombers. Are those two water bombers included in the 16 that the Minister is referring to that the Provinces will be negotiating?


John (Moody) Roberts: The answer to the second question is no, that arrangement is one which has already been made by, as I
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understand it, the Province of Ontario. It has nothing to do with the federal Government or this program announced today.
The answer to the first question is yes. It was clear at the meeting of the Canadian Council of Resource and Environment Ministers in September that the Provinces are anxious to participate in the program. The committee of provincial officials has prepared proposals which are supported by at least half of the Provinces. I could tell the Hon. Member which Provinces these are if I had a moment. The arrangements have yet to be finalized, but clearly there is a determined volition on the part of a large number of the Provinces to participate in the program. Specific details of the contracts, arrangements and so on still have to finalized.


Mr. Nowlan:: Mr. Speaker, I have a question based on the shipbuilding part of the program. I appreciate that this is not necessarily within the Minister's administrative domain, but he did mention the $630 million for shipbuilding. I have a wire service story on that release. I would ask the Minister how much of that $630 million is new money as opposed to recycled money; and has there been a definition as to the division of that money between the regions, as mentioned in the press release?


John (Moody) Roberts: Mr. Speaker, as the Hon. Member said, this is an area that goes beyond my administrative responsibilities. I cannot reply to the second part of his question, though I am sure my colleague the Minister of Supply and Services will be in the House at Question Period and ready to respond if the Hon. Member wishes to put the question to him.
In answer to the first part of the Hon. Member's question, I believe I am correct in saying that this is all new money above and beyond what has previously been directed to the program. This is an addition of funds, not the reworking of existing funds.


Mr. Foster:: Mr. Speaker, I would first congratulate the Minister on this concept of a national fleet of water bombers. He has graphically portrayed the advantages this will have to the country in terms of the loss from fires every year.
I would ask the Minister whether the national fleet of 16 planes as he has described it will include only eight aircraft, or half of them, owned by the federal Government that will be available to be moved to wherever in the country the fire danger is the worst or where in fact there are losses from fires, or will they all be stationed in certain Provinces? It seems to me that it would be advantageous to have 16 planes available on a national basis to go to wherever the fire hazards were the worst.
Second, a press report this morning, I believe from The Globe and Mail, indicated that the laboratory research facilities were going to be increased, I believe in Eastern Canada, Northern Ontario, and Western Canada. Is any of that funding under the Special Recovery Projects going to be allocated to increase the laboratory facilities at the Great Lakes Forest Research Laboratory in Sault Ste. Marie, which
The Budget-Mr. Roberts
essentially serves, at the federal level, research programs for Northern Ontario?


John (Moody) Roberts: Mr. Speaker, I am not sure whether there is a failure of communication between the Hon. Member and myself in relation to the first part of his question. I hope that there is not. Four of the water bombers will be in the Yukon and Northwest Territories. Clearly they will be federally operated. We are agreeing to purchase 16 more on a matching basis with the Provinces. I cannot tell the Hon. Member exactly where they will be because I cannot tell him which Province is going to buy five and which is going to buy three and so on. The extra 16 planes purchased by the federal Government would match the 16 purchases of planes by the Provinces and will be allocated to match the provincial contribution. If, hypothetically, Ontario bought four planes, the federal Government would buy four planes which would be owned by the Ministry of Transport but operated and maintained in conjunction with the four planes the Province had purchased. It will not be, as it were, one massive national fleet that goes swinging from place to place.
The Hon. Member may be concerned about the question of how these national efforts are going to be directed to specific locations as the fire problem shifts from Province to Province or area to area during the fire season. The answer is that we have established, with the provincial Governments, the InterAgency Co-ordinating Centre at Winnipeg to co-ordinate all of these efforts. Thus, the federally owned planes plus the provincially owned planes from all of the Provinces will be allocated to meet the pressing fire need wherever it may occur. I do not want to get too trapped by semantics, but in a sense both the provincially owned planes from all of the Provinces and the federally owned planes will be available to focus on the current fire threat in whatever part of Canada it is to be found.
This is a first step on the part of the federal Government. We have never been involved in the purchasing of water bomber equipment before. We believe, however, that the need is so pressing and so great and that forestry is such a fundamental resource for Canada that we should participate. We must participate in a co-operative and co-ordinating way with the Provinces, since they are the owners and managers of the resource and already do have major firefighting installations at work. I may have gone on too long, but I am trying to answer the Hon. Member's question as specifically as I can.
In terms of research centres across the country and the Canadian Forest Service efforts, I cannot make any announcement to the Hon. Member at the present time about what will happen there. I can say that within the next few weeks I hope to be able to say some things with respect to it which I hope he will find encouraging.


Mr. Jarvis:: Mr. Speaker, the CP wire story with respect to the recovery programs quotes officials as saying that "there will be a sleek publicity campaign over the next several weeks to attract maximum attention." I have no quarrel with "sleek"

April 25, 1983
The Budget-Mr. Lambert
or "publicity" but I wonder if, attendant upon the program, there is a paid advertising campaign in order not to ask for supplementary funds. I would remind the Minister how counter-productive the paid Government advertising was with both the National Energy Program and the Constitution, given the size of the deficit. I wonder if he could assure me that with regard to the merchandising justified by the Government there will or will not be a paid advertising campaign with respect to these capital programs?


John (Moody) Roberts: Mr. Speaker, in terms of publicity or public relations, I should say that my colleagues and I believe it is important to communicate these proposals to the regions of the country. Some of the projects will have local significance and others will have national importance.
We are going to make a special effort and I think you will see the Ministers and Members on the Government side travelling the country talking about these things. I think that is entirely appropriate.
No special advertising campaign is presently envisaged. In the nature of things I cannot say that no informational material will be produced or distributed. We intend to communicate the program which 1 think is the legitimate responsibility of the Government, but we do not have in mind some massive paid advertising campaign.


Mr. Deputy Speaker:: The period for questions and answers has expired and regretfully, without unanimous consent to continue, I have to call on the next speaker. The Hon. Member for Edmonton West (Mr. Lambert).


Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I appreciate the opportunity to speak so early in the budget debate. I must say that I was rather taken with one particular feature of it. That was not the hubbub about the so-called disclosure of a page or two of the budget, but that at the end of the Minister's delivery Government backbenchers and Ministers stood up and applauded in a frenzy, calling "more, more, more".
Watching them during the debate I notice that every time the Minister said there would be $80 million for this or $120 million for that, they applauded. They reminded me of a nest of bird chicks-every time the parent bird came near the nest there was a great squawking and mouths opened wide. Every Hon. Member opposite gave the visual impression that the $80 million or $120 million was destined for his or her riding. That is precisely what was happening.
I hope Hon. Members have now examined the budget in detail. If they have they will see that the money is not there. All those investments they thought they were going to get are figments of the Minister's imagination, trying to sell something that does not exist.
Let us look at some of the incentive programs. In so far as they shall be tax deductible, there will be tax allowances. For the firm in a loss or break-even position a tax credit may be carried forward. But is that sufficient to induce the management to enter into hard cash expenditures for additional facilities at this time? If a firm or industry is operating at twothirds or three-quarters capacity, what good are incentives to improve plant and machinery if the goods are not saleable? This is a very subtly acceptable delusion. At other times in the past this practice has been in effect, and not only espoused by Liberal Cabinet Ministers.
I recall the recession that started in 1956 and ran through 1957-58 and 1959. Attempts were made to induce businessmen and manufacturers to invest in more machinery and plant through double depreciation allowances and that sort of thing. Subsequent Liberal Cabinet Ministers did the same sort of thing. I thought this was a good idea until I talked to members of the Canadian Manufacturers' Association and the Canadian Chamber of Commerce. They unanimously said that, notwithstanding what appeared to be an interesting proposition, it was a non-starter. They asked: "Why should I, as a machine tool manufacturer, for instance, invest some $2 million in new machinery-$2 million of hard earned money that I am going to have to spend-if the industry is operating at two-thirds capacity and I will sell additional production only if I lower my price or gain some other competitive advantage? Should I do that so that I can get a double depreciation break on new equipment, when I am not making much money? What good is that to me?" Is that the argument about many of the incentive programs that the Minister indicated are the stars of his budget?
We will see about the accelerated capital projects program, the one to which we added the $200 million-the Minister's "save my reputation" addition to the budget.
This morning's The Globe and Mail listed certain things that are going to be done-public works buildings in Halifax and Vancouver, additions to Dorval Airport-things that are going to be judiciously placed in Liberal ridings. When we see the list we will see how they will benefit the country.
Another thing that struck me is how the word "incentives" has been rehabilitated in the Department of Finance. On November 12, 1981 when the Department of Finance was under the jurisdiction of the present Secretary of State for External Affairs (Mr. MacEachen), tax incentives were tax havens. They had become tax expenditures. They were to be obliterated. Not only in the November 12, 1981 budget were they anathema to Government financing, but even the Parliamentary Secretary will agree that on June 28 we still had some of the same language. During the summer the tax advisers were again saying that incentives were bad for the system. Now they have been rediscovered, and we hear them talking about incentives.
I hear the Hon. Member from Newfoundland making a remark. He strikes me as one of these big seagull chicks that opens its mouth every time there is mention of more funds being provided for this incentive or for that grant. The incentives, of course, do not cost the Government anything. Unless something is done, no allowance is claimed. In any event, most of the industrial incentives are on the basis of tax credits.
April 25, 1983

Again, if nothing is done there is no cost to Government. Therefore, take all the sponge and water out of a good part of the budget and what is there?
The one area on which I want to comment before my time expires is the removal of the $100 allowance for charitable and medical expenses and its replacement with actual expenditures based upon receipts. All I can say is that 1 think about two-thirds of all personal taxpayers do not make that $100 contribution to charity. All you have to do is to ask any clergyman, any parish priest, what is the average donation within his or her parish. All you have to do is ask national charitable organizations what is the average contribution. The sum total is far less than $100. Therefore, taxpayers will lose on this provision. Those, however, who do contribute to charity in excess of $100 based upon this marginal rate will get a benefit of maybe $8 to $20. The Government will gain up to $80 and more on this particular provision.
Socially I think there is something I should draw to the attention of Hon. Members. In many instances gifts to private or voluntary organizations that qualify under the charitable gifts donation clause in the Income Tax Act were for $100. A gift of less than $100 gave no advantage and no incentive to the taxpayer because the taxpayer already had the deduction under the Income Tax Act.
There is a great deal to be said for gifts to voluntary organizations. I know some of my colleagues will be saying a good deal more about this during the debate on the Income Tax Act. But I feel that as much as possible we should encourage gifts to charitable organizations. I do not say there should be a tax credit dollar for dollar, but what is wrong with setting up-I am not the author of this particular suggestion, it has been made several times-a scheme similar to that given to people who make political donations within certain rules? On the first $100 there should be a tax credit of, say, $75 and then on up through the limits, but not a limit of $1,000. I know there are many people who are well endowed with worldly goods who are quite prepared to donate to a university, a church, a museum, an art gallery or what have you, gifts far in excess of $1,000. They should receive some encouragement. But all we do with the Income Tax Act at the present time is deter these individuals from making gifts to what you might call posterity. At the present time it is only in particularly artificial and devious ways, devious in that they are complicated, that major gifts may be made of collections of art to public purposes by donating the whole of the collection to the state and releasing for $1, say, to the individual concerned who can keep the collection in his home or in his own particular gallery.
There are other matters which I think I should talk about at this time. We will do this much more thoroughly when considering the particular Bills in detail. As for those measures dealing with excise tax, we will see some fancy footwork with regard to the excise sales tax on aircraft tickets and journeys. We will see an increase next year in the excise tax to 10 per cent. What on earth will this do to the proposal now under discussion with the public to change the impact of the sales tax from the manufacturers to the wholesale level, and a reduction
The Budget-Mr. Simmons
of it to 8 per cent, without any concurrent reduction on building materials from 5 per cent to 4 per cent? The former Minister of Finance simply dismissed my question on that by saying "I need the revenue". It is a standard ploy with Government to say ''We need the revenue", regardless of how wise the legislation is under which the Government will spend the revenue. There will also be an increase in the excise tax on domestic wines to 13 per cent. We will also see the continuation of indexation.
There is one point I want to mention favourably which we will be discussing later. I am speaking of the Index Security Investment Plan which arose from the Lortie Report. There were some changes from those offered in the Lortie Report. I do not know if everything is in good order because there are some hooks with it. It is not all gravy, but it may provide an incentive for investment in Canadian securities if they are grouped under this particular heading.
The last thing on which I want to comment is to say that we are now into the fourth year of this session of Parliament. There are some proposals which went through the Income Tax Act in 1980 and subsequently through Bill C-139 which, unfortunately, we cannot move now to strike out. As you know, Mr. Speaker, it is a rule that within the same session of Parliament a motion may not be introduced to reverse an earlier decision taken in that Parliament. Now we are into the fourth year and we cannot start to undo some of the nonsense which was imposed on this Parliament under the Income Tax Act and under the Excise Tax Act by a Government which was not thinking clearly.
For instance, a vicious principle of the indexation of excise tax based upon cost of living was introduced in a section of the Excise Tax Act. It is absolutely self-defeating, except for Government. Government can continue to tax at a higher level simply based upon an increasing cost of living without coming back to Parliament for approval. Talk about Government being interested in inflation! That is a classic example, Mr. Speaker.
I believe my time has expired but I hope I will be able to take up a number of other subjects when the various Bills come up.


Mr. Roger Simmons (Burin-St. George's):: Mr. Speaker, many different yardsticks will be applied to this budget to determine its success. How many jobs will it create? How will it benefit consumers? To what extent will this budget serve to stimulate the economy? These yardsticks and many others, I know, will be applied to determine the sucess of the budget of the Minister of Finance (Mr. Lalonde).
I want you to know, Mr. Speaker, that I also intend to apply a yardstick to this budget. How far does this budget go to address the particular problems in the electoral riding of Burin-St. George's, which it is my honour to represent in this Parliament? There are those who will argue that my yardstick is too specific, that a budget ought to be concerned instead

April 25, 1983
The Budget-Mr. Simmons
with the greater good of all Canadians. I have no quarrel with that particular yardstick, either. I submit only that the greater good of Canada can best be served by addressing the problems and the realities which exist at the individual constituency level.
For the people of Burin-St. George's, which is on the South and Southwest coast of Newfoundland, the most graphic economic and social reality is the fishery. The fortunes of my people are tied up in the offshore and the inshore fishery. The same can be said for Newfoundland as a whole. In my Province, fully 15 per cent of the jobs are in the fishery. That compares to about 5 per cent in Nova Scotia and a lesser percentage in the other Canadian Provinces. In Newfoundland and Labrador, the fishery is the most important source of employment. But, Mr. Speaker, it is much, much more than that. It is the economic and social underpinning for literally hundreds of Newfoundland communities. Without the fishery, most of these settlements, these towns and villages, would cease to exist or would become welfare ghettos, permanent wards of the state.
As you know, Mr. Speaker, an important segment of the fishing industry in Newfoundland and, indeed, in Atlantic Canada generally has come upon hard times. The simplistic view is that the current crisis in the fishery results from the nature of the industry itself, that it is a marginal enterprise at best, forever requiring Government hand-outs. That is the simplistic view. It is also the wrong view. Indeed, Mr. Speaker, much of the fishing industry is thriving today. I can cite for you many examples of that fact. Instead, I would like to confine my remarks today to that segment which is in trouble, to say why it is in trouble and to say what the Government, and specifically this budget, can do to deal with the problem.
It is the management, the large fishing companies, which must bear the lion's share of the blame and responsibility for the current fisheries fiasco, and rightly so, because it is the managements of those companies which have made incredibly bad decisions. These have been decisions on the unwarranted over expansion of fish processing capacity, shortsighted practices in marketing strategies, and financial undertakings which have resulted in unmanageable debt-to-equity ratios. The solution to the problem lies, first and foremost, therefore, in ridding the industry of that kind of incompetence. It is here, Mr. Speaker, that both the federal and provincial Governments have key roles to play.
It would be easy, Mr. Speaker, to stand here and blame the Newfoundland provincial Government for its failure to act in the face of the current fisheries crisis. After all, it is the provincial Government which, under the Constitution, has jurisdiction in the fish processing sector. As a Newfoundlander, I am shocked and shamed at how callously the present provincial Government has dealt with this issue to date. I have long since learned, however, that pointing fingers of blame, however well directed, has not solved very many problems.
What is more important, the federal Government also has a key role to play for two reasons; first, because of the shared federal-provincial jurisdiction for fisheries which is provided for the Constitution; and, second, because the problem has
been dumped in our laps by an irresponsible provincial Government.
I am pleased to say that the federal Government has already made some important decisions which are aimed at dealing with the fisheries crisis. A team of negotiators has been appointed and given a mandate to deal with the fisheries restructuring issue. A substantial sum of federal money has been labelled for that purpose. All of this constitutes an important step in the right direction because the result will, hopefully, include putting the offshore fishery on a more stable footing, ridding the industry of the incompetent management, and providing some much needed capital.
However, Mr. Speaker, there remains one crucial item of unfinished business. That is the future of several of the fish plants which have been closed or are under threat of being closed as a direct result of the terribly incompetent management which I mentioned a moment ago. You may ask, Mr. Speaker, where, then, are those plants located? On the Northern tip of Newfoundland, perhaps, where local and Arctic ice conditions allow their operation on a seasonal basis only? Are they located some place far removed from the groundfish stocks which are so important to their operation? Not quite. These plants, Mr. Speaker, whose very future is now at stake are situated along Newfoundland's South and Southwest coast, a coast which is completely ice-free at all times of the year, so that these plants can operate year round and have regularly done so for decades upon decades.
Further, because of that location, these plants are literally on the doorstep of the richest groundfish stocks in the entire world. Who among us has not heard of the renowned Grand Banks of Newfoundland with its wealth of codfish and other species?
So you may ask, Mr. Speaker, who in his or her right mind would want to close a fish processing plant in that situation. Who indeed? The answer is: The very same incompetent people who made those other bad decisions about overexpansion, marketing and financing which I talked about a few minutes ago.
It is important to understand, Mr. Speaker, that those plants have been there a long time. They are not fly-by-night operations begun a few weeks, a few months or maybe a year or two ago as the result of some state of euphoria in some management office in St. John's or Halifax. I say to my good friend, the Hon. Member for Edmonton West (Mr. Lambert), that well before the Leduc oil well signalled Alberta's prosperity, fish plants at Burin and Grand Bank were pumping money into the pockets of fishermen and fish plant workers on the Burin Peninsula of Newfoundland. Decades before high technology came here to the Ottawa valley, the Gaultois fish plant had become a way of life for 700 people on an isolated island in Hermitage Bay.
Many, many years prior to the coming of the aerospace industry to Toronto and Montreal the 1,500 people who
April 25, 1983

inhabit a tiny island in the Atlantic Ocean miles off the Newfoundland shore had come to know and rely on the economic and social stability provided by the Ramea fish plant. Burin, Grand Bank, Gaultois and Ramea. I could also mention Harbour Breton which serves not only the immediate community but many others for miles up and down the coast. After all those years, are those plants to be allowed to close, to fold, along with dozens of communities and thousands of jobs, at a time when we are searching so diligently, and so desperately at times, for new ways to create jobs? I cannot accept that as a sensible thing to do; therefore I will not stand by and allow that kind of thing to happen.
Now, Mr. Speaker, it is important to understand that the Government of Canada did not create this problem, but it is equally important to understand that the Government of Canada will surely have to bear a lot of the blame if those plant closings go ahead. We have waited long enough for the fish companies to do the right thing but they lack the confidence to do so. We have waited long enough for the provincial Government to step in, but we all know the present provincial Government of Newfoundland would rather pick a fight than solve the problem. We have seen that with the offshore resources issue. We are seeing it right now in the way Premier Peckford and his administration are dealing with the Province's teachers. And the list goes on.
We cannot depend on the fish companies to do the right thing. We certainly cannot depend on the provincial Government to do the right thing for those communities, those fish plants and those people. That means, Mr. Speaker, that the ball is in our court. If the federal Government does not take action, those plants will close, perhaps forever.
So, Mr. Speaker, I am making an urgent appeal to the federal Government to wait no longer for the provincial Government to act. My suggestion is simple: Provide the necessary funding to allow those plants to operate. The sums involved are by no means astronomical. Indeed, it is my understanding that the per job cost of the federal Government's current employment initiatives program is actually higher than the per job cost required to ensure the continued operation of those plants.
I have chosen to make my appeal public today at this time, Mr. Speaker, not because I fear the federal Government lacks the will to act in this important matter, but because, frankly, I have been fighting behind the scenes against a sweet reasonableness among federal Cabinet Ministers, a reasonableness which argues that surely the provincial Government can be expected to bear its responsibility for keeping those plants open. It is a reasonableness that argues that the shared fisheries jurisdiction requires that the federal Government must act in collaboration with the provincial Government in this matter.
I agree with all those arguments because I, too, am a reasonable man. Unfortunately, the same cannot be said for Premier Peckford. Therein lies the problem. That is why it is essential that we wait for the provincial Government no longer. Jobs are at stake. Employment opportunities are slipping
The Budget-Mr. Nystrom
through our fingers, the economic and social fabric of many communities along Newfoundland's South and Southwest coast is being threatened. My appeal is that the federal Government do now what clearly has to be done: instruct our federal negotiators in the fisheries restructuring issue to take the necessary steps to have those plants opened. Forget the constitutional niceties; accept as fact Mr. Peckford's total inability to participate in civilized federal-provincial arrangements, even when the jobs of thousands of Newfoundlanders are at stake. Act now in the spirit of the Minister of Finance's budget by stabilizing the economy of the South and Southwest coast of Newfoundland and by preserving so many thousands of permanent jobs.
At the beginning of my remarks, Mr. Speaker, I talked about applying yardsticks to this latest budget. I said that the appropriate yardstick from my vantage point is, how far does this budget go in addressing the particular problems in the riding of Burin-St. George's? If it does not address those problems, then the budget will be a dismal failure in my books, an affront to the people I represent here. To address those problems adequately, it must deal with the fisheries issue. The Government must do its part in ensuring the continued operation of those plants.


Mr. Deputy Speaker;: Are there any comments or questions? If not, I recognize the Hon. Member for Yorkton-Melville (Mr. Nystrom).


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I want to have the opportunity to say a few words on this budget this morning and perhaps talk about a slightly different issue which I think is very important in terms of economic performance in our country. Over the last 25 or 30 years there have been a number of trends in Canada that I find very, very frightening. For example, our standard of living has fallen since 1960 from the second highest in the world to around nineteenth. If we exclude the oil-producing states, we are somewhere around tenth or twelfth in the world. Our performance as a member of the OECD is such that we find we are now 24th out of 24 nations.
I think, Mr. Speaker, one of the reasons for this is that so much of our economy is so foreign owned and controlled that in times of world recession, in times of major structural readjustments such as the technological revolution we are going through, this tremendous amount of foreign control causes us problems more severe than elsewhere around the world.
As a nation we seem to have gotten away from the politics of the past where certain people did have visions of developing our country, whether it was Sir John A. Macdonald or others. As a nation we seem to have accepted the ideas of C.D. Howe and continentalism. I think that is very wrong. I do not believe that foreign ownership and control or our economy makes us rich. I believe that is a myth. Indeed, foreign control of our economy, when we consider the costs and benefits on balance, has made us poorer and has cost us many jobs as a nation.

April 25, 1983
The Budget-Mr. Nystrom
We should consider some of the statistics. We find, for example, that about 26 per cent of Canadian industry is now foreign owned, in comparison with about 3 per cent in the United States, 3 per cent in Great Britain, 3 per cent in France and less than 1 per cent in the booming country of Japan. If we consider it sector by sector, we see that many of our key sectors are really foreign controlled and dominated. In manufacturing, it is about 41 per cent; in the rubber industry it is around 90 per cent; and in the chemical industry it is around 76 per cent. One could go on and on. In fact, in 1982, 19 of the 50 largest Firms in Canada were in the hands and control of foreigners.
When one considers foreign investment and ownership, one must consider both the costs and the benefits. As I said earlier, my assertion is that the costs far outweigh the benefits in our country at this particular time, as has been the case, indeed, throughout most of our history. In terms of benefits, foreign investment is only a benefit if it is working for Canadians, if it is controlled for Canadians, if it does pass a really meaningful, tough, foreign benefit undertaking or control test. However, we have an organization in Canada today called FIRA which is by no means strong enough when it comes to policing foreign investment in Canada.
The only other way by which foreign investment would be meaningful or helpful would be through joint ventures, where there is Canadian control, where we do carry out some research and development, where we do have some markets in other countries because of the fact that they are joint ventures. However, it is very important that Canadians remain in control of joint ventures of that sort.

Mr. Speaker, if foreign control of our economy is so beneficial, then perhaps someone could explain why, as revealed in a study on the economic performance of twenty-four countries published three or four months ago by the OECD, Canada happens to rank twenty-fourth. Perhaps someone could also explain why some Latin American countries, where the multinationals have made large scale investments, are among the poorest in the world.

The costs of foreign investment are indeed very great. It is one of the reasons we have so many major structural and performance problems today. For example, consider the tremendous fragmentation of the Canadian market, the tremendous distortion of Canadian trade when it comes to both exports and imports, the lack of R and D, the lack of manufacturing and processing in Canada and, indeed, the outflow profits and dividends from our country.
First, the fragmentation of the Canadian market. As long as Canada has existed, we have tended to be a mini version of the United States. We have tended to be a shadow economy or a tag-along economy of the United States. Where the Americans have had ten large firms, we have tended to have eight or ten branch plants in this country. Because of that, many of our industries have been very inefficient and have been very costly to the Canadian people and, as a result, have not exported. In
fact, in 1968, during a major study, the Government of the day found one example which pretty well sums up the fragmentation of the Canadian market. In 1968, there were nine refrigerator subsidiaries in operation in Canada in a market, according to the Government, which could only support two such operations in an efficient way according to the economy of scale. This is a good example of the lack of rationalization of our industry, because so much of our industry is foreign controlled and owned, to a degree which is not permitted by any other developed country around the world.
I have mentioned four or five areas of real concern to me. The second involves the whole area of research and development. In 1973 only 2.7 per cent of Canada's manufacturing Firms carried out any research and development whatsoever. In 1981, a year and a half ago, we as a nation spent only 1.2 per cent of our Gross National Product on R and D. Most of that was spent by Canadian firms. In comparison with other countries, we find that the United States spends around 2.5 per cent of its GNP on R and D and that the Japanese spend around 2 per cent of their Gross National Product on R and D. By the way, very little of the Japanese R and D expenditures are on the military, while in the United States, of course, the opposite is true. In France, around 1.8 per cent of GNP is spent on research and development.
I am not proud of the level in our country. It is lower than in countries such as Sweden, Norway, Belgium or Yugoslavia and is probably on a par with countries such as Egypt and Ireland. That is one reason our economy is not performing very well. The major reason we do not have R and D in this country is that foreign firms dominate many of our industries, and it is a natural tendency for research and development to occur at home base. This lack is something which we as Canadians must change.
I am particularly concerned about this aspect of foreign control when I consider technology in our society today. In the last year, for example, we have had a trade deficit of $8 billion in high technology alone, and by the year 1990 many people in the field are predicting that our deficit in computers alone will be around $10 billion.
The third cost of such overwhelming control of our economy by foreigners is in terms of the trade distortions in Canada. Once again, one can consider many examples from the past. In the early 1970s, the Gray Report stated that of the foreign manufacturing firms which were exporting-I want to make it very clear that it only concerned those which were exporting because some were not allowed to export at all-about 58 per cent had some kind of export restriction placed on them by their parent company. For example, 31 per cent were excluded from exporting into the American market.
Recently some papers from the 1960s of the Trade Commissioner were made public in this country. The Trade Commissioner said that in those days over three-quarters of foreign firms operating in Canada had export restrictions placed on them by their parent Firm in the United States. In 1980 there
April 25, 1983

was a repetition of this in a Cabinet document which was referred to the Cabinet by the then Minister of Industry, Trade and Commerce, who was from Windsor, in which he requested stronger legislation for the Foreign Investment Review Act and that amendments promised in 1980 be made. Of course, he was turned down by the Cabinet.
Another example involves the Nelson muffler company, a firm in the United States with its headquarters in Wisconsin. In 1980 it applied to the Foreign Investment Review Agency to establish a plant in Canada and was granted permission to establish a firm in Ontario. Two years later, in a licensing agreement between Nelson Industries Incorporated in Wisconsin and Nelson Muffler Canada signed in July of 1982, it was found that the Canadian plant was subject to export restrictions. In fact, page 4 of the licence agreement stated that the Canadian branch plant could not export anywhere in the world without written consent from the head office in the United States. I believe that to be very unfair. It is an attack upon the economic sovereignty of Canada. It is the type of thing which no self-respecting sovereign nation in the world would allow to continue.
In addition, in terms of trade distortion on the import side, we find that Statistics Canada reported last November that in 1981 foreign owned or controlled firms in Canada imported about four times as much as Canadian controlled firms in the same areas. Once again it is evident that a Candian owned and controlled firm is more likely to purchase in Canada in terms of its procurement policy and do its processing, fabricating, its research and development and its expansion in this country, than those firms which are controlled and owned from outside our borders. This means that foreign control makes us poor as a nation since many jobs are lost in Canada and created elsewhere.
During the 1960s there was a study conducted by the Department of Commerce in the United States which showed that American investment in Canada essentially replaced investment that otherwise would have been there. This resulted in a net benefit to the Americans of millions of dollars per year.
My fourth area of concern over the cost of foreign control deals with the lack of manufacturing and processing in Canada. In 1981 we had a trade deficit in manufacturing of $21 billion, yet manufacturing is the sector in which we have the most labour intensive dollars. It is one of the major reasons why our country's unemployment record is much worse than most industrialized states. Even when we have international agreements with other countries, such as the autopact with the United States, we have tended to come out on the short side of the deal as a result of foreign ownership in companies like General Motors and Ford. The accumulated deficit in the auto parts industry has now reached approximately $41 billion. This has also caused the loss of many jobs. In 1982 the deficit in the auto industry was some $5 billion.
The Budget-Mr. Nystrom
The high degree of foreign ownership of the manufacturing industry in this country is costing us millions of dollars, making Canadians poor, increasing our tax burden and losing many jobs for Canadians. We have even seen evidence of foreign owned companies that are economically profitable curtailing work in plants or closing them down. A good example of this is Bowater in Newfoundland which made profits in the millions of dollars in this country but was closed down as a result of balance sheet considerations by the head office of the multinational. There is also the example of Brian Mulroney's Iron Ore Company of Canada. In that case Schefferville has become a ghost town because of foreign control in our economy.
The fifth reason why foreign control of our economy is costing jobs and making our nation poorer is the outflow of funds from our country. Between 1976 and 1981, the net outflow of funds from Canada was $38 billion. This was an outflow of direct capital that was made as a result of the productivity of Canadian workers, farmers and the business community. As well, there is the outflow of dividends and interest payments. This amount represents a net loss after taking into account the difference between inflow and outflow.
In the gas and oil industry alone, between 1975 and 1979 there was an outflow of $2.1 billion in direct capital from this country to be invested or enjoyed as profit elsewhere. As well, there was an outflow of $1.6 billion in interest payments and dividend payments abroad to foreign shareholders. The total outflow of profits in the oil and gas industry during those four years was $3.7 billion.
I believe I have generally summarized the five areas in which foreign control of our economy has made our nation poorer and has cost Canadians many jobs and has cost taxpayers more. We are not masters in our own house.
I would like to deal with the argument which questions where the money will come from. We often hear that we Canadians are not competent to conduct our own affairs. In fact, the Hon. Member for St. John's West (Mr. Crosbie), who is running for the leadership of the Conservative Party, believes that we should have even stronger ties with foreign investors and an even greater influx of money from the United States. I suspect that he is not running for the leadership of the Conservative Party but to be Governor of Canada after some of the statements he has made recently.
According to reports in 1972 and previously, 80 per cent of the funds that foreign investors use in this country come from Canadian sources. Those sources include retained earnings that are reinvested, funds borrowed from Canadian banks, pension funds and other funds that are available to foreigners. In effect, we are financing our own sell-out with our own money and it must stop.
For example, it appears that during the 1970s over half of the bank loans that were made in Canada from Canadian banks went to foreign companies. Some of these loans went to companies that invested in Canada while others went to companies that invested outside of our boundaries. Today, it

April 25, 1983
The Budget-Mr. Nystrom
appears that 65 per cent of the bank loans in this country are going to foreign firms.
The other area of concern is FIRA, the Foreign Investment Review Agency in this country. Contrary to the message we hear from many people in the business community, FIRA is a very timid organization. It is a watchdog with very dull teeth. That agency must be reinforced. As an example of its ineffectiveness, it will only screen about 8 per cent of the foreign expansion in this country, because it only screens new investment, foreign takeovers and the expansion of foreign firms into unrelated areas. It does not have the authority to screen the much larger incidence of expansion of existing foreign firms into areas in which they are currently operating.
In 1980 the Liberal Party promised the electorate of this country that it would expand FIRA and give it the power to make periodic performance reviews of all foreign firms in this country to ensure that they are operating for the significant benefit of Canada. This was one of the reasons Canadians voted for the Liberals, but they have not taken such action.


Marcel Joseph Aimé Lambert: Who says that that is not right?


Lorne Edmund Nystrom: I am very surprised at the Conservatives. At one time they were a nationalist Party in this country in the tradition of Macdonald, Diefenbaker and others. Suddenly they have adopted the philosophy of C. D. Howe and continen-talism. That is not the direction in which Canadians want to head. Canadians want a Canadian vision with Canadian goals and objectives. They want to see Parliamentarians, in cooperation with others in the country, make 1983 the year in which we begin to patriate the Canadian economy and make us masters in our own House and of our own destiny.
It is time for us to begin that process. Other developed countries in the world have already done so, including Japan, Germany and France, all of which were virtually destoyed in the Second World War. If they can do it with fewer resources, a smaller geographical area and without the energy base which we have, surely we can do it better than they can and become a nation that is economically sovereign.


Mr. Evans:: Mr. Speaker, I was very interested in what the Hon. Member said about foreign ownership. He has made similar speeches in the past and has made very good sense in regard to the need for Canadians to control their own economy.
How would he, then, rationalize his position with that of his own Party, which opposes the budget because it puts too much emphasis on savings and investment and on encouraging Canadians to invest in their own country and to own shares of companies in their own country? His Party believes that the budget should emphasize consumption and give greater tax breaks for increased consumption at the expense of savings and
investment by Canadians. How does he rationalize his concern over foreign ownership when he is opposed to incentives being implemented to encourage Canadians to buy up Canadian industries and invest in our own country?


Mr. Deputy Speaker:: The Hon. Member will have to rationalize after Orders of the Day this afternoon.
It being one o'clock, I do now leave the chair until two o'clock this afternoon.
At 1 p. m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Mr. Gaston Gourde (Levis):: Madam Speaker, I would like to read into the record part of an article that appeared in the Journal de Quebec on Friday, April 22, 1983, and I quote:
Paying for gas in Quebec is like being robbed, but Quebecers, like willing victims, are not complaining, although filling the tank certainly burns a hole in the budget. It is outrageous.
If your car consumes 14 litres per 100 kilometres, in other words, does 20 miles per gallon, and you drive 12,000 miles a year, it costs you $491 more per year to buy gas in Quebec than in Ontario. Nearly $500! Five hundred dollars more in taxes.
If you drive 20,000 or 50,000 miles per year, the difference is incredible. For 20,000 miles per year, the difference between Quebec and Ontario is $818, and for 50,000 miles for a travelling salesman, for instance the difference is $2,045 per year, for gas alone.


Madam Speaker:: Order, please. Is the Hon. Member still quoting an article? I would like to point out that long quotes are not allowed in statements by Members. Just a few lines are acceptable, but this is not the place to read articles.


Gaston Gourde: Madam Speaker, I was quoting from an article in the Journal de Quebec, and I wanted to read parts of the article into the record. In quoting last Friday's Journal de Quebec, I merely wanted to point out that the cost of gas in Quebec is exorbitant, compared to taxes paid by Canadians in other provinces, because of Mr. Parizeau's elevator tax. The journalist, who unfortunately did not sign the article, tells us in his article that he understands why over 100,000 Quebecers have left the province since 1976. It is an absolutely untenable situation, which has helped to convince Quebecers to move to the other provinces.
April 25, 1983


AGRICULTURE
Mr. Gordon Taylor (Bow River):: Madam Speaker, the Minister of Finance (Mr. Lalonde) in his budget address pleaded with private enterprise to invest and expand and to provide jobs. The Minister of Finance should have told the Minister of Agriculture (Mr. Whelan), "Now, listen to this. A Canadian oil drilling company placed an order for $100,000 for food which included $30,000 for beef, with a merchant in Cochrane, Alberta. This would have meant increased jobs, increased purchases from farmers, et cetera, et cetera." But the federal Agriculture officials in Calgary said "No." Why? "Because you sell fresh meat over the counter in your store."
The federal officials were clinging to a regulation that was placed on the books some 70 or 80 years ago. "Besides", the civil servant said gleefully, "you would require a wholesale permit." The merchant had a wholesale permit. "Well," said the civil servant, "you still cannot do it because you sell fresh meat over the counter in your store." So the order went out of the country.
A little later the oil company wanted 1,000 steaks to celebrate the launching of a new ship. Again the merchant was told, "Nothing doing. You sell fresh meat over the counter." So the company bought the steaks in Japan.
This merchant runs a top notch business; he sells only government inspected meat, a high quality meat, and he employs Canadian help. This merchant, typical of hundreds of others, wants only to create jobs, to sell goods and to expand his business, but he is frustrated. Would the Hon. Minister of Finance speak to the Hon. Minister of Agriculture, that is, if they are still on speaking terms?


UNEMPLOYMENT INSURANCE
Mr. Stanley Hudecki (Hamilton West):: There is currently a discrepancy in providing unemployment insurance benefits to working mothers who have given birth and benefits given to mothers of adopted infants. The discriminatory status exists in the immediate pre and post birth or adoptive periods.
It is argued that adoptive mothers should not be given unemployment insurance benefits inasmuch as they can systematically plan for the occasion of the arrival of the infants and make necessary preparations at their convenience. The error in this reasoning is as follows. In light of the extreme shortage of infants for adoptions, and with the ever-increasing number of married couples wanting infants, there is no correlation between the date of application for such a child and the date of its arrival. The period varies drastically and the waiting period maybe up to two or three years. The expectant parents when forewarned about the availability of such a child are usually busily engaged in their own particular regulated
workday pattern. They must then make a very concentrated effort to make necessary preparation to receive the child. This requires an infringement on their days of work.
I feel that the policy of granting UIC benefits to adoptive parents should be reviewed, keeping in mind the loss of work entailed in making provisions to provide a home for the adopted infant, at times on very short notice.


LABOUR CONDITIONS
Mr. Joe Reid (St. Catharines):: Madam Speaker, some
8.000	people in Niagara gave up looking for work last month, writing "finis" to their Canadian dream. Another 26,000 people, 17 per cent of the labour force, continued pounding the pavement looking for jobs that have disappeared at the rate of
1.000	a month over the past two years.
The ILAP Program has managed to bypass our region altogether, and the Labour Adjustment Benefit Program has been of assistance to only one plant. Hopes have again been fanned by the Special Recovery Capital Projects announced in the budget, but dampened just about as quickly by the list of projects published by Canadian Press. No Niagara area projects appear to be in the running despite the fact that Niagara would fit into any one of the Minister's six target areas, particularly land and tourism development, transportation, and vessel procurement. This is intolerable.
There are any number of projects that could and should be undertaken, starting with the Welland Canal. We know that in time improvements to meet demand will have to be made. The old canal lands are ideal land for tourism development. Our ship builders and dry docks are fully capable of filling any number of the Government's vessel procurement orders. We ask, Madam Speaker, that the Niagara region receive a fair share of the Special Recovery Capital Projects, a share that is fair, equitable and commensurate with the appalling unemployment situation that now exists in our region.


EMPLOYMENT
Mr. Cyril Keeper (Winnipeg-St. James):: Madam Speaker, the Government over the last year has been selling Canadians the idea that they have to lower their expectations in terms of income under the six and five propaganda program. The Government has now switched to selling the idea that more and more Canadians have to accept unemployment as a part of the Government's new economic and political thrust.
Last Friday the Prime Minister (Mr. Trudeau) taunted my colleague from Vancouver-Kingsway, asking him to think what an acceptable level of unemployment would be, talking about

April 25, 1983
figures like 8 per cent, 5 per cent, and 3 per cent. We know that the Government is now pushing 8 per cent as an acceptable level of unemployment.
We, in this Party, believe that all people who want to work, who are healthy and capable of working, have a right to work, not just at the whim of the private market or of international economic forces.
To put some hard figures on this, particularly for the enlightenment of our esteemed Prime Minister, when the Unemployment Insurance Program was established, 4 per cent was the goal for unemployment. When the parliamentary Task Force on Employment in the 1980s was established, all Parties accepted the goal of full employment and defined that as being 4 per cent.
The budget was a businessman's budget to solve the cash flow problems of business. It did little or nothing for consumers and did virtually nothing for employment. I want to remind this House-


Madam Speaker:: Order, please. The Hon. Member for Western Arctic (Mr. Nickerson).


PENSIONS
Mr. Dave Nickerson (Western Arctic):: Madam Speaker, an abnormality and apparent injustice contained within the income tax system as it applies to certain highly remunerated federal Government employees such as judges, medical doctors, and very senior officials, should be put to right.
Pursuant to the Superannuation Contributions Agreement such people are obliged to contribute a fixed proportion of their income toward superannuation, and this frequently exceeds the $3,500 maximum allowed by Revenue Canada as a deduction against taxable income. Payments in excess of $3,500 are therefore taxable as income, but are subject to double taxation as they are again taxable when they are withdrawn from superannuation.
For someone with a marginal tax rate of 50 per cent, both at the time of paying in and also at the time of withdrawal, the combined effect results in a 100 per cent tax rate on superannuation payments in excess of $3,500 per annum. This amounts to total confiscation and, as such, is grossly unfair. Either the superannuation legislation of the Income Tax Act ought to be amended so as to avoid this type of confiscatory double taxation.
[DOT] (MIO)


FOOD AND DRUGS
Mr. Gus Mitges (Grey-Simcoe):: Madam Speaker, it is only in recent years that researchers have begun to focus attention on some of the adverse interactions of drugs and food. Such interactions are very important, whether people are on constant medication of for short intervals of time. A typical label on a prescription drug tells a patient how many pills to take and when. What does not always get through to the patient, however, is the interaction between nutrients and drugs. Not only do some foods affect the way drugs behave, but some drugs adversely affect the way the body uses food. Certain types of medication can lead to vitamin deficiencies and poor nutrition.
A number of drugs affect specific vitamins and minerals. Some drugs inhibit nutrient absorption in the system. Nutrient specialists have developed definite guides of what foods to avoid when taking certain drugs and antibiotics. This list is available and very comprehensive, but has not been widely distributed.
I would ask that the Department of National Health and Welfare make it mandatory that such lists be supplied to doctors and pharmacists all across Canada, and to make the information available to all people who either buy drugs over the counter or by prescription. This information should, as well, be part of the labelling.


CUSTOMS AND EXCISE
Mr. Rod Murphy (Churchill):: Madam Speaker, the Prime Minister (Mr. Trudeau) is quoted in an article in The Toronto Star as saying there is no consumer tax break because we would just blow it on foreign goods. He said:
They would spend half of it-and sometimes more-on imported goods which would be creating jobs in other countries and not in ours.
That is the justification which the Prime Minister and the Government have used for not giving the consumers a tax break. In the same budget the Minister of Finance (Mr. Lalonde) announced an increase in the exemptions for those who travel abroad. The quarterly exemption for goods bought abroad will be increased from $50 to $100, and the annual exemption from $150 to $300. That means the Prime Minister is saying to those Canadians who stay at home that they may not have a tax break because they may spend some of their money on foreign goods, but for those Canadians who have money and can afford to travel, it is okay for them to buy foreign goods and bring them back to Canada. That is a double standard. It is not only hurting ordinary Canadians but hurting people who would have jobs if Canadians had a tax break and could spend money on goods made in Canada.
April 25, 1983


EXTERNAL AFFAIRS
Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, President Reagan is quoted as proposing that the Middle East peace talks concerning the future of the land of Palestine be conducted without the participation of a representative from the Palestinian Liberation Organization. He is basing his proposal on the fact that the PLO has never been elected.
All knowledgeable people, including our own Government and President Reagan, know that the Israeli occupiers of the West Bank and Gaza have not allowed the Palestinians to hold elections. They have ejected from office all the elected Palestinian mayors except one. Several polls conducted among the Palestinians show an overwhelming support of the PLO, including one recently held by Time magazine which indicated that over 85 per cent of the Palestinian people considered the PLO to be their sole legitimate representative. There is not another group that even purports to speak for the Palestinians.
I urge our Government to tell President Reagan that, if he wishes to see an elected group speak for the Palestinians, then let there be elections. Advise the President that if he cannot convince the Israelis that they must allow the Palestinians civil rights, including elected representation, then his Government should withhold the amount of funding from their support that it is costing to build the illegal settlements in the occupied territories, to divert Palestinian water to Israeli water systems, to pay for the education that is being denied to Palestinian youth, to pay for the destruction of the Palestinian hospitals, schools, orphanages, daycare centres, clinics, et cetera, that were destroyed in Lebanon, until the Israeli Government realizes it cannot deny others that for which it struggled so long, the right to self-determination and the right to a homeland.



ORAL QUESTION PERIOD


John Patrick (Pat) Nowlan: Madam Speaker, my question is directed to the Minister of Supply and Services or the Minister of State for Economic Development, whomever cares to answer. It is with reference to this morning's announcement that $630 million will be spent on a Coast Guard Renovation Program. How many jobs will that create this year and how many over the four years of the Program, in what regions, and how much will be new money and not money that was previously designated for Coast Guard renovation?


Hon.   J.-J. Blais@Minister of Supply and Services: Madam Speaker, the total amount of money involved is $780 million of which, as mentioned by the Hon. Member, $630 million will be spent over the next four years. Of that, $185 million is new
Oral Questions
money. In terms of the number of jobs, we envisage 20,000 person-years over the four-year period. That is within the shipbuilding industry. There are, of course, all sorts of offsets and spin-offs that will be created within the Canadian marketplace because, as the Hon. Member well knows, Canadian content in the shipbuilding industry is very high.
There is one question the Hon. Member asked to which I cannot reply, that is, how many jobs will be created this year. As the hon. gentleman knows, all these projects are on the fast track. We are trying to bring the jobs into the shipyards as rapidly as possible. They will be going in within the time that has been identified and within the criteria, namely, within the next six months. Hopefully the Hon. Member will support us in those initiatives.


LOCATION OF NEW JOBS
John Patrick (Pat) Nowlan: Madam Speaker, in principle I am in favour of anything that is constructive with regard to renovating the Coast Guard. I could be even more in favour if I knew more of the details. The fundamental question that I asked was how many jobs there would be this year. The Minister overlooked the other part, how those jobs are going to be broken down. As I understand from the press release, there are six regions with a Coast Guard. Has there been any planning within the Department or the Government as to where those jobs, 20,000 person-year over four years, will be located in that period?


Hon.   J.-J. Blais@Minister of Supply and Services: Madam Speaker, I am sure the hon. gentleman recognizes that, wherever those jobs may go, they will be in areas of high unemployment. If he thinks about where the shipyards are located, he will see that all those areas presently suffer from very high unemployment. We are attempting to have the investments go into all of the various regions as fairly and equitably as possible. However, as the Hon. Member knows, contracts will be awarded on a competitive basis, as is fair. Therefore, the regional distribution is subject to the competitive basis of the award of the contracts.


AWARDING OF CONTRACTS
John Patrick (Pat) Nowlan: Madam Speaker, coming to the contracts, when will tenders be let so that the unemployed in Atlantic Canada and other areas of the country will have the chance of some jobs and some hope, rather than just being suffocated with press releases?


Hon.   J.-J. Blais@Minister of Supply and Services: Madam Speaker, contracts will be let as rapidly as possible in order to accomplish that. There have been a number of changes in the process of awarding contracts so as to bring them on to a fast track. That means that my Department, in the shipbuilding area in particular, will be front and centre in terms of the awarding of contracts. We have had an increase in the level of delegation of authority for contracting purposes.

Oral Questions
Also, as the Hon. Member knows, there has been the establishment of a special board of officials that will review the contract process in order to remove all the bureaucratic impediments that could be placed in the way of fast tracking. As well, there is a subcommittee on priorities and planning composed of ministers, which will, of course, try to eliminate as many of the political hindrances as there may be.


SPECIAL RECOVERY CAPITAL PROJECTS PROGRAM
Joseph Lloyd Reid: Madam Speaker, my question is directed to the Minister of Finance. The Minister stated that the Special Recovery Capital Projects Program would form an integral part, if not the key part, of his job-creation plan, and an announcement was made this morning with respect to sharing of work among regions. The Minister knows that in very few regions of the country is unemployment higher than it is in the Niagara region. I ask the Minister what criteria he is using and what steps he has taken to assure that the largess and funding of the 100 select programs to which he has referred, dealing with transportation and vessel procurement, will be distributed fairly across the country as was stated in the budget speech? More particularly, what allocation of funds or projects has been designated for the Niagara region?


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker, I would first advise my hon. friend to look more carefully at the statistics. Unfortunately, he will find that there are other regions of the country that have higher unemployment levels than does the Niagara Peninsula, much higher indeed. This having been said, my colleague, the Minister of Supply and Services, has indicated that tenders for the construction of ships, for instance, would be out on a competitive basis and that shipyards across Canada will have the opportunity to bid and compete for those projects.
I would also like to remind my hon. friend that the budget had two elements. One was public investment to the tune of $2.4 billion, and the other was incentives to the private sector to the tune of $2.4 billion as well.
As my hon. friend knows very well, the Niagara area is a heavily industrialized area. It is a great centre of manufacturing. The benefits contained in the budget for the private sector will be felt very, very strongly by the manufacturing and industrial sector. If my hon. friend looks at that very important aspect, he will find out that his own area will be a very large beneficiary of the incentives contained in the budget. If he has been to his riding last weekend, he probably found that members of the private sector have welcomed the budget and are really enthusiastically supporting the measures announced last Tuesday. His own area will be a very significant beneficiary of those measures.
April 25, 1983


ALLOCATION OF PROJECTS
Joseph Lloyd Reid: Madam Speaker, in light of the comments made by the Minister of Finance I would like to direct my supplementary question to him rather than to another Minister. The Minister of Finance knows full well that the Niagara region was bypassed with respect to ILAP programs, and again, only one plant in the whole Niagara region received any benefit from the Benefits Adjustment Act.
What assistance may the Niagara region expect under the Minister's budget program? The Minister has said that he is considering 100 selected special projects. Is any one of them related to the Niagara Peninsula? Can we look to any increase in job-creation activity in the Niagara area to belie Statistics Canada's figures? The Minister has discarded those figures by saying that other regions have just as much unemployment, but we have been pointed out as having one of the highest levels, above the national average in urban industrial unemployment, presently at 17.6 per cent, but having 134-


Madam Speaker:: Order, please. Order.


Marc Lalonde: Madam Speaker, as I have indicated, the Minister of State for Economic Development is processing the various projects. Once he has reached a point where decisions can be announced, he will make these decisions known in so far as they affect the various regions of the country. But I would like to stress to my hon. colleague that he should be looking at the very large incentives provided under the budget for the manufacturing and industrial sector and the construction sector generally.
The Niagara Peninsula being what it is will be proportionately a very large beneficiary of the measures contained in the budget. If the Hon. Member compares this to most other areas of the country, he will probably find that, under the budget, the measures for the private sector will have a much larger impact in his own area than any other measures I could have announced.
I think one has to look at the budget in its totality and look at its total impact upon the situation in Canada. The budget was geared to try to get the business sector going again. As I have said, if we can get business back to business, we will get workers back to work in this country.


Some Hon. Members:: Hear, hear!


HOUSING
Mr. Derek Blackburn (Brant):: Madam Speaker, my question is directed to the Minister responsible for Canada Mortgage and Housing Corporation. In the budget brought down last week, changes were announced for the Registered Home Ownership Savings Plan. While at first glance it appears as if
April 25, 1983

this measure will provide assistance to home buyers, after closer examination it is clear that it does not provide as much assistance to lower and middle income earners as did the straight $3,000 grant under the CHOSP program.
I would ask the Minister to confirm for the Members of this House and for Canadians the fact that a family earning about $32,000 will only receive a $2,400 benefit from the new changes to RHOSP, while a family earning in the neighbourhood of $57,000 will receive a $5,280 benefit.


Hon. Romeo LeBlanc (Minister of Public Works):: Madam Speaker, I do not know if I follow the Hon. Member's arithmetic accurately. I will examine the figures he used and give him a response. I should point out to the Hon. Member that the Home Ownership Program which was instituted by my predecessor was put into place at a time when interest rates were at an all-time high, and a time when the economic situation had not stabilized. I think we should, in our own minds, divorce the two programs. Otherwise we may end up coming to some misleading conclusions.


NEED FOR SOCIAL HOUSING
Derek Nigel Ernest Blackburn: Madam Speaker, I direct my supplementary question to the same Minister. Can he explain to the House why, within the Cabinet, he was unable to pry from the Minister of Finance more than $1 million to create an additional 2,500 social housing units-which is really not an addition but a catch-up from the overspending last year- when he knows full well that we need a minimum of 50,000 social housing units a year?
An expenditure, for example, of $500 million, only half the monthly expenditure in the UI fund to the unemployed, would have created those 50,000 badly needed housing units for the poor in this country. It would have created an additional 5,000 jobs, and people would not be sleeping in subways and church basements and old wrecks of hotels across the country. Those people deserve something better from the Minister.


Roméo LeBlanc: Madam Speaker, when the Hon. Member is talking about job creation and social housing, I think he would do well to examine the implications of his statement. The cost per job in social housing is estimated at $30,000 per person-year of employment. That is a very high cost considering that home renovation at $5,200, or new construction at $7,000 per job per year, appear to be a better investment in terms of job creation.
I do not quibble with the Hon. Member's assertion that there is a need for more social housing. I underline to him, though, that it is a very, very expensive program in terms of the people who are served by it. We are trying to find a way to get more bang for the buck in that area of social housing. I hope that he will support us when we come down with some changes.
Oral Questions PLEA FOR HOMELESS


Derek Nigel Ernest Blackburn: Madam Speaker, 1 gather the Minister is presently considering increasing the housing units for the poor, by one means or another. I would ask the Minister when we can expect some alleviation of this very critical problem. When will he be reporting to the House on a plan to get people out of subways and old wrecks of hotels and get them into decent, affordable housing? These are the forgotten people in Canada. It is not just the biggest bang for the buck that is required, it is also decent, affordable shelter for our own Canadian citizens.


Roméo LeBlanc: Madam Speaker, obviously I do not follow the Hon. Member in his rhetoric. The fact is that we are looking at alternatives. Some of the municipalities play a role in this sector, and some of them do not.
The Hon. Member will have to decide whether he wants to go the route of the old public housing system which created ghettos for a smaller amount of money per family, or whether he wants to continue in the present system which is expensive but which is giving the people who are living in these houses the dignity of not being considered residents of ghettos. I think all Parties will have some interest in discussing the changes in policy that may be required.


IMMIGRATION
Marcel Joseph Aimé Lambert: Madam Speaker, my question is for the Minister of Employment and Immigration. A week ago I asked him about the circumstances surrounding the transfer to Ottawa from Toronto of 11 detainees under the Immigration Act, most if not all of them in leg-irons and handcuffs. I wanted to know the reason they came to Ottawa and the reason they were so restricted.


Hon. Lloyd Axworthy (Minister of Employment and Immigration):: Madam Speaker, I thank the Hon. Member for his question and for drawing that particular issue to my attention. I would point out to him that the immigration enforcement branch itself does not have the facilities or the capability of transferring people from one area to another who are detained for a refugee hearing.
In this case we contracted with the Ontario Correctional Services to provide that movement for us. In the circumstances they applied the procedures that they normally apply to all people under detention. As the Hon. Member indicated that included leg-irons and other forms of incarceration described. I find that to be a reprehensible way of transferring such people. I have asked the Department to look into changing such procedures to ensure that such things will not happen again.

April 25, 1983
Oral Questions REASONS FOR TRANSFER


Marcel Joseph Aimé Lambert: Madam Speaker, will the Minister advise us why the 11 persons were being brought to Ottawa from Toronto? Would he also advise why they were turned around, to be brought back here today for a hearing? Is there not a possibility that someone can foresee what is going to happen so that the expenditure and the incident can be avoided?


Lloyd Axworthy: Madam Speaker, under the Immigration Act people who have had their refugee appeals turned down by the Refugee Advisory Committee or Appeal Board have recourse to the court system and are free to exercise that. In some cases the inquiry officers determine that some individuals must be kept in detention because they are not responsible for their actions, or because they have shown, as some of these individuals have in the past, an inclination to escape or not to show up for their hearings. The reason for the movement here was that their hearings could be held before the court system or the Appeal Board.
As the Hon. Member may know, we are going through a pretty major revision of the entire refugee determination procedures. We have worked on changing the Refugee Advisory Committee, and the Appeal Board will be working on other parts of the system. That was the reason for such movement. We are looking closely at the way in which this is done so that such incidents will not be repeated in the future.


DETENTION PRACTICES
Marcel Joseph Aimé Lambert: Madam Speaker, in addition to this particular incident of a refugee being leg-ironed and handcuffed when guilty of no crime, are there not other areas where the Minister has spoken about the special officers who, on their own opinion, determine that a person may not return for a hearing and on which there is no appeal or review of that opinion? In most jurisdictions this means the tank in either the local jail or the remand centre.


Lloyd Axworthy: Madam Speaker, I want to ensure that the Hon. Member understands that, in the case of these particular individuals, most had a past record of some fairly violent behaviour or unwillingness to abide by the rules. In fact during the course of the transfer here two or three of them tried to escape and had to be detained again. This is not the normal procedure that we use; it is only used in exceptional cases. Even though I find the methods to be unacceptable, they were applied because of the behaviour of the particular individuals.
As far as the other part of the Hon. Member's question is concerned, I would remind him that the Immigration Act allows a number of areas of discretion. We are dealing with individual cases; no standard rule can be applied universally and we allow immigration officers such discretion.
We also have a very foolproof and open appeal system. By the number of appeals that I receive each week, I can attest to the fact that this is a very open system and we try to maintain a high degree of fairness in the system.


NATIONAL PARKS
Mr. Mel Gass (Malpeque):: Madam Speaker, my question is directed to the Minister responsible for Parks Canada, and I have sent him notice of it. The Minister is well aware of the situation in Prince Edward Island regarding Parks Canada employees, using criteria that are different from those used in previous years for hiring surf guards. In view of the fact that there are qualified, experienced surf guards, some even possessing seven years' experience, available for work in Prince Edward Island, could the Minister inform the House why his officials hired four surf guards from outside the Province?


John (Moody) Roberts: Madam Speaker, I am aware of the situation. My colleague, the Minister of Veterans Affairs has been assiduous in drawing it to my attention.
Unfortunately there still seems to be some dispute about the essential facts of the situation and I am trying to disentangle those. It is my understanding that while some off-Island people have been employed as surf guards, by far the majority are people who have previously worked in the park in Prince Edward Island. The process for selection has been to go through the Canada Employment Centre of the Island and, as well, to consider those people who worked in the park in past years.
There has not been a specific shift this year compared to other years in the terms of the opportunity for people from off-Island to apply for jobs and be considered for them. Indeed, some of the off-Island people that I know the Hon. Member is particularly concerned about have worked in the Park in previous years. So there has not been a shift in approach from that point of view. Indeed, the hiring approach in using the Canada Employment Centre follows that used in other parks in the Atlantic Provinces where people are able to apply for jobs even though they are not from the specific Province concerned.
I also want to tell the Hon. Member that some of the facts in the matter seem to be in dispute. I am trying to find out exactly what the situation is. To the best of my knowledge the answer I have given is accurate.


PREFERENCE SOUGHT FOR ISLAND RESIDENTS
Melbourne Alexander Gass: Madam Speaker, the Minister said other Provinces have similar hiring practices. I should like to point out to him that Prince Edward Island is the only park in eastern Canada where Parks Canada employees interview and hire lifeguards directly.
April 25, 1983

I should like to draw his attention to the terms of reference that Parks Canada gives to the contractor who, in turn, has to use them to hire surf guards for national parks other than in Prince Edward Island. In the beach patrol service, for Cape Breton Highlands National Park, in the terms of reference it is provided that in the selection of beach patrol the contractor shall ensure that preference is given to equally-


Madam Speaker:: Order. Order, please. Does the Hon. Member have a question?


Melbourne Alexander Gass: Madam Speaker, the Minister said that no preference was given. Why are residents of Prince Edward Island not given the preference as in other Provinces? In other Provinces the reference that is given by Parks Canada to the contractor stipulates that the persons hired have to be residents of the Province.


John (Moody) Roberts: Madam Speaker, in terms of off-Island or on-Island employment, the situation is much the same. In the past there have people who have worked in the Park who were not from Prince Edward Island. That is still the case, but in this case as well people who are off-Island have been employed again.
The Hon. Member has referred to other parks. I indicated to him earlier that there is some confusion in the advice that I have received on what the facts are in other parks in comparison with Prince Edward Island. I do not want to mislead the Hon. Member, and so I do not want to confirm specifically or deny specifically what he has suggested. I have conflicting advice on what are the facts. I want to make sure that when I give him the information it is as accurate as I can make it. That is what I am trying to do at the present time.


BILINGUALISM
Mr. Bill Domm (Peterborough):: Madam Speaker, last week in the House I asked the Secretary of State to explain what he meant in a speech to a Francophone crowd, when he said that he intended to make Canada a French state, and I received an unsatisfactory answer.
In an advertisement that appeared in a Peterborough newspaper recently, the Minister advertised for students or people to apply for work in Katimavik, a program to bring Anglophones and Francophones together to understand each other better. The qualification was that the applicants should show a willingness to become bilingual. I ask the Minister why his senior official refused employment to an Anglophone because he could not speak French and was applying for a job with Katimavik to work in Ontario?
Oral Questions


Hon. Serge Joyal (Secretary of State):: Madam Speaker, the Katimavik program is specifically aimed at bringing Canadians together from all parts of the country, to learn about Canada's diversity and be given an opportunity to work in communities that differ from their usual environment, and thus get first-hand knowledge of the many facets of our country. When we ask a student to indicate his or her interest in the other official language, this is done so that we can direct this student to the appropriate language community where he or she will be able to communicate with his or her environment.
The purpose of Katimavik is not to provide courses in either official language of Canada, but to enable young people taking part in the program to become familiar with Canada's diversity through their contacts with the communities in which they are to work. However, if the person in question does not show any particular interest in this aspect, he or she is then directed to a community where his or her language is spoken.


William Henry (Bill) Domm: Madam Speaker, the Minister intentionally avoided answering the question.


YOUTH EMPLOYMENT
William Henry (Bill) Domm: Madam Speaker, my supplementary question is directed to the Prime Minister. I asked the Prime Minister last week if he would consider using some of his advertising budget to employ students, rather than using hundreds of millions of dollars for advocacy advertising to promote the Government's own programs. The Prime Minister said my question was a silly one. So my question to the Prime Minister today is as follows. Why is he adding to an already exorbitant advertising budget in announcing his intention to use advocacy dollars to promote a budget which is well known to all Canadians for what it really is? Would the Prime Minister not consider using some of those advertising dollars, some of the $800 million or $400 million spent on advertising, for the creation of jobs for the youth of the country? This is not, Madam Speaker, put as a silly question but as a constructive proposal from the Opposition.


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the Hon. Member has heard the Minister of Finance and the Minister of Employment and Immigration many times give an answer to the effect that almost half the money which we were spending for direct job creation or for retraining was going to the youth of the country. Therefore, it is difficult to follow his reasoning that the Government is not concerned with the youth of this country.

April 25, 1983
Oral Questions
As far as advertising is concerned, Madam Speaker, I have not recently been briefed on the amounts of money which the Government is spending on this. I would wager that it is proportionately the same as that spent by any of the Conservative provincial Governments, proportionate to their representations.


NUCLEAR ARMAMENTS
Mr. Simon de Jong (Regina East):: Madam Speaker, my question is directed to the Prime Minister. The people of Canada are voting with their feet for world-wide nuclear disarmament. In fact, just two days ago more than 80,000 Canadians took to the streets in many cities in Canada to demonstrate their opposition to the Cruise missile testing. It must be clear, even to the Prime Minister, that Canadians want to send a message to the war planners both in Moscow and in Washington. Is the Prime Minister not prepared to listen to the wishes of the people to be free of nuclear threat, no matter from which camp it comes? Will he assure this House that, as a first step, no final decision on Cruise testing in Canada will be taken until there is a full debate in this Chamber? Will he also permit that debate to be open and free of party restrictions, allowing each Member to vote according to his or her conscience?


Some Hon. Members:: Hear, hear!


Pierre Elliott Trudeau: Madam Speaker, Hon. Members on this side are always encouraged to vote according to their consciences.


Some Hon. Members:: Oh, oh!


Pierre Elliott Trudeau: In asking the question the Hon. Member is implying that in the New Democratic Party this is not the case. We hope they will vote according to their conscience if ever such a debate is held. There has been a debate before on this whole problem. I certainly would welcome another one. The Opposition Parties have a multiplicity of days between now and the end of June when they can choose the subject they want to debate. I would hope that in the debate, Madam Speaker, there would be a reminder to all of us that the danger of nuclear escalation is not a one-sided one. I believe the Hon. Member is making that point in his question and, if he is, I certainly agree with him.
As I indicated before, I understand the pangs of conscience of those in Canada who are protesting against the eventual testing of the Cruise. I have indicated that I have been somewhat surprised that there was no similar protestations during the several years when the Soviets were deploying their SS-20s, replacing their SS-3s and SS-4s by a much more sophisticated and dangerous weapon, which I believe can only be justified as a weapon of terror for western Europe. I was
surprised that there was no such demonstrations as the Hon. Member commends, during that period, Madam Speaker.


Some Hon. Members:: Hear, hear!


POSITION OF GOVERNMENT
Simon Leendert de Jong: Madam Speaker, this Party is on record as opposing all escalation in this mad dance in which both super powers are involved. In fact, in this day and age there are no longer good guys and bad guys. When both sides can destroy all human life several times over, no one is a good guy any more. They are both crazy. Madam Speaker. The intent of 80,000 Canadians is to plead with the Government to disentangle Canada-


Madam Speaker:: Order. The Hon. Member is on his feet and I believe he should be reminded that he must ask a question.


Simon Leendert de Jong: My question, Madam Speaker, is again directed to the Prime Minister. Canadians wish to know, really, what the situation is. Has the United States made a formal request or has it not made a formal request for Canada to test the Cruise? Has Canada given a commitment, or have we not given a commitment? Are 80,000 Canadians marching in the streets over a decision which has already been made? Can the Prime Minister tell us what the situation is? Has a request been made, and have we given a commitment?


Pierre Elliott Trudeau: Madam Speaker, the situation has not changed since this question has been answered repeatedly by the Secretary of State for External Affairs and myself. The request has not been made yet. We have not, therefore, made any commitment. I would point out, however, to this House and to the Hon. Member, that it is surprising to me, when he used such balanced language in his first question, that there is not a sign in any of these demonstrations, and no energy is expended by the NDP, which I know of, to militate against the Soviet SS-20s. Has the Hon. Member ever seen in that band of people signs protesting against the Soviet Union? Has the Hon. Member's Party expressed disappointment with Secretary Andropov's nonreply to President Reagan's offer to go away from the zero option to find some compromise level? That is the kind of question, Madam Speaker, that I throw back to the Hon. Member.


Some Hon. Members:: Hear, hear!


FINANCE
Mr. Douglas Roche (Edmonton South):: Madam Speaker, my question is directed to the Minister of Finance. Last week the Minister said he had accepted one recommendation of the Coalition of National Voluntary Organizations to do away with the $100 automatic deduction, and rejected the other
April 25, 1983

recommendation for a tax credit for receiptable charitable donations. Will the Minister confirm that what is at issue is a recommendation called the "give and take proposal", under which a new incentive would be given to taxpayers to contribute to the nation's 47,000 registered charities which do such an important job in building up community life in Canada? Thus the Minister has distorted the precise proposal which has been before this House for several years.


Marc Lalonde: Madam Speaker, there has been no distortion by requiring that charitable donations be receipted. I have given a great incentive to Canadians to give to charitable organizations during the course of the following years rather than receiving a deduction for which they have not contributed anything to charitable organizations. The Hon. Member is right in saying that I had accepted one out of the two recommendations made, as I have indicated. If you get a 500 batting average in any baseball league, you are way at the top. That is a pretty good average for anyone who is making representations to the Government.
[DOT] (M50)


CALCULATION OF BENEFITS TO GOVERNMENT AND CHARITIES
Douglas Roche: Madam Speaker, has the Minister studied the protest launched by the Coalition of National Voluntary Organizations? Taking the 500 batting average, has the Minister personally examined the statistics and estimates presented by the voluntary organizations in a brief which has been before this House for some time, and which shows the Government would be ahead financially with the give and take proposal, and that the charitable agencies would be helped in their valuable work? Those statistics were put on the record by myself in a Private Members' Motion some time ago.


Marc Lalonde: Madam Speaker, I cannot blame anyone for trying for a 1000 batting average. But if you compare this with various other representations made by other groups to the Government, particularly with relation to the budget, I would argue that the voluntary organizations have done extremely well and I hope they will see it that way. If they feel that the measures taken are not appropriate, then obviously I would be ready to listen to them, as I have done in the past. If they feel I should abandon this proposal, I will be ready to listen to them again.


BANKS AND BANKING
Mr. W. C. Scott (Victoria-Haliburton):: Madam Speaker, my question is for the Minister of Finance. The Bank of Canada sets the bank rate weekly, which affects every Canadian who has cause to borrow money. The fluctuations in this rate are quite often artificial in nature, for the purpose of maintaining the status of the Canadian dollar. Thousands of
Oral Questions
Canadians who took out loans when the rate was forced to record highs last summer are now faced with prohibitive penalties if they wish to buy down to the present rates. Will the Minister provide a tax credit to banks to allow them to permit relatively penalty-free buy-downs of loans to current interest rates?


Marc Lalonde: Madam Speaker, I would like to point out to the Hon. Member that the bank rate is not established or determined by the Bank of Canada. It is determined weekly by the auction of Government of Canada Treasury Bills, and it is that auction which in the final instance sets the bank rate each week. I hope my hon. colleague sees reason to rejoice in the fact that the bank rate has dropped substantially since last year and that interest rates in Canada are now the lowest they have been in four years or even five. I hope my hon. colleague appreciates that fact.
As for the Hon. Member's proposal, I do not intend to give it further consideration.


William C. Scott: Madam Speaker, I think we all agree that the bank rate is down. I do not know whether that is altogether due to the Minister of Finance, or not.


PLIGHT OF HOME OWNERS WITH HIGH INTEREST MORTGAGES
William C. Scott: Madam Speaker, what about the people who borrowed money to buy homes or finance businesses and who are paying as high as 23 per cent? Now the bank rate has dropped and they can buy mortgages at 11 per cent to 13 per cent. What about these people caught in a bind? Is there any relief in his mind for these people to get them on a more competitive basis so that they can afford the homes in which they are now living?
[ Translation]


Marc Lalonde: Madam Speaker, my hon. colleague is probably aware that in most cases, these are short-term loans which are being renegotiated and are or will be due very soon. My hon. colleague is also aware that in many cases, there is a clause under which the borrower may pay back a loan before the due date, subject to payment of a penalty. Such clauses are customary and are available in most loan contracts.


FINANCE
Lorne Edmund Nystrom: Madam Speaker, my question is directed to the Minister of Finance as well, and it concerns the long-term future of farming. In the last election campaign the Liberal Party promised to change the valuation

April 25, 1983
Oral Questions
day for capital gains on farms from 1971, and to index it to reflect the real increase in inflation.


Marc Lalonde: Nineteen seventy-four.


Lorne Edmund Nystrom: From 1971 to 1974, and then index it after that. The Minister of Agriculture said this would happen soon, and then last month he said sooner than soon. Why was this not in the budget last week?


Marc Lalonde: Madam Speaker, I must have received thousands of suggestions and proposals regarding the budget. Some of them I considered but others had to be dropped because of the Government's financial obligations and the tax burden on the Canadian public. I believe that the proposals I set forth in my budget speech provide a very sensible balance, in view of the needs of the country's various economic sectors. I hope my hon. colleague realizes that the measures announced last week already included an additional $100 million for farmers in need, in the form of subsidized interest rates, and that every single measure concerning investment credit as well as the business loss allowance are available to farmers just as they are to small-, medium-sized and large businesses.
Therefore, there are a number of very useful measures available to farmers, who, I hope, will use them to good advantage.


Lorne Edmund Nystrom: Madam Speaker, the Liberal Party should not make an election promise if it does not intend to keep that promise.


INCOME TAX
Lorne Edmund Nystrom: Madam Speaker, as the Minister knows, farm incomes are down and many farmers, particularly young ones, are forced to work part-time off their farms. Yet under Section 31 of the Income Tax Act they cannot deduct more than $5,000 of their farm losses against their income. That Section has not been changed since 1951 and we have had a lot of inflation since then. Why has the Minister not indexed this aspect of the Income Tax Act as he has for many corporations and so on? And if he does not index it, why has he not deleted this Section of the Income Tax Act so it would be more fair to the farmers?


Marc Lalonde: Madam Speaker, I would like to inform the Hon. Member that the reason is the same one I gave in answer to a previous question.


COLLECTION OF TAX FROM SENIOR CITIZENS-DEMAND FOR QUARTERLY PAYMENTS
William Herbert Jarvis: Madam Speaker, my question is for the Minister of National Revenue whose Department, for the first time, has compelled many thousands of senior citizens to pay income tax installments rather than waiting until they completed their returns. Having regard to the fact that many of these people have additional taxable income because of their frugal living and having denied themselves many things during their working lives, on what basis is the Minister now compelling these thousands of senior citizens-I understand the legal rights the Department has-to pay tax installments four times a year?


Hon. Pierre Bussieres (Minister of National Revenue):: Madam Speaker, I must admit I am a little surprised at the line of reasoning followed by the Hon. Member, because he says that the Act prescribes that this is how the Department of National Revenue must proceed, because that is what is provided under the Act.


An Hon. Member:: May proceed.


Pierre Bussières: No, not may, must proceed. The Hon. Member should take another look at the wording of the Act, and he will see that officials of the Department of National Revenue cannot choose whether or not to enforce compliance by certain groups of taxpayers. I have already answered a similar question here in the House, and I indicated our concern within the Department of National Revenue regarding enforcement of these provisions of the Income Tax Act. However, the Hon. Member will understand that until this provision is changed on the recommendation of the Minister of Finance, we must enforce it, and at the same time be as flexible as we can in considering each specific case.


William Herbert Jarvis: Madam Speaker, if the Minister and his officials have been compelled to act that way, I wonder what they have been doing for the last few years, because these are people whose income has not changed, but they are being asked to do this for the first time.


TREATMENT OF ANNUAL BOND INCOME
William Herbert Jarvis: Madam Speaker, given a case, and I am sure it is not unique, where a senior citizen receives bond income all in the month of December and that is the only additional income to her pension, is the Department going to be sufficiently flexible so that a taxpayer like that may go to the district taxation office and make an arrangement to pay just the one installment, rather than four installments, when she receives that additional taxable income? Is there going to be any flexibility in the implementation of this program?
April 25, 1983

[ Translation]


Pierre Bussières: Madam Speaker, Hon. Members must understand that I cannot establish a general rule on the basis of one example, one specific case, submitted by the Hon. Member. 1 think that if he reviews the provisions of the Income Tax Act, he will see that for there to be an obligation to pay income tax in quarterly instalments, a certain percentage of income must be paid to the person concerned at certain times of the year, so that I cannot establish a general rule, on the basis of one case or specific example, like the one submitted by the Hon. Member. I think the Hon. Member should remember that we are trying to be as flexible as we can. However, we have no choice, when the provisions of the Income Tax Act do not allow us that discretion, but to ask people to comply with these provisions.


PRIVILEGE
Hon. Erik Nielsen (Leader of the Opposition):: Madam Speaker, you will recall that I raised a question of privilege last Thursday. I rise now simply to ask whether or not the Chair has yet had time to make its investigation or whether the Minister of Public Works (Mr. LeBlanc) has an explanation. If not, how much further time will be necessary before the inquiry is completed?


Madam Speaker:: I am hopeful that by tomorrow I will have all the facts. There is one report which I have not received in writing, and I would prefer to have it in writing. However, as soon as the investigation is completed, I will certainly be able to rule on it.


PERMANENT AND PROVISIONAL STANDING ORDERS
Mr. Donald W. Munro (Esquimalt-Saanich):: Madam Speaker, on this particular occasion may I thank the Table for having prepared the Index to the Standing Orders of the House of Commons. I state for the record that persistence sometimes has its just reward. The Index is ready. Thank you, Madam Speaker.
Order Paper Questions



ROUTINE PROCEEDINGS


[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Jack Burghardt (Parliamentary Secretary to Minister of Communications):: Madam Speaker, the following questions will be answered today: Nos. 3,750 and 4,744.


Mr. MacKay: 1.	As of (a) January, 1982 (b) January, 1977, what was the total staff, stationed in Canada and enjoying diplomatic immunity, of (i) the U.S.S.R. (ii) Czechoslovakia (iii) Poland (iv) Hungary (v) Romania (vi) Bulgaria?
2.	As of (a) January, 1982 (b) January, 1977, what was the total staff, employed at diplomatic missions in Canada and not enjoying diplomatic immunity, of (i) the U.S.S.R. (ii) Czechoslovakia (iii) Poland (iv) Hungary (v) Romania (vi) Bulgaria?
3.	Were any of the employees in Part 2 Canadian citizens and, if so, how many?
4.	As of (a) January, 1982 (b) January, 1977, what was the total staff enjoying diplomatic immunity stationed at the Canadian missions in (i) the U.S.S.R. (ii) Czechoslovakia (iii) Poland (iv) Hungary (v) Romania (vi) Bulgaria?
5.	As of (a) January, 1982 (b) January, 1977, what was the total staff not enjoying diplomatic immunity employed at the Canadian missions in (i) the U.S.S.R. (ii) Czechoslovakia (iii) Poland (iv) Hungary (v) Romania (vi) Bulgaria and, in each case, what was the breakdown between Canadian citizens and locally-employed staff?
6.	What travelling restrictions are currently in force for the employees of the foreign missions in Canada of (a) the U.S.S.R. (b) Czechoslovakia (c) Poland (d) Hungary (e) Romania (f) Bulgaria?
7.	What travelling restrictions are currently in force for Canadian diplomatic personnel in (a) the U.S.S.R. (b) Czechoslovakia (c) Poland (d) Hungary (e) Romania (0 Bulgaria?
8.	Since 1952, were any employees of the diplomatic missions in Canada of (a) the U.S.S.R. (b) Czechoslovakia (c) Poland (d) Hungary (e) Romania (f) Bulgaria expelled from Canada as personae non gratae or otherwise and, if so, in each case, what was the (i) name of the employee (ii) country (iii) date (iv) reason for expulsion?
9.	Since 1952, were any employees of Canadian diplomatic missions in (a) the U.S.S.R. (b) Czechoslovakia (c) Poland (d) Hungary (e) Romania (0 Bulgaria expelled as personae non gratae or otherwise and, if so, in each case, what was the (i) name of the employee (ii) country from which he/she was expelled (iii) date (iv) reason for expulsion?


Hon. Allan J. MacEachen (Deputy Prime Minister and Secretary of State for External Affairs):: 1. As of (a) January, 1982 and (b) January, 1977, the total staff stationed in Canada and enjoying diplomatic immunity numbered as follows for the following countries:
(i)	U.S.S.R.	1982 38	1977 31(ii)	Czechoslovakia	7	4(iii)	Poland	9	15(iv)	Hungary	6	5(v)	Romania	3	7(vi)	Bulgaria	5	2
April 25, 1983
Order Paper Questions
2. As of (a) January, 1982 and (b) January, 1977, the total staff not enjoying diplomatic immunity was as follows for the following countries:
		1982	1977
0)	U.S.S.R.	24	30(H)	Czechoslovakia	5	figures not available(iii)	Poland	2	figures not available(iv)	Hungary	10	figures not available(v)	Romania	5	figures not available(vi)	Bulgaria	5	figures not available3.	The Embassy of Bulgaria employed three Canadians as of January, 1982.4.	As of (a) January, 1982 and (b) January, 1977, the total staff enjoying diplomatic immunity numbered as follows at thefollowing Canadian Embassies:	1982	1977(i) U.S.S.R.	14	16(ii) Czechoslovakia	16	6(iii) Poland	20	9(iv) Hungary	4	4(v) Romania	11	3(vi) Bulgaria	non-resident	non-resident5. As of (a) January, 1982 and (b) January, 1977, the total staff not enjoying diplomatic immunity numbered as follows at	the following Canadian Embassies:	1982	1977(i) U.S.S.R.	62 (including 34	61 (including 32Soviets)	Soviets)(ii) Czechoslovakia	19 (all Czechoslovaks)	27 (including 16Czechoslovaks)(iii) Poland	27 (including 23 Poles)	39 (including 26 Poles)(iv) Hungary	20 (including 12	19 (including 11(v) Romania	Hungarians)	Hungarians)14 (all Romanians)	19 (including 11 Romanians)(vi) Bulgaria	non-resident	non-resident6.	(a) In reciprocity for travel restrictions imposed on members of the Canadian Embassy in Moscow, Soviet diplomats resident in Ottawa may travel freely only within the National Capital region. If they wish to travel outside these limits, the Soviet Embassy must give the Department of External Affairs 48 hours' notice. The time for advance notice is reduced to 24 hours for travel to Mirabel airport and to Montreal.
Soviet personnel serving at the U.S.S.R. Consulate General in Montreal may travel freely within a 40 km radius of Montreal City Hall. If they wish to travel outside these limits, 48 hours advance notice is required. The time for advance notice is reduced to 24 hours for travel to Mirabel and Ottawa.
(b), (c), (d), (e) and (0 There are no travel restrictions for Czechoslovak, Polish, Hungarian, Romanian and Bulgarian officials serving in Canada.
7.	(a) Canadian personnel may travel freely within a 40 km radius from the center of Moscow. Forty-eight hours advance notice is required when travelling to all areas outside of Moscow with the exception of Leningrad where only 24 hour notification is required.
(b), (c), (d), (e) and (f) There are no travel restrictions on Canadian staff serving in Czechoslovakia, Poland, Hungary, Romania and Bulgaria.
8.	See reply to question 4,167 answered on June 23, 1982.
9.	Since 1952 no employees of Canadian diplomatic missions were expelled from Poland, Romania or Bulgaria, but a total of four were expelled from the U.S.S.R., Czechoslovakia and Hungary. Particulars of three of those four incidents are as follows:
(i) Name (i	i) Expelled from	(iii) Date	(iv) Reason1. Lt. Col. J. Watson Military Attache Canadian Embassy Moscow	U.S.S.R.	May, 1968	Accused of spying against the U.S.S.R.2. S.G. Noble Visa Officer Canadian Embassy Budapest	Hungary	January, 1970	Alleged to have engaged in activities inconsistent with his official duties3. Col. H. Gold Defence Attache Canadian Embassy Moscow	U.S.S.R	January, 1980	Alleged to have carried out intelligence activities in the U.S.S.R.4.	The fourth expulsion was from Czechoslovakia, and was not publicized at the time. Having reviewed the circumstances the government abides by the earlier decision not to disclose details concerning the matter.


Mr. Blenkarn: 1.	Did the Government give a permit to Messrs. Peter Knapton and Ian Weir, both of Mississauga, to use firearms to kill migratory birds out of season within the corporate limits of Mississauga?
2.	Is it the policy of the Department of the Environment to allow migratory birds to be killed for the purposes of display in museums?


John (Moody) Roberts: 1. A
scientific permit was issued under Section 19 of the Migratory Birds Regulation to Mr. Peter Knapton to use a firearm to collect migratory bird specimens outside of existing season on behalf of the Royal Ontario Museum. No permit was issued to Mr. Ian Weir.
2. Yes.


John O. (Jack) Burghardt: I ask, Madam Speaker, that the remaining questions be allowed to stand.


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


Some Hon. Members:: Agreed.
April 25, 1983



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that this House approves in general the budgetary policy of the Government; and the amendment of Miss Carney (page 24689).
Madam Speaker:: I recognize the Hon. Member for York East (Mr. Collenette).


Mr. Collenette:: Madam Speaker, it is indeed a pleasure to speak in this particular debate because, for the first time in a long time, we as Parliamentarians and as Canadians-


Gordon Edward Taylor: I rise on a point of order, Mr. Speaker.


Mr. Deputy Speaker:: The Hon. Member for Bow River (Mr. Taylor) rises on a point of order?


Gordon Edward Taylor: Mr. Speaker, you will recall that when the House adjourned at one o'clock noon, a question had been asked by the Hon. Member for Ottawa Centre (Mr. Evans), and you stated that the Hon. Member for Yorkton-Melville (Mr. Nystrom) would have a chance to reply right after lunch. I think the Hon. Member should have a chance to reply.


Mr. Deputy Speaker:: Does the Hon. Member for Yorkton-Melville (Mr. Nystrom) wish to reply to the question?


Lorne Edmund Nystrom: Yes, thank you very much, Mr. Speaker. The Hon. Member has asked a question about supporting Canadian investors and a general tax cut, and he asked why I cannot support the budget. I do not support it because I do not see anything approaching a general economic strategy for Canada. The Government does not appear to have any vision of where it wants the country to go. It does not appear to have any alternative philosophy in terms of the economic development of our country as spelled out in the budget. As a matter of fact, the budget does not even pose many questions about where the Government wants the country to go. For reasons like that, I certainly cannot support the budget.
The other reason is that I do not think there is much in it of importance to small business. We all know that small business creates many more jobs than big business. So far the Government has been more content to give incentives to the large business community.
In terms of the select tax cuts, the Parliamentary Secretary made an excellent point. He pointed out some of the structural problems we have in this country because of the fact that we have so much more foreign ownership and we import more manufactured goods per capita than any other developed nation in the world. When we do have selective tax cuts and when consumers do spend their money on consumer goods, much or perhaps the greatest majority would come from
The Budget-Mr. Nystrom
abroad. That is one of the problems. As an alternative, I would suggest that we consider selective tax cuts.
I note that a few years ago in Quebec the Finance Minister, Mr. Parizeau, provided a sales tax cut for goods produced in this country like shoes, clothing and furniture, giving consumers a real break and also stimulating Canadian industry. Perhaps we could do something similar at the federal level.
As a last point on the tax cut, once again, because of the structural problem we have in our economy, we are left with a pretty difficult choice as to whether we should have a tax cut and stimulate foreign enterprises or whether we should not have a tax cut at all. There is also a good argument, just for equity reasons, to have a tax cut for low income people, even though much of the stimulus which would result would, of course, go to the benefit of industry in Japan, the United States and elsewhere. Therefore, I would favour an across the board tax cut for low income people, but I realize the problems which would be created in terms of more goods coming in from abroad.
Therefore, I suggest that we consider making a selective tax cut which would perhaps satisfy both principles of having a more fair and equal tax system for the ordinary citizen who would spend the money to create more jobs, but the tax cut should be provided in areas where we do have Canadian industry, such as textiles and shoes.


Mr. Deputy Speaker:: Is the Hon. Member for Vancouver Quadra (Mr. Clarke) seeking to ask a question?


Mr. Clarke:: Yes, Mr. Speaker, I wanted to ask the Hon. Member for Yorkton-Melville if he included, in his opposition to foreign investment, the type of investment which would see the Japanese establishing a wheel plant in Richmond, British Columbia, creating some kind of employment out there. Is that included?


Lorne Edmund Nystrom: Mr. Speaker, I did say at the outset that there are some benefits from foreign investment, as long as we had control of foreign investment as Canadians and as long as we had agreements with other countries. I would like to see some kind of auto pact with the Japanese so that we would produce Japanese cars and plants in this country, which would provide some jobs here. I think that is something we should try to negotiate.
We must also determine what kind of foreign capital we want in the country. I have nothing against foreign debt capital, for example. I am more concerned about foreign equity capital because that gives control over industries to foreigners. In my own province of Saskatchewan, for example, our people decided many years ago to take over the electrical facilities in our Province. Much of the money to do so came from the United States and was borrowed on American financial markets. Once we paid off the mortgages, we owned the industry, which is the Saskatchewan Power Corporation. The other example is the Saskatchewan Potash Corporation. Again, part of the money to take over the foreign mines was

April 25, 1983
The Budget-Mr. Nystrom
American money, but it was money we borrowed in United States. Once we paid off the debt, the people of Saskatchewan owned that particular enterprise.
Therefore, I suggest that the federal Government consider those types of examples when it comes to foreign investment in this country. The important question is: Who will be in control of the particular enterprise once there is foreign money in it? 1 maintain that it is to the benefit of Canada that control remain in the hands of Canadians.


Douglas Glenn Fisher: Mr. Speaker, I would like to ask a question. The Hon. Member had a quick throw away line, which I think deserves comment on my part and additional comment on his part, to the effect that the budget does not do very much for small business. I differ with that statement. I quickly remembered five items suggested to us by the Canadian Federation of Independent Business. We followed all five of these items in the budget.
First, we used the tax system generally, instead of a system of grants, because the Federation felt it was a more direct way to send our aid to those in small business. We helped them write off their losses and put an emphasis on equity rather than debt. We have avoided payroll taxes and have used solid public works which will have ongoing benefits instead of adding make-work programs.
I wonder if the Hon. Member could tell us how he reacts to that when those were five of the key points recommended by the Canadian Federation of Independent Business when its representatives came to see us before the budget was announced.


Lorne Edmund Nystrom: Mr. Speaker, of course there is something in the budget for small business but, in my opinion, it does not go far enough to help the small business people in Canada. I think that will be the reaction of the small business community within this calendar year. I think there are many more incentives that the small business community needs, such as low interest loans to help them expand their operations-


Douglas Glenn Fisher: The Federal Business Development Bank.


Lorne Edmund Nystrom: The Hon. Member mentions the Federal Business Development Bank. I think that if he did a survey among the small business community in Canada-


Mr. Benjamin:: They quit going.


Lorne Edmund Nystrom: -he would find that they quit going, as my friend from Regina West (Mr. Benjamin) says. I think he would also find that they were very dissatisfied with the type of help that is available from that institution.
The federal Government has generally been more content to aid big business in this country through the tax system and its policies rather than small business. Small business tends to be Canadian owned and controlled and tends to create many more jobs than the massive, foreign owned enterprises.


David Michael Collenette: Mr. Speaker, I apologize for jumping too quickly to my feet a few moments ago before the previous speaker's question period had ended.
It is indeed a happy occasion for a Member on the Government side to speak in this budget debate. For the last year and a half, Members of our Party, supporters of the Government and all Canadians generally have been on the defensive as a result of the problems that have been caused by the recession in our country. It is indeed a pleasure to be able to stand up in the House at last and talk about some good economic news.
There is no doubt in my mind that we are well on our way to restoring economic health in Canada, and this can be borne out by looking at the leading economic indicators in the country. But we must ensure that while on this road to economic recovery we enhance its growth which is expected to occur in the coming year. This Parliament, the federal Government and provincial Governments as well must not do anything to undermine that economic recovery.
As I have said, the aim of this budget has been to enhance the recovery and create an underpinning of sustained longterm growth. I believe all Canadians want to see this happen. Not only Members of our Party but Members opposite believe that these goals should be realized. While we may have some differences as to the nuances of policies to enhance economic recovery, there cannot be any quarrel with the basic objective outlined by the Minister of Finance (Mr. Lalonde) in his budget.
I would like to digress for a moment and talk about the Minister of Finance. He came into the portfolio last October during a very difficult time for the Government and the country as a whole. Without a doubt he has performed admirably in that portfolio. As a Member from Metropolitan Toronto, which I believe is the leading business centre in the country, I may say that the Minister has won many friends as a result of his determined effort to consult widely with the business community, labour, consumer groups and individual citizens. Indeed, I have no doubt that certainly in Metro Toronto the Minister has been tireless in the number of visits he has made to the communities and in the amount of time he has spent meeting with people to discuss the economic future of the country.
I spoke a moment ago about the signs of economic recovery taking place. I would like to highlight two or three of those signs which have given me the confidence that it is taking place. First, there has been increased confidence in the stock market in the past six months. There is an old adage which states that the stock market always anticipates the real economic climate on the street about a year to 18 months ahead of time. If that is true, the real signs of economic recovery will be felt strongly by ordinary Canadians, including those who are trying to keep their jobs, manage their businesses and those who are seeking work, later this year and early next spring.
There has been a rise in the leading industrial indicators both here and in the United States. We have seen inflation dropping. I understand that the inflation rate in the United
April 25, 1983

States has been approximately zero for the last two or three months, which is an admirable performance in that country. I will talk about the differences between inflation in the United States and Canada in a few moments because several factors must be taken into account when comparing inflation between the two countries.
However, the six and five program which was instituted in this country last summer has been an overwhelming success. We have seen the inflation rate drop to 6.5 per cent or 7 per cent in the last four months. June 28 of this year will be the anniversary of the announcement of the program last year and there is every indication that the inflation rate will be down to 6 per cent for the 12-month period from June 28, 1982 to June 28, 1983. If we reach that goal, which I am sure we will, our goal of 5 per cent inflation for the next year will easily be attainable if we take the right steps as a Government and as citizens.
While there has been a slight resumption of consumer spending, it has been enough to make our retailers smile at least a little. It is our hope that people will begin to spend more as increased confidence continues over the next few months.
Members on the Opposition side will say that Canadians do not have the money to spend. While that is true for the 12 per cent who are out of work and those who are fearful of losing their jobs, we must remember that 88 per cent of the work force is employed. We must also remember that the Canadian savings rate are at an all-time high. My constituency in Metro Toronto is by no means wealthy. It consists of lower and middle income Canadians. As I travelled through my constituency I found that many of my constituents have been very prudent, putting money aside in the good years to provide for the lean years. They are still working but they are reluctant to purchase. Their fear has caused them to keep their money in a nest egg.
A comparison shows that the Canadian savings rate is also double that of the United States. Disposable income in the United States is 6 per cent whereas it is 13 per cent in Canada. I suggest that this indicates there is room for ordinary citizens to begin once again to make those purchases which they have held back on in the last years because of their fear of the economic climate in the country. Indeed, we have seen some resumption in consumer spending and I think we will see more.
Let me deal with housing for a moment. Housing has been the traditional bellwether index in this country. I am pleased to say that housing starts have increased significantly over the past year.
The important strategy for all Governments in Canada to use is to enhance the economic recovery that is now under way. There has been much discussion up to this point in the debate about how this budget benefits the business community. My opinion that this is true has been reinforced as a result of talking to my friends in the Toronto business community. They are absolutely ecstatic about the measures that have been introduced which will improve the investor and the business climate generally. We have heard a great deal in this debate
The Budget-Mr. Collenette
about the federal investment tax credit and the initiation of the Special Recovery Investment Fund and the Special Recovery Export Financing Fund. As well there is the indexed Securities Investment Plan and the changes in the tax treatment regarding business losses. These have been very well accepted by people both in the big business community and the small business community.
I recently went to the opening of a refurbished landmark in my community, a local restaurant that has been renovated. Its owners are very enthused about the way the budget will help their small business. Clearly small business as well as big business is happy about the budget.
It is important that the budget makes provisions to help business because the private sector must be the engine for economic growth in the long run. The Government and the public sector can do a lot by levering funds from the private sector, but they cannot bring about the resumption of economic health and the creation of more jobs on their own.
However, we must not lose sight of the fact that the budget does more than just help business. Let us look at how ordinary citizens will be helped by this budget. Let us take a look at housing. Housing is one of the bellwether industries of this country. It has suffered severely in the last couple of years but it is now seeing its recovery under way. The theme is to enhance the recovery occurring within the housing industry. As interest rates have declined, housing sales have started to surge. In Metropolitan Toronto where very few houses moved last year we are now seeing quite a surge in sales. That means people will be moving out into the suburbs and buying newer houses. Those people in apartments who have been saving up over the last few years will now look to moving out and buying their own homes.
An amount of $250 million has been set aside for housing and related measures in this budget for 1983-1984. New housing starts are expected to be boosted to over 175,000 this year alone and to 200,000 in 1984. Those are not quite the levels we saw a few years ago but the number is indeed significant. As houses are being built, building materials are in great demand, which helps every single sector in the country. The forest products industry and other allied building industries that have suffered so much in the last year will also be helped.
The Canadian Home Renovation Plan, which has been a great success in my area, provides up to 30 per cent of the cost of home improvement to a maximum of $3,000 and will be continued and enhanced. This will help all Canadians in the moderate income bracket.
The Canadian Home Ownership Stimulation Plan, which I think has helped to spur the housing sale resurgence that we have seen in the last year or so, has been extended another month. That is very important in the Spring season because people will be able to take advantage of the program, which provides a $3,000 grant to buyers of new homes.

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The Budget-Mr. Collenette
The Registered Home Ownership Savings Plan has allowed people for the past ten years or so to set aside $ 1,000 a year up to $ 10,000 tax-free to help toward the purchase of their homes. This will be adjusted and allow people to build up that $10,000 ahead of schedule. It will accelerate the achievement of $10,000 to 1984. This will give a real boost to people who have a bit of extra cash. There are people around who have considerable savings as a result of the high savings rate that we have had in the country. Hopefully, this will encourage people to buy those houses now rather than wait two or three years.
Then we have the Residential Rehabilitation Assistance Program which has been designed to upgrade sub-standard housing in designated areas. The money for that program has also been increased. That, I think, is a pretty good group of measures for the ordinary taxpayers in the country, not those concerned with capital gains and other tax and business incentives, but the ordinary taxpayers.
But there is more in this budget which makes it a document to which I am proud to give support in the House of Commons. First, the child care expense deduction will be doubled to $2,000 per child, up to $8,000 per family. That means a lot to working parents, especially in my constituency and in all those constituencies in the country which are made up of lower and middle-income groups.
Getting back to the Registered Home Ownership Savings Plan, there is now a provision whereby the money in existing plans this year can be freed up to be used not just for purchase of homes but for the purchase of furnishings and appliances. It is funny but about a month ago one of my constituents came to me with that specific request. The individual is a lady 66 years of age. She and her husband I suppose, when the plan first started, were in their middle 50s. They had intended to buy a house. All Canadians, I think, have the dream of owning their own home at one time or another. This couple had that dream. They put aside $2,000 or $3,000. But the husband died and the surviving wife fell upon tough times. There was no way she could afford to buy that home. The lady is now living in assisted housing in my constituency, assisted by the Metropolitan Housing Corporation, CMHC and the provincial Government. She is living a life with dignity as a senior citizen, but she had $2,000 or $3,000 in a RHOSP and she wanted to make use of that money. I made a request of the Minister of Finance and I got a nice answer from him. He said he was sorry but the plan did not cover taking money out for furnishings. That was all the lady wanted. She wanted a new fridge, stove, a chesterfield and that type of thing in order to furnish her apartment in a proper manner. Then low and behold we have a proposed change in the budget which will help this particular lady.
I will not be so immodest as to suggest that this was my idea, but I am very glad the representations I made, and which I am sure other Members made, on this particular point were accepted by the Minister of Finance. It shows how sensitive he is, not only to opinions of interest groups in the country but also to those of Members of this House. I have at least one happy constituent and I am sure there are a number of others
who have the same kind of circumstances this lady had. These people are no doubt quite pleased by that particular budget measure.
Of course, this measure will also help the retail furniture industry which has been hard hit in the last year. This measure will help the industries that produce appliances, chesterfields and other home furnishings.
One particular matter about which I am very glad is the proposal to make the Student Loans Program applicable to part-time students. We tend to think that there are two categories of students. First are the ones full-time at school who work in the summer but live at home with their parents. They really do not have too much in the way of difficulty getting through from year to year. Second are the part-time students who are cribbing at night upgrading themselves, and working in the day.
There is another group of people who do not have the luxury of living in their family homes and are perhaps working parttime in service industries in particular. They live with two or three other young people away from home. As I understand it, these people have been ineligible for student loans. Now we have a proposal where the student loans program can be applied to part-time students. I think that is a very laudable measure.
In the budget the Government has also allocated an additional $170 million for the job creation program. There have been a few problems in Toronto with the NEED Program starting up, but that has more to do with the fact that the officials at Employment and Immigration branches in Metropolitan Toronto have been swamped with the work they have been expected to perform in job creation. They have the normal summer and winter job creation programs and now they have the NEED Program. With the general retrenchment in Government hiring the past few years, these people are working literally night after night-I know this has occurred in Toronto-trying to make these programs work. We have had some problems in my own area of the Borough of East York, but I have been fortunate enough to have had the cooperation of the Department. Some senior officials have spoken to the Mayor to help speed up the projects.
An additional $170 million will be pumped into the job creation program over the next couple of years, which means another 120,000 jobs will be created in the short term. Much of this budget is geared to long-term growth and stability and long-term job creation. However, we have to realize there are an unacceptably large number of people out of work. This is one measure that will help increase and create employment in the short term. I might just say that $280 million has also been allocated to help youth employment.
There is one item of $2.4 billion on which I want to touch briefly. This will be pumped into the economy by the large capital projects. This morning the Minister of State for Economic Development (Mr. Johnston) and the Minister of the Environment (Mr. Roberts) made announcements. Others followed up on that. I will not go into the details.
April 25, 1983

One message has been given to the Minister of Finance (Mr. Lalonde) over the past six months by the Provinces and municipalities. The message is that large scale federal projects can help get the economy going. The Ministers announced such programs as the purchase of water bombers from Cana-dair and modernization of the Coast Guard, $147 million for the water bombers and $630 million for the Coast Guard modernization. The Provinces and municipalities will try to build on this. This is perhaps one of the largest areas of control we have whereby we can increase the job-making potential in this country. I refer to public procurement.
In my brief sojourn in the private sector when the Thirty-first Parliament was elected and I was not, I was involved with public procurement in private industry. With the amount of money at the disposal of federal, provincial and municipal Governments, there is no doubt in my mind that an imaginative use of Government procurement policy can be of much help.
In addition to the announcements today, other projects will be announced in the next few weeks such as the core area, industrial parks and harbour-front improvements. I could go on, but my time is up.


Mr. Deputy Speaker:: Are there Members rising to ask questions? If not, the Chair will recognize the Hon. Member for Vancouver Quadra (Mr. Clarke).


William Hillary (Bill) Clarke: Mr. Speaker, I am shocked to be standing here today to debate a budget introduced by the Minister of Finance (Mr. Lalonde) who has earned the reputation or nickname of the $200 million Minister. The Minister demonstrated such a total lack of ministerial responsibility with at least three breaches of the oath of secrecy that I am astonished and shocked that he was allowed to present his budget and that this debate is allowed to proceed.
I referred to three leaks. One is well-known. It was the infamous photo opportunity in which the Minister invited the press to come to his rooms where he joked about telephoto lenses. He unwittingly allowed telephoto lens exposure of pages of his budget, revealing a very important $4.6 billion recovery program. That $4.6 billion figure was deceitfully changed between the exposure and the delivery of the budget speech to $4.8 billion. The result is that taxpayers must pay an additional $200 million to save the skin of the Minister of Finance.
Less well known perhaps were two other information leaks from the budget. On Tuesday, before the budget was announced, Ian Morrison, President of the National Voluntary Organization, sent a telegram to members of that organization saying that reliable reports from Government were that the $100 deduction for charitable purposes would be reduced or eliminated. That became a fact when the Minister of Finance announced it on budget night. I may have more to say about that later.
The Budget-Mr. Clarke
The third not so well known leak occurred the week before budget night, about ten days ago. There were front page news reports of high Government officials indicating that the child care expense deduction would be doubled. Sure enough, we saw that on budget night. After the budget, the Minister said that budget secrecy was outdated. The Party opposite has shown it can change principles to suit whatever circumstances it happens to find itself in. This is just one, and I suppose we should not be too surprised.
This is the Government which was confronted with breaches of conflict of interest guidelines by Alastair Gillespie, a former Minister and the then Minister of Energy, Mines and Resources. The evidence was clear. The Prime Minister (Mr. Trudeau) said that, after all, they were only guidelines, they were not carved in stone. He even stated in the House that they would be happy to change the guidelines if Members opposite would rather see the guidelines more closely fit current practices.
I am not surprised to see such behaviour from a Government led by a man who uttered unprintable or at least unparliamentary words to striking workers in Quebec from the back of his limousine. This Cabinet includes a self-confessed forger, another who was convicted of contempt of court. Another, now departed, admitted dialing a judge in an attempt to influence a court. A couple of others who have fled the scene gave us such incidents as "Nannygate" and "Coalgate". At present we have an expert on sex who told one of his colleagues that everyone knows that after you get laid you get hungry. With behaviour like that, we should not be shocked by anything this Minister does. It seems the only way to get out of the Cabinet is to tell the truth. I am sure a few occupants of the front bench would attest to that.
In the 30 or so hours during which this debate will carry on, about 70 Members of Parliament will be called upon to speak. They will cover many different topics. I want to touch on some areas covering the treatment of individual Canadians. Before the business community smiles too broadly about this budget, businessmen should look at the effects it will have on individual Canadians. It is these individuals on whom businessmen rely for their fortunes and futures.
I should say something good about the budget before I comment on the sneaky and deceitful things that I see in it.


Mr. Blais:: Come on, now.


William Hillary (Bill) Clarke: The good thing is that the child care expense deduction has been doubled. I say amen. I also say it is about time. I want to make reference to efforts that I have made to get increases in this deduction. At least ten times in this House, on motions under Standing Order 43 under the old rules, in Question Period, in speeches, in letters to Ministers and as recently as in January, 1983, in Question Period, I have raised the matter of the child care expense deduction that has not changed since 1976. For a deduction of that sort to not change in seven years is unforgivable. Those who need that deduction are the working mothers and single fathers. They should get the whole deduction of costs, not just $2,000. A
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April 25, 1983
The Budget-Mr. Clarke
decent daycare facility in any centre in Canada costs at least $4,000. This Government is finally willing to permit a $2,000 deduction. A working mother or single father who had to hire a clerk to stock shelves in his or her store would be allowed to deduct the total cost of that expense, but not if it is for child care.
Mr. Speaker, there are two important changes of principle that are proposed in this budget. The Minister of Supply and Services (Mr. Blais) took objection to my use of the word "sneaky".


Jean-Jacques Blais: Deceitful.


William Hillary (Bill) Clarke: Well, deceitful. I will repeat it. These changes were introduced in a sneaky and deceitful way. Mr. Speaker, I will outline the problems and I will show you where those actions occur in the Minister's speech.
The first principle to be proposed in an underhanded way is to freeze personal exemptions. That trial balloon had been flown by another Minister earlier in the year and that Minister was shot down in flames. So this Minister of Finance has proposed that it is only the child exemption for children under the age of 18 that will be frozen at the present level of $710. What exactly did he say? On page 14 of the budget speech, he said:
-I propose to keep at its current level of $710 the tax exemption for children-
In other words, he is deindexing the child tax exemption even though indexing was introduced by one of his predecessors ten years ago. Mr. Speaker, I say it is deceitful because when one reads "keep at its current level", one does not think that it is being frozen or that it is being deindexed.
The Minister used similar terminology in that same section of the budget speech when he was referring to the income threshold above which the Child Tax Credit will be phased out. He used the soothing words, "hold at the present level" the family income threshold. Mr. Speaker, what he meant to say and what he would have said if he had been truthful is that he is freezing the family income threshold. In other words, the family income threshold has been deindexed. This is a very important principle that has been changed in a sneaky and deceitful way by this Minister in this budget.
Another very important principle is being changed by this budget, the principle of imposing tax on unreceived income. The Minister of Finance did not stand up and say, "Fellow Canadians, I am going to start now taxing your unreceived income". No, he gave the people a little gift. On page 7 of his budget he introduced the Indexed Securities Investment Plan. He said:
The Indexed Securities Investment Plan is also a significant step in our systematic search for ways to remove the distorting effects of inflation from our tax system.
That sounds great. We would applaud it on this side of the House. In fact, four years ago I chaired a committee of this Party which recommended the very same thing. So that sounds great, but we cannot just read the Minister's speech. We have
to go to the multi-paged booklet on the Indexed Security Investment Plan. I would just excerpt a few statements taken from pages 2 and 3 so that people will realize what this Minister was up to in his underhanded way. To establish an ISIP-an Indexed Security Investment Plan, Mr. Speaker- one needs an administrator in much the same way as one needs an administrator for an RRSP. The booklet contains these words:
At the end of the year, the administrator will give the investor an information slip with all the information necessary for inclusion in the investor's tax return.
A little room is left for doubt there, Mr. Speaker, but on the next page he goes on about the calculations:
The second calculation is the determination of the portion of real capital gains or losses required to be recognized for tax purposes each year.
Further down on page 3 of the booklet he goes on to say:
Only 25 per cent of the real gain is required to be reported for tax purposes each year-
Can there be any doubt of the intent to tax unreceived gains? When he says "real capital gains", Mr. Speaker, he is referring to the capital gains in excess of the rate of inflation. If we did not have a Government that encouraged that kind of policy, we would be better off and would not need all of these plans to overcome our problems.
Mr. Speaker, on page 17 of his speech, the Minister was again being very nice. About other tax changes, he says:
Representatives of voluntary organizations have expressed concern that this-
That is, $100 deduction for charitable donations.
-reduces the tax incentive for charitable giving since the deduction is not directly related to actual amounts given.
That is true only as far as it goes. The Minister failed to say that in discussions with delegations from the voluntary sector, the Minister had been told that it was important that the $ 100 exemption be removed, but it was equally important that it be coupled with a tax credit system so that gifts to charitable organizations could be offset by a tax credit. We have a system given to us by the Government opposite which allows contributions to a political Party a more beneficial tax treatment than it allows contributions to a church. That is inequitable and wrong.
The Government had the opportunity to put things right. Instead it has angered the whole voluntary organization sector in Canada by removing the $100 deduction. This means that all of those organizations are going to incur enormous costs in sending out receipts which people formerly did not want. If people had only given $5 to a charity and had the $100 exemption, they could give $5 to half a dozen or ten or 15 other charities and still not need receipts. Now they are going to need those receipts and the voluntary sector is going to have to bear the cost of producing and mailing out those receipts.
Mr. Speaker, that is not the worst feature of the underhanded and unfair removal of the $100 deduction. It amounts to an $80 million tax grab by the Government. That is the exact figure that appears on page 25 of the Minister's budget papers. He says that the loss of the $100 charitable exemption will
April 25, 1983

produce an extra $80 million in revenues for the Government in 1984, lest anyone think that I am being unfair.
That is not the only tax grab from individuals that is contained in this budget. The Minister announced that he is going to reduce the federal tax reduction for many Canadians. That will result in an extra revenue in 1984 of $265 million. The freeze on the exemption for children will produce an extra $35 million. The Child Tax Credit adjustments will produce an extra $235 million, and then there is the consumer tax of 6 per cent on cable services. The Minister says that will raise $50 million. The so-called special recovery tax of 1 per cent on manufacturers' sales and 1 per cent on building materials, etc., will produce $70 million. This amounts to a total tax grab of $735 million by the time those policies have matured in 1984. Goodness knows what it will be after that, but that is what it will be then.
In his comments this morning, the Minister of the Environment (Mr. Roberts) made reference to an announcement that his colleague, the Minister of State for Economic Development (Mr. Johnston), had made earlier today. I was surprised because the Minister of the Environment spoke at about 11.15, just after the House met this morning. What does that tell us, Mr. Speaker? It tells me that the Minister of State for Economic Development revealed some more details about the recovery program. But where did he reveal these details? Before what forum did he make these announcements? We are in the budget debate. This is the third day of the budget debate. The Minister of State for Economic Development is revealing budget information, but where? Not in the House of Commons, not in the budget debate, but in some other forum. I suppose we will have to read about it in the newspapers.
The Minister of Finance also made reference to business in his speech. He said that Canadian businesses have been battered by the recession, and he went on to describe what he would do for businesses. I think he should have said that Canadian businesses have been battered by the Government over the past decade or so. They have been battered by Government policies such as the National Energy Program, higher interest rates and many other interventionist policies.
The Hon. Member for York East (Mr. Collenette) spoke about people saving their money because they were afraid. Of course they were afraid; they were afraid for their jobs and for their homes. He did not say that they were afraid of this Government. They were saving their money, Mr. Speaker, because they did not know when they would be in dire need of savings. As a result, businesses suffer and bankruptcies abound.
The Government introduced cruel job programs that only lead to dead ends. After three or four months on a job program people find themselves out of work again and perhaps not eligible for Unemployment Insurance benefits. Young people do not want short-term jobs; they want careers. Unless the Government comes forward with a policy to get the economy
The Budget-Mr. Clarke
back on the rails they are not going to get permanent jobs. In fact some of them are displacing people who have permanent jobs. Some of the Mickey Mouse programs that the Minister has introduced at various times encourage businesses to hire young, subsidized workers by paying part of their wages. That just results in long-term expert workers being laid off. They then apply for Unemployment Insurance benefits. That kind of program just incurs more deficits Mr. Speaker.
The Minister is proposing continued record deficits. As somebody or other said, "We ain't seen nothing yet". The total projected deficits for the next four years are higher than the total deficits for the last 11 years. Already about 25 per cent of every dollar taken in by the Government is paid out in interest. That has to stop, Mr. Speaker.


Mr. Deputy Speaker:: Do any Hon. Members wish to ask questions of the Hon. Member who has just spoken?


Jean-Jacques Blais: Yes, Mr. Speaker. The Hon. Member ended his remarks by dealing with the national debt. Hon. Members opposite do not often deal with the question, by whom is the national debt owed? The Hon. Member has undoubtedly read a recent article in The Toronto Star by Reuben C. Bellan with the headline "Recovery blocked by myth". Does he recognize that the national debt is owed by the Government of Canada to the people of Canada? Does he know that the holders of the national debt are the holders of Canada Savings Bonds who in effect are being paid the interest rate that the bonds bear?
Would he like to indicate to the House that he agrees that is the case and that although the national debt tends to increase from time to time as it did during World War II, as prosperity returns that debt is discharged and is paid back to Canadian citizens who are the holders of Government securities?


William Hillary (Bill) Clarke: Of course I realize who is owed the national debt, Mr. Speaker. But that is the tragedy. Those Canadians should not be buying Canada Savings Bonds, just to allow the money to be dissipated by the Government opposite which has no idea what it is doing. People should be investing their savings in Canadian business. Those people who invest in Canada Savings Bonds are being robbed by the Government which allows inflation to increase. The person who invests $100 is lucky to get $50 in purchasing power back-if he ever does. Some people who invested in Government bonds in 1936 will never get their money back.
The Minister raises the point that there is nothing wrong with debt. Of course there is not. There is no businessman who does not have debt and no one expects the Government to exist without debt, but we all expect the debt to be under control. Any businessman who borrowed in the ratio that the Government has borrowed and continues to borrow, would be bankrupt. Anyone must be able to service the debt. Every individual or business borrows for capital projects, whether it be a car or a house or a plant or a fleet of trucks, and there is nothing wrong with that. Sometimes I think that I have more debt than I would like myself. Debt must be serviced, Mr. Speaker and the Government's debt is rising to the point where it will not be

April 25, 1983
The Budget-Mr. M.A. Dionne
able to service it. That is when the collapse comes, but Hon. Members opposite do not seem to realize it.


Jean-Jacques Blais: Mr. Speaker, 1 appreciate that the hon. gentleman is trying to extricate himself from difficult assertions, but he is not doing very well. May I ask him whether he knows of any stockbroker or investment counsellor in the country who would advise his clients against investing in Canada Savings Bonds, or whether he knows of any investment which is more secure than Canada Savings Bonds?
May I also ask him whether he knows what the rate of savings is today in Canada? It is upwards of 13.8 per cent, the highest it has ever been. Would the Hon. Member address the question of any hindrance to individuals who are saving their money today, not in bonds but in other forms of saving, from investing that money in equity, especially in view of the budgetary provisions that have been announced by the Minister to encourage this?


William Hillary (Bill) Clarke: Mr. Speaker, I do not know of any self-respecting stockbroker who would advise any normal investor to buy Canada Savings Bonds. I will give the Minister some credit however. I did advise my mother to invest in Canada Savings Bonds, but she is 85 years old. She is not looking too far ahead and she needs liquid capital. She needs security, not long-term growth. The only individuals in Canada who should ever invest in Canada Savings Bonds are those who need short-term security of capital-a short-term home for interest-bearing securities.
As far as the rate of savings is concerned, the Minister says it is 13.8 per cent. I knew it was very high and I explained why that was so. Those who are working are afraid they are going to join the ranks of the unemployed. They are afraid of what the Government is going to do to them. That is why the rate of savings is so high. The Government ought to be ashamed that the rate of savings in that kind of security is high. Canadians should be encouraged to invest in the country and make their savings work.


Jean-Jacques Blais: Mr. Speaker, my last question to the Hon. Member is whether he has read the budget.


Mr. Maurice A. Dionne (Northumberland-Miramichi):: Mr. Speaker, I welcome the opportunity to put before the House some of my views concerning the federal budget introduced by my colleague the Minister of Finance (Mr. Lalonde).
I listened to the last speaker very carefully. I hope the Hon. Member will stick to giving financial advice to his mother!
I should like to comment on the measures announced by the Minister, particularly those designed to generate jobs. While 1 know that Hon. Members are concerned about the tragically high levels of unemployment in the country, few areas have been hit as hard as the Miramichi area of New Brunswick which I have the honour to represent.
There are a number of reasons for the high unemployment in our region and I am pleased to see that the Minister has
taken steps to address some of them. The Miramichi economy has been sustained by two principal sources of employment over the years. The first, and by far the most important, is the pulp and paper industry and the forest industry generally. This industry has been among the hardest hit by the severe recession in the western industrialized world. A significant fall in pulp and paper prices, severe decline in consumption, complicated by devaluation by a major competitor, have all combined to bring this industry to the brink of disaster. The industry itself has taken steps to reduce costs and become more competitive and that, of course, is all to the good. Markets have begun to improve. Most of the factors which lead to the layoffs in this industry were foreign induced, however, and therefore most of the solutions will also come from abroad.
There are, however, steps which the Government can take to hasten the recovery and to make it a more sustained one. The Minister has included in his budget two initiatives which will assist in the recovery and the provision of jobs in the Miramichi. As a result of high interest rates and declining sales, the balance sheets of many of the firms in the pulp and paper sector have taken a beating. Any increased cash flow as a result of firmer prices and sales would go to paying down vastly higher debt loads than normal. A number of the tax incentives announced by the Minister will permit a faster restoration of healthy balance sheets and a more rapid recall of the thousands of workers who have been laid off during the past two years. As well, in announcing increased outlays of capital projects, the Minister can assist in the effort to make industries in the Miramichi more competitive.
I have been working in co-operation with the Minister of Public Works (Mr. LeBlanc) and the Minister of Transport (Mr. Pepin) to ensure the construction of new port facilities in the Newcastle-Chatham area. I am confident that the announcement of new funds allocated for capital works will mean that these facilities will be commenced this year. The construction of these facilities alone will mean a significant reduction in costs for Miramichi and area pulp and paper producers, and will most assuredly lead to new jobs as well as the maintenance of existing employment. When this investment in port facilities occurs, Mr. Speaker, it will mean that this Government has invested somewhere between $25 million and $30 million in an increased navigational system for the Miramichi.
It is my belief that the combination of the tax changes announced by the Minister, plus the allocated funds for capital construction, could lead in the near future not only to the rehiring of previously laid off workers but to significant new investment in the pulp and paper industry in the Miramichi, investment which would help to diversify and upgrade the product shipped from our area and to make us less vulnerable to the peaks and valleys of this industry. I believe there are also incentives in the budget which will help the mining and
April 25, 1983

mineral companies to reverse the situation in which they have found themselves in the last few years, and I hope that Noran-da, and the owner of Heath steel mines, which has announced major lay-offs for the end of this month, will take a new look at the situation under the terms and provisions of the budget and other existing incentives provided by Government to keep facilities such as these functioning, in the hope that this company also will be able to find a way to keep that mill open and its people employed.
There is one comment I would like to make with regard to the Minister's announcement of a Committee under the chairmanship of the Minister of State for Economic Development (Mr. Johnston) to avoid delays in implementing newly announced projects. While I welcome the creation of this Committee, I must caution the Minister that eternal vigilance will be necessary to avoid the mounds of red tape which have accumulated in the federal bureaucracy over the years. In my opinion, red tape and interminable studies are two of the greatest stumbling blocks to solving problems with respect to the provision of employment. While I applaud the Minister's intentions, I am sure he will understand that I will reserve a standing ovation until I witness actual performance.
The second sustaining employment factor in my area, Mr. Speaker, has largely been the presence and investment of the federal Government there. I spoke a moment ago of the $25 million to $30 million investment in port and navigational improvements. Besides that, of course, we have benefited largely from the job-creation projects which the Government has designed over the years. We have in our riding a major military base, and I would like to comment briefly on that. That is proving to be a very difficult problem which, if it is not solved, will help to worsen the unemployment situation. I am referring, of course, to the Government's rather poorly timed, unwise and in fact unnecessary decision to stand down the 416 Squadron at CFB Chatham at the end of 1984. It is difficult for me, as an Hon. Member from a district with unemployment approaching 50 per cent, to explain how the Government can announce measures to increase employment in the Armed Forces as a job-creation measure while generating unemployment in one of the hardest hit regions of the country as a result of actions having to do with the same Armed Forces. It is imperative, therefore, during the next few weeks-and I emphasize "weeks", Mr. Speaker, I am not saying months-as Ministers make decisions on projects to aid in the national recovery plan, that they not forget the special obligation they have to the residents of the Miramichi. As the Member of Parliament from this area, I can assure the House that I will continue to remind my colleagues of this special obligation for as long as I represent my electors. I am convinced that the Government will respond to its commitments and work with me to broaden the economic base of the Miramichi region. However, we need some concrete evidence of that commitment, and we need it without further delay. The Minister of Finance has taken some action in his budget which will help in this regard. I caution my colleagues, however, that the people of the Miramichi, and I as their elected Member, will measure
The Budget-Mr. McLean
this Government's commitments by its actions rather than its words.	f
A new prison is under construction at Renous, the site of another former military establishment. It is making progress and, of course, I welcome that. In fact, 1 must say that the Solicitor General (Mr. Kaplan), in my opinion, has been a "doer" rather than just a "sayer". I appreciate his efforts and his co-operation. However, vis-a-vis CFB Chatham, it has been now some 18 months since the Minister of National Defence (Mr. Lamontagne) made the announcement with respect to the 416 Squadron. In that time the Minister has announced that the Department's directorate of pay services will be transferred to Chatham. That will provide 350 much needed jobs. We of the Miramichi appreciate this move, but it still leaves 1,150 positions to be replaced. Those are 1,150 military positions, not civilian. Whether they are replaced with military or civilian personnel makes little difference to me, but the fact they must be replaced makes a great deal of difference. Our patience is wearing thin. It is time for some decisive action with concrete results. I sense that in the budget there are means and mechanisms to resolve problems such as CFB Chatham, to cut through the red tape and get it done. I remind the Government again that this is a problem of the Government's own making. I expect to see these provisions used forthwith to effect solutions and to provide desperately needed employment.
I shall be voting for this budget, Mr. Speaker, because it is a good budget. In fact, it is one of the best I have seen since I have been here. The provisions can be used to bring relief for hard hit areas. No Member elected under our system looks for opportunities to vote against the Party or the Government he is elected to support, and our system demands loyalty to sustain stability in Government. I shall stand or fall politically as a Liberal. I was elected as a Liberal and I shall remain one. But I was sent here-


Mr. McKinnon:: No ambition.


Maurice Adrian Dionne: -to represent the electors of Northumberland-Miramichi. I notice the hens yonder are starting to cackle again. Obviously they do not understand what a bit of loyalty means.


Allan Bruce McKinnon: We are laughing.


Maurice Adrian Dionne: It is to the
electors of Northumberland-Miramichi that I owe and willingly dedicate my first loyalty and I always will, Mr. Speaker.


Mr. Deputy Speaker:: Are there Hon. members rising to ask questions? If not, I recognize the Hon. Member for Waterloo (Mr. McLean).


Mr. Walter McLean (Waterloo):: Mr. Speaker, in entering into this budget debate I do so in concurrence with the amendment before the House to the effect that this House condemns the Government and rejects the budget for its failure to

April 25, 1983
The Budget-Mr. McLean
address adequately the human tragedy of unemployment. It goes on to speak about the unmanageable deficit and the greater tax burden on Canadians.
In entering the debate let me identify with the comments of my colleague, the Hon. Member for Vancouver Quadra (Mr. Clarke), who spoke to one particular aspect, namely, the removal of the $100 charitable deduction. He spoke of it as a tax grab on the part of the Government as it pretends to be helping the voluntary sector. Earlier today in Question Period, in response to questions by my colleague, the Hon. Member for Edmonton South (Mr. Roche), we heard the Minister trying to persuade the House that somehow, in ignoring the give and take tax proposals and in somehow removing the $100 tax deduction, he was giving an incentive to Canadians by allowing them to file receipts. We also heard him arguing that the voluntary sector had done fairly well in Canada, and that somehow by having all its proposals ignored it had been encouraged.
In these few moments, as Opposition spokesperson for the Department of the Secretary of State I want to lay before the House the failure of this Government with relation to any effective measure in support of the voluntary sector. Let me begin not just by referring to the leaders of the national voluntary agencies of Canada, the 100 major agencies, but rather by referring to my own riding and sharing with Members of the House comments which come from Ernie Ginsler, President of the Waterloo Region Social Planning Council. His reaction to the Government's proposal as it relates to the voluntary sector was as follows.
According to him there are no job creation rules set out for the voluntary sector. Make-work projects lack creativity. The cost effectiveness of the voluntary sector continues to be ignored by this big spending Government. He then went on to say that the documented effectiveness of the give and take tax proposals was ignored. The large capital public works projects which the Minister of Finance (Mr. Lalonde) said he was moving up from the end of the decade may create work for some of today's unemployed, but in his estimate it will be at the cost of greater unemployment at the end of the 1980s. He then went on to say that in seeking to motivate the voluntary sector in that part of southwestern Ontario, he sees no acknowledgement of the fact that 50 weeks of UIC benefits is not good enough in this economy. Community support services are already stretched to the breaking point by the imposition of six and five on the social service section of the Established Programs Financing Agreement, and the federal Government is merely shifting the load of the whole UIC exhaustee problem to another level of Government, namely, the municipal level. He ended his comments by saying that this Government quite clearly has demonstrated absolutely no understanding of the complexity of the services delivered by the voluntary sector into the life of Canada. With this, Mr. Speaker, I concur.
I want to remind the House that in Committee, in public utterances, and in the House, the Government has been indicating that it intended to take seriously the proposals and the input of the voluntary sector. On March 2, 1983 I wrote to
the Secretary of State (Mr. Joyal), and I want to share with the House the contents of that letter in which I outlined my Party's willingness to work with the Government in laying incentives before the voluntary sector. I said:
As I told you during the Proceedings of the Standing Committee on Culture and Communications, on November 23, 1982, and as I have subsequently underlined in Question Period interventions, the Official Opposition is eager to participate in the Parliamentary investigation of fiscal and legal situations facing Canada's voluntary sector which you announced in Toronto earlier that month.
In the nearly four months since you made the announcement, I have become increasingly concerned about the penalties being imposed on the voluntary sector by the inconsistent and unco-ordinated actions of various Departments in the Federal Government. Failing the establishment of a recognizable umbrella policy for voluntary action, a promise of Secretary's of States since 1976, this sector as a whole, and individual agencies in particular, are increasingly forced to contend with operational disincentives laid in their paths as a result of short-sighted rulings emanating from the Departments of National Revenue and Finance.
I went on to remind the Minister that:
I have always felt that an energetic Parliamentary review of this situation could be a first step in encouraging Canada's voluntary sector to maintain and expand those services for which it has received well-earned recognition. The current economic situation has brought another level of urgency to such an investigation. You will recall that a predecessor of yours, Hon. David MacDonald, P.C., M.P., announced on November 2nd, 1979, the creation of a special Task Force of the House of Commons, "to report its conclusions and recommendations with respect to the measures that could be taken by the Federal Government to strengthen the role of the voluntary sector:
1.	as an objective that is desirable in its own right,
2.	as an alternative to public dependence on Government services, and
3.	in ways that would enhance the ability of such groups to operate independently of Government".
In the intervening years, the National Voluntary Organizations have made an important contribution to the development of public policy in this area by identifying specific problem areas, such as:
1.	tax reform
2.	the legal definition of charitable activity
3.	the fiscal position of non-profit corporations, and
4.	the co-ordination of the relationship between various branches of the
Federal Government and the voluntary sector.
Research conducted by voluntary agencies and several Canadian Universities, has demonstrated the cost-effect-capacity of the voluntary sector as an "engine for job creation and skills training". Now more than ever, the country needs this capacity operating at the highest possible levels of activity. As you noted on November 23rd, the Federal Government has yet to recognize the need to support this documented ability to create employment-
I must stress, however, the contention of my colleagues and I in the Official Opposition, that we do not need another exhaustive study of the "situation" of a voluntary sector. What we need is a swift and efficient review of current research and experience. This would result in concrete recommendations for early government action ... You will remember that the 1979 Orders of Reference required a final report to be tabled within six months.
I also reminded the Minister in outlining our agreement that Statistics Canada finally released the results of a 1980 survey showing that the economic activity generated by the 47,000 charitable agencies in Canada amounted to 3 per cent of our Gross National Product.
Surely it is time the Government recognized the contribution of the voluntary sector to Canadian society by launching a parliamentary investigation. I outline that to indicate that my colleagues and I have given this matter considerable thought
April 25, 1983

and are prepared to move in the direction the Government has been indicating it wished to go through the years.
I received a response from the Secretary of State on March 25 thanking me for my letter outlining these proposals on March 2, expressing support "for the proposal to establish a parliamentary task force regarding the fiscal and legal issues of our governmental policy on voluntary action". He stated:
I was pleased to receive such an enthusiastic reaction and I consider your offer of participation in our initiatives on voluntary action as an expression of support you are willing to give to my plan of action.
That was the context in which we came to the budget. That was one of the expectations, one of nearly a decade of signals form the Government that it intended to take this sector seriously.
Then we received the budget which claims that representatives of the voluntary organizations have expressed their agreement to the $100 standard deduction removal and that somehow it has their blessing. However, I have in my hand the paper from the February 22 meeting with the Minister of Finance. In fact, during their meeting face to face with the Minister on February 22, representatives of the voluntary agencies made it very clear that a removal of the standard deduction which was not combined with some form of tax credit for charitable donations would constitute "an absence of substantive benefit for the Canadian voluntary sector". This action creates no new incentive for either charitable donations or the current inequitable situation which allows the rich more credit, more reason for giving, than the lower income taxpayer.
The Minister, as we listen to his comments, makes it sound as though he were removing the standard deduction only because the voluntary sector asked him to do so. In fact, it would appear that the Secretary of State has not been able to deliver on his promise. He had promised to set up a task force on the legal and fiscal situation of the voluntary sector. He had said, "Wait for the budget". The change has been made against the advice given in consultation sessions and without the benefit of sector-wide incentives, without the three-to-one job-creation cost efficiency of the voluntary sector, for example.
As one of the leaders of the national voluntary agency said to me, removal of the standard deduction constitutes a "tax on the un-generous", the 90 per cent of taxpayers who do not give, but further cements the control of the central Government over the voluntary sector by reinforcing the need for individual agencies to rely on federal Government funding to continue their activity. Without a review of the definition of charitable activity, the federal Government has essentially ensured that the voluntary sector will continue to toe the line or else.
Looking at the budget from the perspective of those in the voluntary sector of Canada, we might call the budget a "do as you are told" budget. If they do as they are told, the Government will, from time to time, give them some funding, but only when it suits it. The real beneficiary of the removal will be the federal Treasury, with an increase of $80 million in general
The Budget-Mr. McLean
revenues, a tax grab by any definition and, as has been mutually agreed, it may go as high as $300 million over a period of five years.
In a budget which has nothing to offer UIC exhaustees, and at a time when the voluntary sector has demonstrated its superior ability to deliver the services required by this swelling segment of our population, and the budget speaks of a continued 11.4 per cent unemployment rate through 1984, the Minister is still able to turn a blind eye on the obviously under employed expertise of the voluntary sector. Of course, in an effort to try to increase employment, there was an announcement of an increase of $40 million for Katimavik. The YMCA has already demonstrated, both on paper and in the field, that it could have stretched the real value of the $40 million to $120 million worth of lasting job training.
In the moments remaining to me, let me pose to the Government the question as to why it has chosen to ignore all the consultations which have gone on through the study, People in Action, Consultation 1981, and the commitments of Secretaries of State, both before the Government's defeat in 1979 and after its return in 1980. Why has the Government chosen to overlook all the facts and figures which have now been laid out by Statistics Canada and by the research departments?
Earlier in this session I proposed Bill C-233, an Act to encourage the role of the voluntary sector in Canadian society. At that time the then Secretary of State, the present Minister of Communications (Mr. Fox), responded to those who were supporting my Bill. In a letter dated June 5, 1981, he said, "I am sure that you will understand why the Government will not support the Bill". He stated:
We are already past the point of determining what is essential to the encouragement of the voluntary sector and are now dealing with specific areas, such as a redefinition of "charity" and the National Voluntary Organizations' "Give and Take" tax proposal. Officials of Voluntary Action Programme are committed to coordinating the development of the voluntary action policy within the Government and as well will be responsible for the day to day liaison with the Committee of National Voluntary Organizations.
Where is that study? The letter was written two years ago. We were told that the matter was under study, that the policies had been reviewed, that my Bill encouraging goods and services which are paid for by the taxpayers would be made available to the voluntary agencies, that somehow that was all in hand.
I want to suggest to Your Honour that the budget, in terms of its expectations and politial impact, has not only misrepresented, but has also alienated many in the voluntary sector in terms of the contributions that they are prepared to make. In their presentation, the leaders of the national voluntary organizations of Canada laid before the Minister of Finance facts and figures about the impact of that sector on Canadian life, of those nearly 40,000 registered charitable organizations, charities which took in $5.6 billion in 1980, equivalent to 11 per cent of all federal Government revenue, almost 2 per cent of the Gross National Product. Their wage benefit bill was $1.7 billion in 1980, estimated to compensate 173,000 workers, 23 per cent of whom were part-time. This represents 1.6 employed workers in Canada, twice as many as are directly

April 25, 1983
The Budget-Mr. Flis
employed in forestry, or one-quarter of all those employed in public administration by all levels of Government, or all employed workers in Newfoundland.
There were 2.7 million Canadians who volunteered 373 million hours in 1979-80. If compensated at the average wage for the service sector, this would be worth $2 billion, which is almost as large a sum as the agricultural sector's wage bill. An application of this value-added concept to financial data on these 40,000 charities suggests that this sector added $4.5 billion to Canada's output in 1980, which is 1.7 per cent of the GNP.
In conclusion I want to remind the Government of the information that was before it and remind the Canadian public of the Government's misrepresentation of the proposals. I want to cal! upon the Government to go back to the drawing board quickly and come clean with Canadians, particularly the nearly three million Canadians who volunteer their time and give generously of their money.


Mr. Deputy Speaker:: Questions, comments and answers?



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
[ Translation]

Mr. Deputy Speaker:: Order, please. It is my duty, pursuant to Standing Order 45, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the Hon. Member for Lisgar (Mr. Murta)-Railways- Oilseed freight rate policy-Exclusion of sunflower seed, (b) Plea for sunflower industry; the Hon. Member for Richmond-South Delta (Mr. Siddon)-Mines and Mining-Cyprus Anvil mine in Yukon, (b) Government position; the Hon. Member for Broadview-Greenwood (Ms. McDonald)-Labour conditions-Wage equality for women, (b) Compilation of statistics.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Lalonde that this House approves in general the budgetary policy of the Government, and the amendment of Miss Carney (p. 24689).
Mr. Jesse P. Flis (Parliamentary Secretary to Minister of Transport):: I was very pleased today when the transportation
critic for the Official Opposition, the Hon. Member for Annapolis Valley-Hants (Mr. Nowlan), led off the Question Period by asking a series of questions regarding the federal Government's Special Recovery Projects Program to modernize the Canadian Coast Guard fleet which was announced this morning by the Hon. Minister of Supply and Services (Mr. Blais) on behalf of my Minister, the Minister of Transport (Mr. Pepin).
In his first question the Hon. Member asked how many jobs this project will create. The Minister for Supply and Services answered that this program will generate 20,000 person years of employment within and outside the shipbuilding industry across Canada. He went on to say that since the Canadian content in these projects is very high there will be many offsets and spin-offs for Canadian industries and Canadian workers.
The Hon. Member for Annapolis Valley-Hants then wanted specific information on the Coast Guard acquisition program, such as, which vessels will be replaced, in what areas of Canada the jobs will be created and where the vessels will be deployed. It is impossible to answer all those questions during the brief Question Period. I would therefore like to give him further details during this budget debate.
As he knows, the Coast Guard operates in five regions of Canada. First, the Newfoundland region, which covers the coast of Newfoundland, Cabot Strait and the Labrador Coast up to the 60th parallel. Second, the Maritimes, covering the eastern Gulf of the St. Lawrence, the coastal waters of Nova Scotia, the Bay of Fundy and the waters down to the U.S. border. Third, the Laurentian region from the Beauharnois locks in the St. Lawrence Seaway, the St. Lawrence and Saguenay Rivers, the Western Gulf and the eastern part of James Bay and Hudson Bay and the Hudson Strait. Fourth, there is the central Canada region, which includes the navigable waters in the Provinces of Ontario, Manitoba and Saskatchewan and the western part of James Bay and Hudson Bay. Finally, there is the western region west from the Manitoba border, the West Coast and the western Arctic including the Mackenzie River system. The new vessels will be allocated to these regions based on operational and seasonal requirements.
I would like to outline what is being acquired under this program. First, a new $100 million heavy icebreaker, type 1200, will replace the 35-year old Labrador now operating in the Atlantic Provinces. The program will further include six type 1100 tenders which are designed to supply navigational aids such as buoys, markers and lights and to act as light icebreakers. There are two type 1050 tenders designed after an existing offshore supply vessel built for petroleum exploration. They will be used to supply navigational aids and for icebreaking. There are two type 800 small navigational aid tenders. A number of small shore-based craft will also be acquired. These are used for routine maintenance work and other duties close
April 25, 1983

to shore, often in support of larger ships. As well, there is a refit and modernization program for the Sir Humphrey Gilbert, the Narwhal and the Simon Fraser. All three provide aids to navigation and do icebreaking work. Upgrading these vessels will enable them to carry out their missions with a high degree of competence for another 10 to 15 years.
The total cost of these vessels is approximately $780 million. Under the accelerated program announced earlier today, $185 million of new money is being added to current spending plans to allow the construction to get under way very much sooner.
As the Minister said in his press release this morning:
The over-all capability of the Coast Guard fleet will be greatly improved with these new ships in the areas of aids-to-navigation and icebreaking. The new vessels will also have an important secondary role in search and rescue operations.
He went on to say that the program is one of the most important in the Coast Guard's history. I would agree with him on that point.
The second portion of the April, 1983, budget that I would like to address is the announcement by the Minister of Finance (Mr. Lalonde) regarding the importance of the Government's western transportation initiative for national recovery. The program proposed by the Minister of Transport calls for federal expenditures of $3.7 billion over the next four years. The Government's Crow benefit payments and other investments such as hopper cars and a rehabilitation of branch lines, the producers paying a little more for shipping their grain and the railways' investment of $16.5 billion over the next decade, will provide 400,000 person years of work for Canadians over the next decade. That is what can be achieved with all sectors and Government working together.
I would like to take this opportunity to explain in greater detail what we mean by the western transportation initiative which will create 375,000 person years of work. In February of this year the Government of Canada announced the policy which will result in the statutory fixed rate for moving grain by rail being replaced by new legislation, the western Canada grain transportation Bill, for determining rates and ensuring railway performance.
The Government will legislate payment of $651.6 million a year. This amount, known as the Crow benefit, represents the difference between the real cost in 1981-82 of moving 31.1 million tonnes of grain and the amount the producer now pays, the Crow benefit, which is only $152 million. Future transportation cost increases will be shared by producers and the Government. The producer will pay the first three percentage points of annual cost increases from 1983 to 1985. The Government will pay everything above the first three percentage points. After 1985, the producer will pay the first six percentage points of cost increases. The Government will pay everything above that. This is a protection against high rates of inflation, a protection that is provided to no other industry. No other sector of our economy has this kind of protection against inflation rates.
As Canada's grain exports increase the producer will be expected to pay the full cost of shipping amounts of grain
The Budget-Mr. Flis
beyond the record 31.1 million tonnes shipped in 1982. The full rate on this additional volume will be blended with the lower subsidized rate on the initial 31.1 million tonnes, to establish a single rate to apply on all deliveries in a crop year. Therefore, there will be no disincentive to increased production such as that being charged by the Saskatchewan Wheat Pool, the National Farmers' Union or other interest groups. By 1986, the Crow benefit and the Government's share of transportation cost increases will be paid, about 50 per cent directly to the railways and about 50 per cent to the producers through an acreage payment. This is a very controversial point because about half the producers in western Canada would like us to make these payments directly to the producers. The other half of the producers in western Canada would like us to make these payments directly to the railways. Therein lies the debate. My Minister, I think very wisely, is suggesting a compromise. The payments will start with payments to the railroads and increase to the producers, so that by the end of 1985 about 50 per cent of these payments will go to the producers and about 50 per cent to the railways. At the end of that period the legislation will recommend a review process. These methods of payments will be reviewed at that time. At that time it will be up to Parliament to decide whether the payments will be increased to the producers, increased to the railways, or continued as suggested by the Minister presently, a fifty-fifty distribution.
The producers' new grain transportation rate beginning in the 1983 crop year will be the Crow rate plus the producers' share of increased costs, blended with the costs of moving additional volume, if any. Rates as always will be generally distance-related.
The Government's contribution to the Crow benefit sharing of increased costs and other direct support measures will be $3.7 billion in the four crop years to 1985-1986. This amount will represent 80 per cent of the over-all cost of transporting grain in that period. By 1990, the Government's ongoing expenditures will be about $820 million annually.
As a result of the western transportation initiative, the railways will receive adequate compensation for moving grain. This means that if the legislation is passed, the railways will be in a position where all their traffic pays its way and the railways can proceed with the necessary and vital $16.5 billion capital investment program. This does not mean that the western grain producers will be paying the freight to move more coal. The Saskatchewan provincial Government is misinforming the producers. In fact, the western grain producers will not pay for the movement of one tonne of any commodity, except grain. Indeed, the western grain producer will not even be paying the full cost of moving grain.
What will the producer pay? What all this means is that in the 1983-1984 crop year, the producer will pay, on average, 15 cents a bushel to ship his wheat, compared with what he pays at present, which is about 13 cents. This is a 2 cent per bushel

April 25, 1983
The Budget-Mr. Flis
increase. This amount will increase to about 25 cents a bushel in 1985-1986.
In 1897, the Crow rate was 20 per cent of the price of wheat. In 1982 it was 3 per cent. In 1983-1984, if wheat prices do not change-hopefully they will increase-the new rate will be less than 4 per cent, and it will be 6 per cent in 1985-1986. Although no cost increase is welcome, this increase in freight rates is reasonable.
The railways will spend up to $16.5 billion in the next ten years to improve the rail system. The Government will monitor the railways' investment program.
Another concern of the producers is what guarantee they have the railways will live up to their commitment.


Mr. Blaikie:: None.


Jesse Philip Flis: The railways must submit an annual plan prior to each crop year.


William Alexander (Bill) Blaikie: They never will.


Jesse Philip Flis: There will also be penalties to the railways if they do not meet these objectives as set down prior to each crop year.


William Alexander (Bill) Blaikie: You do not have the guts to penalize them.


Jesse Philip Flis: The Government will continue the branch line rehabilitation program estimated at $1 billion until 1988-1989. In 1977, $700 million was committed. The Government will spend $290 million to purchase more hopper cars. This will bring the total federal purchases since 1972 to about 15,000 hopper cars, valued at about $630 million.
The Grain Transportation Agency, formerly the Grain Transportation Co-ordinator, will be strengthened with power to co-ordinate rail car movements, foster efficiency, and monitor performance guarantees by the railways.
It is difficult to know what the future will bring in terms of grain volumes, grain prices and inflation. For this reason, the Government will, in legislation, commit itself to a review in 1985. This will enable us to actually quantify the impact of Crow changes and make any necessary adjustments to ensure that changes work to the benefit of producers, all producers.
In closing I would like to reiterate that the problem before us today on the western transportation initiatives is not how we are going to move grain in 1983, but how we are going to ensure that grain goes to market consistently four or five years from now. This is why we need to begin to add the necessary capacity today. For example, the Beaver Tunnel will take five years to complete, and we have not yet begun construction. If the legislation is passed by June, which is our hope and objective, producers will face freight increases which will barely double by 1985, but the railways will have begun to add the necessary rail capacity to ensure that never again will the Canadian Wheat Board have to defer or forgo sales of Saskatchewan grain due to transportation constraints.
I just gave two examples of what was contained in the present budget as far as job creation is concerned. There are
20,000	person years in the first project and 375,000 person years over the next decade in the second project. I think you will agree, Mr. Speaker, that this budget should receive full support from the Official Opposition and from the New Democratic Party.


Leslie Gordon Benjamin: Mr. Speaker, I have a question for the Hon. Member. I believe I heard him refer to a small or a slight increase in freight rates for grain producers. Does he call a $21 million increase in freight charges in the coming crop year, 1983-1984, small? Or let us go to another year. The Hon. Member mentioned 1985-1986. Does he call an increase of $155 million a small increase? He also mentioned 1991 and 1992 when there will be a $1.110 billion increase. Does he call that a small increase in freight charges for grain producers?


Jesse Philip Flis: Yes, I will be very pleased to reply to those questions, Mr. Speaker. The figures do look large when you give totals for a whole Province or for all the Prairie Provinces. But look at what the increase is per bushel. Right now it costs the producer 13 cents per bushel to ship grain. In the next crop year that price will go to 15 cents, a 2-cent per bushel increase. In 1985-1986 the price will go up 25 cents a bushel. Hopefully by then the price of grain will also increase. We do not know because the price of grain is dictated by world markets. It would be great if we could set the price ourselves, but we cannot. In ten years from now, yes, it looks like a large figure which the official transport critic for the New Democratic Party is giving, but even in the 1990-1991 crop year the producer will be paying only 60 per cent of transporting his or her grain to market. The federal Government, the taxpayers of Canada, will still be subsidizing the purchaser to the tune of 40 per cent.
The Hon. Members should also take note of the protection against inflation increases. As I mentioned, for the years 1983, 1984 and 1985, any increases beyond 3 per cent will be picked up by the Government, and 6 per cent after that. If in three years inflation reaches 15 per cent, heaven forbid, 12 per cent of that increase will be covered by the Government, the taxpayers of Canada. I was very pleased that a couple of Members of the New Democratic Party invited me to speak to Saskatchewan farmers, which I did this past weekend. When they heard these kinds of explanations, they were more inclined to accept the western transportation initiative.


Leslie Gordon Benjamin: The Hon. Member spoke about the amount of money to be paid to the railroads by the Government and by the grain producers under the Gilson-Snavely formula. Obviously the Government and the Hon. Member consider that to be a proper formula. Do the Government and the Hon. Member consider that to be a fair formula for other sectors of the economy?
For the benefit of the Hon. Member let me say that the point I am making is that if you applied that formula to the
April 25, 1983

price of grain, No. 1 Red Spring wheat would be $12.90 a bushel instead of about $4.50 a bushel. In that case, probably most grain producers would be willing to pay more freight charges. Does the Hon. Member consider this formula, which the draft legislation is based upon, to be a proper formula for the railroads? Is it equally proper for grain producers, other farmers and others sectors of the economy in computing their costs to compute also a 39.5 per cent return on investment for the railroads, which has to be some kind of chicanery? Does the Hon. Member consider it fair for grain producers as well as the railroads to get 39.5 per cent when last year all the grain producer got on his return on investment was 3.5 per cent? The Government and the Hon. Member want to guarantee the railroads 39.5 per cent, half of which is straight add-on profit.
He tells me that a billion dollars by the end of the decade is a small payment for grain producers with no guarantee on their incomes and prices. This is not a megaproject but a megaplunder, a guarantee of railroad profits and dividends for shareholders. What does the Hon. Member have to say about the Gilson-Snavely formula for grain producers and maybe a few other sectors of the economy?


Jesse Philip Flis: Mr. Speaker, it is no wonder the producers in the West are confused and angry with the wild kinds of figures being tossed around by the NDP. I visited two NDP ridings in Saskatchewan. It was stated there that we were guaranteeing the railroads a 20 per cent return on their investment. Between the weekend and Monday that figure has gone up to a 39.5 per cent return on investment. That is what the Hon. Member is saying. No wonder the farmers get confused and angry. What we have to look at-


Leslie Gordon Benjamin: Mr. Speaker, I rise on a point of order. The Hon. Member has either misinterpreted or misunderstood what I said.


The Acting Speaker (Mr. Blaker):: Order. Regretably, that is not a point of order.


Jesse Philip Flis: Mr. Speaker, it is sad that someone who has been in the House so long still has not learned what is a point of order.
We have to look at what the railroads are making or losing in the transporting of grain. In the last crop year, the railroads lost over $200 million transporting grain. The Hon. Member would like to throw in coal transportation and sulphur transportation on which the railroads are making money. It is only natural that the railroads will invest in and give priority to the shipping of coal and sulphur and forget all about grain.
Our concern is that in five or ten years, when exports increase and people want our grain, we may not have a railroad transportation system to get that grain to market. All the NDP look at is price competitiveness, saying that our producers have to be price-competitive in the world market. I suggest that to be competitive you have to be price-competitive, delivery-competitive and quality-competitive. You have to get the grain to market in a good, dry condition, on time and at a competitive price.
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I am pleasantly amazed, and I congratulate the grain producers in Saskatchewan and the other western Provinces on the high degree of efficiency they have achieved. Grain producers in Canada are probably the most efficient grain producers in the world. By increasing this efficiency, and with the world price of grain going up, we hope, the farmers will get an even greater return on their investment. I agree that the cost of fertilizer, chemicals and equipment is going up. It only makes sense that the cost of grain should go up accordingly. Will the NDP Members tell us how we are to dictate the price of grain to the world? Do they want to nationalize not only Canada but the whole world, which I guess they would want to do if they were in power?


William Alexander (Bill) Blaikie: Mr. Speaker, the Liberal budget of April 19, 1983 is really only the latest stage in the progressive and now almost completed capitulation of the Liberal Party to the neo-Conservative view that the only solution to our various problems is to put overselves at the mercy of the combined effect, for good or ill, of thousands of unconnected and unintegrated small and large private sector business decisions, decisions which are all made in the selfinterest of the individual or corporation involved, but which the Government hopes will combine in some mysterious way to lead us out of the economic wilderness in which we find ourselves. This unabashed rehabilitation of laissez-faire rhetoric by the Liberal Party demonstrates once again, and all too tragically, that he who pays the piper calls the tune.
The corporate bagmen of the Liberal Party have clearly made their wishes known to the Minister of Finance (Mr. Lalonde). What they have told him is to mind his own business, reduce corporate taxes, provide more tax breaks for business, increase taxes for middle-income working Canadians to pay for these reductions and breaks and let the corporate sector find its own way out of the mess that it has got us all into, while the poor and the unemployed will simply have to wait it out as best they can. Above all, the bagmen have instructed the Minister of Finance not to ask, let alone answer, any fundamental questions about the structure of the Canadian or global economy, the values they embody or the human dimension of the bloodless statistical world in which the oneeyed Government and corporate economists massage their stunted intellect and shrivelled souls with the deceptive brilliance of their latest graph or mathematical illusion.
The Minister of Finance has been a good little boy, Mr. Speaker. And all thinking Canadians are that much more full of shame at what has become of us as a nation, a nation that watches in agony as a Government, long since bereft of courage or integrity, lives on its knees and degrades the whole notion of an independent Canadian nation through its subservience to American economic policy and its subservience to American foreign policy. This budget and the budget papers which accompany it are cowardly documents which completely

April 25, 1983
The Budget-Mr. Blaikie
avoid facing up to known economic and political realities, realities which have to be faced if we are ever to solve our admittedly great economic problems.
It is some of these realities that I would like to deal with today, Mr. Speaker. I will not pretend to have all of the answers, but I am absolutely convinced that unless we ask the right questions, we will not have a chance of finding helpful answers. This is what I believe this budget has failed to do, and failed utterly.
The Canadian people were, in my view, ready to hear how difficult the problems are and what lies at the root of them and how complicated some of these problems are. They were ready for the truth, and they are still ready. They were ready for bread but the Liberals gave them a stone, that same stone that the Conservatives have been polishing for years and that the Conservatives will give the Canadian people if, in their understandable desperation, Canadians opt for the Conservatives in the next election because they, historically and numerically, have the best chance of forming a new Government.
So what are these realities, Mr. Speaker, that this Liberal-Conservative budget has not faced up to? First there is absolutely no acknowledgement anywhere in this budget, in the economic outlook or in any of the accompanying papers, of the special role multinational corporations play in the Canadian economy and indeed in the global economy and how Government can or cannot protect the common good when it conflicts with the global profit strategies of these giants. There is no analysis whatsoever of the effects of the behaviour of these institutions, which are often larger in power and assets than many of the nation states of the world. In this sense, the budget is comparable to trying to describe and understand what is going on on a football field by studiously pretending that the largest and the key players are not even on the field. This omission alone is enough to disqualify the budget as a credible piece of economic and political analysis.
Second, and related to the omission of the multinationals, there is no evidence in the budget that there was ever anything known as the North-South dialogue or that there is a need for Canada as a country to try to articulate what kind of new, just and sustainable international economic order it wishes to work for, and to foreshadow in its short and long-term economic planning. But then a Government which has abdicated its role in the market-place can neither plan nor work for a new and more just international economic order because both planning and working to that end are contrary to the spirit of letting the private sector make the key decisions. The Prime Minister (Mr. Trudeau), known at one time for the quality of his North-South rhetoric at least, has added another layer of terrifying emptiness to the countenance which must confront him in the mirror every morning as Canada's answer to "the Picture of Dorian Gray".
Third, there is no attempt in this budget or any of the analyses which accompany it to face up to the real economic crisis of the welfare state, a crisis which is not, incidentally, caused by too many average Canadians looking for a free lunch from the welfare state. The real crisis is that for too
long, the corporate sector in this country has been having a free economic lunch at the expense of the social and environmental future of this country and its present and future citizens. The bill for this free lunch is now coming due.
Yet those on the right wing of the political spectrum who do so much talking about user-pay theories when it comes to medicare, who do so much talking about hard work and responsibility, are themselves unwilling to face up to their obligations as those who have used up certain human and environmental resources in this country. Indeed, they are even less able to hear arguments about responsibility and obligation as over the years the ideology of competition and self-interest and rugged individualism have eroded our moral capital, to use an analogy that I hope some of my right wing colleagues would understand.
Those who appeal to the common good or to ethical concepts, as did the churches or the Bishops in their recent statement, are ridiculed as idealistic and naive and out of their element. We have come a long way, Mr. Speaker, only to stand at the edge of the abyss with the Liberals whistling while they saunter into the darkness and the Tories urging us to jump headlong into the darkness in the name of renewed social Darwinism and the world view of Amway.
Where is the cry for the need to enshrine the responsibilities and obligations of property and not just the rights of property? Whatever happened to the language of responsibility? The corporate sector in this country, and indeed around the world, has been successful to the extent that it has because it has been parasitic upon the natural strengths of the human community and the planet Earth, taking for granted certain social factors like families and certain environmental factors like clean air and water. But this can only go on for so long.
As the environment is fouled and as human communities and families break down thanks to the untrammelled virtues of the maximization of profits and the reduction of human beings to disposable commodities, the social and environmental costs begin to come due. And the Government cannot be expected to address all of these costs if the very people who have had the free lunch for years, that is the corporate sector, are going to rebel in the name of profit against a tax regime and an economic model which would require them to pay their just share of the cost incurred by their economic activities and to be accountable in other ways for the impact of their actions. Indeed, most of the so-called free enterprises are, more than ever, standing at the door of the public Treasury looking for various handouts.
This is what is happening, Mr. Speaker, and what the Liberals have failed to do in this budget is to challenge Canadians to face up to this reality and to decide whether they want finally to stand up and work for an economic future that takes all of this into account and ends all of the hidden free lunches.
Instead, what have the Liberals done? They have conceded without a fight. They have conceded without even honestly asking the Canadian people what they would prefer and
April 25, 1983

engaging them in conversation about what the consequences of various decisions might be.
Do Canadians want a Government which will continue to fall for the corporate sector's false argument that productivity is declining because something is wrong with Canadian workers and Canadian society, or do they want a Government that is prepared to fund the maintenance and the expansion of the role Government must play in addressing the social and environmental costs of our economic system and in working toward an economy in which these costs will not be incurred in the first place?
Most economists and all Liberals and Conservatives talk alike about the decline in productivity. From their limited point of view, it may look as though productivity is declining. However, as Hazel Henderson, U.S. lecturer, futurist and author of "The Politics of the Solar Age, Alternatives to Economics" says, productivity appears to be declining, and I quote:
-only because they have over-stated it for decades, and swept the real costs under the rug.
Mr. Speaker, why is it always labour productivity that is under scrutiny and not the productivity of our entire economic way of life? That is where the productivity crisis is. Energy use is a good example. Is it any wonder that there is declining productivity and profitability in Canadian oil and gas when the economic model we have operated under for years has called for and succeeded in accomplishing the rapid sale and depletion of easily accessible reserves?
We have a crisis all right but it is not a crisis of productivity as such; it is a crisis of our failure to husband wisely, easily accessible resources, which resulted in our being increasingly dependent now on expensive, hard to get at and socially and environmentally destructive oil extraction in the North and in the sea.
It is in analyses like this, Mr. Speaker, that I believe we are getting to the heart of the profitability crisis in the western economic system. It is not that Governments are spending too much, as the Conservatives and the Liberals seem to believe; it is that Governments have not had the mandate to collect, to spend and do what was necessary to keep up with the social and environmental costs of our economic values and our way of life. Nor have many had the ideological capacity, inclination, or insight to do so.
The solution is not to get Government out of the marketplace but, through Government at all levels and through other forms of co-operative and community action, make the marketplace finally become a place where all the costs of any particular economic activity are taken into account and where social and environmental sustainability are equal to other considerations.
Yet when Governments try to do that from time to time, their citizens suffer great consequences. We have to face up to this as well, which brings me back to my first two claims about the way in which the budget avoids reality in pretending that there are no multinational corporations and in ignoring the
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need for a new international economic order. At present countries which try to achieve social, economic and environmental justice are likely to be boycotted by the multinationals economically and branded as suspect by the Americans politically, if not actively persecuted.
The multinationals can and do use their almost lethal global mobility to invest elsewhere when their profit margins are threatened. The Americans actively prevent that global dialogue, which is crucial, by filling the councils of the world with their deadly innocent rhetoric about free enterprise and the communist conspiracy. The only country allowed to defend itself economically, even if it violates the principles of free enterprise, is the United States. Somehow that is all right.
The three issues that I have raised are all related. We cannot, in Canada hope to build a socially and environmentally sound future unless we find a way to control our own economic destiny and make it significantly less vulnerable to decisions taken outside our border in the board rooms of foreign multinationals. We cannot hope to do this apart from a new and just international economic order in which the power of the multinationals will either be dissipated or made accountable to the planetary common good and in which they will be unable to play nation off against nation. We have to work on all fronts simultaneously.
There is a new social and economic order taking shape, both domestically and internationally, within the deteriorating shell of the system we have known for decades. New things are happening, technologically speaking and in the international division of labour, resources and wealth. This can be the greatest opportunity that humankind has ever had if we take advantage of our present dilemma to evaluate honestly, objectively and ethically, the problems that we have as a human community.
We must resolve to co-operate in building a world in which new technologies will serve real human needs, not narrowly commercial priorities, in which Third World development means real human development and not exporting raw capitalism to countries without the political culture to stand up to it, and the de-industrialization of countries like Canada, in which all economic development is designed and judged according to the needs of present and future generations for a liveable environment, and in which countries like Canada do not have to give up all they have accomplished in social policy, like medicare, for example, in order to remain competitive- competitive being the word for responding to the present blackmail.
This is the challenge from which the Liberals, with the advice and consent of the Progressive Conservative Party of Canada, have walked away by not acting now to stimulate debate on these crucial matters. Canadians are to remain spectators to a game which involves their very survival.
As I said before, a new world order is taking shape within the existing one-a new economic world order. It will not conform to the theories of Keynesians, Marxists, monetarists or supply-side economists or, for that matter, to the traditional

April 25, 1983
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expectations of any political tradition. All of us in the near future will have to re-examine our assumptions.
What I have argued today is that the prevailing political views, that of the neo-conservative, Liberal and Progressive Conservatives, does not have the conceptual capacity or the political room to understand and then show us the way out. They are in retreat from the pressures we are experiencing. They are trying to go back instead of going through to the other side of the problems we are experiencing.
Nevertheless it is still an open future. As free human beings and as a free human community it seems to me that we cannot believe or act otherwise. Therefore, let us not hand over our future to the global corporate and technocratic planning elite and its political vassals, the Liberals and the Conservatives.
As democratic socialists we believe that we have something special and crucial to offer in the debate about what kind of shape the new order ought to take and what we can do as a country and as individuals to help it become that new opportunity for justice and survival that I spoke of earlier.
Democratic socialists by their very name have always held to the basic insights that the present economic crisis is revealing to more and more people who look at it closely; that is, first, that our economic system must be made accountable to the common good in all its dimensions and that this can only be done through increasing democratic control of the economy in various ways.
Second, the so-called economic realities are really social realities and cannot be understood in narrow economic terms. That is why we call ourselves democratic socialists.
We want to see a world in which people as individuals and as comunities have more control in co-operation with all our fellow inhabitants on the planet over the economic decisions which affect the social, environmental and political quality of their respective futures. This can only be done through activist Governments, democratically mandated to seek this kind of world. It is this kind of mandate which I and my NDP colleagues are seeking from the Canadian people. The failure of this budget to face reality only makes our task more urgent.
The ideological battle lines are drawn and are becoming more clear every day as Liberals and Conservatives fall into line behind each other. I invite our opponents to justify their stances at this conceptual level and try to refute what I have to say. In the final analysis I still believe it will be in the serious exchange of ideas and not in partisan exchange of competitive number crunching that Canadians may yet come to see the need for, and have a desire to find, ways to have real economic and human growth that is more than just the last destructive fling of so-called free enterprise. That is a fling which could fatally damage the long-term health of the economy and society and the planet earth.
But that kind of debate is not in the interests of either the Liberals or the Conservatives, and also we will likely continue to see their relationship continue as it has, the goal of which can only be described as the perfection of the superficial and the elevation of parliamentary confrontation to the be all and
end all of politics in this country, at the expense of the Canadian people and ultimately of the global community, as a country which has the political and economic resource to be an example to the world, Canada, shirks its responsibility and backslides into the pit.
It is this same lack of will to face up to the need for fundamental change that explains why the Government will continue to spend $12 billion per year on unemployment rather than spending an equivalent sum on meaningful work instead of cosmetic, short-term, revolving door job-creation programs.
As difficult as the burden of $12 billion is on the federal Treasury, it is preferred by the Liberals to facing the retaliation of the international and domestic investment community which would regard the spending of money to actually give people meaningful work as a threat to its dominance of the economic order.


Douglas Glenn Fisher: Mr. Speaker, there is a distortion or two in the Hon. Member's speech which 1 believe deserves correcting, and perhaps we can put some of these items into a little better perspective. The Hon. Member, for example, went on about how discussions of productivity are often anti-labour. I would like to quote to him from the budget and then get an expansion on that bias of his and some additional comments. I will quote from page 24666 of Hansard. The Minister of Finance (Mr. Lalonde) said:
Many people are under the impression that productivity gains cause unemployment.
Then he continues further on:
We should recognize, for example, that the concerns of the labour movement for working conditions, the quality and safety of the work place, the involvement of workers in what they are doing, and the possibilities for self-development offered to them, are entirely legitimate and can, if properly addressed, improve our productivity performance.
A little further on he says:
There will always be tensions between labour, business and Government. But that should not prevent labour, business and Government from co-operating to improve the productivity and competitiveness of the Canadian economy. This is the key to higher wages and better profits.
That is precisely the opposite of the implication raised by the Hon. Member, and I believe the Hon. Member might appreciate the opportunity to stand up and admit in the House, first, that labour has a legitimate voice on productivity issues and, second, to recognize that the Government is listening to that voice.


William Alexander (Bill) Blaikie: Mr. Speaker, I appreciate the opportunity, not to admit that what I said was wrong but rather to elaborate on why the Hon. Member, in speaking for the Government, completely missed the point. In fact, he has reinforced what I had to say. He can only think of productivity in terms of labour-management relations. The whole statement from the budget which he quoted ignores completely the other matter of productivity, which I rightly condemn the Government for not bringing into the analysis, and that is the productivity of our
April 25, 1983

traditional investment models, the productivity of the way we organize our whole economy. What I am saying is there is no fundamental critique of the way in which productivity has been lessened over the years by the way we do things in general. The Member, when he rose to quote to me a paragraph from the budget which only refers to labour management relations, reinforces the point I made. It does not go against my point at all. The Hon. Member should take a course in logic and spare us all these non sequiturs.


John Leslie Evans: Mr. Speaker, I have heard the Hon. Member talk a great deal about productivity. Could he define it for us in precise and concise terms, please?


William Alexander (Bill) Blaikie: Mr. Speaker, I know enough about the Hon. Member for Ottawa Centre (Mr. Evans) to know that he knows what is meant when people speak about productivity. The point which I have been trying to make is that we have too narrow a view of what we mean when we talk about productivity. That is precisely the point. For me to give a traditional definition of what productivity means would seem to be pointless. I would hope that he would have something more important to ask me.


John Leslie Evans: Mr. Speaker, I would not want the Hon. Member to give me a traditional view of productivity. I would like him to define in precise and concise terms precisely what he means by "productivity".


William Alexander (Bill) Blaikie: Let me put it this way, Mr. Speaker: You cannot call something productive which over time eats up the social and environmental resources of a country or a planet, for that matter. I am saying that only those things which are sustainable socially and environmentally can be called productive. Those are the kinds of things which ought to be taken into consideration when one is talking about productivity, and we have not done that to date. We have talked about profits, how many widgets we can get out in an hour, how the new technologies will improve delivery times, and what we can get out of a factory in a certain time compared to what we used to be able to do. I am saying that is not all we should be thinking about when we talk about productivity. We need to look at the big picture both domestically and internationally. If the Hon. Member does not understand that point then we are in serious trouble, indeed. Of course, we are in serious trouble because it is people like him who man the back benches of the Government.


John Leslie Evans: Mr. Speaker, I agree with the Hon. Member that there are a great many things which have to be included within the concept of productivity. However, in light of the fact that he spent a great deal of his speech dealing with the concept of productivity and how it was wrongly defined traditionally, I still would like to have him define what he means by productivity and not beat around the bush, as he just did, in trying to answer my question.


William Alexander (Bill) Blaikie: Mr. Speaker, I am not trying to beat around the bush. Perhaps it is just a habit of mind I have that I do not easily come up with examples. I will give you an example,
The Budget-Mr. Blaikie
however. I was on a tour a while ago in northwestern Ontario. Tell me what is productive about cutting down millions and millions of acres of forest and not re-seeding the trees, thereby putting the Canadian forestry workers in a position where they now have to go farther and farther afield for products upon which we are dependent for our balance of trade and that sort of thing, not to mention the need for wood domestically. What has been so grandly productive about that way of managing our forests in this country? There is nothing productive about it at all. What was so productive about the mercury poisoning of the English-Wabigoon river system? What is so productive about what our economy has done to the inner cities of our country? I could go on for hours, Mr. Speaker, about cancers in the workplace, long-term health problems, etc. The list is endless. If the Hon. Member does not know what I am talking about, then he has a very serious problem. We all do.


Douglas Glenn Fisher: Mr. Speaker, I believe the Hon. Member is beginning to give us some useful and concrete examples, and I would like to follow up a little further on the question asked by the Hon. Member for Ottawa Centre (Mr. Evans). It would help the House considerably, I believe, if we could distinguish between the vague dogmatism of the Hon. Member and the much more specific and useful concrete examples which he has put forward. Could he try and bridge the gap between his examples and his dogmatism by answering the question put by the Hon. Member for Ottawa Centre and tell us how he defines productivity.


William Alexander (Bill) Blaikie: Mr. Speaker, the Hon. Member is making my point again. I asked why do we not talk about something at the level of ideas, for a change. I know that is really hard for Liberals. I know they have to have examples, little pictures and story books to help them along. There is nothing wrong with what I had to say, Mr. Speaker, and I was not being vaguely dogmatic. Indeed, I hinted that we all had to re-examine our basic economic assumptions. However, that is something which the Liberals are unwilling to do. They are unwilling to think. They want to rise and be cute and tell me that if I do not have a long list of examples there is something wrong with my arguments. I challenge any one of them-because neither one of them has done this yet-to get up and address the argument I have made head on. They have not done that, Mr. Speaker.


John Leslie Evans: Mr. Speaker, I would say to the Hon. Member, with respect to a definition of productivity, it seems to me one cannot talk about ideas when one is refusing to define the concepts in terms of the word he is using. The Hon. Member refuses to define what he means by productivity. I would define it as being the amount of output, the amount of Gross National Product, not in just narrow terms of dollars but in terms of quality of life, in broad terms, which all of us can share among ourselves. If that is going up, then productivity is obviously increasing, the standard of living is increasing. Productivity is all about increasing the well-being of Canadians. That is my definition. Now I have not been able to extract a definition of exactly what it is the Hon. Member is talking

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The Budget-Mr. Taylor
about, but if he is going to talk about ideas, it seems to me that he must define what it is that his ideas are referring to.


William Alexander (Bill) Blaikie: Precisely, Mr. Speaker. For too long we have measured productivity in terms of the Gross National Product. When you talk about GNP, traffic accidents in which young people are killed are equal to anything else in term of generating economic activities. All things are equal when you add them up into the GNP. Precisely what I am saying is that for too long our way of measuring productivity, or well-being, to use the Hon. Member's phrase, has been too narrowly construed in terms of money, in terms of input and output, and the very kind of depersonalized and dehumanized concepts which the Member just used when he started talking about the input and output and the GNP. That is exactly what I am talking about. We have been prisoners of that. I said we have to get down and talk about what we mean about productivity, and the Hon. Member is not willing to do that.
I do not make any apologies for not having a whole new plan in order to be able to criticize what we have regarded as productivity to date. If we wait to get into that kind of debate until someone has an answer which is beyond criticism, we will be stuck for years within the conceptual prison you guys have foisted on this country for the last three decades.


Gordon Edward Taylor: Mr. Speaker, I do not know whether the discussion we just heard was a private one between the Liberals and the NDP, but I would like to tell you what I as an ordinary, common, every-day rank and filer mean by productivity. I was raised in the coal mines. There was a miner who actually loaded the cars, and he tried to load 12 or 13 cars a day. You get paid so much per car. In the Newcastle Mine there was a competition on to see who could increase productivity by loading 14, 15 or 16 cars. Believe it or not, one man there loaded 20 cars in one day. He did this on his hands and knees in these low mine shafts. Weil, that is increasing productivity. If another fellow was quite lazy and loaded only eight, that is the opposite of productivity.
A few years ago I was in the elevator of the Calgary Inn. I said to this fellow there with me, "Are you from Alberta?" He said, "No, I am from Newfoundland." 1 said, "How do you like Alberta?" He said, "I don't like it at all." I was rather shocked. I asked why. He said, "I am going back to Newfoundland. I am a bricklayer. I am used to laying as many bricks as I can per day and my boss is on my back because he tells me I am laying too many bricks. I am not going to work in conditions like that. I want to earn the money, I want to produce as much as I can." That is increasing productivity, men with that attitude. If they say, "I am going to do as little as I can, work to rule", that is not increasing productivity. That is what the man on the street understands by productivity. Unless we as Canadians, together, increase productivity, we lower the standard of those who do not work, the senior citizens, the crippled and the aged. They are the ones who are going to depend on productivity growing. That will happen if
each individual does his part. That is what makes the country great. Well, Mr. Speaker, I think it is a really worthwhile topic, but I did not stand up to talk about productivity.
I want to make an announcement, Mr. Speaker. Today, there was a baby bom to Mr. and Mrs. Albert Cooper. He was six and a half pounds in weight, born at 11.30 this morning, and we are happy to say that the mother and baby are doing well and the father is enthusiastically excited.


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


Mr. Stewart:: Now, that is productivity.


Gordon Edward Taylor: Now, I am going on to comment on the budget.


The Acting Speaker (Mr. Blaker):: I hear indications from some Hon. Members that this announcement may be related to productivity. I have a dreadful feeling that the Hon. Member for Bow River (Mr. Taylor) is going to prove to me that the announcement he has just made is relevant to the budget. If he is going to continue with his announcement, he ought to prove that his comment is relevant to the budget.


Gordon Edward Taylor: Thank you, Mr. Speaker. I am just about ready to make it relevant to the budget. I am going to tell Albert that next time he should have twins. But the point I really want to make-and I am sorry about this, as I am sure Mr. and Mrs. Cooper must be sorry about it too-is that every parent who has a baby like little baby Albert Brandon Cooper and every baby like him is born with a debt of $3,800 around his neck. That is how he is starting life in this country. It is increasing every time the Liberals bring in a budget and the poor little babies have a greater weight around their neck.
Is that relevant, Mr. Speaker? I think it is.


Some Hon. Members:: Hear, hear!


Gordon Edward Taylor: I would like to speak a little longer about babies and that debt, but I have several other things I want to talk about. I think the Minister touched a real chord when he said we have to build confidence in this country. That is one of the difficulties in Canada today, lack of confidence. A man on the street in Calgary said to me one day, "I just came back from the United States where I invested $10,000". I said, "How come you did not invest in Canada?" He is a Canadian. He said, "I wouldn't invest ten cents in Canada, I have no confidence in the Government." Hundreds of people are taking their money out, investing it somewhere else, because they do not have confidence in the Government. The Minister touched on the real heart of this whole thing when he said we have to build confidence in this country. I think we do, and today. I think the budget helps to build confidence to a degree. It is certainly building a lot more confidence than the last two budgets. The last two budgets destroyed confidence in this country. But there are too many people today making fun of the financial policies of the present Government. That does not help confidence at all. For instance, an ad appeared in the Calgary Herald on March 2, and one of my constituents sent it to me. This is what it said:
April 25, 1983



Loyal Liberal Party member. Preferably ex-M.P. with $20,000 to invest in a feasibility study and pilot project to turn Alberta crude into N.B. coal. Must have suitable connections with top Liberal M.P.s to obtain a 10 million or more government grant.
Excellent return on investment assured.
Success of project not assured.


PHONE 289-5681
[Stage Direction]
The newspaper contacted the man. He said he spent $121.50 for this ad, somewhat as a joke, because he was so angry with the Government. I do not know how many of my constituents have written to me and said there is no confidence in this Government. It has to build confidence and stop some of the things it is doing to destroy confidence, such as the "Coalgate" affair and the destruction of a beautiful part of Banff National Park.
There is another thing which is very important, too. If you are going to have confidence, it grows from each individual being satisfied. When I ran a business I tried to satisfy each individual who came in that store. 1 said to my staff, "It does not matter what you think of them". One of the girls had said to me, "Oh, he is a drunkard, he is no good". I said, "I do not care what you think of him, he is coming in here and he gets service. His money is just as good as the money from the millionaire. As a matter of fact, I would rather do him the service because he needs the help. 1 want everyone in this office to realize that. If that customer goes out satisfied, he tells somebody else and the business grows. But every dissatisfied one you send out, I tell you, it is not something that is going to lift you up or build confidence".
Well, Mr. Speaker, I have a story here that I never thought I would have to tell in the House of Commons. I am sorry the Minister of National Revenue (Mr. Bussieres) has gone because it certainly concerns his Department. It concerns a man and his family who are now frightened of this Government. Not only have they no confidence in the Government, they are frightened of it. Let me give you the story quickly. This man sent a $1,000 installment to Revenue Canada. The cheque was not only stamped by the Department but it was also credited to my constituent's account. Someone in the Department of Revenue decided that it had not been credited to the right account, so he transferred it. My constituent notified the Department of the mistake. It appeared that in transferring this money back and forth, it was finally lost. My constituent contacted the Department, and his bookkeeper went to the Calgary office time in and time out asking the Government, "What about this $1,000"? Each time he was told that it looked as if the money had been found and it would not be long. The bookkeeper was at the tax office on an average of once a week to obtain copies of the account and stamped cheques, proof of the remittance, but each time he was told that it was a simple computer mistake and would be corrected shortly. Each time he was told that it looked as if the money had been found. Around that time, the Department of National Revenue moved many records from Calgary and
The Budget-Mr. Taylor
Edmonton to the Winnipeg office, and all the papers went to Winnipeg. The $1,000 was lost again.
At one point my constituent even phoned the Winnipeg office, which told him that after a certain number of years the account was closed and that he should have done something about it before. He had been trying to do something about it before. He had been trying to do something about it week by week, throughout the whole period.
I brought the matter to the attention of the Minister who said, "We have destroyed our records. This man kept paying his installments until his payments were down to less than $1,000. Then, on the strength of all his representations, he figured that the $ 1,000 would look after the $900 or so in tax. However, the first thing that my constituent knew was that the Department of National Revenue had gone to his bank and had taken $1,000 out of his account without even telling him, and then closed the case.
Do Hon. Members think that we can get anything from the Department? It says that the records have been destroyed, that it does not have them. I do not care whether or not it has the records. The $1,000 was received by the Department of National Revenue and it should be accounted for. The Department sent two cheques back to the bank in Calgary, but the bank in Calgary says that there are no notations. If the Department proves that it sent the $1,000 back to us, we will pay the $1,000, but the Department is not doing that. This cannot be simply wiped off and sloughed off. This amounts to $1,000 of hard work by that man. I am asking the Government, every backbencher, every Minister, to be honest enough to say to this man, "We will give you your $1,000, because the Department stamped and received it". This man should not be out that $1,000. That is the type of thing that undermines confidence.
I would like to mention something else with regard to asking private enterprise to help us out. I have high respect for the Hon. Members to our far left. I think they are sincere in the things in which they believe. I do not believe what they believe. I do not believe in nationalization. I believe in free enterprise. However, I do not like the way they slur free enterprise all the time. Maybe they do not like the way I slur nationalization, and I suppose we are even in that respect.
William Alexander (Bill) Blaikie: You're right.


Gordon Edward Taylor: However, I want to tell Your Honour that many of the people who support the Hon. Members on the far left are free enterprisers, such as the farmers. They want to make a profit. They cannot stay in business unless they make a profit. What is wrong with making a profit? Making a profit has given us the highest standard of living in the world. We can say to someone, "You can invest your money and you can make a dollar. There is an incentive. When you make a dollar you can buy something else, you can give your family a better standard of living, buy better clothes and buy things you like. You can take your wife and family on a holiday. You can have

April 25, 1983
The Budget-Mr. Taylor
extra furniture and good food". All of these things come from hard work and investing, increasing productivity, and then the country benefits as well. I believe in making a profit. I do not believe in exorbitant profit, but I believe that people who are working are entitled to a profit. That is what really keeps this country going. However, here the Government is asking free enterprise to cooperate.
When I listened to the Minister of Finance (Mr. Lalonde) asking private enterprisers to cooperate in getting us out of the mess the country is in, I could not help but think that part of the mess was due to his national energy policy. It just about ruined our farms in the West as well as our oil and gas industry. It went right down into the stores and lunch counters in the small towns. The effect of the national energy policy really hurt the country. It was a destructive policy, but now the same Minister is asking free enterprisers to expand their businesses, to hire more people, to invest more money, because that is what will get us out of this slump, and I agree with him.
If we can get thousands and thousands of entrepreneurs to hire one to ten people, it will not be long before we have 1 million or 2 million people employed. I do not accept the theory that we cannot have a country in which everyone who is able to work is employed. There may be a few who do not want to work, but most people want to work provided they can make a decent wage and see a chance of giving their families a better standard of living, perhaps sending their boys and girls to university.
I was raised in a poor home and I know how people feel. We did not think we could ever send anyone in our family to university because we did not have the money. There were ten children to feed. The mines were only working four or five months a year. Finally, through the help of my brothers I was sent, the first out of the ten, to university or normal school so that I could obtain a teacher's certificate. Then, after that, we were able to send my sister by working together. However, they were willing to work and sacrifice so that they could provide a better education for the rest of us, and it is even more so with parents. They want to do that. The Minister is certainly tapping the right source. If he can build confidence, he can certainly get people working. This is true, provided that too many obstacles are not put in the way.
Earlier today I mentioned the story of a man in Cochrane who received an order amounting to $103,000 from an oil company. The oil company had built a couple of ships in Japan. I am running that down. I do not know why they were built in Japan, because it is a Canadian oil company. Anyhow, it had two ships built in Japan-
Mir. Blaikie: Got a better price. That's free enterprise!


Gordon Edward Taylor: -and the company wanted to have a celebration and give Canada the business. So an employee of the company went to the Cochrane store, an excellent store with a coffee shop, groceries and a meat counter, and said, "We will give you a $103,000 order". Beef amounted to $32,000 of the order. The owner buys his beef from Canada Packers and the federal inspectors inspect the meat. However, when he went to
the federal inspectors and said, "I want an export permit", they said, "Nothing doing". He asked why, and they said, "It is because there is a regulation on the books which was passed about 70 or 80 years ago which states that you cannot export meat if you keep a fresh meat counter and sell meat over the counter". That might have made sense back in 1915 or 1930, but it is not sensible today. Why should a man who sells excellent meat over the counter not be permitted an export permit? The civil servant in Calgary said to him, "And besides, you must have a wholesale licence." He said, "I have a wholesale licence". He was told, "You cannot have it anyhow, because you sell meat over the fresh meat counter". Therefore, he lost $103,000. I do not know whether the business went to the States or to Japan. I am not sure about that part. However, a couple of weeks later the same company man came back and wanted to order 1,000 steaks. One can imagine the thrill of having someone come into one's store and order 1,000 steaks.
It reminds me of a story about someone who ordered 1,000 hamburgers from MacDonalds and everyone in the place became very excited over 1,000 hamburgers being ordered all at once. This is a situation involving 1,000 steaks. The oil company wanted all of the friends, builders and workers to celebrate the great event of building two ships. The storekeeper said that he would love to provide them with a thousand steaks. He went to the federal agricultural people again, but they said that if he sold fresh meat over the counter he could not have an export permit.
How ridiculous is the situation in this country when a thousand steaks, which could have come from the cattle of Alberta, Saskatchewan, Manitoba or even Ontario and could have provided work in Canada, were not allowed to be sold. Instead, the situation became so frustrating that the man said he could not bother with the officialdom any longer. He went back to Japan and bought his thousand steaks in Japan. In the meantime we talk about building up Canadian industry, we talk about unemployment.
Free enterprise will work but not if it continues to be shackled. It will not work half as well when it is handcuffed. Let free enterprise work by eliminating these ridiculous Government regulations. I see, Mr. Speaker, that your are pointing to your watch, but I have barely started.
In the one minute that I have remaining I wish to say something about the deficit. One thing that bothers me when talking about recovery is that the deficit is increasing continually. How can we eventually recover if we do not begin reducing the deficit? I have figures for 1972 which indicate that the deficit was $999 million. It kept increasing until 1979 when the Progressive Conservatives came to power. It then dropped slightly to $11.48 billion from $12 billion. When the Progressive Conservatives went out, the deficit rose again to a level higher than it was in 1979; it rose to $12.6 billion. In the next year it went to $13.6 billion, and then to $25 billion the next year after that. The deficit this year is $31.3 billion.
April 25, 1983

How will Canadians be able to face this deficit? We cannot pull ourselves up by the bootstraps or by borrowing ourselves out of the deficit.
The Government must begin to reduce its expenditures and it can only do so by cutting down on those unnecessary expenditures. It should not do so, as some have suggested, by cutting old age pensions. It should take the money from those areas which can afford it. There is a lot of lard in this Government and in its budget. Let us cut out some of that lard. One example is the metric system. It is not necessary to spend $25 million a year on a program that half of the people of Canada do not want. Expenditures on programs such as that should be cut from the budget.
I wish I had more time to deal with the deficit. While I am in favour of some of the budgetary measures, those that encourage people to work and get us out of this mess, some of its other measures are bad. I hope to have the opportunity to deal with some of the pros and cons of the budget at a later time.


William Alexander (Bill) Blaikie: Mr. Speaker, I wish to comment on the remarks made by the Hon. Member for Bow River (Mr. Taylor). I do not have to put it in the form of a question because I know he will respond to my comments.
The Hon. Member for Bow River is known for the clarity and vigour with which he puts forward his views of the world. Given the argument about the nature of productivity that ensued just before he rose, I was grateful to him for the manner in which he so clearly described the limited view of productivity which I rejected in the previous argument. The Hon. Member was giving us the example of coal miners working on their hands and knees in the mines. In his opinion productivity meant that if they could double the amount of coal they mined on their hands and knees on a particular day, that was productivity. As well, he suggested that the bricklayer who laid as many bricks in a day as possible was another example of productivity. 1 agree with the Hon. Member to the extent that his argument relates to the value and meaning of not only work, but hard work.
However, to use the coal mining example, I do not agree with the Hon. Member's view of productivity or lack thereof, in the general scheme, when one considers the destructive impact that that kind of productivity related mining has had on the lives and families and the environment of coal mining communities.
It was precisely my point that it is not enough to think only about productivity in terms of output which, in this case, is coal. One must consider the long-term social and environmental costs of a particular economic activity. That is the kind of productivity analysis that I was trying to have Members of the House consider.
The Hon. Member asked what is wrong with profit. If he had listened clearly to what I said, he would know I always talked about the maximization of profit, which might be another word for exorbitant profit which the Hon. Member used. Whenever there is an economy in which people are
The Budget-Mr. Taylor
driven to the maximization of profit in order to stay competitive, it is a bad situation.


Gordon Edward Taylor: Mr. Speaker, I appreciate what the Hon. Member says but I want to give him an actual illustration of what was happening in a mining town. We had a good life as long as we were able to produce coal and my father and brothers were able to work in the mine. The more coal that one of my brothers loaded, the more money he received and the more he was able to keep us at school, and the more he could give us on payday.
We had a good life while the mines were busy. Productivity increased our happiness, our prospects and our standard of living. When productivity started to decline, we started to suffer. Productivity started to decline when people felt they were making too much for the company and decided to cut their productivity in half. We suddenly realized that we were not competing with other forms of fuels.
Of course, with the arrival of oil and gas, productivity became a vital factor in remaining competitive with oil and gas. It was almost impossible to compete in those days, and the whole coal mining industry almost collapsed.
After I was elected, I remember being on a committee which went to Crowsnest Pass to see what could be done for the miners whose lives had suddenly become empty because the mines had closed. They did not know what to do since mining was all they knew. We tried to work out programs of rehabilitation for them. The point is that it was the lack of productivity that destroyed our coal mines. The same thing will happen in any industry. If people take the attitude that they should do as little as they can, that will be the result, as compared to the person who will do all he can.


Jesse Philip Flis: Mr. Speaker, on page 10 of the budget speech of April 19, the Minister made reference to the Government's $3.7 billion for the western transportation initiative. In the few minutes remaining could the Hon. Member for Bow River (Mr. Taylor) give the House his opinion, his Party's opinion, the Alberta Government's opinion and the Alberta producers' position, on the changes to the Crowsnest Pass rate?


Gordon Edward Taylor: Mr. Speaker, I certainly cannot do that in 30 seconds but I will respond partially by saying that I like many of the proposals, one of which is the inclusion of several segments of agriculture. It was always my opinion that instead of dealing with producers of different types of grain separately, all producers should be combined.
While I am in favour of other proposals, I do not like the assumption that the freight rates on the farmers' grain will rise quite significantly by 1990. While the Government makes an assumption on the freight rate, it does not make any assumption on the price of grain. I hope to have a chance to deal with this properly during a proper debate in the House. If the Minister were to tie that increase in freight rate to the price of grain, the farmers would have a chance to understand it. But for the Government to say that it will charge them so much more on their freight, not even knowing if there will be that much more in wheat, oats or barley, would frighten anyone.

April 25, 1983
Adjournment Debate
The farmers and their families are frightened because they do not know where they will get the money to pay those rates. I wish I had more time because it is an interesting problem.


The Acting Speaker (Mr. Blaker):: I must indicate to Hon. Members that it is six o'clock. It is totally out of order for the Chair to express the hope that Mr. and Mrs. Cooper and child are well, but then I thought that the Hon. Member as well was totally out of order in doing it.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. Jack Murta (Lisgar):: Mr. Speaker, the question I asked the Minister of Transport (Mr. Pepin) on April 18 is related to the matter about which we have just been talking in the last few minutes, the whole question of the western transportation initiatives announced last February by the Minister.
The concern I have, and the concern I expressed in my question on April 18, is for a segment of that whole initiative that was left out, the sunflower seed industry and its associated products, the various brands of sunflower oil which compete with soyabean oil used in cooking.
The background of this industry is interesting. It was the first special crops industry established in western Canada back in the 1940s. It has been a major industry since that time and it continues to grow. It shares a place in the hearts of producers in western Canada along with rapeseed or canola in terms of an alternative crop to wheat, oats and barley.
Under the proposals of the Minister of Transport, if the freight rate parity does not include sunflowers along with canola, rapeseed, linseed oil, and flaxseed, the sunflower seed industry is in danger of becoming extinct in western Canada.
There is about a $60 disparity per tonne between the cost to move rapeseed oil and sunflower oil from a crushing plant in Altona, southern Manitoba. Of course, an industry cannot survive with that type of disparity. Nobody will buy the products. Why would they? It would not only cost the industry more, it would certainly cost the consumer more. Sunflower seed is the only western Canadian oil seed crop not included in the statutory freight rate structure. As such, the much higher commercial rates continue to apply, both domestically and for export. This further erodes the competitive position of this very important crop to western Canada. In the context of Manitoba, the sunflower seed industry amounts to $35 million to $50
million. That is for the Province of Manitoba. It is a substantial industry in Saskatchewan and also Alberta.
The proposed rate structure actually increases the freight rate disparity between sunflower and canola products to almost $60 per tonne. As I said before, the crop itself, unless something can be done, is under threat of extinction.
If we were looking at the cost to include this very important crop-in the context of Manitoba some $35 million-into the total plan which the Government has proposed, using a multiplier factor of 5.2 times the existing Crow rate, which I think is realistic, the cost to the federal Government of removing this anomaly and providing statutory rates for sunflower seed is estimated to be only $750,000 for the period August 1, 1982 to July 31, 1983. It will cost only $750,000 to save an industry in Manitoba that represents $35 million to $50 million to the producers. This has to be looked at and acted upon by the Government in a positive manner to ensure that sunflower seeds and by-products retain their rightful place in the whole agricultural industry in western Canada.


Jesse Philip Flis: Mr. Speaker, I first want to congratulate the Hon. Member for Lisgar (Mr. Murta) for taking advantage of this parliamentary process of going to bat for the oilseed crushing industry.
In its announcement of February 1 on the western transportation initiative, the Government accepted the recommendation of Dr. Gilson that only canola meal and oil and linseed meal and oil be included under the new statutory rate regime. The inclusion of other crops and products such as sunflower seed and oil and alfalfa was examined. The prime reason for adding canola and linseed oil and meal is that there has been a long-standing disparity between the western rates for the movement of raw seed and the rates for the movement of the corresponding product. For example, canola and flaxseed move under the statutory rate whereas their products in general do not. Since sunflower seed does not move under the statutory rate, the question of parity between seed and product does not arise in this case.
The sunflower seed industry will benefit, however, from the Government's decision on the method of payment of the Crow benefit. To the extent that payments are made to producers, they will be made on the basis of all cultivated acreage. Sunflower acreage is therefore eligible and the distortion between sunflower and the so-called "Crow crops" will be reduced.
The sunflower seed industry will also benefit from the agricultural adjustment payments recommended by Dr. Gilson. These payments will be at a level of $204 million over three years to 1985-86 and are designed to offset the dilution effect on grain producers of extending the Crow benefit to all cultivated acreage. The payments will be made to all producers, thereby benefiting sunflower producers as well.
April 25, 1983


MINES AND MINING-CYPRUS ANVIL MINE IN YUKON. (B) GOVERNMENT POSITION
Mr. Thomas Siddon (Richmond-South Delta):: Mr. Speaker, on February 14 in this House I asked questions of the Minister of State for Mines (Mrs. Erola) and the Minister of Finance (Mr. Lalonde) with regard to the reopening of the Cyprus Anvil mine at Faro in Yukon. On March 17, and again last week, I questioned the Prime Minister (Mr. Trudeau) about the Government's failure to deal with this long neglected problem which has been devastating for the economy of Yukon.
In asking my question on April 20, I asked the Prime Minister to confirm reports that the Government had Finally reached a decision on the long-sought aid for the Cyprus Anvil mine. Even though the Minister of Indian Affairs and Northern Development (Mr. Munro) was at that very moment in Whitehorse making an announcement on this matter, the Prime Minister refused to confirm the announcement in this House, thereby denying me and other Members an opportunity to question him on the specifics of the assistance and the delays in reaching this decision.
The federal Government has done irreparable damage to the mine, the Town of Faro and all of Yukon through the manner in which the Cyprus Anvil problem has been handled. The inordinate delays in the approval of this assistance have seriously undermined the future viability of the mine and the Government has done nothing to offset the damage it has done over the past five months.
Until it closed in June of last year, the Cyprus Anvil mine was the largest private sector employer in the territory. It represented 40 per cent of the income to Yukon's economy. Obviously, a permanent shutdown of the mine would devastate the Territory of Yukon, yet it took the Minister of Indian Affairs and Northern Development five months before he indicated the Government would be prepared to take action. That was last October.
The Minister agreed in early October of 1982 to assist in reviving the mine if the company, the workers, and the people in the Government of Yukon would meet a number of conditions. By early December, the Minister's requirements relating to the settlement of a labour contract and coming to some decision on the northern benefits taxation question had all been met. Yet the Minister still balked at fulfilling his part of the bargain. Meanwhile, workers continued to leave Faro, Yukon's economy continued to deteriorate.
This reluctance on the part of the Government is hard to understand. It appears it is always ready to provide assistance and low interest or no interest loans for projects of questionable merit in other countries, whether it be for transit cars for the citizens of New York City, or the opening of new mining developments in various South American countries that end up competing with Canadian mines. In those cases, the Government responds very quickly.
Adjournment Debate
The delays in this case are also vexing because the federal Government can be blamed for many of the financial problems at the Faro mine. It has ignored calls for improvements to the power and transportation systems in Yukon. It was the Liberal Government's policies on foreign investment that resulted in the mine coming under the control of Dome Petroleum, a move that may be a crucial factor in the mine's current financial difficulties.
Clearly the Government of Canada had every reason and had a responsibility to move quickly, but it allowed the mine to sit idle for almost a year. This unbelievable delay has magnified the problem several times over. The effects of the Government's inaction were highlighted in January by the decision to indefinitely shut down the White Pass and Yukon Railway.
Every day that this railway is shut down its old narrow gauge track deteriorates further and the cost of re-opening the line escalates. The cost to re-open the railway will eventually have to be borne by the Cyprus Anvil mine as it is the major user of the railway. This problem will not be solved by merely clearing overburden at the mine site over the next several months, a solution which is the essence of the aid package unveiled last week.
Short term aid such as that announced by the Minister in Whitehorse on April 20 is obviously necessary in view of the desperate situation in Yukon. But will this aid ensure that the Cyprus Anvil mine will be re-opened? Is there a requirement on the part of the Cyprus Anvil Mining Company to guarantee the re-opening of the mine? Does the deal in which the federal Government is to put up a loan and grant amounting to $25 million then require that the mining company convey to the Government of Canada a piece of equity interest in the mining company? I believe Members of this House would like to have these questions answered, Mr. Speaker.
What is also needed, however, is action that will ensure the long-term viability of the Cyprus Anvil mine. The Government should, for example, scrap the obnoxious northern benefits tax which has already seriously impeded any efforts to resume full mineral production at the mine. The tax will hurt Cyprus Anvil's chances of becoming competitive and winning back the Japanese customers who have already been lost during this long shutdown. The Government should also launch work on infrastructure that would show a commitment to reviving the northern mining industry.
Will the Parliamentary Secretary tell the House this evening whether any of the 100 capital projects discussed in the budget speech will be of direct benefit to Yukon mining? For example, is the Government prepared to open the road to the port of Skagway or to launch power projects that could provide Yukon industry with reasonable electricity costs for the future? If this is not the case, then last week's announcement of aid to the Cyprus Anvil mine is obviously too little, too late.


Jesse Philip Flis: Mr. Speaker, 1 am very pleased to answer the hon. gentleman's question tonight because having spent a week in Whitehorse, Yukon, just before Christmas, I heard and

April 25, 1983
Adjournment Debate
listened to the concerns of the unemployed miners in that part of Canada.
Following intensive negotiations between Cyprus Anvil and the federal Government which concluded on April 20, the federal Government has agreed to accept Cyprus Anvil's proposal to re-open the mine. Implementation of the $50 million package is subject to certain technical and financial conditions that remain to be negotiated with Cyprus Anvil and its financial backers.
The Minister of Indian Affairs and Northern Development (Mr. Munro) has informed Cyprus Anvil about the Government's decision. The company will now present its mine reopening plan as accepted by the federal Government to a steering committee of Dome's main creditors within the agreement in principle. If the package is acceptable, Government and company officials will prepare a detailed agreement. The Government is optimistic that this agreement will enable the mine to re-open, and that stripping operations will commence as soon as possible.
As described in the communique issued by the Minister on April 20 in Whitehorse, the agreement was achieved after ten months of intense negotiations. Implementation which is contingent on resolution of certain financial details to protect the federal Government's investment, means the recall of 210 employees.
The Minister is convinced that this plan will result in a more competitive mine, one that will be a continuing source of stability in the coming decades for Yukon generally and for Faro in particular. He also noted that Cyprus Anvil is the bedrock of the Yukon's economy and its continued closure threatened the territory's very livelihood.
The two-year plan calls for the federal Government and Cyprus Anvil to invest $25 million each in the Faro operation. The agreement will stipulate that the federal contribution, with the exception of money Cyprus Anvil receives under existing federal programs, is fully repayable and is intended solely to re-open the Faro mine.
The Minister also paid tribute to both the Yukon Territorial Government and organized labour, whose actions helped in the efforts to re-open the mine. The Yukon Government has agreed to contribute roughly $2 million toward topping up employees' wages, plus further assistance when the mine resumes full production. In the case of organized labour, the Steelworkers Union signed a new contract boosting productivity by an estimated 20 per cent. It was also instrumental in organizing a delegation of Yukoners who supported the Minister's efforts to obtain Cabinet approval for the agreement.
The federal Government is fully aware that Cyprus Anvil is but one of many mining companies in Canada currently experiencing financial difficulty. However, Cabinet agreed that Cyprus Anvil is a unique case largely because of the federal Government's quasi-provincial responsibility in relation to Yukon's economy. Furthermore, Cyprus Anvil accounts for about 40 per cent of the territory's economic base. Failure to
act would have resulted in the Government assuming direct financial and social costs far in excess of the assistance announced.
The agreement is a symbol of what can be achieved through the co-operation of the federal and territorial Governments, business, labour and Yukoners in general.


LABOUR CONDITIONS-WAGE EQUALITY FOR WOMEN. (B) COMPILATION OF STATISTICS
Ms. Lynn McDonald (Broadview-Greenwood):: Mr. Speaker, I want to pursue a question asked of the Minister of Labour (Mr. Caccia) regarding equal pay for work of equal value, and particularly the Minister's responsibility to see that this is effected.
I should like to begin by recounting the importance of equal pay for work of equal value to the women's movement of Canada. The women's movement settled on equal pay for work of equal value as its main object in the economic field because of the inadequacy of provincial equal pay for the same job legislation. Women want to see women workers paid as men are, on the basis of skill, effort, responsibility and working conditions, according to objective criteria.
Yet, while women are ghettoized into different jobs from men, simply requiring them to have exactly the same jobs as men means that many women do not get any protection from legislation. This was a recommendation of the ILO, Convention 100 and it was taken up by the Royal Commission on the Status of Women in Canada, and recommended in 1970. Many groups lobbied for it and unions supported it after that date. Finally it was made law under the Canadian Human Rights Act. We have it on paper at least federally and we have a similar provision in Quebec for equal pay for travail equivalent.
I whould like to say that the Canadian Human Rights Commission enforces equal pay for work of equal value better than any Province enforces its equal pay legislation at the present time. But the Commission is short staffed and procees is slow. Cases take years to be investigated. The process was deliberately made to be cumbersome, and certainly when women's organizations were lobbying for it they wanted to see it speeded up. There is a complaint stage, an investigation stage and a separate conciliation stage; all this takes an enormous amount of time.
The difficulty is, Mr. Speaker, that the wrong problem is addressed. The model is wrong. Equal pay for work of equal value treats discrimination as an anomoly; that there is an exception when women are paid less than men for doing whatever their job is. This is seen as a failure in human relations. If we could only get the employer and employee together, then we could have reason prevail.
The human rights model, which I would suggest is the incorrect model for labour relations is a model which has worked best for landlord and tenant relations, particularly to
April 25, 1983

get a landlord to accept a tenant of a minority racial or ethnic group. The point is, however, the landlord will be getting the same rent when he does this.
The difference here with equal pay for work of equal value is that paying women less is profitable for companies. The employer will make more money if he can hire women workers who will do the work for less money than male workers. Therefore, it is not a failure of good will, but simply economics.
There is a growing library of literature which shows as well that equal pay legislation at the provincial level has not been successful. That is the case-by-case approach which the Canadian Human Rights Act also uses. Let me give you a few statistics for wages and salaries for full-year employees for all of Canada.
In 1969 women's wages and salaries on average as a per cent of men's salaries was 55.6 per cent; in 1971 it was 55.3 per cent; in 1973 it was 55.8 per cent; in 1975 it was 56.1 per cent; and in 1977 it was up to 57.8 per cent. The latest year for which we have statistics available is 1980, and then the percentage was 58.3. All of these figures are under 60 per cent. The figures fluctuate a little from year to year so that I do not even think we can be enthusiastic that we have gone up from 55 per cent to 58 per cent. We are not sure that this is a lasting increase or just one of the fluctuations; that figure may have gone down in the following year.
Women, therefore, are earning somewhat under 60 per cent of men's wages and salaries for full-time work. Studies show that roughly half of this 40 per cent difference can be attributed to women being paid less than men for doing the same job, and roughly half because they are doing different work. If provincial legislation were working, we would see that women would be earning about 80 per cent of what men do. That is, they would be receiving this 80 per cent figure and the other 20 per cent would be because of women being in job ghettos.
If the federal legislation were working however, that is equal pay for work of equal value, women would be earning on average the same, roughly 100 per cent of what men are earning. And if the federal legislation were working, we would see that wage and salary gap for federal employees declining, and we would see it decline, but not as fast, for provincial employees. If the Minister of Labour had relevant statistics it would be possible to look at this. I do not believe there are any such statistics, and that is regrettable. There should be. The Minister of Labour should be able to show this. If he wants to argue, as he did in replying to me, that the Canadian Human Rights Act is such a good thing, he should show that the gap is declining for people who are under this legislation.
I suggest it is very clear that the legislation is not effective and that there is a lot more that can be done. I suggest that the Minister of Labour himself has some responsibility. It is not enough to say that 90 per cent of Canadian workers are under provincial jurisdiction. He should still be doing something for those 10 per cent of Canadian women workers who come under his jurisdiction. Furthermore, the Canada Labour Code specifies what the Ministry of Labour can do. In Part III,
Adjournment Debate
Division 11.1, Section 38.1(1) we learn that employers are required to live up to the same expectations of Section 11 of the Canadian Human Rights Act. I will quote from Section 38.1(2):
Where an inspector has reasonable grounds at any time for believing that an employer is engaging or has engaged in a discriminatory practice described in subsection (1), the inspector may notify the Canadian Human Rights Commission or file a complaint with the Commission-
In other words, inspectors could be filing complaints. But are they? In 1981 there were only one or two filed by inspectors and we have 127 labour inspectors in Canada for all provisions of the Code. No complaints were filed in 1982. The Department of Labour, Women's Bureau, had an ad campaign on equal pay, but it did not have a phone-in number. It did not facilitate complaints. They had a campaign on sexual harassment and they received a lot of phone calls. I suggest they should be welcoming phone calls and they should be acting on them, taking up complaints to the Canadian Human Rights Commission.
I would like to suggest further that the Minister could be helping the women's movement and union groups which are working for equal pay for work of equal value. These people need statistics as part of their campaign. Instead of doing this, however, we see the Ministry of Labour, which does publish material, not publishing what it should.
This book, "Facts and Figures", is an old and useful handbook which is no longer available in this form. There were complaints that it was not useful enough because it was inconsistent. Instead, what we have now is a glorified computer print-out. We also have discontinued series, Mr. Speaker, for average weekly and hourly earnings. They were extremely useful statistics. They showed a long and stable wage and salary gap. The Department of Labour discontinued this series.
To conclude, I would like to suggest that if the Minister is concerned about equal pay for work of equal value, and if he is concerned about justice for Canadian women workers, there is a lot he could be doing.


Jesse Philip Flis: Mr. Speaker, I want to assure the Hon. Member for Broadview-Greenwood (Ms. McDonald) that the Minister of Labour (Mr. Caccia) is very much committed to the policy of equal pay for work of equal value. That is the policy of this Government and always has been. We as the Government, and I know the Minister of Labour, are anxiously waiting for the day when, not only in the public service but in the private sector, the philosophy practiced will be equal pay for work of equal value.
Judging by the original question of the Hon. Member and by her remarks today, she seems to imply that Labour Canada has discontinued its annual survey of wages in Canadian industry. In fact, the Labour Data Branch has conducted surveys annually since at least 1974, and continues to publish the results annually in the publication "Wage Rates, Salaries

April 25, 1983
Adjournment Debate
and Hours of Labour". This report presents information on wage rates and salaries for selected cross-industry and specific industry occupations by sex and union status. Information pertaining to the standard hours of work for office and nonoffice employees is also shown.
"Wage Rates, Salaries and Hours of Labour" is published separately for Canada as a whole and for selected Canadian cities, including St. John's, Charlottetown, Trois-Rivieres, Saskatoon, Regina, Victoria, Saint John, Halifax-Dartmouth, St. Catharines-Niagara, Ottawa-Hull, Thunder Bay, Kitchen-er-Waterloo, Windsor, London-St.Thomas, Vancouver, Hamilton, Winnipeg, Calgary, Edmonton, Quebec City, Montreal and Toronto. As the Hon. Members can see, no city is omitted.
In addition, the Women's Bureau of Labour Canada annually publishes a three part report entitled "Women in the Labour
Lorce". Part 1 deals with participation rates of women. Part 2 is entitled "Earnings of Men and Women", and provides data on male-female earnings by sex, age, occupation and education. These data are obtained from surveys conducted by Statistics Canada and, as mentioned, from Labour Canada. Part 3 of the report provides a variety of facts and figures on such issues as unionization, pensions, day care, and complaints of discrimination on the basis of sex, as registered with the Human Rights Commission.


The Acting Speaker (Mr. Blaker):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until 11 o'clock tomorrow morning.
At 6.30 p.m. the House adjourned, without question put, pursuant to Standing Order.

Tuesday, April 26, 1983